Mark Lohmeyer CLUS 2014For years, many IT organizations have been addressing slow application performance by adding more bandwidth. With broadband speeds available at over 100 Mbps, and the future of Fiber-optic at 1 Gbps, you would think bandwidth would solve all our application problems. However, many organizations are quickly learning that bandwidth on its own is not the answer, especially when it comes to the branch office.

So what is the problem? While connections are getting faster, branch offices still need high reliability. We all know downtime can be very costly. The Aberdeen group estimates that downtime can cost a company, on average, over $160,000 per hour.  And, some hours are more costly than others. For example, if your CEO is talking to shareholders during an earnings call and the network goes out – I would imagine that would cost someone their job.

There are several factors to consider on why “throwing bandwidth at the problem” is not enough. First, let’s consider the impact of data center virtualization. Over the past decade, organizations have been consolidating applications to their data centers. While IT has benefitted from cost savings, applications have moved further away from users. This has resulted in a delay in application response times, which is felt strongest by branch users.

Let’s also look at the cloud: Today, over 77% of IT leaders use cloud-based infrastructure. This means critical productivity applications like Microsoft Office will switch over to a cloud SAAS model with Office365. Here again, the branch users face the greatest impact because applications in the cloud must travel through their data center before reaching the branch – even though these applications can be accessed more directly from the Internet.

Other factors driving branch traffic include mobility and next generation applications. In 2014, the number of mobile devices will exceed the number of people on earth, and an estimated 77 billion apps will be downloaded. By 2015, two-thirds of the mobile data traffic will be video. [Cisco VNI, 2014] This type of growth is overwhelming our wide area networks. We have even seen schools who are using fiber – which they can afford thanks to e-rate programs – but still cannot keep up with the demands of thousands of students who may all access HD video at the same time.

And while the pace of change continues to accelerate with cloud, mobility, and apps, the majority of network budgets will remain relatively flat in 2014. Today, most Enterprise IT organizations already spend nearly half of their budget on wire-line transport. With the exponential bandwidth growth, there really is no way for their budgets to keep pace with the demands of users.

This is precisely why looking to bandwidth alone is not the optimal choice for most networking teams. In an interview at CiscoLive San Francisco 2014, Mark Lohmeyer, Vice President of the Enterprise Routing and WAN Services, summarized the challenges most of our customers are facing, and how Cisco can help customers address this issue with an Intelligent WAN.

He reviewed the key components of an Intelligent WAN:

  • Transport Independence, which allows customers to migrate to lower cost connections without compromising reliability
  • Intelligent WAN Path, which helps IT meet application SLAs by selecting the best path based on real-time network conditions
  • Application Optimization, which provides IT visibility into the network for capacity planning and troubleshooting, as well as offload the WAN for better application performance
  • Secure Connectivity, which addresses secure connections within the corporate WAN or directly to the Internet, with robust threat defense

For most businesses, the branch remains a critical place in the network, where the greater majority of employees work and where we typically engage customers. As a result, the branch will be the next frontier for IT must tackle to enable the business. Of course customers will continue to add more bandwidth. But, it will be those IT organizations that re-think their approach to the WAN, and leverage advanced services that will be able to keep pace with business and user expectations, while staying within budget.

You can learn more about the key services of an Intelligent WAN that can help you keep pace with cloud, mobility and next generation apps and re-gain control over your network.


Raakhee Mistry

Senior Director

EN & Cloud Marketing