Finding the best telecom vendor for your company can be a difficult task. You have to find a vendor that meets your needs now and in the future. How does your company know which telecom vendor is best for your specialized needs?
To start the telecom vendor selection process, you must first know how to differentiate telecom vendors so your company will get the best telecom solutions possible.
Telecom providers are broken into 3 tiers which are based on their size and core competencies:
A Tier 1 carrier is a provider that has a direct nexus to the Internet and all the comprehensive networks it uses in order to deliver both voice and data services to customers. Tier 1 carriers do not borrow network capacity from anyone else.
Tier 1 premier carriers like AT&T, Verizon, Sprint, and T-Mobile are full-service providers who take care of all of a company’s telecom needs. Considered the largest providers of telecommunications services, Tier 1 carriers are typically able to host, invoice, and thus streamline all of a company’s wireless services, digital and cable television options, and broadband internet access through only one vendor. Because they have such far-reaching and comprehensive networks, true Tier 1 providers never need to purchase IP transit agreements from other providers.
Engaging in service with a Tier 1, full service telecom vendor will get you efficient telecom services. All of your company telecom services will be hosted, and in most cases invoiced, through one vendor. This approach also leaves the option for bundling, which can save you money on your telecom services.
While Tier 1 providers are the largest carrier, Tier 2 providers are the most common telecom carriers on the Internet. Tier 2 operates in a similar way as Tier 1 carriers, except that it engages in the practice of “peering” with some of the comprehensive networks that are operated by Tier-1 carriers. “Peering” is when a carrier gets a portion of its network directly from a Tier-1 operator by piggybacking onto the network already established by the Tier 1 source. Tier 2 networks are providers that specialize in a specific product type – such as Internet.
Tier 2 networks actually purchase IP transit (or pays settlements) in order to reach some of the many networks that Tier 1 carriers operate. If you are seeking a telecommunications provider that can outline core competencies in a select service area, you would want to consider a Tier 2 provider; however, it’s important to know that you will be managing multiple vendors with each offering their specialty products. Examples of Tier 2 carriers are: Sprint, CenturyLink, XO Communications, and Level 3.
Selecting a Tier 2 telecom provider is a solid option if you need a telecom vendor that hosts core competencies in a select service area. With this approach it’s important to keep in mind that you will have to manage multiple telecom vendors, and in turn, multiple telecom invoices. Although this can be more to juggle, using tier 2 vendors can be worth the effort.
Niche Market Specialization remains a Tier 2 telecom vendor option and it’s essentially a division of product type services. You can select a specialized individual service or product. Niche market specialization is especially helpful when you’re attempting to establish a competitive advantage, or to position yourself on the cutting edge of a new product or service.
Tier 3 telecom vendors are carriers that concentrate on a regional scope or niche market product. Examples of tier 3 vendors are Windstream, Time Warner, and LightPath.
A Tier 3 carrier has no direct access to the network on its own and thus obtains 100% of its network through a Tier 1 or Tier 2 operator. Like the Tier 2 carrier, the Tier-3 carrier is also typically a smaller, regionally-based provider that focuses on smaller networks. By purchasing voice and data coverage from a Tier 1 operator, both Tier 2 and Tier 3 carriers can then re-sell the services to their customers without those subscribers knowing anything about the integral details going on behind-the-scenes.
Tier 3 telecom vendors are able to be in sync with a company’s particular unique needs because they focus on niche markets. Tier 3 carriers consists of several vendors that focus on a region or niche market product. Examples of these providers include: Windstream, Time Warner, or LightPath.
A tier 3 option is regional telecom specialization. If the bread and butter of your business is hosted on a local level, regional telecom specialization can be your best option. Not only are regional vendors in tune with your service needs, they’re also privy to local information and techniques that other telecom vendors outside your area may not know. Regional telecom support can also offer benefits that national level telecom vendors cannot provide.
It’s a smart option to enlist in a Tier 3 telecom vendor if your company is seeking an add-on service that your current telecom vendor does not provide.
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The most important information to take away from this blog post is that your company does not have to settle with poor telecom services – you do have options!
When it comes to pursuing a new or supplementary telecom vendor, be open minded and explore your options. In order to get the best, most optimized service, you will need to do your due diligence but it will pay off.
Once you have an understanding of how this technology works, including the three main tiers of telecom carriers, you’ll be able to make informed decisions to cut costs confidently and save money without comprising your employees’ ability to attain their goals.
You can still find ways to save on telecom expenses without sacrificing quality, but to be able to do that, you need to familiarize yourself with all the fees telecom vendors ask you to pay.
Telecom Vendor Fees
Most telecom vendors charge non-recurring fees (NRC) at the start of service. These fees are typically for cost of installation, equipment, and other necessities related to setting up a telecom system. These are often one-time charges, and will not appear in later invoices. You can expect the initial bill to have different items compared to the succeeding ones.
Next, pay attention to the monthly recurring charges. Some services may be billed according to usage per minute, so you’ll see variable costs in your invoice every month. These are usually long-distance calls, international calls, inbound calls from toll-free numbers, etc. Their rates also vary depending on whether they’re local calls, data calls, or Internet calls.
Knowing all the fees charged to your company will help you understand exactly how the billing works. This will make it easier for you to spot any so-called hidden charges. Take note that most of the time, only the discount is fixed, and not the actual base rate. When the base rate increases, your monthly bill will increase even when the usage stays the same.
Selecting a Telecom Vendor
After arming yourself with knowledge, it’s time to go shopping for the best telecom vendor. The great thing about telecommunications is that you have several providers to choose from, so you can find the best one that suits your needs.
What Telecom Services Do You Need?
Determine what services your company frequently uses then ask vendors for discounts and deals they’re willing to give you. Request a consolidated quote to give you a clear idea of how much you’ll be spending on telecommunications as a whole. Piecemeal quotes add up to a considerable total sum, which take many companies by surprise when they receive their first invoice.
Better Telecom Quotes
For better telecom quotes, look for vendors that are offering their services with newer technology. Old solutions are not as efficient and end up costing more.
The secret to getting a good deal lies in your commitment to be proactive. Ask detailed questions, seek specific answers, and request more options. Don’t let your company get tied up in a contract without an easy way out. Make sure that all contracts with your chosen telecom vendor have coterminous expiration dates, and avoid over-commitment. Instead of meeting the ceiling amount (e.g. $2,000 a month in total expenses) to get your money’s worth, work toward lowering your telecom expenses and pay any amount that goes over. In the long run, you’ll save more with this approach.