How One Company Cut Costs In Half With a Converged Network

E&S Ring Management, a property management company based in Culver City, Calif., was faced with a dilemma: As its voice and Internet costs increased, its data service was deteriorating. The company, which manages 25 properties with about 11,000 top-of-the-market residential apartments in Northern and Southern California, was using one provider for data services and several others for voice services, in separate networks that were both costly and challenging to manage.

The difficulty of auditing 25 separate service provider invoices led Kevin Hott, E&S Ring’s director of information systems and technology, to seek a solution through network convergence — moving the company’s multiple networks, with multiple providers, to a single voice and data network. Hott also sought to reduce ongoing service provider costs and improve overall services for the company, which relies heavily on phone and fax communication to conduct business.

The move to a converged network, Hott says, not only put an end to the complex auditing tasks but also fostered greater productivity, higher levels of network scalability and redundancy, and instant cost savings for E&S. The company, which also operates 800 boat slips in Marina del Rey, Calif., now captures 100 percent of residential payments electronically and offers interactive web tools for current and prospective residents.

Convergence of Savings

E&S Ring migrated its separate legacy voice connections to a converged voice and data network over a multiprotocol label-switching (MPLS) wide area network with carrier services from XO Communications. The reward was lower costs, higher levels of utilization and more efficient management, Hott says.

Because E&S Ring had a working relationship with CDW Account Manager Chris Proper, it was poised to take advantage of CDW services. In fact, it was advice from the CDW Telecom Services team that helped Hott get up and running quickly without needing to shop for the best service provider on his own.

After a complete analysis of the pros and cons of each carrier, CDW — a direct agent for more than 70 service providers — recommended XO Communications as a cost-effective and straightforward alternative.

“We evaluated the entire industry for a converged network that would essentially be a better fit for E&S Ring,” says Brent Strombom, telecommunications specialist at CDW. “We were able to deliver a proposal without any capital outlays, and guide them through the process of selecting the right carrier for the infrastructure.”

The solution included a one-to-one replacement of MPLS circuits in many of the apartment buildings managed by E&S. XO Communications provided all the equipment, dropping the needed circuits at the building locations.

Cutting Costs with a Converged Network

The move to a converged network reduced E&S Ring’s costs by half.

“We realized cost savings immediately,” Hott says. “We have all the same features, and layered on voice for no additional costs. So essentially, we’re paying just for data.

“We were on a straight MPLS solution with our previous data vendor,” he adds. “So adding the voice layer on top of it offered a great deal of efficiency.”

Plus, no more auditing different bills with different phone numbers — a time-consuming and challenging process, says Hott.

“The system we moved to is an all-in-one solution for the price,” he says. “Now we get one bill for all the locations, and it’s much easier to audit.”

E&S moved its data first, and migrated its voice communication last February. The system has been live for several months.

Migrating from aging legacy voice lines to MPLS converged voice and data allowed for right-sizing E&S Ring’s WAN, which enhanced its network performance. It also offered a way to reduce network complexity and significantly cut communication costs. The rewards were significant, including:

• savings on WAN and voice costs of approximately $8,500 per month, or $306,000 over the term of the contract;
• higher levels of network scalability and a redundant voice platform;
• easier end-to-end management of the communication network.

MPLS has become the company’s network architecture of choice for implementing converged voice and data, ensuring sufficient bandwidth and avoiding the congestion and latencies that slow data delivery or voice service.

“Our overall goal, for cost savings resulting from the converged network, is $10,500 per month,” Hott says. “To recoup the additional $2,000, we plan to move our emergency communication to another provider or readjust our business plan.”