How governments can reduce networking equipment costs while boosting performance

We’re past the phase where “move to the cloud” was a buzzword in IT conversations; today, moving to the cloud is seen almost as a matter of course – IT organizations are more or less expected to plan a cloud migration as part of their evolution.

But moving to the cloud doesn’t make sense for many governments. In fact, governments looking to reduce IT costs without sacrificing performance may do better to reconsider the cloud alternative: on-premise computing powered by brand-equivalent optical interconnect solutions.

Problems with the cloud for government entities

Cloud solutions are efficient and cost-effective in many business applications, but they come with two major downsides for government use:

1. Insufficient data assurance: While cloud providers agree to make their “best effort” not to lose data, governments have no way of verifying those efforts. A massive data loss (e.g., of driver’s license numbers or medical records) would cause widespread panic (and likely serious political fallout). And thanks to the terms of operating agreements, governments would have no means of recourse against the cloud provider.
2. Cost: For entities with large datasets or large files (e.g., medical records that include images), the initial move to the cloud can be time-consuming and expensive. This is especially true relative to alternatives, like running a fiber between locations that need to be connected – various buildings in a hospital complex, for example.

So while the cloud is a practical and highly functional option for many businesses, its limitations make it less than ideal for government entities.

Cutting IT networking costs

So the question is: if you’re staying off the cloud to preserve data assurance, how can you minimize networking costs?

The answer: brand-equivalent networking equipment like optical transceivers.

A Gartner study published last year highlighted the obscene markups OEMs typically charge for optical transceivers: as much as 350 percent of cost. The parts themselves account for only 10 to 15 percent of a typical network equipment purchase, so it’s easy for this markup to fly under the radar.

But by opting for transceivers branded by someone other than the OEM, it’s possible to reduce networking costs by 30 to 50 percent. So why aren’t more government bodies making this cost-saving switch? There are two main reasons:

1. Some OEM sales people insist that using non-OEM transceivers will void the warranty on their products. These claims are untrue; in fact, that practice is illegal.
2. Network architects aren’t aware that brand-equivalent equipment is built to the same quality and interoperability standards as OEM equipment.

When governments do opt for brand-equivalent transceivers, the cost savings can have profound impact, not only in the present but for years to come. For the cost of upgrading from 10GB to 40GB with an OEM, for example, it’s possible to upgrade from 10GB to 100GB with a brand-equivalent provider.

This translates not only to better performance in the short term but also to a future-proofed network that won’t require an update for years. What’s more, non-OEM providers often support legacy equipment for years after the OEM has end-of-life’d it. This can prevent costly forced equipment upgrades.

When to consider non-OEM transceivers

Generally, governments can benefit from updating their systems to include brand-equivalent optical transceivers if they…

• Need to maintain high levels of data assurance;
• Have a network that consists of massive amounts of data or large file sizes;
• Want to future-proof their networks; or
• Are looking to improve performance and cut costs.

Robert Coenen is the VP of business development at InterOptic, a data interconnect company that helps companies and government institutions manage the bandwidth, interoperability and complexity in their IT networks.