AT&T and Verizon — Spending Less on Wireline

Spend Matters welcomes another guest post from NPI, a spend management consultancy, focused on delivering savings in the areas of IT, telecom, transportation and energy.

Over the last few years, two industry leaders -- AT&T and Verizon -- have expanded their wireline offerings far beyond traditional local and long distance phone service to include a broad portfolio of telecom solutions and consultative services.

That's a good thing for enterprises that want to outsource non-core functions like telecom, but it comes with cost risks -- these non-traditional services, ranging from cloud services and VoIP to managed security -- are high-margin for the carriers. However, with the right due diligence, they can become a savings opportunity for your business.

To make sure you're paying a fair market price, do the following:

  1. Have an accurate inventory of your requirements and consumption. Conduct a company-wide inventory of telecom assets, usage and spending to understand what you're currently paying for (and if you should be).
  2. Eliminate service overbilling. Once you understand your usage profile, review areas where you may be paying for more service than you need. Do you really need to buy a T1 port?
  3. Source competitively. Don't rush the carrier sourcing process. AT&T and Verizon are notorious for creating complex service packages and pricing that make it difficult to compare against the competition. Creating a level playing field and comparing services "apples to apples" requires some specialized expertise -- but it will be well worth the effort.
  4. Don't commit full spend to a single carrier. It's hard to retain leverage in a carrier-customer relationship when working with a single provider. By keeping two or more carriers in the mix, you can keep all carriers motivated to provide pricing, discounts and incentives.
  5. Confirm that you're paying fair market value. Many companies are not able to verify whether they're paying a fair price for wireline services. If you're not sure, bring in outside pricing expertise.

-- Jeff Muscarella, EVP of IT, NPI

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