How to Get the Best Service Contract For Your T1 Line, VoIP, MPLS, Metro Ethernet Or OCx Circuit
One thing to keep in mind about the telecom world is that everything is negotiable. Thousands of carriers out there want your business, so if you are planning on spending $100,000 in usage every month, you can probably deal with the carrier to get the installation fees, as well as the small monthly recurring charges waived. Be sure to check out a handful of carriers to get them to start a bidding war for your business.
The following tips will help you find the right telecom product for your business:
Timing is Important
Avoid locking into a lifetime contract with your carrier. There is a lot of competition in the telecom world, so prices are continuing to drop. Instead, chose a contract that lasts only 12 months. The best time to start your search for a new carrier is approximately eight months prior to your contract expiring. This may seem like a long time, but researching each carrier for its pricing, services and support can take a bit of time.
Dedicated circuits can take approximately two months for your carrier to install. Contract negotiations can also take a month or so to make sure all the wording is correct. Growing or busy companies that can't dedicate a lot of time to or don't have the required personnel to concentrate on this one task can suffer from installation delays as well. It can take approximately four months to research and weed down to the carriers that meet a business' needs. Another four months can be spent in activating the service once all the requirements are met.
While the above mentioned time lines are approximations, the point is to allow more (not less) time for setting up or switching your service contract with the carrier. For companies in remote locations, it can take an additional 3 months to install dedicated services. It's also important to crunch the numbers to see if the savings gained from switching carriers or upgrading to better services are worth the effort. For example, if the cost savings will only be $200 per month on a $5,000 monthly bill,you might be better off renegotiating with your existing carrier. However, if your business is looking at a cost savings of $10,000 per month on a $120,000 monthly bill, it would be worth the effort to pursue the new carrier.
Using LCR (Least Cost Routing) with Multiple Carriers
If you have a large business that can benefit from using several dedicated circuits, your savings can increase substantially by adding on more long-distance carriers. The good thing about long distance services and prices is that they can vary from one carrier to another.
Some carriers offer better U.S. rates than international rates, it just depends on which areas they are more competitive. If your company has at least two or three dedicated circuits and a good phone system, you can identify which carrier has the best rate by building a least cost routing (LCR) table. This allows you to then route those calls by using the appropriate carrier.
Two words of caution when activating an additional carrier in this kind of routing are:
- Meeting Carrier Commitment Levels: Check with your old carrier to make sure you will meet your commitment levels. While most long distance contracts for dedicated service give you a great per-minute rate, they require a monthly minimum usage from you. For example, in order to get your 2.5 cents per minute rate to California (or wherever), you have to bill out $2,000 in usage per month. Make sure you'll make enough calls to meet this requirement. Failing to comply with your carrier's commitment levels could invalidate your contract and allow the carrier to increase your long distance rates. So if you bring in a second carrier that offers a better rate on international calls, be sure you can hit your commitment level with your primary carrier.
- Setting up the LCR table correctly: Check with your carrier for different breakout pricing. Some carriers may charge a flat rate for all calls within your state while others may charge a flat rate for all calls out of state. No matter where you dial, what time of day you dial, what day of the week you dial, etc., the rate is always the same. Some carriers may break down the pricing per state, or even on a smaller geographic area within each state, called a Local Access Transport Area (LATA). Rates can also be based on the specific local carrier that receives your call. Building your LCR table to meet your business' needs will be easier to do if you completely understand the level at which each carrier bases its rate.
In summary, researching and installing dedicated long distance services takes more time than you think. Allowing enough time to research and compare long distance carrier's products and services, well in advance of a deployment deadline, will give your business the best contract and rates to match your business' needs. Know what your business needs, do you homework and your business will come out ahead.
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Written by:
Laura Rucker
Editor, USaveTelecom.com - © 2008
