Magic Quadrant for Communications Outsourcing and Professional Services

This document was revised on 22 December 2011. The document you are viewing is the corrected version. For more information, see the Corrections page on gartner.com.

This Magic Quadrant will help midsize and large companies with multinational operations to identify and evaluate vendors that deliver IT and process services in support of enterprise communications systems and network connectivity. The IT services covered in this Magic Quadrant include maintenance and support, consulting, application development and integration, implementation and the ongoing management of IT and related business processes.

The vendors in this Magic Quadrant provide IT services to support fixed and mobile connectivity and related communications systems and technologies. These vendors do not necessarily own or lease the hardware, software or connectivity service contracts. Though all the vendors in this Magic Quadrant provide communications-centric IT services, their competencies and approaches to customer engagement and contracting practices vary. Generally, the vendors' different approaches are dictated by their primary business model (in terms of revenue).

Users are advised to base their communications outsourcing and professional services (COPS) vendor selection on:

• A detailed evaluation of their requirements in terms of operations and levels of support services and the user's ability to deliver with in-house resources.
• A review of their sourcing goals in terms of contract structure, cost benefits, and technology and business transformation.
• A comparison of prospective vendors' capability to execute against expectations globally, and in the specific countries or regions in which a vendor's services are required.

This Magic Quadrant provides insight into vendor capabilities and skills across different geographies, communications-centric IT services and related communications technologies.

Source: Gartner (December 2011)

Market Overview

Key User Demands for Communications Outsourcing and Professional Services Success

In Gartner surveys, ad hoc conversations at industry events and during Gartner's formal inquiry process, the key value propositions that end users cite most often for entering COPS relationships with third-party vendors are:

• Program management.
• Flexibility in contracts related to engagement and consumption models.
• Attaining targeted cost benefits.
• Improved operational and technology performance.

Program Management

Very few COPS providers are able to meet all customer requirements, across all countries and geographies, by leveraging internal resources for IT service delivery. Typically, COPS deals are an amalgam of internal and subcontracted resources to deliver IT services and support. Managing the workflow between the vendor's account management team, its own internal service delivery personnel, the customer's sourcing management resources and the resources of subcontracting partners is a challenge that few providers in the market have mastered. Each interaction and delivery milestone that requires fulfillment across time zones and language barriers represents risk in the IT service supply chain. The risks are amplified when the workflow systems of the providers and their subcontractors are not bonded electronically and when there is process dissonance across provider and user organizations. Users must work to understand the skill sets of the vendor's program management office to manage complex COPS deals. Increasingly, Gartner is seeing COPS deals that leverage third-party multisourcing service integrators (MSIs) to manage work streams, ensure execution and measure value.

Flexibility in Contracts Related to Engagement and Consumption Models

The COPS megadeals may not be dead; however, they were certainly on life support in 2011. The run of very large COPS deals that started in the banking and financial services sector with the financial crisis of 2008 has given way to the disaggregation of the communications "tower" that is increasingly multisourced according to a provider's expertise, vertical acumen and geographic presence. Instead of creating large, intractable contracts to manage assets and personnel transferred to the provider, users now seem more inclined to use providers to attack specific technology and business pain points. These may range from the management of increasing complexity to the management of out-of-control capital expenses, or the provision of advisory services related to network and communications architectural transformation to accommodate business change. The benefit of migrating from traditional outsourcing to managed services, or communications cloud services, is that each engagement is rightsized based on demand and pricing (for example, monthly recurring charges per device, per instance, or utility-based charges that are user, business unit or site specific). The danger of disaggregating the communications tower into multiple bid opportunities (tenders) is that it creates an environment with too many vendors requiring management and oversight. Vendor management is rarely a core competency of user organizations. As a result of this scenario, Gartner is seeing the multisourcing service integration model beginning to pick up for very large multinational corporations (MNCs). Smaller, midsize organizations are often not willing to take on the added expense of program management by an MSI. As communication cloud services move from private clouds to public services, the MSI, or cloud broker, will become increasingly important in successful integration and ongoing program management.

Attaining Targeted Cost Benefits

The primary justification for engaging in COPS agreements continues to be to reduce the expense burden of corporate networks and communications systems by transitioning the management, and sometimes ownership, of the related technologies to a third-party provider and, increasingly, to multiple external providers. Gartner believes that it is reasonable for companies to expect managed services, communications cloud services and outsourcing relationships to reduce a company's ongoing costs while maintaining, or improving, service levels. It is the intent of many midsize and large companies to effect COPS agreements that reduce their capital and/or operations expenses by 30% to 40%. Unfortunately, Gartner sees cost reductions typically falling in the range of 10% to 20%. Often, the gap between desired and actual savings is the result of how poorly COPS deals are qualified and benchmarked in the due diligence process. Culpability for the shortfall lies with the bidding providers and the sponsoring user.

Improved Operational and Technology Performance

Many end-user organizations have recognized that improving service levels related to their communications systems requires significant investment in full-time equivalents and technology. Of course, poor processes, methodologies and tools make investments in operational services inefficient and ineffective. Organizations that have underinvested in resources often do not realize cost benefits when engaging in managed services or outsourcing relationships. However, the improvements in technology performance and change management can be significant. Due diligence is critical to secure improvements in operational and technology performance. Gartner is seeing the inclusion of process outsourcing, in the form of telecom expense management (TEM), in almost every major competitive proposal as a way for businesses to increase visibility of their telecommunications costs and operations.

Market Demand

Outsourcing the ongoing operation and support of connectivity and communications systems to third-party vendors continues to gain significant traction among businesses of all sizes. Gartner forecasts that the global market for communications outsourcing will have a compound annual growth rate (CAGR) of 5.5% from 2010 through 2015. The fastest-growing markets for managed services and outsourcing related to corporate communications will be in Asia/Pacific and Latin America, which will have CAGRs of 9% and 16.4% respectively from 2010 through 2015. While the demand for managed services and outsourcing contracts related to networks and communications systems continues to grow, the market in 2011 is challenged to provide consistent and acceptable service levels. In 2011, analysts across all Gartner business units dedicated to network services, network and communications technologies, and IT services received many calls from dissatisfied and disaffected COPS customers. Many of the most dissatisfied customers fell into one of three categories. They:

• Transitioned in the previous 36 to 48 months to a traditional outsourcing relationship where communications assets, related IT personnel and service contracts were transferred to the vendor's accounting books.
• Experienced diminished service levels, from support to ongoing IT and process management, because the prime contractor changed subcontractors or offshored increasing levels of service delivery without adequate process knowledge transfer and without ensuring that the new providers had sufficient levels of expertise. This forced users to perform program and vendor management themselves, which they had originally outsourced to their prime contractor.
• Experienced recurring outages and performance issues, and viewed ongoing problem management not as their provider's core competence, but as something on which their provider needed to work.

In day-to-day customer discussions as part of Gartner's inquiry process, it is estimated that more than 70% of conversations related to COPS focus on possible replacements for providers. In the customer reference survey conducted as part of this Magic Quadrant's due diligence process, more than 55% of the providers' handpicked references told Gartner that they will put their work out to tender in its entirety, rather than sole-source it back to their provider. Seventeen percent of the customer references that engage in traditional outsourcing contracts told Gartner that they will bring their network and communications operations back in-house. That is the highest percentage of users wishing to return operations in-house in all the years we have published this Magic Quadrant. Of those companies engaging in managed service contracts, 62% of customer references told Gartner that they will put their contract out to tender again; however, none of the references stated any desire to bring operations back in-house.

Of course, many users are hesitant to switch providers as there is significant risk and other potential costs associated with vendor transition. Risk mitigation and cost avoidance are two primary drivers of the market transitioning from traditional outsourcing to managed services. Managed services are often focused on smaller, more definite segments of the network and communications opportunity, whereas large traditional outsourcing deals tend to encompass most, or all, of the network and management responsibility.

Competitive Landscape

The main competitors, in terms of business models, for COPS globally are:

• Communications service providers (CSPs), such as BT Global Services, Orange Business Services and Verizon.
• System integrators and IT outsourcers (ITOs), such as Atos, Dimension Data, Getronics Workspace Alliance and NextiraOne.
• Manufacturers (OEMs) and independent software vendors, such as Avaya Client Services and Cisco.

Gartner does not include offshore outsourcing vendors — such as Wipro, HCL Technologies, Infosys and Cognizant — as these companies have not yet met the inclusion criteria to be considered for rating. However, Gartner fully expects one or more of these players to be included in the next iteration of this Magic Quadrant. Of course, many of the offerings of offshore vendors are private labeled and brought to market by CSPs, system integrators, ITOs and OEMs.

User References

We asked each vendor rated to submit five references to complete a formal interview or survey. For this Magic Quadrant, we used a combination of online surveys and telephone interviews to collect 112 reference responses.

The current market for COPS opportunities based on recently closed deals, and those still at the proposal stage, shows that end-user organizations are looking for a more modest and flexible relationship approach than in previous years. The results from this year's formal customer survey reveal that:

• The average relationship between respondents and their service providers was slightly shorter than five years, at 57.3 months.
• The average respondent was more likely to engage its vendor for managed services than for traditional outsourcing — 56.4% of respondents had managed service contracts.
• Users were much happier with their providers' project-based consulting and advisory services than their program management of multiple service delivery providers. Consulting, in aggregate, was rated 6.02 on a 7-point scale. A rating of 7 equated to "exquisite execution." Program management was rated at 4.95 out of a possible rating of 7.
• Although counterintuitive, the average respondent found CSPs to be more effective for hardware maintenance (6.08 rating) than ITOs and system integrators (5.63 rating). OEMs were viewed as the least effective of all provider types (5.5. rating).
• Most respondents — 55% — were likely to put up their contracts for tender in their entirety on the open market.

Market Definition/Description

COPS engagements may be project based; however, the focus — and significant weighting in the rating process — of this Magic Quadrant is on multiyear, annuity-based agreements for the ongoing operation and support of communications systems and corporate connectivity (inclusive of wired and wireless services and systems). The communications-centric IT services considered in this Magic Quadrant include:

• IT management (on-site and remote).
• Hardware and software maintenance (logistics and product support).
• Application development and integration (commercial-off-the-shelf and customized middleware).
• Process management.
• IT consulting (planning and development).
• Hosted and cloud communications services (for example, unified communications as a service).

COPS contracts may include one or more of these IT services for enterprise networks; however, the contracts always include IT management services as the core of the relationship. IT management services include operational services, application management services and help desk management services. Although these vendors provide network IT services, they do not necessarily own the infrastructure itself.

Asset and resource transfers (of technology or employees) may be included in the agreements but are not a requirement. In fact, the retention of employees and assets by companies while using a third-party manager is a driving force in the market, as companies feel this gives them more control than traditional outsourcing contracts.

Some vendors, namely CSPs, bundle connectivity services with IT services and infrastructure in their offerings. Bundling was not a requirement for vendors to be included in this Magic Quadrant. For this study, each participating vendor delivered a formal presentation to Gartner and was asked to provide a list of five customer references. Gartner then assessed each participant.

The compilation of the results from the presentations and reference checks contributed to the final placement of the vendors in the Magic Quadrant. Gartner also used its research and conversations with users in the market to ascertain capabilities and satisfaction beyond what was provided by the vendors' selected references. The positioning in this Magic Quadrant reflects each vendor's Completeness of Vision and Ability to Execute.

Communications IT Service Definitions

IT Management Services

IT management services transfer all or part of the day-to-day management responsibility for a customer's network environment (including LAN hardware and software, WAN — voice and data — and voice network hardware and software) and, in some cases, the ownership of the technology or personnel assets to an outside vendor. These services may include system operation or support, capacity planning, asset management, availability management, performance management, administration, security, remote monitoring, technical diagnostics/troubleshooting, configuration management, system repair management and generation of management reports. Network remote monitoring and management, and backup and recovery services also fall into this category when some degree of management is included in the service.

Hardware and Software Maintenance Services

Maintenance services include both hardware maintenance and support services, and network software maintenance and support services.

Hardware maintenance and support services are preventive and remedial services that physically repair or optimize hardware, including contract maintenance and per-incident repair. Hardware support also includes online and telephone technical troubleshooting and assistance for setup, and all fee-based hardware warranty upgrades.

Sales of all parts are also included, exclusive of parts bundled with maintenance contracts. This segment includes only external customer spending on these services.

Software maintenance and support services include long-term and pay-as-you-go (incident-based) support contracts. Software support contracts include remote troubleshooting and support provided via the telephone and online, installation assistance and basic usability assistance. In some cases, software support services may include new product installation services, installation of product updates, migrations for major releases of software and other types of proactive or reactive on-site services. Software products and technologies covered under this category include OSs and infrastructure software. Software support services do not include the purchase of subscriptions that provide entitlement and rights to use future minor versions (point releases) or future major releases of software.

Development and Integration Services

Development and integration services support the implementation and rollout of new network infrastructure, including the consolidation of established network infrastructure. Activities may include hardware or software procurement, configuration, tuning, staging, installation and interoperability testing.

Process Management

Specific to the communications environment, the practice of TEM encompasses the business processes conducted by IT and finance departments to acquire the provision (and support) of corporate telecommunications assets. Put another way, TEM is the build out of services, or the acquisition of third-party services, to manage the supply chain for telecommunications. Gartner has identified the component services of TEM as: sourcing; ordering and provisioning; inventory management; invoice and contract management; use management; dispute management; and business intelligence.

IT Consulting Services

IT consulting services are advisory services that help clients assess different technology and methodology strategies and, in doing so, align their network strategies with their business or process strategies. These services support customers' IT initiatives by providing strategic, architectural, and operational and implementation planning related to their networks. Strategic planning includes advisory services that help clients assess their network requirements and formulate system implementation plans. Architectural planning includes advisory services that combine strategic plans and knowledge of emerging technologies to create the logical design of the network environment and the supporting infrastructure to meet customer requirements. Operational assessment and benchmarking include services that assess the operating efficiency and capacity of a client's network environment. Implementation planning includes services aimed at advising customers on the rollout and testing of new network deployments.

These services are given a deeper review in "Market Definitions and Methodology: IT Services."

Hosted and Cloud Communications Services

This is communications functionality that may include telephony, messaging, conferencing, presence and notification, based on variable attributes including asset ownership, management of services and colocation of systems. These services are defined more thoroughly in "Magic Quadrant for Unified Communications as a Service, North America."

Technologies and Services Under Management

This Magic Quadrant focuses on the third-party management of user- and provider-owned communications hardware, software and systems. The technologies are profiled in the following documents:

• Network services are defined in "Market Definitions and Methodology: Enterprise Network Services."
• Communications applications are defined in "Market Definitions and Methodology Guide: Enterprise Communications Applications, Worldwide, 2011."
• Network equipment and software are defined in "Dataquest Methodology Guide: Enterprise Network Infrastructure, Worldwide, 2008" (Note: This document has been archived; some of its content may not reflect current conditions).
• Mobile communications and technologies are defined in "Dataquest Guide: Mobile Communications Glossary, Methodology and Definitions, Worldwide 2007" (Note: This document has been archived; some of its content may not reflect current conditions).

Inclusion and Exclusion Criteria

This Magic Quadrant relies heavily on the analysts' knowledge of, and familiarity with, the enterprise communications market and on checking vendor customer references. To be considered for this Magic Quadrant, vendors had to fulfill the following delivery criteria, based on how they serve the global market:

• In 2010, they had to realize at least $300 million dollars in COPS revenue. The revenue considered for this Magic Quadrant is for process and IT services only. Revenue from the sale of communications hardware, communications software and fixed- or mobile network services should not be considered as COPS revenue.
• They have to compete for stand-alone COPS deals that are not encompassed within broader IT outsourcing deals. Their intent is to address a market need for selective sourcing of communications systems and services.
• They must not derive more than 70% of their COPS revenue from a single vertical market.
• They must not derive more than 80% of their COPS revenue from maintenance services, as this Magic Quadrant seeks to exhibit broad value.
• They must be able to demonstrate the ability to deliver substantially against COPS agreements as sole-source, direct providers of relevant IT services (providers relying entirely on partners or subcontractors are excluded). Ratings will favor more "organic" offers. Organizations that leverage substantial third-party service delivery must be able to provide compelling evidence of superior program management and execution on COPS contracts.
• They must maintain a prime relationship with customers in at least four of the seven regions tracked by Gartner. These regions are: Asia/Pacific; Eastern Europe; Japan; Latin America; the Middle East and Africa; North America; and Western Europe.

Gartner views the ability to create and maintain a centralized remote management platform as a key indicator of an organization's ability to provide superior and quality network management services at reduced cost to end users. As the COPS market matures, participants may not be required to maintain their own platform but, given the strategic nature of these assets, Gartner made this a requirement for inclusion in this iteration.

This Magic Quadrant does not consider the resale of network hardware, network connectivity or software; nor does it consider revenue or products related to managed security services. In addition, while all the vendors in this Magic Quadrant provide network IT services, they do not necessarily own the infrastructure itself. For more information on these sectors, see Gartner's relevant Magic Quadrants.

Not all qualifying vendors provide the same breadth and depth of network IT services, and some offer specialized services. However, the vendors represent the range of managed network services available and are evaluated in this larger context.

Added

• Getronics Workspace Alliance.
• NextiraOne.
• Telefonica.
• Vodafone Global Enterprise.

Dropped

• Getronics.
• NEC.

Evaluation Criteria

Ability to Execute

Gartner evaluates vendors on the quality and efficacy of the processes, methods or procedures that enable them to be competitive, efficient and effective, and to have a positive impact on revenue, retention and reputation.

Each criterion is ranked high, standard or low in importance.

Source: Gartner (December 2011)

Completeness of Vision

Gartner evaluates COPS providers on their ability to articulate convincingly logical statements about current and future market direction, innovation, customer needs and competitive forces, and on how well they map to the Gartner position. Ultimately, we rate COPS providers on their understanding of how market forces can be exploited to create an opportunity for companies.

Each criterion is ranked high, standard or low in importance.

Source: Gartner (December 2011)

Leaders

Leaders affect competitors by: enabling technology and IT service offerings; their focus on the enterprise and targeted industry segments; and their capability to differentiate on value, price and service levels to be first to market with relevant products. Vendors in the Leaders quadrant are performing well today, have a clear vision of market direction and are building competencies to sustain their leadership positions in the market. From our analysis, the following vendors are Leaders:

• BT Global Services.
• CSC.
• Dimension Data.
• HP.
• IBM Global Technology Services.
• Orange Business Services.

Vendor and customer experience weigh heavily in the Leaders quadrant. All these vendors have demonstrated that they have significant network management and outsourcing experience and understand the dynamics needed to deliver network-centric IT services successfully.

Challengers

The Challengers are strong on execution, but lack the vision to take market leadership in terms of enabling technology or other important service offerings. These players often follow quickly, but they are less innovative than Leaders. An example would be that they increase capital expenditure to match that of competitors or bring service offerings to market after a competitor has already established a willing marketplace.

Vendors in the Challengers quadrant execute well, but have a narrower view of market direction. The vendors that emerged as Challengers are:

• Atos.
• Getronics Workspace Alliance.
• T-Systems.

These vendors demonstrated that they have a base of satisfied network management and outsourcing clients. Overall, these companies need to address their strategic vision and broaden their service offerings — in terms of capabilities and delivery — to meet clients' needs.

Visionaries

Visionaries exhibit excellent planning but suboptimal execution. These players are often held back by financial restructuring or weak management and strategy. Visionaries may plan to expand IT services coverage or to roll out a specialized IT service for the enterprise, but encounter delays because of a lack of executive sponsorship. The vendors in the Visionaries quadrant are:

• Accenture.
• AT&T.
• Avaya Client Services.
• Cisco.
• Verizon.
• Vodafone Global Enterprise.

Vendors in this quadrant have a clear vision of market direction and are focused on preparing for future customer requirements, though there is room for improvement in service delivery and execution.

Niche Players

Companies in the Niche Players quadrant focus on a particular segment of market requirements, as defined by characteristics such as size, industry focus and selective network technology management offerings. We positioned the following vendors in this quadrant:

• Cable&Wireless Worldwide.
• NextiraOne.
• Siemens Enterprise Communications.
• Telefonica.

Vendors in the Niche Players quadrant are viable options for organizations seeking COPS vendors. In this Magic Quadrant, vendors identified as Niche Players may have limited experience in the general or commercial worldwide markets, or they may provide only specific service offerings focused on certain network platforms (for example, PBXs, mobile and wireless services, narrow industry markets or business segments).

Vendor Strengths and Cautions

Accenture

Accenture continues to compete selectively for COPS opportunities by pursuing stand-alone deals in the consulting space or managed services when there is clear value for the customer to improve operations and create a flexible environment for change. For COPS deals, Gartner considers Accenture to be a multisourcing integrator, rather than a traditional outsourcer. Gartner views Accenture as having the resources to provide consultancy for large MNCs and manage global COPS programs that include the life cycle of IT services.

Strengths

• Accenture is highly rated and favored by its customers for industry-leading consulting services related to communications systems and network services. Accenture is viewed as a key provider of transformative consultative services that apply and integrate connectivity modalities — including mobile and wireless — to new and existing business processes.
• Accenture is considered one of the leading providers of TEM services for very large MNCs. It is also considered one of the top integrators of TEM applications for global MNCs.
• The combination of Accenture's communications and business process management expertise, application development experience and investments in the Accenture Mobile Operating Services business offers companies industry-leading expertise to build-operate-transfer machine-to-machine (M2M) solutions across vertical market solutions.
• Based on its current customer base, partnerships and internal resources, Gartner considers that Accenture offers a strong proposition to MNCs as the lead, or prime, program manager in COPS deals. In this role, Accenture functions as the aggregator of IT service delivery (including for vendors who maintain asset and personnel control), and maintains responsibility for management and reporting of performance and mediation. Accenture is able to take on midsize and large MNCs independent of geographic distribution of the communications systems or networks that require management.
• Accenture has built a highly evolved global delivery network and integrated global workforce. Its processes for global delivery are among the most mature in the industry. That gives it access to a diverse global talent pool and helps it to be price competitive when required.

Cautions

• As Accenture has expanded its network transformation business, there have been some customer questions in relation to service delivery challenges in the past 12 months. Accenture contracts for outcome-based results that are intended to deliver business value, but there is sometimes a view that Accenture positions high-quality resources for service delivery in the presales process only to offer lesser-quality resources or reduce the numbers of service personnel to complete IT service delivery. It is important for any client to understand the partner ecosystem and delivery personnel that Accenture commits to providing those results.
• Accenture rarely pursues traditional COPS deals involving asset transfer or COPS opportunities that are related solely to cost reduction.
• Accenture leverages third parties for the ongoing maintenance and support of communications solutions. Given its proclivity to optimize resources or to switch to lower-cost subcontractors, companies looking for global COPS deals should scrutinize Accenture's IT support services supply chain and partnerships. While Gartner finds Accenture's present partnerships satisfactory, its IT service delivery partnerships are fluid and changing.
• Despite a consultative approach, Accenture's strict adherence to its own methodology and process can often clash with the client's desire for processes that conform to its own requirements. It is important to align expectations.

AT&T

AT&T supports a robust portfolio of communications-centric IT services spanning both the traditional outsourcing portfolio and an expanded hosted communications and managed mobility portfolio, including Global Mobile Management, Machine to Machine (M2M), Mobile Device Management, Mobile Enterprise Applications Platform (MEAP), Wi-Fi solutions and mobile outsourcing services. The scope of AT&T's management responsibilities spans more than 1 million WAN ports, over 7 million voice ports and more than 12 million connected devices. Based on customer feedback from surveys and inquiries, Gartner believes that AT&T should be considered for midsize and some large companies for the support and ongoing management of environments where third-party networks account for less than 30% of the engagement.

Strengths

• AT&T's investments in resources for consulting and professional services related to telecom process outsourcing have greatly improved its capabilities, especially for mobility services and assets.
• AT&T's continued efforts to market its cellular M2M solutions are creating a market-leading consultancy and professional service organization. AT&T has shown good discipline and focus in helping enterprises address the challenges of creating and deploying M2M connectivity, intelligence collection and asset-control solutions.
• Some AT&T customers have provided positive feedback on AT&T's management and support related to conferencing services (audio and Web), as well as telepresence systems.
• Based on its current customer base, partnerships and internal resources, AT&T maintains the capabilities and scale to fulfill, as the outsourcing prime contractor, COPS opportunities for North-America-based companies that also have communications assets in Western Europe. Given AT&T's financial strength, and considering its direct and partner-enabled IT services delivery capabilities, Gartner believes that AT&T should be considered for COPS opportunities for companies independent of size within these regions.

Cautions

• Customer satisfaction ratings for AT&T have declined since the last iteration of this Magic Quadrant. The primary complaints by customers point to an unwillingness, or inability, to work with partners effectively, whether those partners are the outsourcing prime contractors or subcontractors.
• AT&T prefers to bid on WAN or mobility outsourcing opportunities when there is a significant AT&T network service component.
• Companies looking for global COPS deals with significant assets in the Middle East and Africa, Latin America and Asia are urged to scrutinize AT&T's IT services supply chain and partnerships for delivery. While Gartner finds most partnerships it witnesses in the market as satisfactory, IT service delivery partnerships are fluid and changing and need constant scrutiny.

Atos

Since the last iteration of this Magic Quadrant, Atos Origin has acquired Siemens IT Solutions and Services, an IT services and outsourcing business. The converged companies go to market as Atos. Atos provides IT services to an international client base across various IT domains, including communications systems and network services. The company's annual revenue is €8.7 billion (pro forma 2010). Atos employs nearly 75,000 people in more than 40 countries, with the great majority of those personnel located in Western and Central Europe.

Strengths

• Atos' approach to service delivery relies heavily on process and technology standardization for its communications solutions. The results are competitive prices and a highly competitive time to solution. Clients continue to point to time to solution as a highly valued capability.
• Atos works successfully with CSP partners to bring hosted and cloud-based unified communications to market. Atos' own solutions are expected in the market in the next six months.
• Atos is able to provide managed mobility services — through internal and subcontracted resources — that span multiple corporate requirements related to device control, security, technical and procurement help desk, expense management and forward/reverse logistics.
• Atos clients praise its ability in terms of relationship management aimed at creating a partnership. In Gartner inquiries, and through the formal reference process, customers praise Atos' ability to be flexible in addressing customer needs, rather than standing behind contract terms and provisions. Customers often cite Atos' receptiveness to negotiate solutions that meet customer requirements without the need for expensive change orders.
• Based on its current customer base, partnerships and internal resources, Atos has the capabilities and scale to fulfill, as the outsourcing prime contractor, COPS opportunities for MNCs based in North America or Europe with communications assets distributed globally. Gartner believes that Atos is able to fulfill COPS opportunities for companies independent of size. Gartner believes that Atos is best leveraged for core networking requirements, such as WAN solutions, remote access, and wired and wireless data networking.

Cautions

• Customer feedback consistently points to poor program management. Feedback generally cites weak response times and a burdensome bureaucracy for work requests and change management. Most customers attribute Atos' weakness to a lack of consistent process structures across geographic theaters.
• Gartner does not view the enterprise COPS market as a primary focus for Atos at this time. However, Atos does pursue complex global deals in which networks and communications are included.
• Atos relies on significant partner resources for service delivery, especially in North America. Companies looking for global COPS deals with significant assets in Asia, North America and Latin America are urged to scrutinize Atos' IT services supply chain. Gartner believes that Atos leverages good partnerships for service delivery in North America, but its subcontracting partnerships for the rest of the world were not revealed during the Magic Quadrant process.

Avaya Client Services

Avaya Client Services continues to make investments and improvements in its service delivery platform, which is its engine of growth and profits for the delivery of managed services. These investments in platforms and personnel have paid off, as the company has won a number of significant, multiyear, multivendor managed service deals. Since the last iteration of this Magic Quadrant, Avaya has been through a reorganization of its services organization, including a rebranding from Avaya Global Services to Avaya Client Services to reflect the inclusion of partners as key clients. Avaya Client Services manages more than 2.6 million voice ports and nearly 1 million LAN ports worldwide. Gartner views Avaya Client Services as having the resources to support, and manage, global COPS opportunities for the Avaya-specific and multivendor systems of large MNCs, including the life cycle of IT services.

Strengths

• Continuing investments in its remote management platform, and organization, contribute positively to Avaya Client Services' ability to win and deliver cost-effective and profitable managed services and outsourcing contracts. Avaya's newly created Matrix Management Platform provides Avaya Client Services with a market-leading shared service among OEMs to provide proactive and preventive management of all communications applications and infrastructure in a multivendor environment.
• In 2011, Avaya Client Services won significant contracts, of both managed services and outsourcing, to manage and support multivendor and multitechnology engagements. Early customer feedback on these three- to seven-year deals is positive.
• Avaya Client Services continues to solidify the market by creating partnerships with CSPs, ITOs and regional value-added resellers to be the private-label and pass-through partner to support and manage Avaya hardware and software.
• Based on its customer base, partnerships and internal resources, the company maintains the capabilities and scale to fulfill managed services contracts for global MNCs independent of geographic location.
• Gartner believes that Avaya Client Services should be considered to manage and support COPS deals where Avaya products represent at least 40% of the installed base of data networks, voice systems and contact center infrastructure.

Cautions

• Avaya Client Services' organization was rated low for overall viability. Since the last iteration of this Magic Quadrant, the company has named its eighth senior vice president of its Services organization in 11 years and transferred its Consulting business unit to Sales.
• Gartner's end-user inquiries in 2010 and 1H11 showed that legacy Nortel Enterprise Solutions (NES) customers, particularly in North America and EMEA, saw a decline in support from Avaya Client Services, while NES partners and support engineers were being trained on Avaya systems. Time to resolution and the quality of advanced-level support engineers were the most reported support issues from the NES customer base. However, these issues have decreased in recent months.
• Feedback from references and feedback received during ongoing inquiry calls with Gartner customers, and with Avaya Client Services partners, shows frustration with its inability to meet maintenance and support contract requirements.
• While it provides multivendor managed services, the company should be considered only for environments where Avaya Client Services represents at least 40% of the overall elements and instances. It is not considered a good fit for global MNCs looking to outsource broad communications solutions for WAN/remote access, WAN optimization and application acceleration solutions, mobile device management or process outsourcing related to telecom expenses.

BT Global Services

Since the last iteration of this Magic Quadrant, BT Global Services has been busy winning back the hearts and minds of its customer base. Based on 12 months of Gartner customer inquiries, ad hoc conversations with key customers and the views of BT Global Services' survey respondents, the company has been successful. While deals were fewer, and some deals were lost when they came up for renewal, Gartner did see improvements in deal quality, which is promising for the future of IT service delivery execution. While many of BT Global Services' competitors are retreating to the midmarket, or will bid for COPS deals only in their immediate installed base, conversations with customer prospects, and with relevant executives, reveal that BT Global Services is the market's lone vendor looking to address complex, stand-alone, global outsourcing deals for an MNC's networks and communications systems.

Strengths

• BT Global Services maintains a talented and geographically distributed consulting and professional services organization, with a broad skills base related to enterprise fixed-service communications.
• BT Global Services maintains the most experienced and elegant go-to-market approach related to applying vertical market expertise and acumen to communications solutions. Depending on geography, it focuses on targeted vertical markets, including: governments; global commerce; banking and financial services; and consumer packaged goods.
• BT Global Services' investments in personnel and centers of excellence in Asia and Latin America offer users more local resources and make the company a more compelling provider of professional services to the local market and to global MNCs with local presence. Additionally, although not its core market, BT Global Services has effected the requisite partnerships to execute IT services for companies looking for global COPS deals with significant assets based in the Middle East and Africa.
• Based on its customer base, partnerships and internal resources, BT Global Services maintains the capabilities and scale to fulfill, as the outsourcing prime contractor, COPS opportunities for MNCs with communications assets distributed globally. Gartner believes that BT Global Services is one of the few vendors that can fulfill all COPS opportunities regardless of size. It is considered a credible and leading provider of IT services across a broad range of network and communications technologies, including: wireless and fixed data networks; conferencing; messaging and presence; contact centers; hosted, cloud and premises-based voice systems; WAN and remote access.
• BT Global Services offers customers a wide range of managed services, from managed voice and video services to managed security services. These services are delivered by leveraging its extensive network of data centers and global service centers.

Cautions

• Customer reference interviews and inquiries point to dissatisfaction on a number of issues. Not unlike many of its competitors that take on complex, global deals, Gartner hears repeated concerns from BT Global Services customers related to the company's ability to perform problem management on recurring issues. Some customers tell Gartner that the company consistently misses commitment delivery times for change management requests. Gartner continues to hear complaints that the company must be monitored closely to ensure it fulfills technology transformation as negotiated within the outsourcing contract.
• BT Global Services is not seen as a competitive provider, in terms of organic or partnered capabilities, for communications outsourcing for companies with more than 60% to 70% of their network service contracts and communications assets located in North America.
• BT Global Services is not seen as a strong global provider of process management related to mobile telecom expenses.
• BT Global Services' lack of organic mobile network operator services does not preclude the company from providing life cycle services related to enterprise mobility. However, its execution on managed mobility services — an increasingly important portfolio of IT and process services for enterprises — related to mobile devices and applications is subscale in the market.

Cable&Wireless Worldwide

Cable&Wireless Worldwide is an emerging player in the COPS market. Its investments in managed services have been primarily network-centric, although there has been solid development in hosted communications solutions, including contact center infrastructure. The company is viewed as a good choice for the support and ongoing management of multicarrier WAN and remote-access solutions. It is not a strong provider of support and ongoing management of multivendor communications systems.

Strengths

• Cable&Wireless Worldwide has good coverage in Western and Eastern Europe to support network-centric opportunities.
• Cable&Wireless Worldwide continues to make investments and commitments in management platforms and resources offshore for the management of global networks and customer-premises-based communications systems. The company is very cost competitive, particularly in the U.K.
• Cable&Wireless Worldwide is highly rated by customers for innovation in its COPS contract approach, including its business-impact SLAs, acting as a multisourcing integrator and managing geographically diverse third-party networks.
• Based on its customer base, partnerships and internal resources, Cable&Wireless Worldwide maintains the capabilities and scale to fulfill managed services contracts for Western-Europe-based companies with communications assets in Eastern Europe and Asia. Gartner believes that the company is best able to fulfill COPS opportunities to manage and support network services in companies with 50,000 or fewer employees.

Cautions

• Cable&Wireless Worldwide's managed service capabilities remain competitive, but its portfolio is not as broad or as deep as those of the Leaders in this market, especially for on-site services.
• Although the company maintains customer accounts outside Western Europe and Asia/Pacific, its experience and capabilities in large outsourcing and managed services deals are thin compared with those of its major competitors in Latin America and the Middle East and Africa.
• Cable&Wireless Worldwide is not viewed as a credible market provider in COPS opportunities where the majority of service contracts and assets to be placed under management reside within North America.
• Cable&Wireless Worldwide customer feedback has been especially tough in the past 12 months. Its customers give the company very poor ratings related to project management, hardware maintenance and software support. Additionally, customers rate the company's technology proficiency for security, application acceleration and unified communications and collaboration (UCC) as not meeting expectations.
• Gartner views Cable&Wireless Worldwide as a provider of managed services related to network connectivity. Gartner does not see the company as a credible provider in opportunities where companies are looking solely for the management and support of their communications systems and network assets. That includes voice and data (fixed and wireless) hardware and software, managed security, visual communications, telepresence and UCC.

Cisco

Cisco provides an increasing amount of maintenance and professional services direct to end customers; however, most of Cisco's IT services revenue is generated by working in partnership with its channel partners. Cisco's strategy is to enable its partners by investing in their service delivery. The enablement of partners, through Cisco's services delivery, is achieved via a private-label relationship, pass through or even with Cisco acting as a subcontractor. Cisco is considered, by the market, as the premium IT service provider for supporting Cisco hardware and software, including communications systems. But based on Cisco's portfolio of services, the company should not yet be considered a broad, multivendor, multicarrier communications outsourcer.

Strengths

• Customer satisfaction with Cisco's consulting and advisory services, branded as Cisco Advanced Services, is considered industry leading among manufacturers in terms of breadth and depth. Since the last iteration of this Magic Quadrant, Cisco has successfully increased its capabilities to sell and deliver Advanced Services. Cisco can convincingly prove that customers that invest in more professional services delivered by Cisco have higher levels of satisfaction with their Cisco relationship and Cisco technology. Further, Cisco has introduced Collaborative Professional Services, which provides its partners with access to Cisco intellectual property and engineering talent for codelivery of expert services to participating partners' customers.
• Customer satisfaction with Cisco's technical support and maintenance services is considered industry leading among manufacturers.
• Cisco is increasingly seen providing direct service delivery to its largest, most strategic customers. These Transformational and Global Enterprise Theater accounts are served in a blended model, with Cisco going to the customer with a partner. Of course, there are cases where the customer prefers direct Cisco involvement.
• Based on its customer base, partnerships and internal resources, Cisco maintains the capabilities and scale to fulfill global managed services for MNCs with globally distributed Cisco-only network and communications assets. Cisco is considered able to provide these services regardless of customer size.

Cautions

• Companies looking for global COPS deals with Cisco should restrict agreements to direct maintenance and support, consulting and minimal management services. Very large enterprise managed service contracts, which include program management of multiple vendors, should not be awarded to Cisco direct at this time. There remains confusion in the market related to Cisco's ability and desire to provide IT services direct to its customer base. The confusion appears to be the result of a command and control issue, as well as strategic ambivalence. Cisco has recently published to its partners formal rules of engagement to address this and to clarify further Cisco's services strategy and how it will collaborate with partners in services across all customer types.
• Cisco's technical support organization fulfills its role in terms of ensuring service readiness for new product introductions. However, in this year's formal reference survey, new product introduction was cited as the company's single biggest weakness by two of its selected references.
• Smart Services and service automation are leading value propositions that Cisco uses in the market to portray its vision of the future of IT services. However, Cisco lags behind other OEMs and nearly every value-added services organization in leveraging its R&D to create a shared service platform in a portfolio of saleable managed service offerings.
• Cisco's Advanced Services are priced at a premium compared with other manufacturers' services. Additionally, Advanced Services do not provide sufficient risk mitigation related to the off-the-shelf statements of work (SOWs). Cisco offers comprehensive SLAs to its enterprise and service provider customers, but with limited transparency to the broader market. Customers are encouraged to push Cisco, and its partners, to commit to structured SOWs and SLAs to secure their business.

CSC

In the past year, CSC has invested time and resources in improving its management capabilities and in increasing its portfolio of hosted and cloud-based communications solutions. CSC is viewed as a good choice for the support and ongoing management of WAN-centric and remote-access solutions. It is also viewed as strongest for the support and ongoing program management of multivendor communications systems. CSC manages nearly 1.5 million users of collaboration systems, traditional and Internet Protocol PBXs, email and voice mail. Additionally, CSC is growing its portfolio of smartphones and tablets under management, with nearly 70,000 users.

Strengths

• CSC has a strong core competency in delivering outsourcing deals in the federal, state and local government sectors.
• CSC goes to market with a higher percentage of internal resources than any other provider rated in this Magic Quadrant.
• Based on its customer base, partnerships and internal resources, CSC maintains the capabilities and scale to fulfill, as the outsourcing prime contractor, COPS opportunities for companies based in North America and Western Europe with communications assets in Asia. Gartner believes that CSC should be considered for COPS opportunities regardless of the size of the opportunity and inclusive of all communications technologies that require support and management.

Cautions

• Throughout 2011, customer references and customer inquiries have cited CSC's inconsistent facilitation of problem management between various constituencies, such as manufacturers, software vendors and CSPs.
• Companies looking for global COPS deals with significant requirements in Central and Eastern Europe and the Middle East and Africa must consider that CSC augments internal resources with selected partners for delivery. Clients should confirm SLA commitments for service delivery in these regions.
• Although CSC has worked to streamline user engagement, some of its customers continue to be dissatisfied with the cumbersome nature of its change management process. Client concerns also cite CSC's inability to deliver change management with any type of consistency in terms of quality.

Dimension Data

The past year was an interesting time for the company. On 9 December 2010, NTT Holdings closed the acquisition of Dimension Data. In July 2011, Dimension Data acquired OpSource, a cloud services provider. All the while, Dimension Data has continued to execute against its plan of more profitable growth and greater market relevance by increasing its percentage of managed service deals. Dimension Data remains the industry benchmark in terms of the geographic diversity of its communications installed base. The more geographically diverse a user's communications IT service requirements, the more Dimension Data's appeal grows. Despite being owned by NTT Holdings, Dimension Data continues to subcontract significant IT service delivery capabilities to competing CSPs. Dimension Data is considered especially strong by Gartner with regard to its capabilities to reach customer locations in emerging markets.

Strengths

• Dimension Data has made significant investments in its IT services management systems for improved and more efficient service delivery.
• Dimension Data places a strong emphasis on, and investments in, program management personnel and skills development.
• Dimension Data maintains a global logistics capability that is unmatched for communications-centric support. The company is very strong in Western Europe, Asia/Pacific, Australia and New Zealand, the Middle East and Africa, and Latin America.
• Based on its customer base, partnerships and internal resources, Dimension Data maintains the capabilities and scale to fulfill, as the outsourcing prime contractor, COPS opportunities for MNCs with communications assets distributed globally. Gartner believes that Dimension Data's experience allows the company to fulfill multivendor support and maintenance services in all opportunities regardless of size; however, for managed service and outsourcing contracts, Gartner believes that Dimension Data is best suited to address the needs of global MNCs with 40,000 or fewer employees. Dimension Data is considered a credible and leading provider of IT services across a broad range of network and communications technologies, including: wireless and fixed data networks; conferencing; messaging and presence; contact centers; hosted and premises-based voice systems; and security services.

Cautions

• Gartner has previously identified some dissatisfaction with IT service delivery quality in North America, and Dimension Data has consequently invested in service transformation measures. Companies looking for global COPS deals with more than 50% of their communications assets located in North America are urged to scrutinize Dimension Data's references.
• Dimension Data is still investing in growing the depth and breadth of its COPS outsourcing capabilities. It does not, therefore, have the experience to be viewed as a credible provider for the management and support of traditional network outsourcing deals, other than in South Africa and Australia. However, the organization already services a list of clients in all regions for which it assumes the day-to-day management of WAN and remote-access solutions.
• Dimension Data is not considered a credible provider, in terms of internal resources, of TEM or managed mobility services, but sees this as an area for future investment and joint opportunities with other NTT Group companies.
• Historically, Dimension Data has been reliant on its relationship with Cisco, and approximately two-thirds of its installed based is still Cisco-centric. In 2008, the organization embarked on a multivendor service program to improve its ability to consistently design and service multivendor environments. The program has been successful in a number of countries, but MNCs with highly diverse communications assets are advised to ensure that Dimension Data's capabilities are commensurate with their requirements. Gartner bases this comment on an analysis of the assets under management by Dimension Data, as well as on customer reference checks.

Getronics Workspace Alliance

The last time we published this Magic Quadrant, Getronics was rated as a stand-alone entity for the delivery of service for global MNCs. In this iteration of the Magic Quadrant, Gartner is rating the Getronics Workspace Alliance (GWA). The GWA is a joint venture between global service providers. The service providers that constitute the GWA, and the countries in which they have their headquarters, are: KPN-Getronics (the Netherlands); CompuCom (the U.S.); APX (France); Getronics Middle East (the United Arab Emirates); NTT Data (Japan); ServiceOne (China); and Tecnocom (Spain).

Strengths

• The GWA presents a broad IT expertise to its customers. In aggregate, the member companies cover the gamut of IT services in support of the broad array of communications systems and fixed/mobile network service requirements, including: WAN and remote-access management; application acceleration and WAN optimization; mobility management services; M2M; unified communications; and expense management.
• Formal customer references say that it is easy to conduct business with the GWA. The member companies have worked to extend flexible billing terms to their global MNC customers — central-to-central billing, local-to-local billing and central-to-local billing.
• The GWA is cost competitive, as its diverse service desks and global service centers provide a good multishore capability.
• Based on its customer base, partnerships and internal resources, the GWA maintains the capabilities and scale to fulfill, as the outsourcing prime contractor, COPS opportunities for geographically diverse midsize and large companies. Gartner believes that the GWA is most effective in COPS opportunities with 50,000 or fewer users.

Cautions

• Although investments in shared processes and systems are encouraging, dealing with seven distinct companies, in addition to the subcontracting relationships used by individual companies, presents a significant program management challenge. Additionally, despite the geographic diversity of the GWA member companies, customer references point to a lack of global coverage by the GWA.
• Because of the multiple delivery entities associated with the GWA, and the use of subcontractors by the GWA members, companies looking for global COPS deals are urged to scrutinize the GWA IT services supply chain and partnerships for delivery. While Gartner finds the core GWA members satisfactory, IT service delivery subcontractor relationships are fluid and changing.

HP

HP Enterprise Services (ES) has a strong legacy of engaging the world's largest organizations and crafting the world's largest COPS contracts across government and commercial constituencies. HP is viewed as a solid provider across all customer communications systems and networks — fixed, mobile and data center. The Technology Services organization continues to work to become a trusted consulting and professional services organization related to networks and communications.

Strengths

• HP is considered to be a leading global provider of network hardware maintenance and communications software support.
• The company continues to invest in systems and resources related to managed mobility services for the enterprise mobile "estate" — smartphones, tablets and field service devices. The company is not considered a leading provider of managed mobility services at this point but, given the number of devices actively under management and the number of years it has been providing services, HP is considered a competent provider.
• HP's ongoing investments in network communications solutions, including cloud-based services, are considered leading edge and will place the company at the center of the COPS market in 2012.
• HP ES is at the vanguard, driving the COPS market toward a carrier-neutral, multicarrier managed service offering that separates IT management from the providers of connectivity. In this model, HP positions third-party network management, and network services utility and flexibility, as the primary values to the customer. This model relegates CSPs to wholesaling and subcontracting relationships.
• Based on its customer base, partnerships and internal resources, HP maintains the capabilities and scale to fulfill, as the outsourcing prime contractor, COPS opportunities for MNCs with communications assets distributed globally. Gartner believes that HP is one of the few vendors that can fulfill all COPS opportunities, regardless of size. HP is considered a credible and leading provider of IT services across a broad range of network and communications technologies, including: wireless and fixed data networks; conferencing; messaging and presence; contact centers; hosted, cloud and premises-based voice systems; WAN and remote access; and mobile devices and related applications.

Cautions

• HP's stand-alone consulting capabilities for communications solutions continue to be rated poorly in formal and ad hoc user conversations in terms of the quality of deliverables and strategic vision.
• In Gartner inquiries, some customers voice dissatisfaction with the support and maintenance services of the Technology Services organization. In the formal reference survey, HP's references said that support and maintenance were not meeting their satisfaction.
• Customer comments continue regarding some HP ineffectiveness in using remote services delivery to provide operational improvements and meet system performance SLAs.

IBM Global Technology Services

As a global IT services leader, IBM Global Technology Services is also a Leader in the market in terms of its Completeness of Vision, as well as its investments related to developing communications solutions, UCC, contact center infrastructure, M2M, Internet Protocol version 6, fixed-mobile convergence, communications-enabled business process, TEM and managed mobility services. IBM continues to rely on an ecosystem of third-party service providers for a good deal of the service delivery in its COPS deals. That said, discussions with IBM demonstrate a growing go-to-market approach in which the company is partnering with third-party network services companies to provide clients with flexible options for different usage scenarios. This is leading to improved customer satisfaction.

Strengths

• IBM Global Technology Services' biggest strength in the market for IT services related to communications systems and networks — fixed, mobile and data center — is its consulting organization. The group of consultants offered by IBM Global Technology Services receives some of the industry's highest levels of satisfaction in terms of deliverables, quality and strategic vision.
• The company has built, operated and deployed leading-edge M2M connectivity solutions in multiple vertical markets with very high levels of customer satisfaction.
• Based on its logistics footprint, IBM Global Technology Services is considered to be a leading global provider of network hardware maintenance and communications software support.
• Based on its customer base, partnerships and internal resources, IBM Global Technology Services maintains the capabilities and scale to fulfill, as the outsourcing prime contractor, COPS opportunities for MNCs with networks and communications assets distributed globally. Gartner believes that the company is one of the few vendors that can fulfill — direct and with partners — all COPS opportunities, regardless of size, across all communications environments.
• IBM Global Technology Services is an early influencer as a provider of telecom expense process management services for MNCs. It is also considered a leading integrator of TEM applications for MNCs.

Cautions

• Since the last iteration of this Magic Quadrant, some customers have voiced dissatisfaction with the efficiency of the company's service delivery specifically related to performance and change management of WANs, and remote access when delivered by certain service provider partners. Customers have also expressed dissatisfaction with the level of clarity in the company's program management of third-party service delivery partners across selected areas of networks and communications systems.
• In terms of COPS deals, IBM Global Technology Services often prices higher than its competitors, so clients should negotiate appropriate SLAs and service-quality metrics for the premium associated with the company's services. Because of the company's strength as a global IT outsourcer, and its financial strength, choosing it is often viewed as a form of risk mitigation.
• The company does not generally bid on network-only outsourcing deals, deferring to partners such as AT&T. However, IBM Global Technology Services' networking solutions are core to its managed services portfolio strategy and foundational to IBM's strategic initiatives, such as Smarter Planet and cloud. COPS deals that include network services management, in addition to the ongoing management and support of premises-based communications systems, or purpose-built hosted communications solutions, play more to the company's strengths.

NextiraOne

NextiraOne is rapidly expanding its COPS capabilities and changing how it goes to market. Traditionally, NextiraOne has been a pan-European third-party maintainer. However, the company initiated a strategy to simultaneously grow revenue and margins by offering various communications-related consulting and managed services, and to reorient its focus from its traditional small or midsize business customers to serve midsize and large accounts. The fastest-growing segment of NextiraOne's business is international customers beyond its traditional pan-European base. The company realizes significant revenue as a private-label contractor for global CSPs and ITOs, effectively operating and delivering services in some of the world's largest COPS deals. At the time of writing, NextiraOne had sold its Swiss business unit.

Strengths

• Customers consistently praise NextiraOne's ability to create a single contract for network hardware maintenance and communications software support across multiple geographies. Customers continue to praise the ease of doing business with the company and its broad portfolio of partnerships across the continuum of network and communications technologies.
• NextiraOne maintains the capabilities and scale to fulfill managed service contracts for Europe-based companies. It is able to provide a range of managed services (not traditional outsourcing) for voice, data and security, regardless of manufacturer origin.
• For its size and scope of business, NextiraOne has made competitive investments in R&D related to its service automation and management platform. The company maintains operations centers in Paris and Berlin.
• NextiraOne's installed base and strengths are focused on midsize businesses with multinational requirements. The company typically engages large, global MNCs through private-label partnerships with companies such as CSC, Telefonica and Verizon.

Cautions

• NextiraOne maintains Cisco Gold Partner standing in only 11 countries. Companies looking for global COPS deals with significant assets outside Europe are urged to scrutinize its IT services supply chain and partnerships for delivery. While Gartner finds the company's present partnerships satisfactory, IT service delivery partnerships are fluid and changing. NextiraOne does not maintain a direct presence in Asia.
• Some customers have voiced dissatisfaction with the company's ability to manage problems and performance. Additionally, some customers complain about the timeliness of contracted service levels for on-site and remote change management.
• NextiraOne maintains a minimal presence in the Middle East and Africa and in the Americas. Gartner does not suggest NextiraOne for companies with significant network and communications assets to be placed under management and support.

Orange Business Services

Orange Business Services slowly and quietly continues to grow its COPS customer base, while maintaining strong customer satisfaction. It provides a full range of managed services related to communications systems and network services; however, the company focuses almost exclusively on opportunities within its home geography (and country). Starting from a strong domestic presence, Orange Business Services is growing its international revenue. It is viewed as a good choice for the support and ongoing management of multivendor WAN and remote-access solutions. It has also proved effective at providing good support and ongoing management of multivendor communications systems.

Strengths

• Orange Business Services has consistently been ranked highly by Gartner clients for its network support services. It is a good choice for the ongoing support of WAN and remote-access solutions. It tends to place its own support engineers in countries around the world to provide more consistency of service than might be possible with third-party engineers. The company has significantly improved service levels for enterprises and enhanced the customer experience by using quality management techniques, such as ITIL and Six Sigma.
• Orange Business Services offers a broad range of managed services, including managed network services, managed security services and managed video services. It is also growing its IT business with offerings such as VPN Galerie for cloud services, and trying to globalize solutions in areas such as M2M communications, which it has developed for the French market. Orange Business Services has made direct investments in customer-specific products and solutions, upgrading skills and capabilities in the areas of project management and service management (International Organization for Standardization [ISO] 20000) and security (ISO 27000 and 9000).
• Orange Business Services is also developing and bringing to market innovations in mobility — such as managed mobility and M2M — for specific vertical markets, such as e-health for the healthcare industry, finance with specific trading functions, and e-government schemes, in addition to its activity in the Middle East with Smart Cities.
• Orange Business Services works with its customers to identify typical application performance, and acceptable performance, specific to customer locations. From this, it derives a site-specific SLA for each application.
• Based on its customer base, partnerships and internal resources, Orange Business Services maintains the capabilities and scale to fulfill, as the outsourcing prime contractor, COPS opportunities for MNCs with communications assets distributed globally. Gartner believes that, based on its customer base and experience, Orange Business Services is best able to fulfill COPS opportunities for companies with 50,000 or fewer employees. It is considered a credible and leading provider of IT services across a broad range of network and communications technologies, including: wireless and fixed data networks; conferencing; messaging and presence; contact centers; hosted, cloud and premises-based voice systems; WAN and remote access; and mobile devices and related applications.

Cautions

• Orange Business Services is more risk averse than almost all the vendors rated in this Magic Quadrant. Subsequently, it does not bid in a great deal of opportunities. Companies with very large global COPS deals where assets and resources are transferred to the books of the chosen provider are best to leave the company off their bid list.
• Orange Business Services is not seen as a competitive provider, in terms of organic or partnered capabilities, for communications outsourcing for companies with more than 50% of their network service contracts and communications assets located in North America.
• Other providers have more extensive portal capabilities that enable users to configure their own options. Orange Business Services' offerings have, to date, been lacking in features such as a full service catalog, the ability to order and provision services, and the ability to manage assets through the portal. Orange Business Services is piloting a new portal — which Gartner analysts have reviewed — among several customers.
• In our formal reference survey, some Orange Business Services customers rated the company's skill sets related to application acceleration and collaboration solutions as less than satisfactory. Additionally, in the Gartner inquiry process, some customers have reported low satisfaction with the consulting personnel in Eastern Europe and in North America, in terms of their skill sets and vertical acumen.

Siemens Enterprise Communications

Siemens Enterprise Communications has built services capabilities — including integration, support and managed services — for a wide range of technologies and platforms. The scope of its management responsibilities includes more than 3 million voice and data ports under management globally. Except for WAN solutions, the company is viewed as a cost-effective choice for the operation of its own and third-party communications infrastructure and as being effective, in particular, in the walk-in/takeover of unified communications environments. Furthermore, it has been proven to provide very good support and management of remote-access solutions. It is a good provider of support and ongoing management of multivendor communications systems and contact center infrastructure.

Strengths

• More than 30% of Siemens Enterprise Communications' managed services base is on third-party equipment, and the company is able to maintain multivendor equipment under a single SLA.
• Siemens Enterprise Communications has strong consulting capabilities that enable it to integrate multivendor platforms and communications into business applications. Overall, this was the company's most highly rated service capability in our reference survey. The company was rated relatively well for expense management, which is a service that it private labels.
• The company maintains the capabilities, scale and ITIL-aligned processes to fulfill managed services contracts for global companies with communications assets distributed across all continents. It is able to provide a range of managed and selective outsourcing services — for voice, data and security — independent of manufacturer origin. It also has the ability to scale to full outsourcing if the client requests.
• Siemens Enterprise Communications has a strong presence in professional and managed services in Germany and across the rest of Europe. It is showing consistent growth and presence in Latin and North America.

Cautions

• In our survey, Siemens Enterprise Communications' lowest-rated attribute was its ability to provide program management across multiple partners and subcontractors.
• In Gartner inquiries, some companies identify Siemens Enterprise Communications' inability to provide effective event, incident and problem management in large complex environments. Additionally, some customers cited timeliness in on-site and remote change management as a chronic challenge for the company. Ongoing IT management was also identified as a challenge in our formal reference survey, registering at just below satisfactory with customers.
• Companies looking for global COPS deals with significant assets in Asia, the Middle East and Africa are urged to analyze Siemens Enterprise Communications' IT services supply chain and partnerships for delivery. While Gartner finds its present partnerships satisfactory, IT service delivery partnerships are fluid and changing.

T-Systems

Although T-Systems generates more managed services and outsourcing revenue in other towers than in networks and communications, Gartner has seen the company compete more aggressively for COPS deals in the past 12 months. The company will pursue stand-alone COPS opportunities; however, it prefers to provide communications outsourcing as part of larger IT outsourcing opportunities. Based on customer conversations — in formal surveys and ad hoc Gartner inquiries — T-Systems is viewed as a good choice for the support and ongoing management of UCC systems.

Strengths

• T-Systems has made significant investment in resources, processes and methodologies dedicated to premises-based UC solutions, as well as mobility enterprise services. Additionally, Gartner sees T-Systems winning some key deals related to visual communications.
• The company is considered a leading provider of consulting and advisory services related to networks and communications strategy and transformation. The company was rated very highly in our formal reference survey for consulting services and for the project management service related to its specific nonrecurring engagements.
• Based on its customer base, partnerships and internal resources, T-Systems maintains the capabilities and scale to fulfill, as the outsourcing prime contractor, COPS opportunities for Western European MNCs with significant communications assets also distributed in Central and Eastern Europe. Gartner believes that T-Systems is best able to fulfill COPS opportunities for large and very large MNCs.

Cautions

• Companies looking for global COPS deals with significant assets in the Middle East and Africa, Latin America and Asia are advised to scrutinize T-Systems' IT services supply chain and partnerships for delivery. While Gartner finds its present partnerships satisfactory, IT service delivery partnerships are fluid and changing.
• T-Systems only selectively pursues stand-alone global COPS opportunities that involve the ongoing management and support of communications systems.
• In our formal reference survey, T-Systems was rated low in terms of its ability to provide program management across multiple partners and subcontractors.
• In Gartner inquiries, some companies have commented on T-Systems' inability to provide effective ongoing IT management in terms of event, incident and problem management in large complex environments. Additionally, some customers cite timeliness in on-site and remote change management as a recurring challenge for T-Systems.

Telefonica

Telefonica is new to the Magic Quadrant, but has been on customers' COPS "radars" for a few years. The company is a credible pan-European provider and has shown early dominance across Latin America. That said, the company needs a broader presence geographically to compete with many of its CSP and ITO competitors. Additionally, Telefonica needs to execute against its vision road map for cloud and managed services to bring a more competitive portfolio to a global MNC prospect base.

Strengths

• Telefonica was recognized by its customer references for its strong consulting capabilities in planning, building and integrating UCC solutions. Overall, it was Telefonica's highest-rated service capability in our reference survey. Additionally, Telefonica's references rated as very good its ability to provide application development and integration services related to UCC. The company was rated relatively well for expense management.
• Telefonica is able to provide managed mobility services to support the IT service life cycle of the enterprise mobile estate.
• Telefonica maintains the capabilities and scale to fulfill managed service contracts for Europe-based companies with communications assets also distributed across Latin America. The company is able to provide a range of managed services related to WAN, remote access and UCC solutions. It was rated highly for its broad IT expertise by a number of its customer references.

Cautions

• In our formal reference survey, Telefonica was rated low for its ability to provide program management across multiple partners and subcontractors. This has been confirmed in Gartner inquiries, where some Telefonica clients point to significant disruption or delays in service delivery or project completion based on the company's inconsistent multivendor management.
• In Gartner inquiries, some companies identify Telefonica's inability to provide effective event, incident and problem management in large complex environments. Additionally, some customers cited timeliness in on-site and remote change management as a chronic challenge for the company. In our formal reference survey, ongoing IT management was also reported as a challenge for Telefonica, registering at just below satisfactory with customers.
• Telefonica is regarded by some customers — in our formal survey and in Gartner inquiries — as not aggressively pursuing and attaining the cost reductions that it markets in the presales process.
• Companies looking for global COPS deals with significant assets in Asia, the Middle East and Africa, and North America are urged to scrutinize Telefonica's IT services supply chain and partnerships for delivery. While Gartner finds its present partnerships satisfactory, IT service delivery partnerships are fluid and changing.

Verizon

Overall, Verizon has been a highly competitive force in the market for large global COPS deals in the past three years. Although it is included in many bid solicitations, the company seems to be favoring smaller opportunities anchored in North America and Western Europe. It is viewed as a good choice for the support and ongoing management of WAN and remote-access systems, application acceleration and premises-based data networks and communications systems.

Strengths

• The company's execution and vision in developing managed service products are an area of strength. It has grown its managed services in North America and worldwide. The company continues to be a good choice for the support and ongoing management of WAN and remote-access solutions, and it has been increasing its focus on managed security and Web applications. Verizon is also a credible choice for corporate fixed and wireless LAN management.
• Its best-in-class customer portal, Verizon Enterprise Center, has been an area of continued investment and focus for the company. While its legacy is focused on the support of network services management, procurement and provisioning, it now also covers mobile service contracts and devices, as well as the support of multiple languages and currencies.
• Verizon continues to lead many of its competitors, CSPs and ITOs, in terms of the portfolio development of managed mobility services. Verizon was an early innovator, creating systems to provide enterprises with managed mobility services, through internal and subcontracted resources, spanning multiple corporate requirements related to device control, security, technical and procurement help desk, expense management and forward/reverse logistics.
• Product management and marketing practices appear to be more integrated across all the company's business units and sales organizations than in the previous iteration of this Magic Quadrant.
• Based on its customer base, partnerships and internal resources, Verizon maintains the capabilities and scale to fulfill, as the outsourcing prime contractor, COPS opportunities for MNCs based in North America and Western Europe with significant assets in Asia/Pacific. Gartner believes that Verizon is able to fulfill COPS opportunities, regardless of company size. Customer feedback regarding its technical competence is strongest for the management of WAN and remote-access systems, application acceleration and premises-based data networks and communications systems.

Cautions

• Verizon must improve its partnerships for the delivery of COPS and/or direct service delivery capabilities in the Middle East and Africa, Asia/Pacific, Latin America, and Central and Eastern Europe. In these areas, the company's IT services supply chain and partnerships for delivery are inconsistent and, therefore, regional availability of selected IT services may not be globally consistent for end users.
• Gartner continues to hear significant negative feedback from some of the company's midsize and global accounts regarding substandard service delivery related to its COPS agreements. Some of the more serious feedback comes from its largest, and sometimes newest, COPS customers. Its customers' most significant points of dissatisfaction include: poor program management of subcontractors and third-party service providers; issues related to timeliness; and inflexibility related to change management services and contract terms.
• Gartner sees weakness in the constant reorganizing of Verizon and the underlying IT services and outsourcing service leaders. When there is change at the top, service planning, reinvestment and delivery are almost always affected. Such questions should be posed to Verizon in the due diligence process.

Vodafone Global Enterprise

Vodafone, Vodafone Global Enterprise and Vodafone operating companies are betting heavily that companies will look to skilled third-party service providers to not only manage their connected devices but, more important, to connect their business processes by outsourcing their mobile estate. Vodafone uses a variety of value propositions. These include its global networks, its ecosystem of network operator partners, its IT services and program management experience, and its deep expertise relating to mobile security, mobile device and mobile application solution development, deployment and management.

Strengths

• Vodafone offers the most comprehensive managed mobility services portfolio in the market. The portfolio spans: sourcing and logistics management; service management; device and system management; application and messaging management; security management; and program and financial management. Although it is a relatively new entrant to outsourcing, customer feedback on its execution in large managed mobility engagements has been very positive.
• To create a leading position in process outsourcing related to managed mobility, and to transfer intellectual property to partners and Vodafone operating companies, Vodafone Global Enterprise acquired two TEM companies in 2010. The integration of these companies into competitive offers and the operations of operating companies is ongoing; however, Vodafone Global Enterprise has been a disruptive force in some of the largest TEM deals in 2011. Its service portfolio is known as Vodafone Telecom Management.
• Vodafone maintains a comprehensive and compelling portfolio for hosted and cloud-based UCC services. The Vodafone One Net portfolio is composed of component services, each created to appeal to the customer's business segment size (for example, small offices/home offices with up to 10 users, to global MNCs with hundreds of thousands of employees). In September 2011, Vodafone passed 1.7 million customers for its Vodafone One Net UCC portfolio.
• Based on its customer base, partnerships and internal resources, Vodafone Global Enterprise maintains the capabilities and scale to fulfill, as the outsourcing prime contractor, COPS opportunities for global MNCs, regardless of company size. Although it actively markets multisourcing integrator capabilities for broader fixed-service environments, Gartner believes that its competencies lie in mobility and mobile-related solutions. Vodafone Global Enterprise's managed services for its own fixed services are rated positively by customers.

Cautions

• Vodafone Global Enterprise's growth into TEM hasn't been without "growing pains." Customers have cited inconsistencies and problems related to the sales process, solution rollout and some help desk lapses. The rate of customer concerns is reducing, as the TEM-related acquisitions become better integrated into the company and as the sales force for all of Vodafone becomes more familiar with the solution.
• Customers have provided negative feedback related to Vodafone Global Enterprise's abilities to manage global fixed-service contracts across multiple global providers. Although it maintains local program management resources globally, it appears that the company requires close scrutiny as it matures its IT service management capabilities.
• Vodafone's joint venture with Verizon prohibits it from directly marketing service contracts in the U.S. Although Vodafone Global Enterprise can directly market TEM services in the U.S., its inability to directly market bundled packages there could impact its value proposition in the short term.