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Research & Education Network Business Models
7/9/2019
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Project Overview Spring of 2007, The Quilt and MIDnet launched a collaborative effort to collect case studies of R & E network organizations Goals of the project: Enrich and deepen the content of the original Quilt business model review Update the case studies of the 'SURA Optical Cookbook‘ Share the history, knowledge and experience of R&E optical network organizations with the broader R&E community. Methodology for collecting information Project Principles: Carol Farnham, MIDnet Jen Leasure, The Quilt 7/9/2019
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Participants Organization State/Hdq 3ROX Pennsylvania FLR Florida FRGP
Colorado LEARN Texas LONI Louisiana Merit, Inc. Michigan NCREN North Carolina NEREN Connecticut NTNC Montana NYSERNet New York OneNet Oklahoma OSCnet Ohio SoX/SLR Georgia 7/9/2019
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Summary Findings No single business model, no single recipe for success Mission statements are unique, but they all have similar elements: Supporting research and education Enabling research and education Providing advanced network technologies and applications Commonalities in the following program areas: Outreach and community building Lessons learned Future directions 7/9/2019
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Summary Findings Thirteen case studies completed
Non-profit or 501(c)(3)s make up 53% 23% are organized as a project of a university system Board 15% are consortiums under a non-profit One is university based 7/9/2019
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Summary Findings Of the 12 operational networks
Majority offer services beyond Layer 1 Majority outsource to a member organization some or all of NOC services Half outsource remote hands to a member organization Staffing levels ranged from 1 to 50 7/9/2019
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Management/Operations
All are managed and operated by R&E organizations Owned vs. Leased Network Assets All have IRU’s on dark fiber Majority own rather than lease the equipment Staffing Network design and geography are important factors in network operations staffing decisions 7/9/2019
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Management/Operations
Sparing Policies and Maintenance Agreements Reliability of network hardware Just in-time inventory practices Sparing vs. maintenance agreements Administrative (Back Office) Functions University system organizations 501(c)(3) 7/9/2019
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Services Offerings All active R&E networks interviewed provide transport services and all but one provide layer 2 services. 73% of organizations are also offering layer 3 services Outreach and community building are integral to the overall success 7/9/2019
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Pricing Strategies Two main funding sources: state and members
Seven expenditure categories Program management/administration Network operations Access to national research and education networks Capital investment Equipment replacement Opt-in services Research and development The majority of organizations set up each service offering as a ‘cost center’ 7/9/2019
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Pricing Strategies State funded Member funded
Administrative costs - membership fee or state allocation Operations and services costs - bundled service pricing Opt-in services priced at cost plus margin Member funded Administrative costs - membership fee or markup on service Operations and services costs - tiered pricing, shared equally or cost plus standard fee-for-service 7/9/2019
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Lessons Learned Outreach and community building are important
Bringing people together provides great value Add value by providing leading-edge services that no one else can or will provide Be an enabler for research and education Do what is in the best interest of your members Leverage opportunities 7/9/2019
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Future Directions Expand fiber footprint Evaluate existing services
Focus on ‘last mile’ Evaluate existing services Develop new services Investigate peering relationships that provide cost effective solutions Expand beyond the realm of the physical network Research new ‘market’: K-12, libraries, health care, etc. 7/9/2019
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Contact Information Carol Farnham, MIDnet Jen Leasure, The Quilt Project Website: 7/9/2019
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