> speciality retailer
In this case our client was an Edinburgh speciality retailer that had two retail premises, one of which doubled as a head-office. There was a private 10 Mbps ethernet connection between their two premises.
The ethernet connection was rented from BT and was used for data and telephone communications between the two offices. The company was paying BT approximately £8,000 per annum for the private circuit.
As part of a larger project our remit was to find a supplier who could offer a cheaper private circuit rental.
We soon discovered a supplier who could provide the same 10 Mbps ethernet private circuit for a lower line rental, but we decided to consider alternatives to renting a private circuit that would provide the same service.
In this company’s case their location suggested two alternatives that had significantly lower cost profiles. These were:
- private wireless connection
- baseband private circuit
The private wireless connection was possible because there was a “line-of-sight” between the two buildings. This implied that a radio link between the premises might be possible.
In order to implement the radio link it would have been necessary to supply and install antennae on each building as well as radio transmission equipment. It would also have been necessary to pay for professional services to design the radio link and address any planning issues.
The total initial cost for the radio link would have been about £5,000 with very little ongoing cost. In other words, there would have been a considerable ongoing cost saving.
Although this was a very attractive option, there were insurmountable problems in getting planning permission to install radio antennae on listed buildings in a conservation area.
The other alternative of installing a baseband private circuit was possible because the two offices are in the same BT Exchange area. It was therefore possible to order a baseband private circuit between the two offices.
A baseband private circuit is essentially a pair of wires connecting both premises that is routed via the BT Exchange.
The cost of a baseband private circuit is £648 per annum. This compares favourably with the £8,000 per annum that the customer was currently paying for a 10 Mbps ethernet private circuit!
In order to provide the same service as a 10 Mbps ethernet circuit it was also necessary for the customer to purchase and install baseband ethernet modems at each end of the baseband private circuit.
The total cost of the baseband modems, connection charges and the necessary professional services for implementation was about £5,000.
Therefore for an initial investment of £5,000 the customer is saving £7,352 per annum.
