Want To Expand Overseas? Take A Fast PoP To ChinaWant To Expand Overseas? Take A Fast PoP To China

AND I PAY WHAT FOR ALL THIS?
With a few exceptions, carriers price services based on both a nonrecurring charge (NRC) and a monthly recurring charge (MRC). Again, Sprint is the exception, providing only an MRC. The NRC accounts for the installation costs of locating each new port at the customer premises. The MRC is based on the size of the port. Verizon and NTT also charge for class of service.

As mentioned, wildly variable regulatory practices mean MRCs will vary considerably between countries. Differences in service classes also significantly affect prices. We requested VoIP service, which requires the top service class from providers. Verizon's charge will vary from $150 within the United States to $1,000 in India and China. NTT was the only provider to say that regulatory regimes within India and China may present a problem for VoIP, if it means toll bypass. Then there are the differences between nonmanaged services, where the customer provides and manages equipment, and managed offerings. We requested a managed setup, but even within that category there are variations. Verizon offers three management options based on capabilities, number of devices to be managed, and device size. Prices range from $70 to $155 for fewer than 99 "small" devices--such as a Cisco 1000 series router--depending on management level.

Service providers pack different extras into the bill; term commitment is one example. NTT based its quote on a three-year term, while Sprint assumed a two-year contract. Verizon specified one year. NTT was also the only provider to include estimated access line charges in its quote. For the others, expect a big charge on top of what had been discussed.

Taxes are another issue. Buyers can reduce this load by checking the way their bills are structured. Local loops are taxable, but not class of service and router management. Service providers should at the very least separate these line items, and some will shift pricing toward nontaxed items to reduce the burden on a given deal. Garson says he's seen such measures cut taxes by half. IT also needs to check whether bid options include the ability to change bandwidth and class of service. NTT charged us separately for many of these items, while Verizon included them in the bid. Sprint didn't specify which options were included.

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