Deal reflects ‘recognition that the enterprise market landscape is changing’, says Verizon Business exec
Verizon is seeking to “re-set and redefine” its managed network services on a global basis, announcing today that it has struck a deal with IT and managed network service provider HCLTech.
The deal, reportedly worth $2.1 billion over six years, keeps Verizon as the lead on sales, customer acquisitions, and planning and development of solutions and brings HCLTech in to take care of post-sale implementations, ongoing support, lifecycle management and monitoring capabilities, according to Scott Lawrence, SVP for the global solutions organization within Verizon Business. He said that the newly announced arrangement “is going to leverage the very best of what Verizon Business brings with our global scale and local presence, with HCLTech’s strength in the broader IT services and technology platforms, to really create that modern, digital and AI-driven network service model for our customers.
“We truly believe that together, we’re going to be ushering in a new era of enterprise managed network services, through the use of contemporary digital platforms like AI, AIops, a broad range of open APIs and enhanced automation, which will create a paradigm shift across the enterprise market segment,” Lawrence said, adding, “This partnership, at its heart, is going to enable Verizon to leapfrog our competition and redefine the enterprise customer experience for our enterprise customers’ most critical network infrastructure and applications workloads.”
“It’s a recognition that the enterprise market landscape is changing and in fact it has changed, as a result of Covid,” Lawrence continued. “The acceleration of digital transformation is really the direct outcome of the massive changes that we’re seeing in consumer expectations on how they want to engage with companies and the brands that they choose to spend their money with. … Companies are wanting to have more real-time observability across their core infrastructure. They want to be able to deliver a unique and differentiated experience for their end users, whether that end user is their employees, their partners or their customers. And they want to work with a partner that can bring those operational efficiencies to bear so that they can gain a competitive advantage in their industry as well.”
He said that Verizon sees the deal as both delivering significant benefits that will “transform our service delivery model” while prioritizing customer experience and gaining commercial scale and growth for both Verizon and HCLTech—and opportunity for Verizon to focus on developing innovation solutions, while HCLTech focuses on the implementation and ongoing support, and also gains some of Verizon’s global customer operations staff.
“This is really coordinated in a go-to-market effort for us to re-set and -re-define that managed network service experience on a global scale, both … the U.S., as well as in every region where Verizon and HCLTech operates,” Lawrence said.
The deal covers service delivery and operations for wireline managed network services, project management and network-as-a-service offerings such as SD-WAN and SASE, unified communications and security as well, Lawrence said. It does not include Verizon’s public sector segment (federal, state, local and education) or wireless services. Support will begin to transition in phases, as early as the fourth quarter of this year, Lawrence said. SLAs will still be between Verizon and its customers.
“Over the last few years, we have been looking at steps we need to take internally to elevate and modernize our existing managed network services platforms and tools to deliver a differentiated experience to our customers,” Lawrence explained. As the tech adoption and transformation accelerated during the pandemic, he said, it became clear to Verizon that it needed to be able to offer more advanced features including AI and automation for enterprise customers. The company had to decide whether to build and deploy its own solutions, or to partner with someone like HCLTech—which, he noted, is a Gartner Magic Quadrant leader in MNS.
“HCLTech is a widely recognized industry leader for Managed Network Services, and
with their IT service expertise and ongoing support of our enterprise networking
deployments, Verizon Business can modernize our service delivery and simultaneously
heighten our focus on helping customers incorporate next-generation technology like
5G, SD-WAN and SASE into their operations and their own customer offerings,” said
Kyle Malady, CEO of Verizon Business. “IT/OT convergence is the future of data-centric
business operations, and with the fast-accelerating pace of digitalization, customers
need a well-coordinated delivery framework to realize that future.”
