Defining SLA and examples of its coverage
A service level agreement is a contract between the provider of a service and its internal or external end-user or customer that defines what services the provider will offer and the level of performance it must meet as well as any remedies or penalties should the agreed-upon levels not be achieved.
SLAs act as a safety blanket, and establish customer expectations on a provider’s performance and quality. Most providers set their own standard SLAs reflecting various levels of service. For example, a telecom company’s SLA may promise network availability of 99.99% and allow the customer to reduce their payment by a given percentage if that is not achieved, usually on a sliding scale based on the magnitude of the breach, according to CIO.
“Customers expect an SLA on a number of different fronts,” said David Allen, director of IoT solutions at AT&T. “They expect 99.999% uptime from your network and expect that access, SIM management, port and API are all reliably available.”
According to Palo Alto Networks, some metrics SLAs specify include:
- A description of the service being provided – maintenance of areas such as network connectivity, domain name servers, dynamic host configuration protocol servers.
- Reliability – when the service is available (percentage uptime) and the limits outages can be expected to stay within.
- Responsiveness – the punctuality of services to be performed in response to requests and scheduled service dates.
- Procedure for reporting problems – who can be contacted, how problems will be reported, procedure for escalation and what other steps are taken to resolve the problem.
- Monitoring and reporting service level – who will monitor performance, what data will be collected and how often as well as how much access the customer is given to performance statistics.
- Consequences for not meeting service obligations – may include credit or reimbursement to customers, or enabling the customer to terminate the relationship.
- Escape clauses or constraints – circumstances under which the level of service promised does not apply. An example could be an exemption from meeting uptime requirements in circumstance that floods, fires or other hazardous situations damage the internet service provider’s equipment.
An SLA may specify availability, performance and other parameters for different types of customer infrastructure – internal networks, servers and infrastructure components.
Where SLAs stand in IoT
Service level agreements as quality of service agreements between service providers, customers and third-parties have been a low priority in the machine-to-machine and “internet of things” space partly due to the technical and partnering complexity of many solutions, according to Machina Research.
“It’s a continuum, there is a value proposition that certain enterprises will go with one technology over another,” said Craig Miller, VP of worldwide marketing at Sequans. “I argue it doesn’t matter cost wise, when people need connectivity they need connectivity and it has to be reliable.”
Existing SLA frameworks have been designed and implemented in those domains where immediate control and management by providers has been available. Machina Research identified more applications will need to be supported by fit-for-purpose QoS agreements; the future priority for customers will become one of securing SLAs that address end-to-end requirements of their specific M2M and IoT solutions; and then exploring which technologies may deliver these requirements.
“Depends how tightly you have to dial that in, and security as well – for different required security levels you’ll pay different amounts.” said Allen Proithis, president of Sigfox North America. “Some uses you care a lot about latency being very low, or being able to dial 911 from a panel when something goes wrong, but for something like agriculture you are able to tolerate slower latency and you pay a different price for that.”
