A lot of people tend to wax poetic about SD-WAN these days, but Windstream CEO Tony Thomas took it to a new level at an investor conference yesterday. A few years ago, Windstream differentiated itself through a superior customer experience but today’s differentiators also include “a disruptor technology,” said Thomas of Windstream SD-WAN service.

Windstream SD-WAN technology came to the company through its acquisition of Earthlink, which had developed an excellent customer portal that differentiates the offering, Thomas said.  Launched more broadly in January, the offering now represents 20% of Windstream’s gross sales to enterprises.

In his 20-year career in telecom, Thomas said, “It’s the most successful launch I’ve ever been a part of.”

Windstream UCaaS and SD-WAN Opportunity
SD-WAN (software defined wide area network) technology gives enterprises the ability to dynamically shift traffic across multiple wide area network connections (typically MPLS and a direct internet connection) based on parameters such as the level of latency an application can accept and on shifting network conditions. The goal is to minimize costs while also enhancing application performance.

In addition to benefiting customers, Thomas sees SD-WAN as a potential solution to a problem that has plagued Windstream since it embarked years ago on a strategy emphasizing the business market. Because the company doesn’t have a nationwide network, it relies heavily on reselling other operators’ networks – an increasingly low-margin approach to the telecom business. But those margins are not as narrow on the internet service that typically underlies SD-WAN as they are on the switched Ethernet services that Windstream traditionally would have sold to customers who are now buying SD-WAN, Thomas said.

Windstream even sells SD-WAN to some higher-bandwidth customers to whom the carrier in the past would have deployed fiber, Thomas noted.

Thomas was almost as enthusiastic about another technology that Windstream acquired through acquisition – the unified communications as a service (UCaaS) offering that came with Broadview.  The acquisition gives Windstream “owner’s economics” for another offering that has gained substantial traction in the enterprise market, Thomas said.

SD-WAN and UCaaS are similar in that both offerings can be delivered “over the top” on any operator’s network connection, noted Thomas.  As such, they have caused Windstream to rethink how it approaches the small and medium-size business (SMB) market in areas where the company operates as a competitive local exchange carrier (CLEC).

In those markets, Windstream “was in the telecom resale business,” Thomas said. But now the company offers a “virtualized network solution.” Customers can bring their own broadband if they like — and where Windstream does sell connectivity, it’s to support UCaaS or SD-WAN.

Windstream also has been getting a lot of SMB wins in its own ILEC territory because of the UCaaS and SD-WAN offerings, Thomas noted.

Thomas made his comments at the Goldman Sachs Communacopia Conference, which was also webcast.

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