Bandwidth ROI White Paper

8/3/2019 Bandwidth ROI White Paper

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Discovery estimates that it has seen a 700 to 800 percent improvement in file transfer rate over 1Gb/s link since implementing Signiant.

through put [throo poot] noun

In communication networks, such as Ethernet or packet radio, throughput is the average rateof successful message delivery over a communication channel.

band width ef fi cien cy [band width i fish uhn see] noun

The bandwidth efficiency , in percentage is the achieved throughput related to the net bit ratein bit/s of a digital communication channel. For example, if the throughput is 70 Mb/s in a 100Mb/s Ethernet connection, the bandwidth efficiency is 70%.

dis ap point ed [dis uh poin tid] adjective

When companies try to move digital media over their WAN, in many cases the bandwidthefficiency and throughput results disappoint . Due to current network protocol limitations,

bandwidth efficiency may only be 5 10% and when you need to move large files over longdistances and business needs may not be met. This can have real economic impact in termsof:

Overpaying for Bandwidth Lost Productivity Delays in Delivering Content


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WAN Acceleration software when deployed can achieve almost 100% of the theoreticalnetwork throughput, has immediate ROI and can help meet your organizations business needs,resulting in the reduction in your monthly bandwidth expenses, increased productivity and amore responsive organization.

The Limitations of TCP and the Impact on the Bandwidth Efficiency

Most applications transmit data using Transport Control Protocol (TCP) over the WAN. FTP isone example of an application that uses TCP; others include web browsing, email, iTunes andCRM are others. In each case performance and throughput are affected by:

The capacity of the network link such as 155Mb/s The congestion on that link the number of people or applications sharing the link The distance the data needs to travel as measured as latency and round trip time the

time it takes for data to travel over the network and then acknowledge the receipt of that data.

Much has been written about how these factors affect the overall performance of a network.In short, when data needs to travel over long distances, in a network with average congestion the overall throughput of the network can be reduced significantly. In general the longer thedistance and the greater the capacity the more bandwidth efficiency will be impacted. It is notuncommon for the actual throughput to be 50%, 25% or even 5% of theoretical. Thisinefficiency has real cost to your organization. The graph below depicts the performanceresults of TCP based on latency (as measured as distance):


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The Cost of Bandwidth

One of the largest components of any monthly IT budget is the cost for network connectivity either internet access or a private WAN. The bandwidth cost varies depending on the type of network, the speed and your time commitment. Also these prices vary around the world basedon the service provider and country providing them. The table below highlights the averagecost for internet bandwidth in the United States (for the purpose of this paper these will bethe costs used).

Network Capacity Cost / Month Cost / Mb/s

1.5Mb/s (T1) $ 300 $200

10Mb/s $ 1,500 $150

45Mb/s (DS3) $ 5,000 $111

100Mb/s $ 7,500 $75155Mb/s (OC3) $ 10,000 $65

1Gb/s $ 25,000 $25


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Measuring the Cost of Lost Bandwidth

When purchasing network capacity, many people take the Cost / Month and divide that by thetheoretical Network Capacity to get the Price / Capacity. If a 155Mb/s OC3 connection iscosting you $10,000 per month the expectation is that you are paying $65 per Mb/s per

month. You also assume that for that same $10,000 per month you will be able to transmitnearly 52TB of data. So if your average digital media file size is 5GB, the assumption is that youcan move 10,000 files or about $1 per file.

Now if you are only getting 50%, 25% or 5% throughput your assumptions are dramaticallyaffected as demonstrated by the table below:

Efficiency NetworkCapacity(Mb/s)

Cost/Mb/s Total MonthlyThroughput (TB)

Cost per 5GBFile

100% (theoretical) 155 $65 52 $1

50% 75 $130 26 $2

25% 38.75 $260 13.5 $4

10% 15.5 $650 5.2 $10

As you can see as bandwidth efficiency drops, your throughput drops and your costs fornetwork capacity and to move a file rises proportionally. The marginal cost to move a 5GB filefrom Los Angeles to Seattle would only be $1 if you could achieve the theoretical maximumcapacity of the network. However with 50 ms of latency, the efficiency drops to 10% and yourcost rises to $10 for that file. While, $10 is a dramatic improvement over the $200 it wouldtake to ship that file as a video tape you are still paying 10X as much to ship that file and yourmonthly bandwidth costs are as much as 10X what they could be.

Optimizing the WAN (to overcome TCP Limitations)

There are a number of methods to increase the efficiency and throughput of your networkincluding data reduction and latency compensation.

Data reduction minimizes the amount of data the needs to be sent over the network. While thethroughput of the network remains the same, it does improve the response time and effectivethroughput by achieve the desired results. Some types of data reduction include:


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Compression by compressing the data set, you send less data through the pipe. Thedata is compressed on one end of the transmission and decompressed on the receivingend. The data that transverses the network is only a fraction of the original data.

Caching by accessing a locally stored copy of a file, that data does not have to

transverse over the network Incremental Changes only sends the changes made to a file thus only a subset of the

file is sent over the networks.

In each of these cases the actual throughput is not increased and if a file is alreadycompressed and has never been transmitted over that network segment, the data reductionmethods are going to have no impact on your network throughput.

WAN acceleration techniques address the limitations of TCP by reducing the effects of Latencyand Congestion enabling the throughput of a network link to approach its theoretical capacity.

When your network throughput approaches 100% efficiency, the amount of data it can carrygoes up dramatically and the costs to move files come down at the same rate.

Measuring ROI

When calculating ROI, the Payback Period the time to get your money back based on theinitial investment is a very quick rule of thumb method. This is done by taking the initialInvestment and dividing that number by the monthly savings. This method is outlined below:

Investment Add all costs to implement a Content Distribution solution

Software Hardware Implementation

Marginal Cost Savings Cost of Bandwidth Recovered Per Location Number of Locations (per location) Add the Bandwidth Recovered Cost for Each Location = Marginal Cost Savings

Payback Period Divide Investment by the Marginal Cost Savings to get the Payback Period

Case Study: International Syndication of Content More Efficiency

A Los Angeles based content provider want to syndicate their content to 5 major internationalmarkets. Once the content has been moved to those international landing pads the content istransformed (trancode, language dubbing and subtitling) for local consumption.


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The current network connectivity is DS3 45 Mb/s and due to the distances, average throughputis only 2Mb/s. The throughput is only about 5% of the theoretical capacity and files are takingan extremely long time to move over the network. For example, the daily programmingpackage is about 100GB and would take over 100 hours to transmit to each of the internationallanding pad. A 5 day delay to get daily programming distributed internationally will not meetthe business needs of the company.

LinkBandwidth

(Mb/s) Latency (ms)

BandwidthThroughput

(Mb/s)With Signiant

(Mb/s)LAPrimary 250 Ave. 225 10 237

London 45 200 2.5 42.75Berlin 45 220 2 42.75

Sydney 45 250 1.8 42.75Melbourne 45 250 1.8 42.75Singapore 45 250 1.8 42.75

Using Signiant, each of the network segments is able to achieve 95% throughput or 42.75 Mb/s.The file package that was taking 5 days to transport can now be moved in just 5 hours. Enabling


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the ability to deliver a complete days worth of programming internationally within 5 hoursopens up those markets by allowing the content provider to get their programs to air quicklywhile the content is still fresh.

Fixed Investment:

Investment: ContentDistribution Management Cost

Hardware $20,000Software / Maintenance $144,000

Implementation $50,000Total Fixed Investment $214,000

Marginal Cost Savings:

Link Bandwidth Throughput (Mb/s)Wasted Bandwidth

Cost / Month

Los Angeles 10 $14,367

London 2.5 $4,708

Berlin 2 $4,766

Sydney 1.8 $4,789

Melbourne 1.8 $4,789

Singapore 1.8 $4,789

Total Monthly Marginal Cost Savings $38,209

Payback Period and Cash Flow:

Payback Period CostFixed Investment $214,000

Marginal Cost Savings (Monthly) $38,209Payback Period 5.6


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Case Study: International Syndication of Content Reduce Monthly Bandwidth Expense

In addition to capturing the efficiency value getting more out of what you spend in theprevious there is an option to spend less per month on your bandwidth expenses. In thiscase:

The primary link is reduced from 250 Mb/s to each of the DS3 45 Mb/s Each of the remote links are reduced from DS 45 Mb/s to 10 Mb/s The results are that there is a $330,000 annual reduction in cash flow while

increasing your network throughput by 500% The Payback period is just 5.7 Mons on this project


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Payback Period Cost

Fixed Investment $214,000Marginal Cost Savings

(Monthly) $37,404Payback Period 5.7

Case Study: WAN Collaborative Production

A bicoastal company with major facilities in California and New York collaborate on theproduction of content. The content is aired on their cable channel as well as syndicated tomany outlets. They are doing production in HD and are under tight deadlines as the value of content is time sensitive. The main content archive is in New York and production is done inboth locations. Finished content is typically distributed through the New York facility.

Link

Bandwidth

(Mb/s)

BandwidthThroughput

(Mb/s)

BandwidthCost /

Month

NewService

withSigniant

(Mb/s)

NewService

withSigniant

(Mb/s)2

Additional

BW (Mb/s)

ImprovedBW

(%)

Improved BW

ValueLAPrimary 250 10 $15,000 45 $5,000 35 450% $3,889

London 45 2.5 $5,000 10 $1,500 7.5 400% $1,125

Berlin 45 2 $5,000 10 $1,500 8 500% $1,200

Sydney 45 1.8 $5,000 10 $1,500 8.2 556% $1,230

Melbourne 45 1.8 $5,000 10 $1,500 8.2 556% $1,230

Singapore 45 1.8 $5,000 10 $1,500 8.2 556% $1,230Current

Bandwidth

Cost

$40,000New BW

Cost

$12,500Perf

Improve

500% $9,904

MonthlyBandwidth Savings

$27,500Total

IncrementalValue

$37,404

Annual $330,000


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The network connectivity is an OC12 622 Mb/s and due to the distances, average throughput isonly about 45 Mb/s. The throughput is only about 7% of the theoretical capacity andcollaborative production is not possible when HD content from the archive needs to beaccessed by multiple producers simultaneously in Los Angeles as well as sending finishedcontent to New York for approval, playout and distribution.

One example is a 90 minute HD program needs to air at 7:30pm in the Eastern time zone.Production cannot be completed until 3pm and needs to be transmitted back to New York forapproval and then transmission to the playout center. If the entire available 45 Mb/s link isconsumed, without any issues, it would take over 2 hours for content to be transmitted fromLos Angeles to New York. This would not able the content to be reviewed, approved and thenre transmitted to the playout center.

LinkBandwidth

(Mb/s) Latency (ms)

BandwidthThroughput

(Mb/s)With Signiant

(Mb/s)LA 622 90 45 578

New York 622 90 45 578

Using Signiant, the throughout is 578 Mb/s or 93% bandwidth efficiency. This enables contentto be send faster than real time the same file that was taking over 2 hours are now takingless than 25 minutes to send allowing them to easily meet them deadlines. This also allowsother departments and projects to use the network simultaneously.


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Fixed Investment:

Investment: Content Distribution Management CostHardware $15,000

Software / Maintenance $60,000

Implementation $12,000Total Fixed Investment $87,000

Marginal Cost Savings:

Link Bandwidth Throughput (Mb/s)"Wasted Bandwidth Cost

/ MonthLos Angeles 45 $18,553New York 45 $18,553

Total Monthly Marginal CostSavings $37,106

Payback Period and Cash Flow

Payback Period CostFixed Investment $87,000Marginal Cost Savings (Monthly) $37,106Payback Period 2.3


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Documents

Bandwidth ROI White Paper