Moving to overhaul what it acknowledged as an inefficient spider
web of a network, Royal Dutch/Shell Group of Companies has detailed
a $250m project to create a hub-and-spoke architecture that will
rely on a reduced number of networking services providers.
Rob van Zwieteren, group infrastructure telecommunications manager
at Netherlands-based Shell Information Technology International,
said the three-year project would tie together Shell operations in
114 countries via a single network infrastructure.
Shell expects to save up to $50m during that period by
consolidating multiple telecommunications services deals under a
master contract with London-based Cable & Wireless, he
said.
Shell's existing network and telecommunications infrastructure "is
fragmented across business units, and one of the key savings areas
is consolidating contracts with fewer suppliers," van Zwieteren
said. Cable & Wireless is to manage the consolidation
process.
The two companies are yet to decide how many services providers
will still be needed. But van Zwieteren said that settling on a
single contract for mobile phone services across Europe was an
example of what Shell had in mind.
The deal with Cable & Wireless - which also includes the
installation of wide-area network equipment (WAN) - is the second
major IT consolidation move by Shell in recent months. In July, it
signed a $100m agreement with IBM for hardware that will be used to
set up three major data centre hubs around the world.
The new networking infrastructure will connect 21 Shell data
centres - all in different countries - over Cable & Wireless's
backbone network, said Alistair Mashford, a consultant at the
networking vendor.
Shell will have access to Asynchronous Transfer Mode (ATM)
technology and frame-relay and IP virtual private network services,
Mashford said. He added that the new WAN will use routers from
Cisco, with Cisco switches controlling network traffic across LANs
tied into the global network.
Cable & Wireless also plans to add carrier equipment from
Alcatel and Nortel to its backbone network as part of the
project.
Van Zwieteren said that Shell would continue to handle network
management operations internally. The network will support systems
running enterprise resource planning applications from SAP and JD
Edwards, plus Windows 2000-based desktop software used by 300,000
workers.
Shell began screening networking vendors early last year and chose
Cable & Wireless over three other finalists, van Zwieteren
said. He would not name the losing competitors.
Lisa Henderson, an analyst at TeleChoice, said users could cut
costs and simplify management of networks by reducing the number of
network services providers they had under contract. But Shell "is
putting a lot of reliance on Cable & Wireless now," she said,
adding that a phased migration plan would be in order "for a
project of this magnitude".