Buying the network or paying for it monthly: what changes with a managed service

Every few years the same conversation reaches management: the switches no longer get updates, the firewall needs its license renewed and someone has to justify a large investment in something that, from the outside, "was already working". It gets approved, bought and installed… and for a few years nobody looks at the network again until something fails.

There is another way to have a network: paying for it as a monthly service, which we call Network as a Service (NaaS). A provider designs, implements, operates and refreshes it, with service levels written into a contract. It is not the best option for every company. Here we explain what changes, what does not and how to tell which model suits you.

What usually happens with a purchased network

Buying is not a mistake. The problem starts when the purchase is the only decision and nobody is left in charge of what comes next. These are the situations we see most often:

CapEx and OpEx, simply put

Finance distinguishes two kinds of spending. CapEx (capital expenditure) is investment in assets: you buy the equipment, it becomes company property and it depreciates over its useful life. OpEx (operating expenditure) is what you pay to keep running: rent, utilities or, in this case, a monthly fee for a network someone else operates.

The difference is not just an accounting one. It changes the shape of spending over time and, above all, who carries the risk: equipment that fails, licenses that expire and technology that ages.

Look at the middle zone. When the equipment reaches end of support and the refresh has not been approved, the network keeps working, but without security updates. It is the riskiest period and it often goes unnoticed, because from the outside everything looks normal.

One important caveat: the accounting and tax treatment of each model depends on your company and on how the contract is written. Review it with your accounting team before deciding.

An example to put it in numbers

Picture a company with a head office and two branches: switches, a firewall and WiFi access points. Assume, purely as an example, that the manufacturer supports the equipment for five years and that firewall and management licenses are paid once a year. Over a 10-year horizon, the payment calendar looks like this:

A useful way to read the example: if the equipment lasts five years, every year you should set aside a fifth of the cost of the next refresh. If that reserve does not exist, the refresh arrives as a cash problem, and that is when equipment is left waiting.

What the example does not say is which model costs less. A monthly fee includes things the price of the equipment does not: monitoring, support, updates and the time of people who know your network. To compare seriously, add up everything it costs today to operate the network, not just what it costs to buy it.

Who takes care of what

The key question is not "who owns the equipment?" but "who responds when something happens?".

One row does not change: deciding what the business needs is still up to you. What changes is that you make those decisions with information, without operating the network or depending on a single person who knows it.

Buying or contracting: an honest comparison

Buying usually makes sense if…

The service usually makes sense if…

How we move your network to a service model

1. 1

   Assessment and survey

   We review the network you have: equipment, licenses, end-of-support dates, links and documentation.

2. 2

   Design and service scope

   We define what stays, what gets replaced and what the service includes. We are vendor agnostic: we choose the equipment for the project and integrate it with what is already installed.

3. 3

   Service level agreement

   We put in writing the committed availability, response times and support channels, based on how critical your operation is.

4. 4

   Phased implementation

   We bring the network up to standard or replace equipment site by site or area by area, coordinated with your operation so it does not stop.

5. 5

   Monitored operation

   When we operate your network as a service, we integrate it into our management system, from where we monitor it.

6. 6

   Support and a planned refresh

   We handle incidents according to the SLA, deliver dashboards with the status of the network and service compliance, and plan the refresh before the equipment runs out of support.

If your network needs a redesign before moving to a service, such as segmenting networks, improving WiFi or connecting sites, we handle it through our connectivity and networks service.

Reviews based on data, not assumptions

In service reviews we go over each site's availability, the incidents of the period and what is worth changing, together with you. If the network needs to grow, we discuss it there, with information, before it turns into an emergency.

Further reading

• What a managed service with an SLA includes: monitoring, response times, reporting and what 99.9% availability means.
• Availability & SLA calculator (AISCNET Learning): work out the availability of a system and how much downtime per year each level allows.
• A well-segmented network: operations, guests, cameras and IoT, each on its own network.
• From a tangled rack to a telecom room that makes sense: the order and documentation that make it possible to operate a network.

Tell us what you need through our contact form or learn more about our managed services. The initial assessment is free.