Magazine Article | July 31, 2006

Contemplating A Network Upgrade?

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Performance, security, and dependable connectivity are a few benefits you could gain with a network upgrade.

Integrated Solutions For Retailers, August 2006

Technology – specifically, network technology – is constantly evolving. Like computer processors, networks become faster as technology improves. Networking companies continually increase their bandwidth offerings, thus providing the ability to send more data “through the pipe.” What can this increased bandwidth do for you?

Are you experiencing problems communicating between your stores and your corporate offices? If so, could this be improved if data were transferred faster between store locations? Does credit card verification at the POS take too long? Do you experience network outages during storms? If so, you could benefit from a network upgrade. Before undertaking an upgrade, consider the following points.

Prioritize Your Application Data
A retailer should prioritize the importance of business applications. For example, are your POS and CRM (customer relationship management) systems mission critical because they are necessary to complete sales transactions and apply discounts? Once you’ve prioritized the value of data in business applications, it’s easier for network providers to control the data flowing through the network. The order should be based on both the application that is generating the prioritized data and the one that’s fed the data (e.g. a back end accounting system that is fed mission-critical POS data). “We prioritize applications based on the retailer’s area of primary concern, then process data via that priority,” says Dan Foster, senior VP of sales and marketing at MegaPath. “Most retailers are concerned with their payment transactions first, so we map for network congestion and place the packets of transmission for MasterCard [or other card processors] first, so they go through before anything else.”

The prioritization of application traffic can also be used in the event of a network outage. For example, most network providers have backup services built into their networks via redundant services. These services provide an automatic backup when an outage occurs, similar to a digital cell phone automatically switching to an analog connection if the digital service becomes unavailable. In some cases, this could appear seamless to you. Most network suppliers provide older, slower technology as the backup service, such as dial-up (sometimes paid for only on an as-needed basis). In the case of decreased bandwidth (i.e. the dial-up service) during a network outage, the priority applications remain running, while noncritical applications are unable to send or receive data.

Increase Network Performance For Remote Stores
Most national retailers have stores and field offices that span a large geographic area, which creates communications challenges. Several networking companies provide solutions for all location types, even rural areas or those in historical buildings with upgrade limitations. For instance, some historical buildings forbid tenants from installing high-capacity wiring. “We have the ability to connect employees from any location using Wi-Fi [which refers to any 802.11 network],” says Piero DePaoli, director of fixed broadband services at iPass. “We take all store locations and find Internet access for them [through 160 partners in North America], then install DSL, cable, or T1 access in all stores, employees’ homes, and on wireless PDAs/phones. It’s very easy, from an IT perspective, to upgrade because we handle the coordination at all locations. We also proactively monitor the performance of the network.”

When upgrading through a network aggregator (a company that combines carriers to make one cohesive network for your communication needs), you have the benefit of interacting with only one party, while receiving service from several carriers. A company managing the networking service also ensures a greater level of security for retailers of all sizes. The network aggregator keeps current with all security threats and automatically sends software patches to your PCs through the network. Additionally, the aggregator monitors the performance of the network and usually resolves problems prior to you knowing they existed.

Secure Your Payment Transactions
Security is a huge concern for many retailers – specifically, the security of payment data being passed through networks. The risk of customer credit card data theft is vast, but some providers are now PCI (payment card industry)-compliant, which adds security. One option to alleviate security concerns is to participate with a networking company that provides a private VPN (virtual private network). “We can provide retailers with a private broadband network, in some cases for half the price that they are currently paying, and they’ll receive three times the bandwidth,” says Greg Griffiths, VP of marketing at New Edge Networks. “We have an exchange with the payment processors most commonly used by retailers. We have direct connections to these companies, so transactions go directly from the stores to the processors [e.g. payment processing companies] without ever sending data through the Internet. We have agreements with payment processing companies that handle 70% of the payments being processed in the industry.” Companies such as New Edge Networks also provide redundant access through multiple data centers as a backup to the initial connection.

High-Speed Networks Enable RFID Data Transfers
As retailers benefit from the increased speed of data transmission (e.g. POS data transmitting immediately to corporate systems), they later find innovative ways to increase efficiency. “Once the network has been upgraded, retailers often request the use of network bandwidth for additional functions, such as loss prevention surveillance, digital signage solutions, remote kiosks, interactive real-time training between stores and headquarters, and remote access to data by district managers who are working from home or traveling,” says Foster. However, providing access via the Web for various applications can increase the exposure to viruses. Consequently, some retailers restrict access to the Internet through Web filtering. This limits employees’ access to certain sites (e.g. the company Web sites only), reducing the retailer’s exposure. Web filtering also prevents employees from spending time surfing the Internet.

Networks also transmit data gathered from wireless bar code scanners or RFID (radio frequency identification) readers. When bandwidth is lacking, RFID data transmission may require upgrades to the network. “Scanning bar codes generates periodic transactions that are transmitted over the network. RFID systems, using something called simultaneous identification, can generate more data in a shorter period than bar codes, and this needs to be managed prior to introducing the technology to an existing business application,” states Rick Olivieri, vertical marketing manager at 3Com Corporation. “Some RFID systems have read/write capabilities; this means that the host systems can send and receive data from tags, forcing two-way communications between printers and readers. Retailers that upgrade their networks to accommodate new technologies like RFID should make sure their service providers offer the ability to implement Quality of Service (QoS). QoS enables retailers to prioritize network traffic by type.” When concentrated amounts of data are generated during shorter periods, the network must withstand that increased transmission. Increasing bandwidth can ensure the data will not slow other applications when RFID readers transmit data.

Whether you are implementing an RFID solution or seeking faster data transmission between stores and corporate offices, network upgrades can increase efficiencies. Remember to prioritize applications and work with your network provider to realize the greatest benefits from your investment. Likewise, you should evaluate how beneficial bandwidth will be for you within the next year, or determine if you should extend the life of your existing infrastructure for a year or more before upgrading.

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