Provisioning on the fly lures customers to Yipes
SAN FRANCISCO-- Metro Ethernet service provider Yipes Communications has been luring enterprise customers in its initial 20 markets with promises of transparently extending their LANs over metropolitan areas.
But the fast-growing start-up is also going after service providers by playing up its remarkably quick provisioning skills. That's attracting application service providers (ASP), e-commerce integrators and ISPs that live in fear of being caught short of capacity due to a sudden surge in demand.
The ability to add bandwidth within a matter of hours was one of the hooks that led ASP eonBusiness of Englewood, Colo., to choose Yipes out of a group of 10 providers for a recent contract for broadband regional connections to customers and the Internet.
EonBusiness needed 10M bit/sec capacity to connect three local buildings into a larger area ring called the Denver Tech Center loop. The company provides Web site design, hosted e-commerce applications and database integration to dot-coms and traditional companies such as Western Union and Corporate Express. But to keep up with demand for transport, eonBusiness got caught in a cycle of endless requests for additional T-1 lines that typically required a 60- to 90-day wait, CEO Dave Carlson says.
Carlson went to Yipes when a jump to T-3 seemed the only option left. Yipes, which offers 1M to 1G bit/sec of native Ethernet connectivity in 1M bit/sec increments, began by giving eonBusiness a 10M bit/sec link. Then, when one of Carlson's clients embarked on a major direct-mail ad campaign, he asked for an additional 2M bit/sec capacity. "They promise it within 24 hours, but as a practical matter you get it in a few hours," Carlson says.
Because the connection is entirely on Yipes' network, latency is reduced to a bare minimum. Yipes guarantees no more than 5 to 10 milliseconds on the metro network. EonBusiness has customers outside the Denver area who must obtain their own local service-provider connections, but even then, "their pages are totally loading in 1 to 3 seconds," Carlson says.
Even at that, eonBusiness is thinking of taking advantage of the fact that Yipes connects into collocation centers around the country operated by Level 3 and Qwest, and third-party "neutral" collocation companies such as Equinix and colo.com. That's a major factor in eonBusiness' possible expansion plans to its own data centers in New York and California, Carlson says.
Like other new metro Ethernet players, Yipes is limited in its potential service-provider and enterprise customer base to those it can reach by fiber, because products for copper-based 10M bit/sec Ethernet wide-area connections -- over such technologies as very high bit-rate DSL -- are just emerging. But Yipes has no plans to expand its addressable market by renting copper loops from Bell companies and diluting its straight Ethernet message.
Those opportunities include many other types of service providers. For example, Yipes co-founder Ron Young says emerging wireless ISPs can locate their base stations on the Yipes network and obtain cheaper backhaul trunks than they would leasing T-1s and T-3s from ttraditional carriers.
Yipes officials are so confident of their bandwidth-on-demand capabilities that Young says they frequently offer to increase customers' bandwidth free for two weeks and then let them decide whether they want to keep it. Company statistics indicate that dangling more capacity in front of customers is a good bet for Yipes. In March the average Yipes customer was taking 4.9M bit/sec of bandwidth. In October it was 25M bit/sec of bandwidth.