When Manulife's chief executive Donald Guloien addressed investors recently, he had two messages: The institution was cutting its dividend in half to build "fortress levels" of capital, and was looking for ways to fund future acquisitions.
Shoring up the balance sheet and absorbing new institutions while quickly deploying new communications technology across the enterprise requires a more manageable network infrastructure - the institution was working with about dozen carriers globally. So Manulife, the largest insurance company in North America and parent company to John Hancock Insurance, signed a five-year deal with Verizon Business to consolidate and standardize the $380 billion institution's networks, creating a single IP-based infrastructure connecting its regional networks in 15 countries and territories, giving more than 20,000 employees access to streamlined communications and a platform for further innovation.
"They found themselves looking at the underlying network and realized that to get to the next step that had to have a secure new network that's tied to regional locations around the world," says Michael Holland, a vp responsible for Verizon's world accounts program and Canadian and Latin American business units.
Verizon Business - which manages a portfolio of 260,000 security network and hosting devices across about 4,200 customer networks spanning more than 140 countries - will deploy a fully managed scalable international wide-area network to connect and unify Manulife's regional networks in the U.S., Canada and Asia/Pacific.
"Banks will take the budget they have and spend more wisely, and that means taking on a partner," says Chris Silva, a senior analyst at Forrester Research, who says that two of the top three IT priorities for institutions are data consolidation and centralizing tasks, trumped only by overall cost cutting. Silva also says WAN optimization provides myriad efficiency-related benefits, such as prioritization of traffic, allowing the network to run faster.
Holland says the relationship will help Manulife accelerate network standardization, aiding in the deployment of Web conferencing, video conferencing and VOIP. The telecom will enable continuity though an investment in an optical mesh network that includes multiple communications routes between different parts of the world - if one route is cut, an optical switch moves communications to another route within milliseconds.
Verizon's business unit also has teams in global locations that Manulife can leverage in future acquisitions. Holland did not reveal specific fees or savings, but claims having fewer partners can lower costs.
Verizon's rivals are also beefing up for financial M&A transitions and advanced network communications. Sprint, which has helped manage about a dozen financial mergers in the past year, offers MiFi, or a mobile wireless router that delivers 3G data network access within a small area. Each device acts as a router and allows quick connections to up to five users.
"You don't have to get a new DSL line," says Claude Mays, industry solutions manger for finance for Sprint, whose pitch to institutions to consolidate networks includes remote access for mobile employees, video conferencing, and the global integration of voice, data, wireless, video call center and data operations.
AT&T offers cloud computing and an expansion of synaptic storage - or a virtualized on-demand storehouse - as part of its global services, selling the ability to plug-and-play quickly when there's a change in business location, or the opening or turnover of offices. "An industry like banking does a tremendous amount of site moves and acquisitions needs to be able to execute these changes," says Nancy Brown, a regional vp of sales.