Hughes Makes Multiple Managed Service Moves

Hughes Network Systems, perhaps best known over the years as a provider of broadband satellite networks, has been pushing into the managed services market. Recent moves mark a solidification of this strategy range from government initiatives to managed VoIP services. Here's a closer look at the strategy.

Last week, Hughes debuted its managed services suite for enterprises. The company positions its offering, which delivers converged voice, data, and video applications over broadband networks, as an alternative to leased-line MPLS solutions.

And earlier this month, the company announced the availability of its managed network services through channel partners holding General Services Administration schedule and Networx contracts. The GSA schedule is open to federal, state and local government agencies. GSA’s Networx program, meanwhile, offers a range of networking services. Hughes partners with Qwest Communications, a Networx prime contractor.

While the announcements may look like the company’s first foray into the market, the company has been providing managed services for a while -- long enough to have an impact on the company’s numbers anyway. For the quarter ended September 30, Hughes cited growth in managed services as a factor in the company’s 19.6 percent year-over-year uptick in North American Enterprise services revenue.

The services expansion had a different impact on the North American Enterprise group’s hardware revenue, which declined 24.7 percent. Hughes’ 10-Q filing with the Securities and Exchange Commission states: “The decrease was due to a lower volume of shipments as enterprise customers delayed their buying decisions as well as the changes in the product mix where the emphasis on managed services has led to lower upfront hardware revenue and an increase in recurring service revenue.”

Going forward, Hughes will pursue he enterprise space with its own network optimization technology dubbed ActiveQoS. According to Hughes, that technology provides what the company terms MPLS-like performance over DSL and cable broadband connections.

Hughes said it believes its managed services offering can fit in such segments as  retail, hospitality, restaurant, convenience store, and healthcare. Chevron last summer tapped Hughes as its certified provider of secure managed broadband services for marketer and retailer stations in the U.S.

Hughes listed several potential enterprise applications include VoIP, digital signage, self-serve kiosks and video employee learning centers.

In government, Hughes targets geographically dispersed offices and telecommuting programs.

“Managed services are particularly valuable for small and medium-sized field offices that need to connect to the agency’s cloud or meet mandated requirements for telework,” said Tony Bardo, assistant vice president for government solutions at Hughes, in a statement.

Hughes serves up another well-established brand in the managed services market, alongside the likes of CSC, General Dynamics, HP, IBM.

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