26. 110 Management Overview: The following section provides a complete overview of the communications deployed at Austin Powder Company. This is intended for management personnel to gain a sense of the overall products in use and the associated costs. 22
27. Local Services- 23 110 Currently DCT Telecom provides the main Local PRI to Austin Powder Company headquarters for Local Service in Cleveland Ohio. There is also one Local PRI in Midland Texas with AT&T, as well a newly installed Local PRI at the Red Diamond facility in McArthur Ohio via Time Warner Business Class. This newly installed Time Warner PRI at Red Diamond has not yet billed prior to delivery of this report. In addition to those three Local PRI’s; AT&T, Frontier and Verizon are the three main carriers who provide the lion’s share of local lines to Austin’s major sites, along with many ancillary carriers to augment Austin Powder Company’s more rural locations across the US and Canada. The following table depicts the monthly costs for current local services:
47. Local Services- Continued 43 120 Notables Items on Local Service- Cramming and Wire Maintenance fees are below. The following table outlines these charges previously approved per Austin to be removed:
53. TELUS account# (212194477 1) in Calgary bills $12.00 per on all 9 lines on this account in order to publish them in the phone directory- totaling $108.00per month
54.
55.
56. Line 770-304-0883, which bills on AT&T account# (770-304-0808 (243 0623)) at the Madras site in Newnan, GA rings into “AMS Locksmith Co.” dispatch center. Monthly cost for this line is $67.33
57. Foothills Telephone account# (MAGBUS-154091) at the Manton site in Martin, KY contains two lines only. Both of those lines ring into other businesses. Line 606-884-5166 actually rings into “Frazier Creek Mining”, while 606-884-5167 rings into “Appalachian Security”. Monthly cost for these two lines combined totals $38.80Geostar Rec R9: Remove if no affiliation
58.
59. During Test Call phase it was learned that three lines (956-831-2313, 7760, and 7792) at Austin Star Detonator at the Brownsville, TX site are charged for a feature called “Local Plus/ aka Extended Local Calling Area”. This feature essentially makes in state calls Local. Monthly cost per line is $140.00. Total for all three lines combined carrying this feature is $420.00Geostar Rec R12: Remove
72. 276-328-2697 & 5645 = $83.52*This equals a combined total of $174.76per month on busied lines* Geostar Rec R19: Remove **We were unable to acquire the local invoices for the site in Marshall, TX as well as the site in Sudbury, ON. Multiple voicemail messages were left, as well as reaching out to Austin Powders billing team. ** ** Geostar Consulting was provided a list of all Austin Powder locations. When scouring through the billing, it was determined that there are two local invoices for two separate sites in Massachusetts that Austin pays for monthly. They are as follows: Account #: 978-744-6666 (145 007 7) in Salem, MA at $27.92 Account #: 978-448-3721 (860 007 6) in Shirley, MA at $23.12
73.
74. 56 Local Services- Continued 126 Notables Items on Local Service Continued- Total possible monthly savings under this Local section could be as high as $5,377.54
75. Long Distance Services- 57 127 DCT Communications is the main Long Distance Provider for Austin Powder Company. It does so over 2 Long Distance T1’s at Corporate Headquarters in Cleveland Ohio. Currently there is a MAC (Minimum Annual Commitment) associated with this LD account in the amount of $72,000.00. There is also some old AT&T Long Distance and WATTs service from what appears to be old carry over, prior to the LD switch to DCT Communications. In addition, there are also stray Long Distance bills included here from multiple carriers. This can occur when new lines are added and not properly PIC’d to the corporate LD carrier, or this can also happen when switching to a new carrier when some lines are inadvertently omitted during the mass conversion.
77. Long Distance Services- Continued 59 127-128 The Minimum Annual Commitment is of great concern, as it is far too high given the current usage. In addition, Geostar projects that usage will actually decrease due to changes in information transfer and technologies. Geostar bid this sector to Qwest, Fidelity, and AireSpring as they are each low cost providers of quality long distance services. The table on the following slide breaks down their associated costs for comparison:
79. Long Distance Services- Continued 61 128 Notables Items on Long Distance Service Continued- Here, the monthly savings provided by AireSpring is not only 15%, but it also is quite flexible and competitive when considering there are no minimums required. The DCT approach is outdated and when Geostar posed the question to have it lowered to zero, DCT declined to entertain such a request. Additionally, Airespring's switched traffic rate is $.0421 for outbound intrastate and .0578 inbound intrastate. This would save Austin and additional $768.00 per month if transferred. Geostar Rec R21: Move services to Airespring to lower costs and have no liability
82. 740-286-2105Geostar Rec R22: This service is in the process of being removed per Austin in a previous recommendation – These three lines appear under the Red Diamond Plant location on as a separate bill (Account: 614 100-0016 670) for this product. During Geostar’s research, AT&T was asked to provide usage statistics on these 3 lines under the watts product. AT&T found no such usage for the last 1 year period and noted that not many in the organization even know that this still existed and how it works. It is merely a legacy billing that should have ceased years ago. Austin is billed a monthly charge of $2,901.84 for these unused services. Geostar requested a credit for these services since AT&T reported no shown usage for over 1 year. However, even though there has been no usage, AT&T denied the credit request stating that they cannot know what Austin has been using them for and there was no previous formal request to cease operations.
83.
84. DCT only charges a flat rate of $5 per month for unlimited toll free’s on the account.
92. Eliminate fees and reduce rates below .05 on proper carrier to save approximately $723.89 monthly.Geostar Rec R27: Move to proper carrier at reduced rates Total possible monthly savings under this section could be as high as $6,171.70 (Additional Tax Reductions projected to be approximately $500-$750.00 monthly)
93. 68 Cellular / Wireless Services – 131 Austin Powder Company utilizes a combined total of seven wireless/cell providers in the USA and Canada. In the United States, Austin houses the lion’s share of wireless services with Verizon Wireless. It also uses AT&T Wireless, and Alaska Wireless. (There was also a Sprint Wireless bill disclosed at the beginning of this audit. However, attempts at receiving a bill copy were denied by Jeff Britcher, as he stated there were only a few lines present and they would be “going away”.) In Canada, Austin uses four providers for this service. They are TELUS Mobility, Bell Mobility, Info-Sat, and SaskTel. Below is a listing of these services by provider:
169. The four-line Verizon Wireless account (281801965-00001) holds only three phones and one Air Card. The current three year Master Agreement term is as follows: (12/26/2008 - 12/26/2011)
170. Three of the four devices are currently out of contract
171. The device still under contract is Blackberry Bold 9650 - 216-392-4100 for David Mercedes
209. 7 units @ $60.00 per (aircard) $2,814.00 monthlyGeostar Rec R28: Leverage Verizon, or switch to AT&T
210. 143 Cellular / Wireless Services Continued– 168 Notable Cellular/Wireless Items Voice and Data total $22,611.68 Monthly savings versus current - $4,175.86 or 15% Amortize ($34k) Bonus over 2 years = $1,423.96 = 5,599.82 or 21%! Additional $2,214.18 in monthly tax reductions are projected as well. *Full recommendation would be to engage Verizon at this point to view a competitive offer for comparison sake*
211. 144 Data and Internet Services- 169 Austin Powder Company currently utilizes a 47 site MPLS Network from AT&T for its Data Network. The number of sites would be larger; however, some Austin Powder sites are in more rural or remote areas and are not supported by AT&T’s MPLS Network. In those remote areas a DIA (Direct Internet Access) T1, local DSL, or cable internet connection is procured by Austin Powder where AT&T could not provide the service on the Austin MPLS Network. Once those DSL or Cable internet connections are purchased, they are tied back to HQ as a Hardware VPN connection. As such, below is the graphical depiction of the current AT&T MPLS Network. Below that network drawing is a detailed breakdown of the remote or stray, Hardware VPN internet sites.
217. Total combined cost for these stray/Hardware VPN sites per month = $4,532.93
218. All of the stray/Hardware VPN sites are on different contractual terms than each other and the main Data Network
219. There are also “at home”, or residential internet users that Austin Powder pays for each month. These internet connections are not a part of the company’s network:
220. MetroCast (account#: 8282 30 174 0007624) at 355 Ekonk Hill Rd. Moosup, CT 06354-2215. This internet service costs Austin $105.08 per sample month
234. $21,361.56 Final offer includes amortized $12,000 annual bonus on 3 year term Geostar recommends that the AT&T offer be accepted to achieve a great deal of savings and incur no major cutover and disruption of services Geostar Recommendation R30: Accept AT&T offer
235. 153 Data and Internet Services- 173 Notable Data/Internet Items “Stray” Hardware VPN sites: The following numbers reflect the bids from both AT&T AND Qwest regarding the sites that do not connect via the main MPLS network but were considered to be brought on board should the cost and speed available be desirable:
236. 154 Data and Internet Services- 173 Notable Data/Internet Items In this case, the costs were either equivalent to or higher than the current expenditures so there is no clear recommendation unless Qwest is chosen and there is a desire to ensure all are on the main MPLS network. Total possible monthly savings under this section could be as high as $6,306.56 Additional $1,610.00 in monthly tax reductions projected as well
266. 158 176 Phone System Hardware No recommendations at this time on the two major expenditures due to length of contracts at HQ and Red Diamond. Future considerations would be to replace the Avaya and not engage in costly monthly fees for warranty etc. Findlay, Pegram, Onalaska, and Northampton sites should be considered as candidates for work on a time and material basis versus paying over $7000.00 in annual maintenance on a very small phone count. The pay as you go recommendation only applies to the sites with the small systems. The Avaya’s do not fall under this category due to the manner in which Avaya applies requirements and stipulations against such an approach. Geostar Recommendation R30: Consider removing maintenance coverage in lieu of t&m Total possible monthly savings under this section could be as high as $594.33
269. MONTHLY BUDGET EXPENDITURE BENCHMARK $89,318.05 161 179 This constitutes the end of the benchmarking portion of this report. The following sections are strategic recommendations compiled as a result of the findings and are the intellectual capital of Geostar. Such recommendations, if implemented, would be subject to fees outlined in the consulting agreement previously signed.
271. 163 PRESENTATION 180 From here, the following is a graphical representation of the process to come post delivery of the report. Regardless of what is selected, all parties now have the playbook of what is in place, its cost, the obligation, and the options/game plan to move forward to enhance the bottom line of Austin Powder and increase the productivity of its most critical players. INTERNAL DISCUSSIONS GATHER FUTURE BILLING PROOFTEXT RECONVENE TO SET GAME PLAN AUSTIN APPROVES/ GEOSTAR IMPLEMENTs
272. Recommendation Results Tabulator 164 181 The following table outlines the possible cost savings as a result of this research. All aspects are submitted to Austin Powder for full review and consideration. Geostar recommends that Austin Powder take the results and discuss internally post the official delivery. Then, Geostar and Austin Powder can reconvene to set a course of action on all items to implement. In all cases, Austin Powder will approve prior to any action taken by Geostar on behalf of Austin Powder.
273. 182 Sample Client Ongoing Savings Calculation- *Monthly Fee Paid – is projected from the possible savings to come and valued at less than 50% of fees that will be due. This is billed on a monthly basis for cash flow purposes and to avoid large lump sums due each quarter but it is intentionally projected low to avoid the chance that the customer pays Geostar more in advance than what will actually be due. 165