What is the Difference Between NaaS and a Lease?

Network-as-a-Service (NaaS) and leasing network equipment both offer alternatives to outright purchasing of network infrastructure, but they differ significantly - not just in the wide range of critical modern networking features, but also in the areas of design, deployment, and operations support by specialized networking talent.

NaaS provides a comprehensive service that includes hardware, software, AI-driven operations, monitoring, security, maintenance, and upgrades, all delivered on a subscription basis. Because the service is highly flexible and scalable, NaaS not only eliminates the manual work of day-to-day operations but frees businesses from concerns of network agility to keep pace with business growth.

Leasing agreements, on the other hand, involves physical hardware rentals for a fixed term making them less flexible and more challenging to scale resources up or down, or keep pace with fast-growing technology standards. Therefore, while leasing provides an affordable way to finance network hardware, NaaS offers a more integrated, managed, and adaptable solution in a more economical, consumption-based package.

Fully Managed Network vs. Hardware Only

Compare the differences in range of services and features, including where does responsibilities fall to fill in the gaps.

Network-as-a-Service

• Purpose-Built Technology: NaaS delivers an end-to-end network technology stack, complete with state-of-the-art hardware, software, network operations center (NOC), security, proactive monitoring tools, AI and automation technology, and network data analytics. The network is engineered to be completely interoperabile between components and functions, high performance with resilience and automatic failovers, flexible to dynamic traffic and capacity scaling, and simplified, cloud-based management with automated issue and security resolution.
• Comprehensive Service and Expertise: NaaS providers are focused solely on the network, so in addition to the technology, offering specialized networking talent who fully manage the network, including design, deployment, maintenance, monitoring, operations, upgrades, and support.
• Integrations and Custom Business Requirements: Ensuring interoperability between NaaS and customer deployments, NaaS providers support typical enterprise needs like customizing network architecture and configurations to support unique usage and traffic patterns, or technology integrations like integrations with existing cybersecurity solutions or enterprise authentication.

Network Equipment Leasing

• Hardware Only: Leasing typically involves renting the physical network equipment, like routers, switches, access points for fixed term lengths. A hardware manufacturer or value-added reseller (VAR) provides the hardware, but the customer is responsible for setup, configuration, management, and maintenance. The customer is also responsible for any updates, upgrades, and optimizations.
• Limited Support: While some leasing agreements might include some level of support or maintenance, it is generally not as comprehensive as with the ongoing, proactive monitoring and automated remediation offered by NaaS, which deliver a more comprehensive fully managed network where technology platform and network lifecycle management work together.

Predictable Costs vs Rigid, Fixed Contracts

Compare the differences in the delivery model between NaaS and leasing options.

Network-as-a-Service

• Predictable Costs and Flexible Consumption: Because NaaS is billed on a subscription basis, network costs are all-inclusive and predictable operational expenses (OpEx). This pay-as-you-go approach is typically more budget friendly and scales better with adding and removing capacity and supporting business growth.
• Hardware Upgrades Included: Most importantly, NaaS includes equipment upgrades, so not only are customers able to access new technology without additional capital expenditures (CapEx), it eliminates most cost and provisioning issues common in fixed-capacity equipment.

Network Equipment Leasing

• Rigid, Fixed-Capacity Contracts: Leasing agreements typically operate on fixed terms with lengths ranging from 12 to 60 months. Even though costs appear predictable through the entire lease period, leasing fixed-capacity equipment means scaling up isn’t possible without renegotiating the lease, waiting until the end of the lease term, or restarting the purchase process.
• No Change in Provisioning or Planning Complexity: Leasing network equipment goes through the same ordering process as outright purchase contracts, involving the same complexity of planning and provisioning. Similar to equipment purchasing, leasing agreements still involve expensive CapEx requiring multiple purchase orders with the same possibilities of over or under provisioning.
• Accounting Complexity: While leasing can reduce initial capital costs by spreading costs over time, as opposed to outright purchases, because it does not include the comprehensive management and support services provided by NaaS, it makes it more challenging to estimate future planning and evaluate the full financial impact of networking costs without time-consuming cost engineering exercises.

Operational Flexibility vs Operational Risk

Compare the differences in service and operational flexibility throughout the network lifecycle between NaaS and leasing options.

Network-as-a-Service

• Flexible Network Design and Deployments: While NaaS providers offer packaged infrastructure and hardware, network design and architecture, configurations, and deployments are fully managed by dedicated networking experts and customizable to the unique needs of each customer network. NaaS provides the ability to scale resources up or down as needed, which is ideal for businesses with changing workforce demands or growth expectations.
• Included Network Lifecycle Management: Because NaaS includes end-to-end network lifecycle management, day-to-day operational responsibilities fall on the NaaS provider. Network operations like real-time monitoring of network traffic and security, or automating network optimizations and patches, is handled without manual intervention by the customer. Risks due to outages and security are greatly reduced when shifting towards more dynamic network operations vs fixed equipment environments.

Network Equipment Leasing

• Zero Operations and Management Support: While this is true of both equipment purchasing and leasing, all network operational burdens fall completely on in-house IT resources. Businesses are solely responsible for ensuring compatibility within their entire network infrastructure, third-party systems and cloud services, and fully managing, operating, and supporting the network.
• Increased Risk: The pace of innovation in network technology and devices, as well as the threats targeting them move rapidly. More technology and devices expose more vulnerabilities in the network and traditional leasing approaches make it very costly to upgrade hardware, and complex to ensure equipment is updated with the latest features, functionality, and patches.

Comparing Hardware Manufacturers with Leasing and NaaS Offers

NaaS solutions from hardware manufacturers like Cisco and Aruba are heavily invested in their proprietary hardware and software, ensuring performance and compatibility. These solutions leverage the full capabilities of their equipment and offer many advanced features specifically designed for their products.

Additionally, Cisco and Aruba have deep expertise, specialized support, and partner relationships globally with VARs and managed service providers (MSPs). This results in a large catalog of product SKUs, options, and support tiers, consisting of in-house and outsourced MSP partners who provide support, troubleshooting, and management services. Due to their scale, they can engineer solution packages with either OpEx, CapEx, or a mixture of both.

In contrast, native NaaS providers offers a more service-centric approach, emphasizing flexible, agile, and vendor-agnostic solutions. Native NaaS solutions may include a mixture of self-manufactured components and off-the-shelf hardware and software from various manufacturers or select manufacturing partners. Native NaaS providers focus on delivering scalable, adaptable network services that can integrate with diverse environments, making them ideal for a wide variety of branch and campus networks. Native NaaS providers have specialized networking knowledge across a wide range of manufacturers, protocols, and technologies, providing more diverse expertise across different technologies and offer customizable solutions tailored to specific networking and business goals.

Interested in learning how NaaS can simplify your network operations? Talk to a Join NaaS expert today and get a tour of our NaaS solutions.