Replacing Antiquated VSAT

Case Study - Shell Oil Company

A Cybera White Paper

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Replacing Antiquated VSAT
Case Study - Shell Oil Company

Companies using satellite-based Very Small Aperture factors in its wide scale adoption. Generally,
Terminal (VSAT) network solutions to support their overcoming “line of sight” limitations due to
critical applications can benefit by switching to a obstructions by trees, buildings and other obstacles
newer, more robust solution. Cybera ONE is a next- have been relatively easy to overcome. As a result,
generation secure application platform that can commercial enterprises which have locations in
reduce cost, increase bandwidth, expand service remote areas where broadband availability was
offerings and improve network security at a lower limited found VSAT’s near universal coverage to
cost than VSAT. In this white paper, we will examine be a consistent method of deploying network
the strengths and weaknesses of VSAT compared across their entire footprint. Designing the entire
to Cybera ONE through a Shell Oil Company case network around the lowest common denominator
study. was sufficient when applications did not require
significant bandwidth, and additional services
Shell Oil Company is one of the largest global such as lottery, ATM machines, tank monitoring
retailers in terms of geographic locations with and security alarms could be facilitated through
14,000 domestic branded stores and over 40,000 analog land lines. The strengths of VSAT have
global stores. By the end of 2013, Shell will be been diminished as higher bandwidth applications
replacing the legacy VSAT solution with Cybera ONE have emerged (such as Loyalty, Kiosks, WiFi and
at all its branded locations. This significant and Business Intelligence), and the availability of
rapid shift away from a well-established technology, broadband has spread to remote areas. Plus the
emphasizes the importance of embracing lower emergence of 3G and 4G wireless connectivity has
cost and highly available broadband alternatives. addressed the outlying regions sufficiently, further
diminishing the strength of VSAT.
What Is VSAT?
VSAT is a two-way satellite ground station or a
stabilized maritime VSAT antenna with a dish
antenna that is smaller than 3 meters, while the
majority of VSAT antennas range from 75 cm to
1.2m. Data rates are typically 56 kbit/s to 128
kbit/s for a traditional connection, although some
newer Ka connections can range up to 4 Mbit/s.
VSAT dishes access satellites in geosynchronous
orbit to relay data from small remote earth
stations (terminals) to other terminals (in mesh
topology) or master earth station “hubs” (in star
topology). VSAT networks are most commonly
used to transmit narrowband data including point
of sale transactions such as credit card, polling or
RFID data; or SCADA traffic.

Strengths of VSAT
The near universal coverage of VSAT is its largest VSAT Satellite System Diagram
strength and has been one of the most compelling

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Limitations of VSAT
VSAT systems are limited in bandwidth throughput
in comparison to widely available broadband
alternatives, and require investment in new
technology in order to achieve higher throughput
rates (which still do not rival terrestrial broadband
options). In commercial applications, the
limitations of VSAT bandwidth typically require the
addition of a broadband line to handle additional
types of Internet and application traffic used by
commercial enterprises as a fundamental part of
their business. This is increasingly making VSAT
an additional cost element that is dispensable
as the traditional applications utilizing VSAT
can be securely migrated onto the broadband
line with other traffic types, thus reducing costs
to the business. The aggregate of these costs
across hundreds or thousands of retail locations
is substantial to a commercial chain oriented
enterprise, or any multi-site entity. The bandwidth
limitations of VSAT also inhibit the deployment of
new applications and services that drive the growth
of businesses, therefore it is becoming more of a
hindrance to growth as electronic services become
more predominant.
VSAT systems are also “single threaded” meaning
that a failure or degradation in performance
results in the complete loss or significant limitation
of service. This leaves commercial enterprises
vulnerable to fraud and results in significant loss in
sales revenues, both of which account for millions
in unnecessary costs per year. Fraud can be
accidental or organized, and is typically the result
of credit card payments not being processed while
product or services are still being dispensed. For
example, if a gas station experiences a VSAT outage
the pump will still process a credit card swipe
and dispense gasoline, but the payment is never
fully processed. An unwitting customer may not
know this and end up with a free tank of gas. But
organized efforts to create and capitalize on VSAT
outages are increasing in frequency, especially as
gas prices rise. Organized efforts to cover VSAT
dishes with aluminum foil to interrupt transmissions
are commonly married with scheme’s to dispense
fuel during the outage in manners that financially
benefit the thieves. But the most common culprit
to transaction processing interruptions is bad
weather since VSAT systems are exposed and
dependent on atmospheric conditions.
Finally, VSAT systems have higher latency then
traditional broadband connections and result in
longer transaction processing times. An average
VSAT transaction can range between 10 seconds
and 30 seconds, while related broadband
transactions are completed within three seconds
to five seconds. Beyond the inconvenience to
the customer, transaction processing delays
commonly place customers in uncomfortable
positions as they are concerned their card may be
denied. As retailers spend heavily to build repeat
customers and improve customer satisfaction,
long transaction times are counterproductive to
that investment. Longer transaction processing
times also inhibit sales as they create longer lines
and impatient customers that may abandon a
purchase, resulting in lost sales.
VSAT Displacement
The combination of the diminished strengths of
VSAT and its increasing limitations was part of the
motivating factor behind Shell’s dramatic shift in
technology and infrastructure. Not only is such a
migration a massive undertaking, but it could also
be a very significant investment. Therefore, the
economics behind such a decision had to be very
compelling. However, the economics are only part
of the driving force behind the decision. One of the
most compelling factors driving the transition was
Shell’s desire to innovate and enable new services
and technologies that support future growth.
While several issues with Shell’s current system
needed to be addressed, one of the most
important was cost. The company needed a cost-
effective solution that addressed its entire suite
of needs including reliability, security and fraud
protection, application and service expansion and
compliance.
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• Improved Reliability – Shell implemented
a solution that would utilize broadband as
its primary method of communicating, but
broadband is known to have failures just like
VSAT. Therefore the solution integrated 3G/4G
wireless back-up with a persistent or “always-
on” VPN so transactions would immediately fail-
over to the secondary connection if broadband
failed. Implementing completely diverse
network connections provided the assurance
that significantly high reliability could be
achieved. In addition, the 3G/4G wireless could
serve as the primary connection in rural areas
where broadband was not available providing
near universal coverage.
• Improved Security & Fraud Protection
– Implementing a more reliable solution • Maintaining Compliance – If card transactions
than VSAT addressed many aspects of fraud
associated with network outages. Thus, an
organized effort to bring down the Internet
connection was no longer an effective method
of conducting fraud because the fail-over
connection could not be eliminated. But
broadband utilizes public Internet, therefore it system provider needed to remotely log into
posed different security threats from external
hackers. As a result, Shell adopted a solution
that facilitated a completely private network
while still using public broadband connections.
The use of cloud-based firewall, VPN and
intrusion detection applications connected to a
secure network appliance on the store premise
facilitated a secure overlay network that
does not use the public IP addressing used by
hackers. As a result, Shell receives the benefits
of public broadband connections (increased
bandwidth, lower cost and broad availability)
while by-passing the security threats associated
with public Internet.
into the same network security appliance. As
a result, applications with smaller memory
footprints could be deployed locally at the store
location. Applications such as Loyalty, POS
Support and Tank Monitoring could be housed
on a single device that was already secure.
These applications could be deployed and
maintained centrally, and future applications
could be downloaded when needed. A secure
WiFi hotspot capability was also integrated
into the secure application appliance so future
WiFi enabled applications could be deployed at
any time. The use of a single application and
security appliance placed Shell on solid footing
to enable future services that would meet
emerging business needs.
were to be placed on public broadband, Shell
had to be able to demonstrate compliance with
all PCI security requirements. Transactions had
to be secured locally and in transit to the card
processors, and all access to the POS system had
to be logged and monitored. If the point-of-sale
the system to update software or fix a problem,
the technician had to be authenticated and all
of his actions logged. The penalty for falling
out of compliance could cost Shell thousands
of dollars a day. To address this issue, Shell

• Application & Service Expansion – Using

a combination of hosted applications and
premise server based applications allowed for
the expansion of new services and applications
in a flexible and cost effective manner. Shell
deployed a network appliance with an
embedded Intel Linux server fully integrated

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 used the secure logging and data retention
capabilities of Cybera ONE to monitor all events
on the network and maintain a database of
network logs to demonstrate compliance if
audited. This capability was integrated in the
solution from the start.
• Cost Effectiveness – By implementing a secure
application appliance that is integrated
with cloud based security, Shell was able to
accomplish all of its needs through a single
device solution, Cybera ONE. The appliance
cost $450.00 per location, providing a
comprehensive solution at a lower cost than
it would take to just upgrade to VSAT 4 G/bit
speeds. The solution also eliminated the need
for multiple different platforms which would
have cost thousands of dollars per location.
In addition, the Cybera ONE appliance can be
installed by the store clerk eliminating the need
to dispatch a technician to install and integrate
multiple IT devices. The Cybera ONE platform
would connect to the cloud and pull down its
configuration and be working in less than 20
minutes. Therefore, Shell could implement
the entire solution for a fixed budgeted price
that paid for itself by the reduction of VSAT
and analog business line costs. As a result, the
entire migration resulted in significant overall
savings.
The VSAT Versus Cybera ONE Business Case
The business case for comparing the alternatives
of low bandwidth VSAT, higher bandwidth VSAT or
Cybera ONE with a 7Mbps DSL solution requires a
comparison of both the monthly recurring costs
and the initial one-time costs. Each solution is
also equipped with a 3G wireless back-up solution
for equivalent comparison of reliability. Although
the Cybera ONE solution also includes secure
wireless HotSpot functionality and an embedded
Intel Server for running secure applications, which
VSAT solutions do not provide.

Cost Element VSAT Cost - VSAT Upgrade Cost - Cybera ONE Cost -
128Kbps Plus 3G 4 Mbps Plus 3G 7 Mbps DSL w/ 3G
Recurring Costs
Primary Circuit Cost $129.95 $399.95 $59.95
Back-Up Circuit Cost $79.95 - DSL $25.00 - 3G $10.00 - 3G
Basic Security Package Cost Integrate Equipment Integrate Equipment Integrate Equipment
Purchase Purchase Purchase
POS Support App Cost NA NA NA
Loyalty App Cost NA NA NA
Total Recurring Costs $209.90 $424.95 $110.80

Non-Recurring Costs
Cybera ONE Appliance NA NA $450.00
VSAT Dish $900.00 $1,500.00 NA
Termination Device $400.00 $400.00 NA
Network Router $500.00 $500.00 NA
3G Wireless Cradle Point $149.99 $149.99 NA
Installation $1,500.00 $1,500.00 NA
Total Non-Recurring Costs $3,449.99 $4,049.99 $450.00

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Savings Analysis
Cybera ONE Monthly Savings % Savings
Versus
VSAT Cost 128Kbps ($99.10)/Mo.
Plus 3G
VSAT Upgrade Cost 4 ($314.15)Mo.
Mbps Plus 3G
Monthly Savings - Cybera ONE was 47% less
than the current costs of operating the limited
bandwidth VSAT connection offering only 128Kbps
in bandwidth. This includes the assumption that
because low bandwidth VSAT could not support
other applications that needed to run in the Shell
branded stores, the store was forced to incur
the costs of a DSL connection. If the customer
wanted to upgrade to the higher bandwidth
VSAT option, they would have paid 74% more
than the Cybera ONE monthly charge, and still
had lower bandwidth. Both options offered no
additional service features such as WiFi hotspot
functionality or application server functionality,
forcing additional costs to add these capabilities.
Cybera ONE Versus Monthly Savings over 14,000
Stores
VSAT Cost ($1,387,400.00)/Mo.
128 Kbps Plus 3G
VSAT Upgrade Cost ($4,389,100.00)/Mo.
4 Mbps Plus 3G
Summary
The economics of the Cybera ONE solution were
both compelling and obvious. The adoption of
Cybera ONE paid for itself through the savings
achieved in monthly costs, plus Shell would
greatly expand its application and new service
capabilities. The ability of the Cybera ONE
solution to securely use public broadband allowed
for the consolidation of all its critical applications
onto a single broadband connection. By moving
applications that utilized analog lines (such as POS
Support, Tank Monitoring), Shell achieved even
Upfront Savings % Savings
47% ($2,999.99) 87%
74% ($3,599.99) 89%
These savings when applied across the entire
Shell footprint would save an estimated $1.4
million a month versus the current VSAT solution,
and almost $4.4 million versus upgrading VSAT.
If Shell would have upgraded to the 4 Mbps
VSAT solution versus choosing the Cybera ONE
solution, it would have incurred greater than $50
million in additional costs. Shell would not have
incurred additional one-time costs if it stayed
on the existing 128 Kbps solution, except for the
addition of the 3G wireless access functionality
and installation, but we provided the cost
comparison to show what it would be for a new
VSAT customer.
Upfront Savings over 14,000
Stores
($41,999,860.00)
($50,399,860.00)
greater savings than depicted here. In addition,
the ability to consolidate multiple devices in the
stores to a single secure application appliance
reduced ongoing support costs, which are also
not reflected in the savings analysis. The business
case was very clear, and it resulted in one of the
largest retailers in the world to undertake one of
the largest architecture transitions in history, and
within an unprecedented period of time. Cybera
ONE made the transition simple.