VPNs are global — but prices are local

30 Mar 2007

Internet-based Virtual Private Networks (VPNs) have replaced private lines as the wide-area networking technology of choice for enterprises around the world. While companies can now connect offices throughout the world via one increasingly standardized technology, TeleGeography has found that VPN port prices vary dramatically by country.

VPN port prices are lowest in North America and Western Europe, where median E-1 and T-1 port prices in major cities range from USD650-USD750. Prices in Southern and Central Europe and Scandinavia are somewhat higher, ranging from USD792 per month in Milan to USD1,236 in Prague.

Hong Kong is the cheapest VPN market in Asia, with a median port price of USD1,347 per month—well above the rates prevailing in most European and US cities. IP-VPN ports in New Delhi are nearly twice as expensive as Hong Kong, at USD2,518 per month.

In Latin America, median E-1 port IP-VPN prices range from USD1,494 in Sao Paulo to USD37,799 in La Paz, Bolivia.

While prices vary widely by city, VPN port prices within cities can diverge just as dramatically. For example, service providers in London charged anywhere from USD300 to USD2,000 per month for an E-1 port, while VPN providers in Mumbai charged USD1,500 to just under USD9,000 for a comparable port.

VPN pricing remains complex and opaque,’ said TeleGeography Pricing Research Director Rob Schult. ‘Service providers and buyers need to understand how VPN prices are structured, and how they compare with alternative services, such as private lines.’

TeleGeography’s new Enterprise Network Pricing Service provides a comprehensive source of market data and expert analysis for IP VPN, retail private line services, and Dedicated Internet Access (DIA), in 60 cities and 41 countries, updated quarterly. To learn more, contact your account representative, or visit our website, at http:// www.telegeography.com/products/enterprise_pricing/index.php

For the full ranking and Q4 2006 median port prices in all 60 cities, please contact press@telegeography.com, or call 202-741-0042.

TeleGeography's Enterprise Network Pricing Service