Ethernet VPN services still far from universal

21 Jun 2011

Enterprise customers around the world are replacing legacy private line, Frame Relay, and ATM wide area networks (WAN) with Ethernet VPLS and MPLS IP VPN services. Companies’ choice of wide-area network type is shaped by a number of factors, including the applications they need to accommodate, the number of locations to be connected, the level of control the customers want to maintain over their networks, their capacity requirements, and the cost of the solution. However, data from TeleGeography’s Global Enterprise Networks Research Service suggest that the most important factor shaping an organization’s international network choice may simply be availability.

Ethernet deployments lag far behind MPLS VPN deployments, both by service provider and by geographic market. Over half of the 63 international service providers researched by TeleGeography offer MPLS VPN service in 10 or more countries, compared with less than one-third of Ethernet VPLS service providers.

The availability of IP VPN and Ethernet VPN services also differs by region. TeleGeography identified 39 IP VPN providers in Europe, 34 in Asia, 31 in the U.S. & Canada, and 19 in Africa and Latin American. Ethernet VPN services are less widely available in all of these regions, but the difference is particularly great in emerging markets. While 32 service providers offer layer 2 Ethernet VPN services in Europe, only 9 offer VPLS service in Latin America and only 6 in Africa. While 22 service providers offer VPLS service in London, only 5 offer VPLS service in Mumbai.

“Ethernet VPN services are generally more cost effective than MPLS IP VPN services for capacity requirements above 50 Mbps, and are most appropriate for linking high-capacity headquarter sites and data centers. MPLS IP VPN services tend to be better suited for linking large numbers of sites with more modest capacity requirements,” said TeleGeography analyst Rob Schult. “However, dependence on Ethernet local access and the relatively slow rollout of Ethernet across MPLS PoPs means that Ethernet VPN solutions are not yet available in as many cities.”

TeleGeography’s Global Enterprise Networks Research Service profiles the international enterprise network services offered by 63 service providers in more than 90 countries, and analyzes trends in enterprise service availability and pricing. Service offerings covered include MPLS IP VPN, Ethernet, dedicated Internet access, and private line services.

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TeleGeography’s Global Enterprise Networks Research Service