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All Eyes on the Enterprise: The Latest in Ethernet VPN and SD-WAN

Network Internet Pricing

By Patrick ChristianApr 19, 2018

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TeleGeography’s Cloud and WAN Infrastructure analyzes service and pricing trends for four key enterprise network services: virtual private networks (VPNs) based on internet protocol (IP) and multi-protocol label switching (MPLS); dedicated internet access (DIA); Ethernet VPN (EVPN); and Ethernet private line (EPL).

This analysis—which has recently been updated with new data—reviews these services and the developing software-defined WAN (SD-WAN) service.

Today we’re sharing the latest on Ethernet VPN and SD-WAN services. Click here to catch up on our recent post about MPLS IP VPN and DIA services.

Ethernet VPN

For many enterprises, Layer 3 MPLS IP VPNs are ideal because routing and management is outsourced to the service provider. However, Layer 2 Ethernet VPN (EVPN) may be preferable for enterprises that want to retain full control of their network configuration and IP routing and have the in-house expertise to manage it.

The service is often considered to connect sites such as headquarters and data centers in any-to-any architectures, particularly where class of service prioritization is useful and at higher capacities where the cost per Mbps may be attractive.

Customer adoption of EVPN has been tepid, yet the availability of the service has expanded rapidly over the past few years, especially in developing markets.

Customer adoption of EVPN has been tepid, yet the availability of the service has expanded rapidly over the past few years, especially in developing markets. As underlying transport costs of the MPLS meshed network have fallen, EVPN prices have also steadily eroded. Between 2014 and 2017, median FastE port prices in global business centers declined an average of 20 percent compounded annually and ranged from $1,155 per month in New York to $7,746 in Mumbai.

SD-WAN

SD-WAN combines traffic prioritization, management, and security functions into a centrally-controlled, transport-independent network overlay. Appliances and software augment or replace traditional customer premises equipment to assess and route traffic over different network connections based on performance criteria. WAN managers can pre-configure performance criteria for different applications in a centralized controller. Traffic is routed based on which links meet these application performance standards. Application policies and security rules can be updated in real time as network requirements change.

Rather than route traffic through MPLS hubs, this capability provides a more direct, cost effective, and lower latency link for public internet traffic.

These capabilities enable WAN managers to optimize underlying network connections, routing lower-priority, less QoS sensitive traffic over cost-effective services such as broadband or DIA, while reserving more costly, higher performance and private MPLS links for real time voice, video, or other high QoS or security sensitive traffic.

Rather than route traffic through MPLS hubs, this capability provides a more direct, cost effective, and lower latency link for public internet traffic.

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Patrick Christian

Patrick Christian

Patrick Christian is a Senior Analyst with TeleGeography. Patrick has over 15 years of telecom market research experience. Patrick heads the Cloud and WAN Infrastructure research service. He also focuses on West African and European markets specializing in international bandwidth markets and Internet infrastructure, WAN services, terrestrial and submarine cable systems, and international voice traffic analysis.

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