Struggle for more boosts comms market

The Ethernet and IP MPLS VPN services markets hit £10.7bn last year, as users struggled to get more out of their legacy comms networks.

The Ethernet and IP MPLS VPN services markets hit £10.7bn last year, as users struggled to get more out of their legacy comms networks.

The growth has been charted by analyst Infonetics Research. It said with corporate data traffic growing unabated, organisations around the world are rapidly exceeding the capacity limits of their legacy frame relay, ATM, and private line networks.

They are now increasingly replacing these legacy services with Ethernet and IP MPLS VPN services, which are more flexible and less restricted than their legacy counterparts.

After more than doubling in 2005 to £2.9bn, worldwide Ethernet service revenue jumped another 65% in 2006 to reach £4.72bn, and IP MPLS VPN service revenue grew 38% in 2006 to £5.5bn.

Michael Howard, principal analyst at Infonetics, said, "Ethernet and IP/MPLS are the layer 2 and layer 3 service protocols of choice for today's data service networks.

“Small and medium businesses and remote and branch offices of large businesses especially like Ethernet and IP MPLS VPNs because they offer considerably more bandwidth with little or no increased WAN costs,” he said.

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