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Issue of January 2006 

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Going the multiprotocol switching route

MPLS VPN has been around in the market since 1997 and it is getting more popular with each passing year. Sneha Khanna finds that MPLS is poised to go places in 2006.

Most companies worry about cost and security issues when it comes to connectivity options. MPLS technology can solve these problems and therefore it is fast becoming a popular option with many organisations.

MPLS VPN stands for Multi Protocol Label Switching over a Virtual Private Network. CIOs can derive many advantages with this technology, which has been slowly but steadily catching up over the years. There are several reasons behind this.

Mesh Power

Sagar Sule
Cyquator Techno21logies

MPLS VPN is based on a mesh network topology giving its users traffic-engineering capabilities for better management, making the network reliable even if the connection breaks down.

This gives the technology an edge over existing routing and packet switching devices. As Sagar Sule, President, Cyquator Technologies explains, “The need for high-speed data transmission rates triggered the evolution of Layer 2 and 3 switching devices. However, these traditional routing and packet switching devices only mitigate issues related to packet traversal speeds within the network. They do not address the network performance degradation attributed to parameters like network congestion, delay and jitter.”

Secure Cost-Effective Edge

Being on the Internet, VPNs provide a cost advantage over other technologies such as leased lines. MPLS VPNs offer security and organisations get the best possible combination.

Anirudh Prabhakaran, Director, Sales and Marketing, Cable & Wireless India elaborates, “MPLS gives the ability to securely cover remote sites or remote users and even employees working out of home or on the move.”

There are three types of MPLS:
1. Layer 2: Point -to- point connectivity
2. Layer3: Peer-to-Peer
3. VPLS: Virtualises LAN, MAN and WAN so that it looks like a single network

Scalable For Growth

VPNs are being used by organisations to interconnect offices located at different sites. The use of MPLS allows for cheaper and easier future expansion.

With MPLS VPNs it is very easy to create new sites without much difficulty unlike leased lines where new lines have to be laid down for every new site. Prasad Babu, SE Manager (India & SAARC), Juniper Networks points out, “With leased lines, you need a network with 99 leased lines for 100 sites whereas in MPLS VPN it is a full mesh network, reducing capital expenditure.”

“The primary advantage of MPLS is that it provides the scalability to support both small and very large-scale VPN deployments: up to tens of thousands of VPNs are possible on the same network core,” adds Shrikant Shitole, APAC Regional Manager, Managed Services, Cisco Systems.

  • End to end single-point management with flexible SLAs
  • Real-time reporting across the backbone
  • Up to five classes of service
  • An availability of 99.999 percent on the backbone could be committed with penalties that can be defined in the Service Level Agreement.
  • Pay only for the bandwidth and the performance levels used with flexibility to easily upgrade the bandwidth whenever required
  • Ability to securely cover remote sites/remote users and even employees working out of home/on the move
  • Critical data like ERP, video conferencing applications can be prioritised depending on the application requirements
  • Capital assets could be done away with, as the carrier invests in the network components
  • As the number of sites increases, the cost to connect additional sites to all other sites starts decreasing
  • If a large organisation has built-in redundancy in bandwidth due to business needs, a substantial cost saving, to the tune of 25 to 35 percent, could be made by the shift to MPLS as the carrier charges customers only for the actual bandwidth used.
  • Note: It is critical to understand that there are two types of MPLS possible: an IP/VPN built over the Internet, and an IP/VPN built over a carrier network. Most of these benefits would be available only on the IP/VPN built over a carrier network

Courtesy: Anirudh Prabhakaran, Cable & Wireless India

Better, Cheaper Management And QoS

MPLS VPNs offer better manageability at a lower cost due to the reduced need to lay a network. As Babu explains, “In MPLS VPN based networks, each branch office needs to have only one port because of which manageability is better.”

Shitole adds, “MPLS fuses the intelligence of routing with the performance of switching and provides significant benefits to networks with a pure IP architecture as well as those with IP and ATM or a mix of other Layer 2 technologies”. Using MPLS over VPN also gives service providers an opportunity to create IP tunnels throughout their network, eliminating the need for encryption and end-user applications.

Another advantage of MPLS VPN is that QoS is higher because of its end-to-end circuit architecture.

Bandwidth-Performance Gains

Companies which have high bandwidth requirements are now opting for MPLS VPNs. Sule feels, “MPLS has already made its mark on the Indian fraternity and in fact, wherever business applications requiring increased and guaranteed bandwidth have been/are being deployed, the technocrats involved therein are surely considering this option.”

“If a large organisation has built-in bandwidth redundancy due to business needs, substantial cost savings could be made by the shift to MPLS since the carrier charges customers only for the actual bandwidth used. Cost savings could be to the tune of 25 to 35 percent,” asserts Prabhakaran.

The organisation needs to pay for only the bandwidth and performance levels used, with flexibility to easily upgrade the bandwidth whenever required.

No Major Changes

One of the major advantages of MPLS VPN is that it does not require major infrastructural changes between service providers. “Almost every service provider is running an IP network to provide IP services and many of these devices are MPLS capable. Today since most enterprises use leased lines, the network is transparent to them and they do not have to change the router (CPE) or infrastructure to utilise MPLS VPNs,” Shitole avers. However, it has to be noted that some configuration changes might be required at the end CPE.

Model Of Choice

Going by market trends in MPLS solutions,organisations seem to prefer the service provider model, due to the perception that except for vendors with established network presence, it would be difficult and protracted for others to build the required infrastructure

Going by market trends in MPLS solutions, organisations seem to prefer the service provider model, due to the perception that except for vendors with established network presence, it would be difficult and protracted for others to build the required infrastructure.

From an enterprise perspective, the service provider model works better as enterprises do not have to invest in and manage a private network infrastructure. Service providers offer multiple classes of services at different price points based on the applications needs of the enterprises.

Larger enterprises prefer in-house models for security reasons, while the service provider model is popular with small to mid-sized companies.

Players On The Block
Some related technologies in the market are frame relay and IP VPN. However, MPLS seems to be giving its counterparts a tough time.

According to K. Krishna, Senior Director, HECL, this is because, “MPLS VPN as compared to frame relay has better security levels, is completely based on mesh architecture and offers more customer assurance; much bandwidth in Frame Relay remains unused unlike MPLS VPNs”.

Another related technology in the market is IP VPN over which MPLS VPN seems to have won as again it has better bandwidth sharing, QoS and IP-based routing.

Probable Adopters

Given the advantages, it can be concluded that organisations which are expanding their business, as well as businesses setting up remote offices are adopting the MPLS technology. IT/ITES is one of the verticals that could see an increased adoption as customer demand grows, and as they add locations where MPLS economies would be better

Given these advantages, it can be concluded that organisations which are expanding their business, as well as businesses setting up remote offices are adopting the technology. IT/ITES is one of the verticals that could see an increased adoption as customer demand grows, and as they add locations where MPLS economies would be better. Prabhakaran adds, “Any other organisation that has a large presence outside India or serves customers outside India with MPLS already deployed could be other adopters.”

Business sectors like telecommunication, finance and banking, which always have the pressure of better productivity, also seem to be deploying these technologies. Shitole reveals, “Verticals such as telecom, banking and finance, and IT-enabled services are increasingly adopting MPLS VPNs to boost their productivity and competitiveness.”

MPLS-based solutions are also quite popular with organisations under consistent pressure of performance. As Sule explains, “MPLS-based solutions would predominantly be adopted by organisations requiring consistent network performance with high service level guarantees, quick network scalability, multi-protocol support, faster implementation and interoperability”.

Babu adds, “Layer 2 of MPLS has the advantage that it can run on all kinds of protocols like IPX, IP etc.”


Inside MPLS
MPLS assigns the incoming packets a label through a Label Edge Router (LER). These are then forwarded through a Label Switch Path (LSP) enabling the Label Switch Router (LSR) to make forwarding decisions based on each packet’s label. In simpler terms, MPLS creates a layer over VPNs, which helps in building a better network infrastructure and in simplifying it with the help of content-based labelling.

Among Indian enterprises, MPLS VPN seems to have made its mark especially with companies requiring higher bandwidth. According to Babu, “MPLS VPNs are becoming popular and there are multiple vendors shifting from leased lines to MPLS VPNs.” Shitole adds, “According to IDC, the Indian VPN market (managed and unmanaged) is slated to touch $97 million by end 2005, a clear indication of its widespread adoption.”

Given MPLS’s inherent benefits of higher speed, security and cost-effectiveness, it is inevitable that MPLS-based VPNs will find their place in the Indian enterprise. Prabhakaran concurs and adds, “The BPO/ITES industry segment within India has been quite positive about MPLS because this handles converged services encompassing voice and multimedia with strenuous service and bandwidth demands quite elegantly.”

“While MPLS-based VPN can be adopted by most enterprises, it is expected to be adopted primarily by the manufacturing, services, banking, airlines and travel sectors,” predicts Shitole.

MPLS still has miles to go. “For international connectivity IPLC still remains the most favoured way of connectivity although MPLS acceptance is on the rise,” says Prabhakaran and adds, “There are some security concerns among many Indian organisations which believe that point-to-point connectivity like IPLC is more secure than MPLS which is a virtual network. However, as awareness grows about the high levels of security built into MPLS, there is openness towards trying it.”

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