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November 21, 2017
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MPLS May Cost Less Than Point to Point
Lower cost alternative for long haul point to point dedicated line connections.

By: John Shepler

The traditional way to connect two business locations to send files back and forth is with a point to point data connection. T1 lines have been perfect for this at modest bandwidth levels. DS3 and OCx SONET services work the same way when higher speeds are needed. Ethernet line service is the latest entry into the Point to Point bandwidth space. But have you considered MPLS networks as your best value for the money?

Why Not MPLS Networks?
MPLS may seem like an odd choice, since MPLS networks are really targeted for multi-point connectivity in place of older technologies like Frame Relay. MPLS networks are organized as clouds with multiple access points over the service footprint. If you have a dozen or a hundred locations to network, an MPLS solution is likely the best solution by a mile. Yet, there’s no reason you can’t just specify connecting point A to point B as your only connection.

Costly Alternative PTP Strategies
The one possible downside might be cost. Whether a dedicated point to point line service or an MPLS network service makes sense for any given application depends a lot on the distance between locations and whether you intend to order more than one line. Why multiple lines? While some businesses have only two locations to connect, many others have three or more. The most expensive way to make multiple connections is by running point to point lines from each location to the others. A more cost effective approach is to set up a star network with the routing equipment at headquarters and point to point lines fanning out from there to each satellite location. The least cost most flexible solution is often to simply connect every location to a regional or national MPLS network and specify the connectivity within the cloud.

T1 Lines Are Cheap
T1 point to point lines became popular because they are relatively inexpensive and offer the security and performance of a dedicated line. You have exclusive use of the 1.5 Mbps bandwidth in both directions. Since the line is “nailed up” to interconnect two locations, security is high. It’s difficult to impossible for snoops and troublemakers to gain access to your private line.

T1 Lines Are Limited
One disadvantage of using dedicated T1 lines is that you are limited to 1.5 Mbps per line, although you can often bond T1 lines together to multiply the bandwidth up to a maximum of 10 or 12 Mbps. Another drawback is that there is no economy of scale. Two lines cost twice as much as one line. They also tend to be priced by distance. A point to point line in town costs much less than a connection from coast to coast. If you need to cross an ocean or international border the cost goes up significantly.

No Economy of Scale For Multiple Lines
Everything that has been said about T1 lines also goes for higher bandwidth options, such as DS3, OC3, and so on. The cost increases along with bandwidth. Ethernet over Copper or Ethernet over Fiber offers higher bandwidth at lower prices, but is also a dedicated line service. It’s the protocol that’s different between T1 or SONET and Ethernet services.

MPLS Offers Shared Cost
MPLS networks have a different cost model. The network is based on a privately owned high speed national or international fiber optic network. None of the core network is dedicated to a single customer. It is intended to be shared among many customers to amortize the cost. As such, the cost of a point to point or multipoint connection is more attractive than for a dedicated line service. In-town or close by, the dedicated line may be the cheaper solution. But for locations spaced thousands of miles apart or overseas, MPLS networks have the advantage.

Security Plus Cost Savings
What makes MPLS networks a good substitute for dedicated point to point lines is that the network offers security and guaranteed performance as well as a cost savings. The proprietary nature of the label switching protocol and the fact that access is limited to customers of the network make security much higher than on a public network like the Internet. The network operators establish the virtual paths through the network on a case by case basis. You may be sharing the fiber strands, but you can’t access another customer’s data and they can’t see yours.

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