Economics point to metro Ethernet, says alliance



End users can save as much as 75% on dedicated Internet access and private data services using Ethernet-based networks versus private line and frame relay (FR), according to a study released by the Metro Ethernet Forum. The study looks at a hypothetical metro application over a three-year period.

The study, conducted by Network Strategy Partners LLC, examined the monthly recurring costs that would be incurred by a hypothetical nationwide enterprise consisting of one large site of more than 500 employees and four other sites with 100-499 employees each. Researchers assumed that at the large site, the demand for dedicated Internet access would grow from 10 Mbits/sec in the first year to 17 Mbits/sec in the third year, and private data demand would rise from 25 to 36 Mbits/sec over the same period. The estimated demand figures for the other sites ranged from 3.5 to 5.9 Mbits/sec for dedicated Internet access and 3 to 4.3 Mbits/sec for private data.

Private-line and FR pricing was derived from publicly available tariffs and other published sources, while the Ethernet prices came from interviews with carriers offering such services. When the prices were applied to the anticipated service usage, the total cost over the three years for traditional private-line service was $2,753,656; it was $2,324,226 for FR. Conversely, the total cost over the three years for Ethernet-based delivery was $624,174.

According to Nan Chen, president of the 75-member forum and director of product marketing at Atrica (Santa Clara, CA), the savings derive from a number of factors. First, Ethernet scales more flexibly than other options, particularly TDM. Ethernet can accommodate 1 Mbit/sec to 1 Gbit/sec in 1-Mbit/sec increments. Second, Ethernet systems generally cost less than WAN routers and FR access devices. Third, Ethernet systems afford lower engineering and operational support costs. The fourth aspect is faster service delivery through point and click provisioning without hardware changes.

The study can be found on the organization's Website, The research is an outgrowth of the Metro Ethernet Forum's charter, which includes evangelizing the benefits of the technology. Of course, raising awareness among end users won't amount to much if carriers don't provide the service. "Clearly, the challenge is making a business case for the carriers," Chen admits. The forum expects to do just that with another study, this one directed toward delineating how Ethernet-based networks can save carriers money as well. This second study was 90% completed when this issue went to press, according to Chen.

In addition to spreading the word about Ethernet, the forum also expects to perform standards-related work that will define Ethernet services and carrier-class Ethernet-based metro transport technologies. The latter activity involves specifying architecture, protocols, and management for Ethernet-based networks. Deliverables in the technical area include implementation agreements, test procedures for interoperability, position statements to propose new standards for existing standards bodies, and technical specifications of new standards in the forum.

Chen reports that several deliverables were approaching the draft stage at the Metro Ethernet Forum's most recent meeting, held in April in New Orleans. Primary activities include establishing 50-msec restoration times for Ethernet networks, defining user-network interfaces, and creating the underlying mechanisms necessary to provide multiple quality-of-service levels. The organization also plans to tackle the issue of transporting native TDM over Ethernet for voice applications.

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