SOURCE: Infonetics Research

July 09, 2008 13:27 ET

Infonetics Research: Ethernet, MPLS continue to eat into legacy services; mid-band Ethernet grows 120% by 2011

CAMPBELL, CA--(Marketwire - July 9, 2008) - Communications market research firm Infonetics Research reports that organizations around the world are increasingly replacing their legacy frame relay, ATM, and private line legacy services with Ethernet and IP MPLS VPN services.

In its latest Ethernet and IP MPLS VPN Services report, Infonetics shows worldwide Ethernet service revenue sequentially grew 33% to $12.5 billion in 2007, and IP MPLS VPN service revenue grew 20% to $13 billion. Both markets are forecast by Infonetics to grow strongly through 2011.

"Customer demand and IP and next gen network (NGN) transformation projects are the 2 main factors contributing to the growing popularity of Ethernet and IP MPLS VPN services. Companies like these services because they offer considerably more bandwidth with little or no increased WAN costs compared to their legacy counterparts (frame relay, ATM, private lines). Customers expect -- and get -- a better per bit cost for Ethernet services. And service providers like them because they help bring in new revenue, so requests for Ethernet and IP MPLS VPN services are coming from both sides," said Michael Howard, principal analyst at Infonetics Research.

Other highlights from the report:

--  Although prices vary considerably, as an example in North America, the
    monthly cost for 100M Ethernet is about $50 per Mbps, but using DS3s or
    SONET will cost about $180 per Mbps
--  80% of all Ethernet service revenue came from retail sales in 2007
    (Ethernet services purchased by business, government, consumers, or
    education from service providers)
--  All sources of retail Ethernet service revenue (Internet/WAN, Ethernet
    private line, and transparent LAN) will increase through 2011, with
    transparent LAN services growing the fastest
--  Service revenue for mid-band Ethernet, or MBE, which include the 1-10M
    and > 10-50M speed bands, will jump 120% from 2007 to 2011
--  The EMEA region, which includes Europe, the Middle East, and Africa,
    accounts for over 1/3 of worldwide IP MPLS VPN service revenue in 2007

Infonetics' report includes market size, revenue forecasts through 2011, and analysis of the Ethernet and IP MPLS VPN services markets for North America (including US and Canada breakouts), EMEA, Asia Pacific, Caribbean/Latin America (CALA), and worldwide. It tracks wholesale and retail Ethernet service revenue by capacity (mid-band, > 50M-100M, > 100M-1G, and > 1G), and retail Ethernet service revenue by source as well (Internet/WAN access, Ethernet private line, and transparent LAN).

For report highlights, log in to Infonetics' online portal from (see Metro Ethernet, Routing, and Switching area). For sales, contact Larry Howard, vice president, at or +1 (408) 583-3335.

Infonetics Research ( is an international communications market research firm. Tracking emerging markets since 1990, Infonetics covers a broad range of service provider, product manufacturer, and enterprise and SMB markets, including network security, enterprise voice, unified communications, broadband networks, IPTV, IP video, mobile TV, optical networks, metro Ethernet, carrier routing and switching, wireless, FMC, VoIP, IMS, policy management, subscriber management, service management, carrier capex and opex, and more. Services include quarterly market share and forecasting, end-user survey research, service provider survey research, service provider capex analysis, and custom research and consulting.

Contact Information

  • Press Contact:
    Michael Howard
    Principal Analyst and Co-Founder
    Infonetics Research
    (408) 583.3351
    Email Contact