April 3, 2000

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Businesses Lock In On VPN Outsourcing Options

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"We wanted one-stop shopping--one help desk, one trouble-ticket place," says Milano. "We didn't want to have to go wandering around or support or buy WAN access here and a managed firewall there." Given those requirements, building a standalone VPN wasn't something Milano ever considered, especially since his six-person IT shop was spending two to three days a week doing network maintenance.

In late 1997, Hitachi signed a five-year VPN contract with Concentric Network, because Concentric was the only provider at the time that would consolidate bandwidth, help-desk, and network-management services. "We put in 15 local T1 loops with 128-Kbps port speed for the same price we were paying for 12 sites with 56-Kbps leased lines," Milano says. "The big savings are the long-haul charges. And VPN services get you out of the router and firmware business. You don't have to provision the network or fight with the local telcos when the line's down."

Hitachi Metals' VPN has expanded to 18 sites, supporting 2,000 users in the United States. It costs the company about $25,000 a month.

Concentric Network's Sheikh and other executives at VPN service providers say small and midsize businesses are embracing VPN services more rapidly than larger customers. Why? Their requirements are much less specific, and they don't have in-house IT expertise, Sheikh says. "They're more concerned with availability and the ability to communicate with partners than they are with new technologies and infrastructure," he says. "They just want to connect."

Nevertheless, users, analysts, and service providers offer several caveats for anyone who's examining VPN options, regardless of the size of their business:

• Evaluate what kinds of employees and sites will use the VPN and assign security accordingly. Marketing and PR people accessing E-mail and calendaring, for example, may require only the medium-level security of the Point-to-Point Tunneling Protocol, whereas executives involved in mergers and acquisitions might need a private IP backbone with a stronger combination of IP Security and strong encryption for remote access.

• Clarify which authentication method is desired; it can be as simple as passwords or as complicated as public-key infrastructure. Not all service vendors support that range.

• Consider automated setup of tunnels between devices, particularly if you have lots of sites. With two or three sites, it's easy to manually configure tunnels, but with 500 sites, every box needs to know the path to another box. Most established equipment vendors, including Cisco Systems and Lucent Technologies Inc., offer VPN platforms with automated tunneling configuration.

• Make sure your service provider can configure remote-access clients in batches, not just one at a time. While VPN client installation has proven tricky and time-consuming, it's improved in the past year.

Lorde's Stribling notes that Timestep, the initial client software offered by GTE Internetworking, was better- suited to site-to-site VPNs than using a remote-access application. He got an unexpected tutorial. "We spent a lot of time with GTE Internetworking engineers, trying to make this stuff work, and we learned a lot about the guts of VPNs," he says.

Last November, GTE Internetworking started offering Nortel's Contivity switch, which serves as the VPN access point for routing, firewalls, bandwidth management, encryption, and authentication. Stribling says the new configuration works extremely well. "Looking back through the tears, it was a fun experience, but I don't want to do it again," he says.

As with any other outsourced service, customers are looking for some combination of scalability, cost savings, and reliability from VPN services. Given the technical complexity that results when you combine an application with security and a public-private network interface, it's clear that customers will continue to examine VPN services.

But keep in mind that the increasing number of options and relative modularity of VPNs ensure that buyer and seller need to be clear about what services and features are required, who performs each of the tasks, and where each function will be performed.

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