Carriers Expand IP-VPN Services - InformationWeek

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5/21/2004
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David Ewalt
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Carriers Expand IP-VPN Services

Local and long-distance carriers target business market with offerings that provide better security and other enhancements

Every tech manager worries about securing networks and keeping proprietary data safe. But when your communications include the personal dossiers of more than a million high-powered business executives, security is critical.

Executive search firm Spencer Stuart has helped place senior-level executives in management jobs and board appointments for almost 50 years. As the business has grown, it has expanded worldwide and operates 50 sites in 26 countries. To ensure that employees can communicate over a secure network that also offers the right level of performance, Spencer Stuart uses a state-of-the-art, carrier-managed VPN.

In recent months, VPN services based on the Multiprotocol Label Switching standard have become increasingly popular. The technology connects sites in a resilient, redundant web of communications links, in contrast to the point-to-point architecture of more-conventional frame relay and ATM VPNs. It isn't new technology, but telecom service providers have been expanding and enhancing their offerings.

Verizon Communications this month launched an IP-VPN service as part of Enterprise Advance, its new national broadband data and voice network. BellSouth Corp. last month enhanced its Managed Network VPN Service with additional access methods, a turnkey system option, and security and service improvements. SBC Communications officially launched its IP-VPN offering in March. And in January, Sprint Communications dropped its criticism of MPLS and said it will begin offering a version of the VPN service, in addition to its own service, which uses IP Security encryption.

The carriers all want to grow their enterprise business, and they view this as one of the top opportunities in terms of rebuilding and growing," Yankee Group analyst David Parks says. "Customers are looking at ways to improve the performance, operations, and economics of their own networks, and IP services are a way to do that."

IP Spells SalesDo-it-yourself VPNs, which require a company to install hardware and run its traffic directly over the Internet, still dominate the VPN market. But the carrier-managed versions are increasingly popular, Parks says, since businesses can get better performance, security, and scalability by running data over an MPLS connection.

Spencer Stuart has 1,100 users worldwide who often move between branch offices, customer locations, and hotels. Each of them is highly dependent on accessing information within the enterprise, including the 1.6 million executive dossiers in its database. It's important to make sure that confidential data is shared across a secure network. "Having a private network as opposed to putting all that [information] over the public Internet is essential," chief technology officer Rick Abel says.

Performance also is important. "Our key software is pretty dependent on [network] response times," Abel says. A proprietary client-server application is run out of the Chicago headquarters, but users all over the world read and write to it. "We're significantly inhibited if response times are over 150 milliseconds," he says.

Spencer Stuart uses Equant IP VPN services, which Abel says has helped improve efficiency while reducing operating costs and freeing up IT staff. The company has been running the VPN network since 2001 and just signed a contract to extend the relationship another three years.

"It allows you to do more for the same amount of money. It allowed us to increase our bandwidth up to 10 times to key offices," he says. "It really is a case where we're saving money, we're doing more with what we're willing to spend, and it's more stable."

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