What is VPLS?

01 January 2010 |


Virtual private LAN service (VPLS) is a means by which Ethernet-based multipoint-to-multipoint communication can be provided over IP/MPLS networks.

The technology makes it possible to connect local area networks (LANs) over the internet in a way that makes them appear to subscribers to be a single Ethernet LAN. A VPLS works by moving each subscriber’s Ethernet packages by tunnelling them through the service provider’s network independently of traffic from other internet users.

The technology enables geographically dispersed sites to share a broadcast domain by connecting sites using pseudowires and therefore is most strongly applicable to enterprises. Pseudowires are an emulation of a Layer 2 point-to-point connection-oriented service over a packet-switched network.

VPLS can be seen as a logical progression of the development of Ethernet from a 10Mbps shared LAN protocol to a multi-Gbps global service. VPLS is applicable to deployments that serve just a few subscribers up to hundreds of thousands and, from a user point of view, doesn’t require subscribers to connect directly to the internet, instead users connect to a VPLS as if they were connecting to an Ethernet network.

What are its advantages?

From a service provider perspective, VPLS enables the generation of additional revenues because it means the provider is able to offer a new Ethernet service with flexible bandwidth supported by sophisticated SLAs.

From a quality of service point of view, VPLS can be used to provide different levels of QoS such as a dedicated service with guaranteed bandwidth and low latency for VoIP. In addition, VPLS is both more simple and cost-effective to operate than traditional services so opex can be minimised.

From a customer perspective, VPLS has advantages because it enables connection of all its sites to an Ethernet virtual private network (VPN) that delivers a secure, fast and homogenous network. The technology also allows users to change location easily and claims to help organisations manage their network connections and control their costs more effectively.

VPLS reportedly provides more bandwidth than a private line for a similar price. The technology is especially attractive in emerging markets where users have seen price drops of as much as 30% in addition to an increase in bandwidth when using it to replace leased line contracts.

The technology is also ideally suited to connecting multiple sites within metropolitan areas and can be deployed as an alternative, or in addition to, LAN-to-LAN services. This, coupled with VPLS’ ability to handle other, older traffic types as well as IP, makes the technology very suitable for use in organisations that depend on outdated protocols to operate their businesses.

What are its disadvantages?

VPLS has several limitations. Most notable among these is that the onus is on the customer to manage the network so that organisations that wish to outsource are, in many respects, excluded from using the technology.

However, many enterprises have large internal pools of resources to draw upon and are happy to manage their own connections. The good news for them is that VPLS isn’t a quantum shift for personnel that are familiar with Ethernet operations. Many enterprises have longstanding experience of Ethernet operations so VPLS fits in with that experience and extends it.

Nevertheless, VPLS has further limitations. For example, it cannot use summarisation to cope with large numbers of media access control (MAC) addresses because, in contrast to IP addresses, MAC addresses do not have any hierarchy. In addition, VPLS faces some issues with scalability because it uses MPLS tunnels to create a fully meshed network and therefore can require a very large number of individual connections.

Which providers are offering VPLS?

Aside from smaller players that have been operating services in limited locations for several years, AT&T was among the large-scale VPLS pioneers and launched its OPT-E-WAN VPLS service last year. Other carriers providing VPLS include Verizon, which launched a global VPLS service that covers 31 countries in November 2009 and Global Crossing, which launched a similar service, addressing 26 countries in October 2009.

Large carriers embracing the technology include: Singtel, Reliance Globalcom, Tata Communications and KPN International. A raft of national players, such as NTL:Telewest Business in the UK, also offer services.

What are the prospects for VPLS uptake?

It’s still an early stage market. A survey by analyst firm Forrester Research into enterprise Ethernet VPLS purchasing decisions in Europe and north America found that 12% of respondents are currently using a VPLS-based network and 27% expect to do so by the end of 2010.

The prospects look good for the technology with IDC projecting the overall market for wide area Ethernet LAN services – including VPLS – will achieve a compound annual growth rate of 28% between 2008 and 2013. However, that figure is based on a wider market and carriers such as BT Global Services remain cool on the technology. Orange Business Services, which has been cautious regarding the technology, has only recently announced plans to offer VPLS.