Report: IP VPN Use Will Skyrocket In 2005

Forrester says 82% of companies already use them, up from 55% in 2003.

November 10, 2004

2 Min Read
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2005 will be a big year for IP virtual private network adoption, according to a new report from Forrester Research. In "Trends 2005: IP VPNs," Forrester associate analyst Robert Whiteley predicts continued IP VPN growth, as large enterprises migrate to secure sockets layer (SSL) and multiprotocol label switching (MPLS) systems and small and mid-sized businesses invest in IPsec-based networks.

According to Whiteley, IP VPNs are taking off as vendors simplify deployment. He notes that IPsec VPN functionality is being integrated into a wider assortment of network devices, from access gateways to firewalls. At the same time, vendors are rolling out more easily managed SSL VPN hardware and service providers comprehensive, hassle-free managed services.

Forrester found that 82% of companies surveyed had completed a VPN deployment in 2004, up significantly from 55% in 2003. The majority of this momentum is behind IP VPNs, which use technologies like IPsec, SSL, and MPLS to provide low-cost site-to-site and remote-access connectivity.

MPLS, offering a cost-effective migration path away from costly ATM and Frame-Relay VPNs, has sprouted up everywhere. All service providers now offer MPLS services and are eager to market them, notes Whiteley. "The ubiquity of MPLS is attractive for enterprises looking to replace aging national and global Frame Relay networks with a more scalable solution," he writes. "Furthermore, MPLS' SLAs are now mature enough to guarantee the latency, jitter, and delay metrics needed to build enterprisewide converged voice, video, and data networks."

Whiteley expects independent local exchange carriers to become a major force in the IP VPN market, and points out that, with their high capitalization and strength in traditional telecommunication services, ILECs are already four of the top seven VPN providers in the US. Nevertheless, there will be, according to the report, a shakedown in the VPN equipment market in 2005. Larger vendors like Nokia, Cisco and Juniper have better resources to improve ease of use and integrate the advanced features sought by enterprises than their smaller competitors.While the big enterprises migrate toward SSL and MPLS solutions, Whiteley points out that the ubiquity and low cost of IPsec solutions will draw increasing numbers of SMBs to the VPN banquet. "Vendors are aggressively introducing integrated security devices and VPN appliances specifically aimed at the SMB space," he writes. "As functionality goes up and price points go down, SMBs will finally be able to enter the VPN space."

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