Regan's Blog

There two common ways of implementing Managed WAN products on MPLS VPNs, via layer 2 (Ethernet) and layer 3 (IP). 

In the New Zealand market, the Tier 1 providers have focused almost solely on offering layer 3 WAN services, e.g. One Office and Private, IP because there is a perception that these provide a higher value than layer 2 services. 

This seems to be because layer 3 VPNs require the service provider to manage the IP addresses, which is seen by service providers - and some customers - as a good thing. 

The problems with this approach can come when the customer is quite capable and willing to manage their own IP address space. 

In many cases, the customer may want to make change to their addressing on a semi-regular basis.  This is where the problems can come in, because IP addressing has to be negotiated with the service provider. 

This means a change request using the appropriate forms, waiting for the response, co-ordinating a suitable time, then hoping that the service provider gets the change right. 

For some customers, who don't have many changes and don't need the control of their IP addressing (which is common in the SME space), this is OK; but for many larger customers with specialised requirements, it's not.

Metro Ethernet Forum (MEF) Carrier Ethernet VPNs are the fastest growing VPN type in overseas markets. These provide customers with the transparency and control of Ethernet, while still providing all the carrier class benefits of reliability and scalability that layer 3 MPLS VPNs provide. 

Customers have the freedom to choose their own architecture, VLAN and IP addressing plans and make changes in their own time without consultation. In addition, MEF Carrier Ethernet VPNs provide the unparalleled service management tools (see a couple of posts back) that allow service providers to be truly proactive to customer faults and to provide meaningful SLAs.

Both types of WAN VPNs have their place, but it’s definitely not an 'any colour as long as it’s black' thing. I'll leave a more detailed comparison of Layer 2 vs Layer 3 VPNs till a later post.