Even though
the actual pricing varies between markets, it is at least 20??“30 percent lower than ATM,
Frame Relay, or Private Lines. The fairly strong competition among Service Providers,
coupled with the lower cost of delivering Ethernet services versus other traditional
services (see the next section), has largely contributed to this situation.
Studies commissioned by the MEF used a scenario of a large enterprise with several
sites, requiring Internet access and a point-to-point connection between multiple sites.
These services could be delivered over a Frame Relay service, Private Line service, or
an Ethernet service. It was found that the enterprise would save nearly 80 percent using
an Ethernet service over a traditional Private Line. As important, in the scenario
presented, this equated to a dramatically lower cost of nearly $500K using Ethernet
services, as opposed to the $2.5 million of using the private line over a period of three
years (see Figure 1.14). Thus, Ethernet services represent a significant savings in absolute
terms as well, even when a nominally sized customer base is considered.
Simpler, Lower Cost Equipment at the Customer Premise Employing a single Ethernet
interface for all the services means simpler Ethernet equipment, such as a low-end
switch or a router, suffices in lieu of complex multiport ADMs??”and usually the associated
demarcation devices like Integrated Access Devices (IADs), and CSU/DSUs, or
similar devices.
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