Seeing as it was originally conceived in the context of a LAN, some fundamental
constraints have surfaced as Ethernet is transformed to a Service Provider??“delivered
service in a MAN or WAN. These are noted next.
Economic Barriers
Ethernet beyond the LAN is usually delivered as service by a Service Providers, and
hence the economics associated with delivering this service should be attractive to the
Service Providers. Put another way, delivering Ethernet services should entail both
top-line (revenue) and bottom-line (profitability) growth.
Revenue per Bit Decreases Quite Dramatically One of the key drivers for Ethernet services
from an enterprise customer??™s standpoint is the significantly lower cost per bit??”
usually a tenfold increase in bandwidth is available for only a two- or threefold increase
in cost. Conversely, however, for the Service Providers offering the service, this means
that their revenues per bit are similarly reduced. Understandably, Service Providers
can be reluctant to offer Ethernet-based services given that they can derive substantially
higher revenues from incumbent legacy services like Frame Relay, Private Line, especially
if customers are not demanding new services.
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