Branch Office Networking
An IT Business State-of-the-Market Brief
by Jim Metzler
Published May, 2004; Posted May, 2004




Branch offices are key to the success of virtually all companies. That follows in part because branch offices typically provide a critical touch point between a company and its clients.


However, branch office networks can be extremely expensive to create and maintain. For example, consider a hypothetical company Acme, Inc. Assume that Acme has 100 branch offices, that Acme has a link from each of these branches to a central data center, and that Acme is looking to upgrade its branch office network.


Further assume that when Acme creates a business case for any IT project it uses a 36-month time lifecycle. Given that Acme has 100 branch offices and uses a 36-month lifecycle, this means that every dollar of monthly recurring cost in a branch office is multiplied by 3,600 (i.e., 100 branches x 36 months) in order to calculate the Total Cost of Ownership of the upgrade to the branch office network. Hence, if the upgrade results in an incremental recurring cost of merely $100/month/office, this results in an incremental cost of $360,000 over the three-year life of the upgrade.


Given the great expense that is associated with branch office networks, Ashton, Metzler & Associates (AM&A) performed market research to better understand the dynamics that surround this component of IT. In order to perform this research, AM&A surveyed the subscribers to Webtorials, the computer-networking industry’s premier educational Web site. Throughout this document, the IT professionals who responded to this survey will be referred to as The Survey Respondents.


The survey focused on a number of topics, including the:



Applications that are either currently running, or soon will be running, over branch office networks


Networking functionality that either currently exists in branch office networks, or will exist in


the near term


Role that traffic management plays in branch office networking


Changes that are occurring within data centers


Degree to which a company’s telecommuters are satisfied with their current connectivity options


Throughout this document a number of conclusions are drawn relative to the changes that are happening in the marketplace.


About the Author:


Jim Metzler is a principle in Ashton, Metzler & Associates, a consulting firm that focuses on leveraging technology for business success. During his career, he has worked in virtually every major segment of the IT industry.  Jim is also co-founder of IT Business.



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