Business Case for Carrier Ethernet Services
by Cisco Systems
Published 2005; Posted November 2006



Service providers are facing vital business issues as the industry moves from service portfolios based on circuit-switched voice and TDM/PDH-based transport to converged networks employing Ethernet, Multiprotocol Label Switching (MPLS), and IP. One problem is creating revenue growth while maintaining profit margins. This cannot be achieved merely by substituting higher-speed IP services for existing voice, T1/E1, and Frame Relay services. New enterprise service offerings based on Ethernet and MPLS provide capabilities to help resolve service providers’ revenue and profit margin dilemmas.


Carrier Ethernet services built on the Ethernet Line (E-Line) and Ethernet LAN (E-LAN) service types defined by the Metro Ethernet Forum (MEF) provide the foundation for service revenue growth. They support a broad range of value-added services that can be sold at higher price points. When combined with MPLS technologies, Layer 3 MPLS VPN-based services support additional service offerings and help reduce total cost of ownership (TCO), directly addressing service providers’ profitability concerns.


This paper describes the architectures and Cisco® products used to deploy a Carrier Ethernet/MPLS network on a national or international scale, and presents a case study that demonstrates the attractive cash flow that can be generated by such a project.



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