Ethernet services

Still Spending on Ethernet

6:00 PM -- Every year, the enterprise business unit of Global Cloud Xchange -- i.e., the acquired Yipes Enterprise Services -- surveys enterprises to look for trends in the usage of things like Ethernet services. With its most recent survey, taken in December, Reliance got a heartwarming surprise: no wholesale decline in expected network spending.

Smaller enterprises seem to be cutting back, but those that spend $500,000 or more per year on the network tended to say their budgets will grow in 2009 compared with 2008. And remember, they said so in December, when it was clear the economy would suck this year.

(Reliance's survey grouped enterprise budgets into ranges from $10,000 to $5 million a year; about 14 percent of respondents said they'd spend more than $5 million on the network this year.)

Asked to list their top reasons for spending money on network improvements, 76.2 percent said they wanted to improve network performance and efficiency. "Last year, the top reason driving network changes, or network spending, was replacing existing services," says Keao Caindec, chief marketing officer of the enterprise business unit. (That reason got a 37.5 percent response this year.)

Asked what they thought the limitations of Ethernet services were, 27.7 percent of those surveyed said availability -- much lower than last year's 40.8 percent. Ethernet services have been docked in the past for simply not being available even in big cities, due to limited network reach, so that's an improvement.

The largest perceived limitation of IP/MPLS services was the cost, surprisingly enough; it was flagged by 45.8 percent of respondents. "With all the other pieces in there, MPLS isn't as cheap as you'd expect it to be," Caindec says.

— Craig Matsumoto, West Coast Editor, Light Reading

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