Bigger, faster networks aren't necessarily better. According to Gartner, businesses will waste more than $10 billion on Gigabit Ethernet for the LAN by 2008. Factor in the cost of Gigabit-equipped phones, larger power supplies, upgraded facilities and additional requirements, and even more money is squandered.

Speaking at Gartner Symposium/ITxpo in San Francisco, Gartner analyst Mark Fabbi said most companies rely on outdated network design and procurement practices that result in over-engineered, overpriced and underperforming network infrastructures. The problem is IT's failure to focus on user needs.

Many organizations have increasingly distributed workforces of users who are located in branch offices, on the road or at home. "The majority of network designers continue to be caught in traditional design practices," Fabbi said. "They continue to spend money on bigger and faster core networking technologies at their headquarters and large locations that don't actually serve the user population."

Rather than buying the next big infrastructure upgrade, Gartner recommends that network managers design networks that meet user requirements and allocate capital to technologies that will have the most impact on the business. "Astute network managers will focus their attention on the upper layers of the stack, and look to security, data control, application optimization and mobility services as key features that will benefit the organization far more than installing Gigabit Ethernet for all desktops," Fabbi said.