VPNs burst on the scene in the late 1990s as a way to use the Internet securely and cheaply as the backbone for corporate WANs.

The downside was that the Internet was unreliable and insecure, but the Internet proved reliable enough for most data purposes, and security in the form of IPSec locked down connections between sites.

Frame relay didn’t have either problem. As frame relay provider networks matured, they were adequately provisioned so bandwidth paid for was bandwidth delivered. As a Layer 2 switched technology, most customers felt that it was inherently secure and if businesses were worried, they could tack on their own encryption.

With the rise of MPLS, a new form of VPN came into being. Rather than installing VPN gateways at each corporate site to create encrypted tunnels to other sites, MPLS required just a router connection to the provider access line. The service provider would route traffic to any other corporate sites similarly connected to the network.

In the world of frame relay, such meshing of connections so all sites could connect to all other sites required setting up virtual circuits, the division of access lines into logical links to other sites. The result is similar to having MPLS route traffic among all sites, but MPLS doesn’t require virtual circuits - a significant cost savings that customers couldn’t ignore.

"Having any-to-any connectivity was a very big driver for us," Catherine Watterson, vice president of enterprise engineering services at Policy Studies in Denver told Network World in 2005, when her company was in the midst of moving from frame relay. "We wanted to simplify our network in comparison to what we had with frame relay, where everything came in to our headquarters location. We also were interested in lowering our costs." 

With IPSec and MPLS teaming up to provide functionally similar and less costly service, frame relay lost its edge and is gradually being replaced by one or the other.

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