• United States
Executive Editor

Service providers help boost popularity of VPN services

Feb 10, 20042 mins

* Analyst firm predicts boom for managed and network-based VPNs

A lot of the talk in this newsletter is about how you can build your own VPN, but there is of course an alternative: buy a VPN service.

That is going to become an increasingly popular option over the next few years, according to market research firm In-State/MDR.

It’s study “VPNs take a New Look: Trends in the U.S. IP VPN Services Market” predicts that these services will grow at 20% per year for the next four years. This calculation includes network-based VPNs as well as managed customer premises equipment VPNs, and predicts that network-based services will grow faster.

The study forecasts that frame relay users will migrate to an IP network VPN service that offers fully meshed connections at a better price, says Henry Goldberg, a senior analyst for the firm who wrote the report. These services balance the need to keep costs down along with security requirements, and they enable converged networks that handle both voice and data to streamline network design. This convergence can lead to advanced services such as unified messaging and follow-me messaging that combines voice, text messaging and e-mail.

He calculated 2003 spending on VPN services in the U.S. was $2.45 billion, but says that the entry of major service providers into IP services means they will become more and more popular. These carriers – AT&T, MCI and SAVVIS being the largest – with the bulk of existing customers will grab about 40% of VPN service revenue, the report predicts. He also notes that VPN service providers are expanding the access options customers can use to include Wi-Fi and Secure Sockets Layer remote access.

The study says more but you have to buy it to find out what that is by contacting and using the intuitive reference number for it: #IN0401350BD.