Gig E to the desktop: Bargain or boondoggle?

What really is amazing is the NIC vendors have proven that the cost of these chips is down to commodity prices. Then why are the switching vendors still demanding the premium for these chips?

Everywhere I turn these days I hear rumblings about Gigabit Ethernet to the desktop. We are seeing white papers touting the joys and benefits of delivering 10 times the bandwidth of a traditional Fast Ethernet network interface card at a fraction of the cost.

Surely, many folks are excited about Gigabit Ethernet to the desktop and big bandwidth returns. But what’s really needed now is for everyone to take a deep breath and exhale . . . and then look at Gigabit Ethernet from a broader, cost-of-ownership prospective.

Recently, The Tolly Group completed a project looking at the viability of Gigabit Ethernet over copper to the desktop. In the study, The Tolly Group benchmarked the performance of a couple of copper Gigabit Ethernet NIC installed in a high-end desktop machine across a few different operating systems. We then analyzed the results and compared the performance with the price/performance that traditional Fast Ethernet NICs delivered.

With the costs for Gigabit Ethernet NICs having dropped dramatically in the past 12 months, prices for these interfaces are hovering at commodity levels. You can pick up a name-brand Gigabit Ethernet NIC during your next visit to CompUSA for less than $80. Even last May, Dell announced that its high-end desktop line was migrating to and standardizing on an onboard Gigabit Ethernet NIC in place of Fast Ethernet. One thing no one is talking about is the cost for plugging in these NICs at the switch.

While consumers no longer have to pay a premium for Gigabit Ethernet NICs, there is no bargain when it comes to the switch ports. Using a current price list from one of the major switching vendors, we calculated the cost per port for a typical workgroup switch for both Fast Ethernet and Gigabit Ethernet. The results were simply staggering.

A 48-port Fast Ethernet switch at list price delivered a per-port cost of a little more than $100 per port, while a similar stackable for Gigabit Ethernet was more than $700 per port for a name-brand product from a premier switch makers. That is roughly a seven times cost for a Gigabit Ethernet copper port over the cost of a 10/100 port. But wait; there’s more.

Beyond the upfront switch port and NIC costs, there is the cost of real estate in terms of rack space. Where it is common to obtain 48 ports in a 1U or 2U form factor for Fast Ethernet ports, the Gigabit Ethernet switch cannot support the port density, allowing only about half the number of Gigabit Ethernet ports in the same form factor.

So you say seven times isn’t bad – not for 10 times the performance. It might not be bad if we were talking $10 per port vs. $70 per port. Unfortunately, we are talking 10 times that. That isn’t chump change, and if you’re looking to deploy Gigabit Ethernet to the desktop across 1,000 users, costs can mount up.

What really is amazing is the NIC vendors have proven that the cost of these chips is down to commodity prices (I doubt the NIC vendors have the motto of “Sell at a loss, we will make it up in volume!”). Then why are the switching vendors still demanding the premium for these chips?

Next time your friendly switching salesman comes calling, ask him to explain the premium-pricing issue to you, then drop us a line and let us know if any of it makes sense.

Tolly is a senior engineer with The Tolly Group, a strategic consulting and independent testing company in Manasquan, N.J. He can be reached at btolly@tolly.com. Kevin Tolly returns with the next column.