IP VPN vs MPLS: Top 5 Factors to Consider

In comparing IP VPN vs MPLS, there are significant differences are in service qualities and the question of who manages and has visibility into the network for remote locations or wireless backhaul.
The two terms — IP Virtual Private Networks and Multi-Protocol Label Switching — are often used without regard for any underlying differences — but at the same time, MPLS has become such an integral part of networks that the comparison isn’t exactly apples-to-apples.
“IP VPNs and MPLS are sort of interchangeable in most people’s minds,” said Mike Rouleau, senior vice president of strategy and business development for TW Telecom, the third largest U.S. provider of Carrier Ethernet services. “Unfortunately, in the in industry we tend to use the terms interchangeably, and they’re really not.”
According to Brian Washburn, research director for network services at Current Analysis, comparisons between the two technologies need to take into the account the fact IP VPNs may actually rely on MPLS infrastructure. That same equipment, he said, is also likely to be running VPLS and dedicated Internet access, and perhaps layer 2 VPNs as well.
“You really start getting into semantics,” he said. “MPLS really has become the universal platform on which all these other services ride. If you’re running IP VPN services, chances are it’s going over MPLS boxes.”
However, while IP VPNs may very well be running over MPLS equipment, there remain significant differences in service choices in choosing a particular flavor of network design.
Flexibility is one. IP VPNs on MPLS, Washburn said, is a very flexible, dynamic route to network connections. “It’s easier for building very large networks with lots of little endpoints. The carrier partner can control it and provide reporting information. … It’s a good choice for people who want a partner to build a very large network for them that they can change as they go along.”
Management also comes into play in thinking about IP VPN vs MPLS. In terms of management, Rouleau said, “IP VPN is most often the customer will manage devices at the end of the line themselves, and with MPLS service, that VPN capacity is managed by the [backhaul] carriers.”
Services and security are two other factors in the IP VPN vs MPLS debate. IP VPNs don’t necessarily have class of service capabilities to enable traffic prioritization and management, Rouleaux said; MPLS does. Also, IP VPNs may operate over the open Internet, which means additional security concerns.
Meanwhile, MPLS relies on shared network equipment, but provides an inherently private network that is logically separated from other traffic via MPLS labels. Although there is no built-in encryption within MPLS, customers can choose to add some level of encryption in order to make sure that their data is unreadable even if an attacker was somehow able to access the mobile care – which is highly unlikely.
Security differences in IP VPNs vs MPLS fall into a “pretty broad range,” Rouleau said. “It depends on how you set it up, from simple authentication strategies to complex encryption. It depends on the service at the end of the line.”
Price can also be a determining factor in the choice between an IP VPN vs MPLS. Some network operators will make a VPLS service cheaper than MPLS, and an IP VPN may also be less expensive than MPLS. MPLS connections often run between $300-$600 per Mbps per month, according to a report in Network World. Fiber MPLS connections can cost twice as much as fiber Internet connectivity.
According to research firm TeleGeography, the median monthly cost of a 1.5-Mbps MPLS IP VPN port in New York was $377 (2010 figures). Prices tend to be higher outside North America and western Europe, the firm said.
However, some vendors charge a single rate for ports regardless of which technology is being run over them, Washburn said.
“Some folks say that a port is a port is a port, and we’re not going to play those games of trying to price one against the other,” he added.