COMPARISON OF COSTS
           MPLS VPN – VS – POINT-TO-POINT LEASED LINES


Let us consider connectivity between two poin...
A similar comparison may be made of intra-city connectivity as shown in Table 2
below.

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Mpls p2 p

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Explains the cost difference of MPLS VPN and p2p leased line connectivity

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Mpls p2 p

  1. 1. COMPARISON OF COSTS MPLS VPN – VS – POINT-TO-POINT LEASED LINES Let us consider connectivity between two points A and B at a chargeable distance (1.25 x crow flight or radial distance) of more than 500km for a 64 kbps link The Table below shows the comparison of costs between a point-to-point and MPLS VPN connection. TABLE 1 CROSS COUNTRY LINK Sl Head of charge MPLS Point-to- Point-to- Remarks VPN point leased point leased line as per line after Web site new circular 1 End link 5 km at A NA 11500 17811 2 End link 5 km at B NA 11500 17811 3 NTU rent at A NA NA 3500 4 NTU rent at B NA NA 3500 5 Long distance NA 51000 51000 charge between A &B 6 Port charge at A 63000 NA NA 7 Port charge at B 63000 NA NA 8 Total cost 126000 74000 93622 9 Service tax @12% 15120 8880 11234 10 Education Tax 2% 2520 1480 1872 11 Total cost based 143640 84360 106728 Based on on rack prices and Rack prices inclusive of taxes and levies 12 Percentage of 100% 58.73% 74.30% Point-to- MPLS VPN cost point leased lines are much cheaper 13 Possible bulk 40% 25 to 30% 25 to 30% discounts Page 1 of 2
  2. 2. A similar comparison may be made of intra-city connectivity as shown in Table 2 below. TABLE 2 INTRA-CITY LINK Sl Head of charge MPLS Point-to- Point-to- Remarks VPN point leased point leased line as per line as per Web site 15 Web site 25 km km 1 Total circuit charge NA 25463 19116 3 NTU rent at A NA NA 3500 4 NTU rent at B NA NA 3500 6 Port charge at A 63000 NA NA 7 Port charge at B 63000 NA NA 8 Total cost 126000 25463 26116 9 Service tax @12% 15120 3056 3134 10 Education Tax 2% 2520 509 522 11 Total cost based 143640 29028 29772 Based on on rack prices and Rack prices inclusive of taxes and levies 12 Percentage of 100% 20.21% 20.73% Point-to- MPLS VPN cost point leased lines are much cheaper 13 Possible bulk 40$ 25 to 30% 25 to 30% discount Page 2 of 2

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