A Madge Networks White Paper. Historical Documentation.

1. Token-Ring Cost of Ownership
Cost Analysis Comparison for Upgrading a Token-Ring Network
A HIGH-SPEED TOKEN-RING ALLIANCE WHITE PAPER
Table of Contents
Executive Summary ...................................................................................Page 2
Introduction................................................................................................Page 3
Cost of Ownership Defined........................................................................Page 4
Comparison Scenarios ...............................................................................Page 5
Existing Network Requirements..........................................................Page 5
File Server Viability ............................................................................Page 5
Ethernet Migration Options ................................................................Page 6
Token-Ring Upgrade Options .............................................................Page 7
Cost Factors................................................................................................Page 8
Tangible Equipment Costs...................................................................Page 8
Necessary Upgrade Equipment .....................................................Page 8
Installation-Related Costs....................................................................Page 9
NIC Installation..............................................................................Page 9
New Wiring Installation.................................................................Page 9
Server Upgrades .............................................................................Page 9
Interim Equipment ......................................................................Page 10
Network Device Reconfiguration.................................................Page 10
Application Reconfiguration........................................................Page 11
Intangible Costs..................................................................................Page 11
Network Downtime.......................................................................Page 11
Migration Planning ......................................................................Page 11
Skills/Training Acquisition ..........................................................Page 12
NW Management Tools Acquisition............................................Page 12
Cost of Ownership Comparison Table....................................................Page 13
Summary and Conclusions......................................................................Page 14

2. TOKEN-RING COST OF OWNERSHIP A HIGH-SPEED TOKEN-RING ALLIANCE WHITE PAPER
Page 2 of 16
EXECUTIVE SUMMARY
In recent years prices have dropped on Ethernet adapters, hubs, and switches. At the
same time Ethernet speeds have increased from 10 Mbps to 100 Mbps to 1 Gbps. These
developments, despite the numerous performance and technical advantages of Token-
Ring technology, have lead some Token-Ring Network Managers to begin looking at
Ethernet as a possible solution when upgrading their Token-Ring networks to higher
speeds. Some Network Managers are also convinced they will save money by doing so.
Our “Cost of Ownership” analysis, which includes tangible costs such as new equipment,
installation-related costs such as cabling changes, and intangible costs such as network
planning, shows that installing dedicated 16 Mbps switch connections to every desktop
and HSTR in the backbone in an existing Token-Ring network is nearly $86,000 less
expensive than migrating that same network to Ethernet with dedicated 10 Mbps switch
connections to every desktop in a 500 node network. Considering equipment costs alone,
the calculations in this paper show that price-per-megabit-per-workstation is $2.21 less
expensive for migrating to 16 Mbps switched Token-Ring to the desktop than migrating
to Ethernet. (A detailed summary of this is shown on page 14.)
At the same time, the Token-Ring solution delivers a significantly higher quality business
solution:
Ø The incremental Token-Ring upgrade can be implemented quickly and easily. The
move to Ethernet is riskier, hard work and could involve a higher degree of service
interruption.
Ø The higher speed and inherently more efficient operation of Token-Ring means that
the 16 Mbps switched desktops will run at nearly twice the speed of 10 Mbps
Ethernet. A switch from Token-Ring to 10 Mbps Ethernet at the desktop would mean
a downgrade in desktop performance.
Ø Capabilities inherent in Token-Ring make it a more robust solution for the future.
This paper does not consider the necessary cost of subsequent upgrades and
extensions to Ethernet to build in capabilities already present Token-Ring (file
transfer efficiency because of Token-Ring’s large frame sizes and Class-of-Service,
or priority mechanism).
Therefore, not only does it make economic sense for a Token-Ring customer to stay
Token-Ring, but it is technically advantageous as well.
At the end of this document, readers will find a worksheet that network managers can use
to perform their own cost comparison of Token-Ring upgrades versus Ethernet migration
alternatives.

3. TOKEN-RING COST OF OWNERSHIP A HIGH-SPEED TOKEN-RING ALLIANCE WHITE PAPER
Page 3 of 16
INTRODUCTION
Token-Ring networking today enjoys a customer base of more than 20 million users
(according to International Data Corp.), chiefly residing in the largest corporations in the
world that depend on their networks for mission-critical applications. Token-Ring shops
chose the technology for its inherent robustness, reliability and efficiency in large
enterprise environments. For many Token-Ring managers today, migrating away from
the networking technology that has served them well for so many years makes little sense
on the grounds of performance, functionality and cost. The argument of cost is perhaps
the most important issue to address.
Understanding the Issues
Recent advances in the bandwidth capabilities of Ethernet technology – including the
introduction of “Gigabit” Ethernet – have generated considerable enthusiasm in the trade
press. For established Ethernet and “Fast Ethernet” installations, the marketing message
from product vendors is that Gigabit Ethernet is the “logical next step” for network
evolution.
While this may be an accurate assumption for existing Ethernet networks, it is not a cost
effective alternative for existing Token-Ring networks. The bottom line is that before
migrating any portion of the Token-Ring network to Ethernet, network managers, IS
Managers and CIOs must understand all of the technical and economic tradeoffs involved
in such a transition.
Maintaining Token-Ring Makes Financial Sense
While many believe that Ethernet is the most cost-effective forward path for the
enterprise network, this is simply not true for existing Token-Ring network installations.
Central to this claim is the notion of “Total Cost of Ownership.” While direct equipment
cost is the most visible factor in calculating an upgrade, many installation-related, as well
as several intangible, cost factors must be figured in to the equation to arrive at your final
cost of upgrading.
As this paper will demonstrate, the total cost of delivering either dedicated 10 Mbps or
dedicated 100 Mbps Ethernet connections to each desktop exceeds the cost providing
dedicated 16 Mbps Token-Ring connections to each desktop. In both cases, servers and
backbones are upgraded to 100 Mbps technology.

4. TOKEN-RING COST OF OWNERSHIP A HIGH-SPEED TOKEN-RING ALLIANCE WHITE PAPER
Page 4 of 16
COST OF OWNERSHIP DEFINED
Total Cost of Ownership analysis seeks to determine the actual cost of a technology
acquisition or upgrade by calculating both the tangible and intangible costs associated
with the upgrade. When applied to an array of upgrade options, TCO provides a means
for evaluating these options on an “apples-to-apples” basis. The technique assumes that
all options are equally valid from a technical standpoint (i.e., that they each provide a
solution to the underlying business problem) and that the discriminator being sought to
facilitate a decision is one of cost.
Tangible vs. Intangible Cost Factors
Tangible costs include the purchase of new network equipment such as switches, routers,
hubs, and network interface cards for servers and desktop computers. However, in
addition to direct equipment costs, network upgrades may entail significant installation-
related costs for infrastructure improvements such as new network cabling, NIC
installation, as well as the cost of network device and application reconfiguration.
In addition to tangible expenses, network upgrades may entail significant intangible costs
that are unpredictable in nature. The intangible costs included in this TCO analysis
include factors such as migration planning, new skills and training acquisition, new
network management tools acquisition, end-user support and, of course, network
downtime.
The range of tangible and intangible cost categories begins to suggest the complexity of a
TCO cost estimate and, by contrast, the inefficacy of simple cost comparisons based
solely on equipment acquisition costs.
IS Managers should understand that, while their networks may differ significantly from
the network profiled in this paper, the principles applied in calculating the total upgrade
cost can be easily applied to calculate the most cost-effective upgrade path for their own
networks. To facilitate this effort, Appendix B provides a worksheet for the reader’s use
in performing his or her own analysis.

5. TOKEN-RING COST OF OWNERSHIP A HIGH-SPEED TOKEN-RING ALLIANCE WHITE PAPER
Page 5 of 16
COMPARISON SCENARIOS
This paper profiles an existing Token-Ring network that is undergoing a performance
upgrade, and looks at two distinct upgrade paths: 1) migrate the network to Ethernet and
2) upgrade the network using native Token-Ring solutions.
Existing Network Requirements
Our existing Token-Ring network connects 500 users and 40 servers. Currently, it is
comprised of 32-user 16 Mbps rings and two redundant 16 Mbps backbone rings.
Additional bandwidth is the goal of the Network Manager through increased server and
backbone performance. At the same time, they want to maintain other network properties
such as high availability. In order to assess the TCO for each option fairly, network
designers set forth very specific network upgrade goals. Following are the network
upgrade goals:
Ø Provide more available bandwidth per user;
Ø Provide future-proof backbone bandwidth;
Ø Provide more bandwidth for the servers
File Server Viability
It is assumed that our sample 500-node Token-Ring network currently employs 40 file
servers. In the Ethernet upgrade scenario, we must account for the upgrading of all 40
servers with a dedicated 100 Mbps Ethernet connection. However, for the Token-Ring
upgrade scenario, we will assume that, accounting for the bandwidth efficiencies of
Token-Ring, only half of the servers will need to be upgraded to 100 Mbps High-Speed
Token-Ring, the rest remaining viable with their existing 16 Mbps connections (in most
cases a 16 Mbps (32 Mbps full-duplex) connection to a server is sufficient).

6. TOKEN-RING COST OF OWNERSHIP A HIGH-SPEED TOKEN-RING ALLIANCE WHITE PAPER
Page 6 of 16
For each potential upgrade solution (Token-Ring and Ethernet), two distinct options are
evaluated to address the most likely upgrade paths used to address real-world solutions to
network bandwidth needs.
Ethernet Migration Options
Ø Ethernet migration option 1: dedicated 10Mbps switched to the desktop; 100Mbps to
servers
Ø Ethernet migration option 2: dedicated 100Mbps switched to the desktop; 100Mbps to
servers. (Note: While many customers in this scenario will consider Gigabit Ethernet
in the backbone, we chose to not use it in this analysis so that we could compare
networks of similar capacity.)

7. TOKEN-RING COST OF OWNERSHIP A HIGH-SPEED TOKEN-RING ALLIANCE WHITE PAPER
Page 7 of 16
Token-Ring Upgrade Options
Ø Token-Ring Upgrade option 1: segment workgroups with 16Mbps switching (20
users/switch port); add 100Mbps HSTR to servers
Ø Token-Ring Upgrade option 2: dedicated 16Mbps switched to the desktop; 100Mbps
to servers and between switches
While Token-Ring managers today have a wide array of upgrade options available to
them, the options profiled in this paper account for the most likely upgrade paths used to
address real-world network bandwidth needs.

8. TOKEN-RING COST OF OWNERSHIP A HIGH-SPEED TOKEN-RING ALLIANCE WHITE PAPER
Page 8 of 16
COST FACTORS
The following describes, and attempts to quantify, the tangible, the installation-related,
and the intangible cost factors associated with upgrading our sample network.
Tangible Equipment Costs
Ø Necessary Upgrade Equipment
Necessary upgrade equipment is the cost category most commonly considered when
comparing upgrade option costs. The cost category includes backbone, workgroup and
desktop switch ports and server and desktop network interface cards (NICs). It does not
include the cost to program or configure equipment or to install NIC cards in servers or
desktop computers.
The Ethernet migration path obviously necessitates the acquisition of new NICs in each
PC, whereas the Token-Ring upgrade path builds upon existing installed NICs.
It is worth noting that, in some cases, companies may have acquired PCs with Ethernet NICs embedded on
the motherboard. In such cases, additional desktop NIC acquisitions may be unnecessary. However,
industry sources suggest that only 25 percent of desktop systems sold with integrated NICs actually utilize
the on-board Ethernet adapter functionality. Network buyers must also be aware that so-called “free”
LAN-on-the-Motherboard is always hidden in the total PC cost.
For purposes of this comparison, average street prices for upgrade equipment have been
obtained from a leading national distributor (see Appendix A). The following table
summarizes the basis for our equipment cost comparisons:
Necessary Ethernet Equipment Necessary Token-Ring Equipment
10/100 Desktop NIC $90
10/100 Server NIC $93 100MB HSTR Server NIC $273
10MB Desktop switch port $66 16MB Desktop switch port $270
100MB Desktop switch port $132
100MB Workgroup switch port $290 16MB Workgroup switch port $408
100MB Backbone switch port $738 100MB HSTR BB switch port $747
The total equipment cost for upgrading our sample network to Ethernet (Option 1) is
$132,871, while the total equipment cost for upgrading to switched 16 Mbps to the
desktop and High-Speed Token-Ring (TR Option 2) is $194,919. (It should be noted that
in calculating price-per-megabit-per-workstation, we find that Token-Ring is still a better
deal since it costs $24.36/Mb/workstation while this Ethernet scenario will cost a
customer $26.57/Mb/workstation.)
This is the point at which most network managers are counseled to draw their
bottom line. Please read on.

9. TOKEN-RING COST OF OWNERSHIP A HIGH-SPEED TOKEN-RING ALLIANCE WHITE PAPER
Page 9 of 16
Installation-Related Costs
In addition to tangible equipment costs, there are also a number of installation-related
costs associated with each network upgrade option.
Ø NIC Installation
As mentioned above, the Ethernet migration option entails the significant cost of
upgrading all PCs with new Ethernet NICs. A set dollar cost of $50 per PC has been set
for this expense, based on one half hour staff time at $100/hour (includes both NIC and
driver software installation). (As previously indicated, some PCs offer integral Ethernet
NIC functionality on the motherboard. If this is the case and the on-board NIC will be
used, the only expense associated with NIC installation may be time and labor to
configure the NIC driver for use with the new network.)
Therefore, the cost associated with upgrading each PC in our sample network is $25,000
(500 PCs X $50).
Ø New Wiring Installation
In addition, the Ethernet migration path may also entail significant costs for new network
wiring. Depending on the type of wiring available for use (STP or UTP), it may be
necessary to completely rewire facilities in order to deploy Ethernet. If the existing
Token-Ring network operates over STP wire, an upgrade to UTP will be required. For
the purpose of this analysis, a cost of approximately $25 per drop (per PC and per Port)
for rewiring work is used (15 minutes of staff time). If UTP wire, which can be used by
both Token-Ring and Ethernet networks, is already in place to serve the existing Token-
Ring network, this cost may be subtracted.
The resulting cost rewiring for the Ethernet upgrade option in our sample network is
estimated to be $25,000 (500 PCs + 500 switch ports X $25). For the Token-Ring
upgrade option, the above costs do not apply.
Ø Server Upgrades
Token-Ring network managers considering an upgrade to Ethernet must be aware of the
potential that such an upgrade may necessitate an upgrade of network file servers.
One of the efficiencies of Token-Ring derives from the use of larger frame sizes (up to
18K for Token-Ring versus 1518 bytes for Ethernet). The resulting benefit at the file
servers is far lower CPU utilization than with Ethernet for a given data transfer. For
example, transferring a 10MB file from a Token-Ring file server requires roughly 2200
processing cycles (assuming a typical 4500-byte Token-Ring frame size), whereas the
same transfer from an Ethernet server will require more than 6500 processing cycles.
The importance of this issue increases significantly as access speeds are moved to
100Mbps.

10. TOKEN-RING COST OF OWNERSHIP A HIGH-SPEED TOKEN-RING ALLIANCE WHITE PAPER
Page 10 of 16
The demands placed on servers in an Ethernet network may raise a serious cost issue in
transitioning Token-Ring servers to Ethernet, a fact underscored by a white paper made
available from the leading Gigabit Ethernet vendor Alteon. Available on the Alteon web
site, the white paper outlines the CPU utilization inefficiencies inherent in Ethernet’s
smaller frame size (Alteon champions its own proprietary implementation of large frames
in an Ethernet environment).
While this cost is not included in the present TCO analysis, planners will need to
ascertain whether server upgrades are necessary and to include new server costs of $4000
or more per server in their analysis.
The Token-Ring upgrade path entails no additional upgrade expense for installed servers.
In a 500-node network such as the one described here, upgrading to High-Speed Token-
Ring does not negatively impact server performance, and instead improves access speed.
Ø Interim Equipment
Transitioning an existing Token-Ring network to Ethernet needs to be undertaken in
phases. As each phase is complete, a router will be required to interconnect the new
Ethernet segments of the network to the as yet unconverted Token-Ring segments.
Equipment acquisition (or lease) must be calculated into the costs for upgrading networks
using the Ethernet option. In addition, a week of staff time per router must be factored in
to configure each interim router for smooth internetworking operation.
As this cost varies greatly depending on the size and complexity of the network, this
analysis does not attempt to estimate a cost for necessary interim equipment.
Ø Network Device Reconfiguration
Replacing Token-Ring with Ethernet carries some significant cost implications for
existing networking equipment.
For example, many Token-Ring networks use Source Route Bridging, which is not
applicable in Ethernet networks. In such cases, the network bridging protocol is replaced
with Ethernet Spanning Tree. As a consequence of this change, legacy networking
equipment such as mainframes, AS400 mid-range processors and their associated
controllers will need to be re-configured for Ethernet operation. Reconfigurations are
estimated on a per device basis at three hours each, and costs calculated at an hourly rate
of $100 per hour.
In addition, all printers and printer interfaces that have been attached to the Token-Ring
network must be reconfigured to work in the new Ethernet environment. We will
calculate an estimated one hour of staff time to reconfigure each printer.
Finally, all individual workstations must be reconfigured for the new workgroup
structure, as well as IP addressing issues resolved in the move to Ethernet. This cost is
estimated at one half hour per workstation.

11. TOKEN-RING COST OF OWNERSHIP A HIGH-SPEED TOKEN-RING ALLIANCE WHITE PAPER
Page 11 of 16
In our sample network, we will assume one mainframe, for which 5 network devices will
have to be reconfigured, as well as 30 printers and 500 workstations in the move to
Ethernet. Therefore, the associated cost will be $29,500 for the Ethernet upgrade
scenario. ((3 hours X 5 network devices + 1 hour X 30 printers + 0.5 hours X 500
workstations) X $100/hour)
Ø Application Reconfiguration
All applications in the Token-Ring have been developed to utilize Token-Ring’s larger
frame sizes, and some may require significant reconfiguration to run on an Ethernet
network. For example, moving from Token-Ring to Ethernet may have an adverse
impact on a mainframe CICS application that is configured with a specific Maximum
Transfer Unit (MTU) setting. Such an application will need to be modified by a systems
programmer in order to operate properly. To assess the cost for application
reconfiguration, planners need to know the number and type of applications that will be
impacted and allocate programmer or systems programmer resources at the prevailing
rate of pay for the amount of time required to make the necessary code changes.
For this comparison, we will assume that three applications must be reconfigured for
Ethernet, each requiring one week of staff time at $2000 per week. Therefore, the
associated cost will be $6000 for the Ethernet upgrade scenario.
Intangible Costs
As is evident from the above, migrating Token-Ring to Ethernet may impact TCO
tangible costs dramatically. In addition to tangible costs associated with an upgrade
option, there are also significant intangible cost factors to be considered. These
intangible costs are typically far more difficult to calculate in an orderly manner.
Following are some important intangible cost categories.
Ø Network Downtime
One of the most difficult aspects of an Ethernet transition is an inevitable period of
network downtime during which users will be unable to perform useful work over the
network. Clearly, planning is required to minimize the impact on users and business
processes.
This analysis does not attempt to calculate a dollar figure for the Ethernet upgrade path.
However, it is certain that the native Token-Ring upgrade option will result in less
downtime than a conversion to Ethernet.
Ø Migration Planning
With the Ethernet upgrade path option, additional migration planning is required. Traffic
flows will need to be assessed and documented to identify potential congestion points and
to anticipate network traffic loads. Based on this input, a network design will need to be
developed that can handle predictable traffic in a balanced way.

12. TOKEN-RING COST OF OWNERSHIP A HIGH-SPEED TOKEN-RING ALLIANCE WHITE PAPER
Page 12 of 16
Additionally, devices and applications requiring reconfiguration will need to be identified
in advance and resources scheduled. Desktop NIC and driver installation must also be
scheduled and a transition plan, incorporating all of the above must be put in place.
The chart below summarizes estimated time requirements for planning a migration to
Ethernet. For costing purposes, a staff month is understood to be equal to $10, 000.
Planning Task Time Required Cost
Traffic flows 0.5 staff month $5,000
Network design 0.5 staff month $5,000
Mainframe and controllers re-configuration design 0.5 staff month $5,000
Applications review and modifications design 1 staff month $10,000
End user client modifications design 0.5 staff month $5,000
Transition plan 1 staff month $10,000
Total Cost $40,000
Most of the above planning activities are unnecessary with a native Token-Ring
technology upgrade. However, a schedule for switch and server NIC installation should
be developed. This cost is estimated at 0.5 staff months, or $5,000.
Ø Skills/Training Acquisition
With the Ethernet upgrade path, a company will need to acquire new skills and
knowledge for network operations and management. This analysis is based on the
assumption that off-site training is available at a cost of $2500 per student. For purposes
of this comparison, it is assumed that the network management team for the existing 500-
node Token-Ring network will need to send 3 staff members to training classes for the
Ethernet upgrade scenario, resulting in a potential cost of $7500.
Ø Network Management Tools Acquisition
With the replacement of Token-Ring by Ethernet, new network management tools may
need to be acquired that are appropriate to the new network technology, or existing tools
may need to be re-customized to monitor network conditions in the newly configured
network. In addition, training in the use of packet sniffers, tracing tools, and network
management system utilities may represent an expense item. Collectively, these costs
will be estimated at $20,000 for the Ethernet upgrade scenario.

13. TOKEN-RING COST OF OWNERSHIP A HIGH-SPEED TOKEN-RING ALLIANCE WHITE PAPER
Page 13 of 16
COST OF OWNERSHIP COMPARISON TABLE
The table below summarizes our “Total Cost of Ownership” analysis for each
upgrade option, and derives bottom line figures for the total upgrade cost.
Network Upgrade (500 Users)
Desktop Connection
Backbone
File Servers
Tangible (Equipment Costs)
Desktop NIC 500 $90 $44.9 500 $90 $44.9 0 $0 $0.0 0 $0 $0.0
Switch port (switch-to-desktop) 500 $66 $33.1 500 $132 $66.2 0 $0 $0.0 500 $270 $135.0
Switch port (WG switch-to-hub) 0 $0 $0.0 0 $0 $0.0 25 $408 $10.2 0 $0 $0.0
Switch Port (WG switch-to-BBone) 21 $290 $6.1 21 $290 $6.1 0 $0 $0.0 21 $747 $15.7
Switch Port (Backbone-to-WG switch) 21 $738 $15.5 21 $738 $15.5 0 $0 $0.0 21 $747 $15.7
Switch Port (WG switch-to-16M TR Server) 0 $0 $0.0 0 $0 $0.0 20 $408 $8.2 20 $408 $8.2
Server NIC 40 $93 $3.7 40 $93 $3.7 20 $273 $5.5 20 $273 $5.5
Switch Port (Backbone-to-server) 40 $738 $29.5 40 $738 $29.5 20 $747 $14.9 20 $747 $14.9
Total Equipment Cost:
Installation-Related Costs
NIC Installation
New wiring installation
Server upgrade
Interim equipment
Network device reconfiguration
Application reconfiguration
Total Ancillary Costs:
Intangible Costs
Network Downtime (service interruptions)
Migration planning
Skills/training acquisition
NW Management tools acquisition
Total Intangible Costs:
Total Upgrade Cost: $43,780 $199,919
(not estimated) (not estimated)
$29,500
$6,000
$85,500
estimated cost
$0 $0
$5,000 $5,000
$5,000 $5,000
$0 $0
estimated cost estimated cost
minimal minimal
$0 $0
$0 $0
$0 $0
$0 $0
$0 $0
$0 $0
estimated cost estimated cost
$0 $0
unit
cost
total
($000)
$38,780 $194,919
Qty
unit
cost
total
($000) Qty
100Mbps Switched 100Mbps Switched
100Mbps Switched 100Mbps Switched
Link Speed/Type Link Speed/Type
unchanged 16Mbps dedicated
Option 1 Option 2
Token-Ring Upgrade
estimated cost
Migration to Ethernet
100Mbps Switched
$165,975
unit
cost
100Mbps dedicated10Mbps dedicated
Link Speed/Type Link Speed/Type
$20,000
$7,500
100Mbps Switched
100Mbps Switched
$132,871
Qty
$67,500
$25,000
$25,000
Option 2Option 1
(not estimated)
$40,000
100Mbps Switched
(not estimated) (not estimated)
total
($000) Qty
unit
cost
total
($000)
(not estimated)
estimated cost
$25,000
$6,000
$40,000
$318,975$285,871
$25,000
$29,500
$7,500
$20,000
estimated cost
$67,500
$85,500

14. TOKEN-RING COST OF OWNERSHIP A HIGH-SPEED TOKEN-RING ALLIANCE WHITE PAPER
Page 14 of 16
SUMMARY AND CONCLUSIONS
Our Cost of Ownership analysis clearly illustrates that staying with Token-Ring provides
greater bandwidth at a lower cost. The equipment purchase, even though it is the one
most evaluated when a network upgrade is being considered, is a small portion of the
total expense for performing a “forklift upgrade” to Ethernet. Even if only the equipment
cost is considered, staying with Token-Ring is still a better alternative since the price-per-
megabit-per-workstation is $2.11 cheaper than moving to Ethernet. The following table
outlines this calculation:
(start with:) (divided by:) (divided by:) (equals)
Equipment Cost Number of users Bandwidth (Mbps) Cost/Mb/User
Ethernet $132,871 500 10 $26.57
Token-Ring $194,919 500 16 $24.36
When all additional installation-related and intangible costs are figured into this equation,
the outcome of this comparison is even more striking:
(start with:) (divided by:) (divided by:) (equals)
Total Upgrade cost Number of users Bandwidth (Mbps) Cost/Mb/User
Ethernet $285,871 500 10 $57.17
Token-Ring $205,892 500 16 $24.99
Thus, adding High-Speed Token-Ring and switched Token-Ring technology to an
existing Token-Ring network is a more cost-efficient strategy than replacing the networks
with an Ethernet alternative. In the scenarios used in the analysis, staying with Token-
Ring resulted in a total savings of between $85,952 and $275,195. As the pie-chart
below illustrates, straight equipment costs for the Ethernet upgrade scenario (dedicated
10 Mbps to each desktop) comprise less than half of the total upgrade cost. For the
Token-Ring Upgrade scenario (dedicated 16 Mbps to each desktop) users pay 98 percent
of the total upgrade cost for equipment.
As Token-Ring network managers upgrade their networks to facilitate new bandwidth-
hungry applications, the most cost-efficient and technologically-sound approach for
doing so is to adopt High-Speed Token-Ring, the next evolutionary step in the network
technology standard. Together, Token-Ring switching and High-Speed Token-Ring
preserve the corporate network technology investment while delivering increased
bandwidth and robust performance.

15. TOKEN-RING COST OF OWNERSHIP A HIGH-SPEED TOKEN-RING ALLIANCE WHITE PAPER
Page 15 of 16
APPENDIX A – ESTIMATED STREET PRICING TABLE (SOURCE: A LEADING DISTRIBUTOR)
Appendix A – Estimated Street Pricing Table (Source: A Leading Distributor)
All prices in US$
Vendor:
Ethernet Equipment 3Com Bay Cisco IBM Intel Olicom Avg ESP
product: 3C905b - - EtherJet Pro 100+ Mgmt RF-2327
ESP: 102 - - 76.59 96.3 85 $90
product: 3C905b - - Pro 100 Svr RF-2327
ESP: 102 - - 76.59 109 85 $93
product: SSII 1000 BayStack 301 Cat 1900 - Expres 10 -
ESP: 66 51 75 - 72.5 - $66
product: SSII3300 24 Bay 450 Cat 2924 8271 Exp510T CF 8420
ESP: 117 121 109 176.15 154 117 $132
product: 3c39024 350T Cat 2926 8277 Exp550T CF 8420
ESP: 259 187 472 306 399 117 $290
product: CB 3500* System 5000* Cat 5000* 8277* Exp100FX* -
ESP: 1228 416 741 306 999 - $738
Token-Ring Equipment 3Com Bay Cisco IBM Madge Olicom Avg ESP
product: - - - HSTR NIC RingNode HSTR RF-3530
ESP: - - - 250 270 300 $273
product: - - Cat 3920 8270 - 600 Sm. DeskStream CF 8601
ESP: - - 220.42 475 149.5 235 $270
product: - - Cat 3900 8270 - 800 RingSw. Expr. CF 8600
ESP: - - 351 519 414 350 $408
product: - ** - 8270 UFC* RingSw. HSTR * CF 8650*
ESP: - ** - 650 940 650 $747
* = price includes an estimated portion of the chassis cost
** = pricing and product info not yet available from Bay
100MB Workgroup switch port
100MB Backbone switch port
10/100 Desktop NIC
10/100 Server NIC
100MB Desktop switch port
10MB Desktop switch port
100MB HSTR Server NIC
16MB Desktop switch port
16MB Workgroup switch port
100MB HSTR BB switch port

16. TOKEN-RING COST OF OWNERSHIP A HIGH-SPEED TOKEN-RING ALLIANCE WHITE PAPER
Page 16 of 16
APPENDIX B – COST ANALYSIS COMPARISON WORKSHEET
Below is a blank worksheet for network managers to calculate his or her own upgrade
cost for both Ethernet and Token-Ring upgrade options.
Network Upgrade (500 Users)
Desktop Connection
Backbone
File Servers
Tangible (Equipment Costs)
Desktop NIC
Switch port (switch-to-desktop)
Switch port (WG switch-to-hub)
Switch Port (WG switch-to-BBone)
Switch Port (Backbone-to-WG switch)
Switch Port (WG switch-to-16M TR Server)
Server NIC
Switch Port (Backbone-to-server)
Total Equipment Cost:
Tangible (Ancillary Costs)
NIC Installation
New wiring installation
Server upgrade
Interim equipment
Network device reconfiguration
Application reconfiguration
Total Ancillary Costs:
Intangible/Elastic (Ancillary Costs)
Network downtime
Migration planning
Skills/training acquisition
NW Management tools acquisition
End-user support
(Loss of) Investment protection
Total Intangible Costs:
Total Upgrade Cost:
estimated cost estimated cost
estimated costestimated cost
total ($000) Qty unit cost total ($000)Qty unit cost
UpgradeEthernet
Migration to Token-Ring
Link Speed/Type Link Speed/Type