The Case for MPLS Backbone

It is a known fact that most of the existing operators have long distance backbone built on ATM/SDH based network, but then, so is the fact that almost all major operators have either moved or are contemplating move towards MPLS based backbone. The wave started as Overlay network (separate SDH and MPLS based network) is giving way to the converged MPLS core. Although independent reports like Infonetics cite operator response to near 100 percent as Ayes in favor of MPLS, there are still apprehension in traditional operators, looking at the cost implications of MPLS vis-a-vis a layer 2 Optical network. The services which needs to be considered while deciding on the move can be categorized into existing services and aspired services. Basic voice services together with leased line, frame relay will fall in the existing services (requiring separate physical layout for each customer), while high speed internet access, VoIP (or IMS based services), Video (specially those requiring multicast like e-Education and IPTV) and IP VPN services can be looked up as aspired services which decidedly require MPLS.
The growth rate of traditional data services seems stagnating at close to 8% (reference IEEE Report on Quantifying the Value Proposition of MPLS Evolution, Bell Lab report), and the growth rate of new data services are growing at 50-75%. Looking at the figures, writing on the wall seems to be quite clear. This interest in the new data services is evident from the amount of interest with which all operators with long term view of the market, seem to be looking at 3G and LTE, both referring to increase in the amount of video(with a significant amount of multicast traffic) and data traffic, which subscribers are demanding and for which operators are gearing up, looking at the amount of money people are willing to spend on it. The IEEE study report mentioned above puts the Present Value saving (taking into account new revenue figures) of 23% over the ATM based network and 10% over overlay model. The biggest source of PV saving is new IP VPN services. Another advantage of this model is that is wonderfully complements the SDH network, which it uses as undelying transport network at the same time using features like MPLS TE-FRR to enhance the redundancy by working out the backup paths between to nodes of connectivity.
This redundancy however, can not be taken as the de-factor prime mover for establishing an MPLS network, rather this enhanced redundancy is a default benefit arising out of the attempt of the operator to re-invent its service offering with focus on high growth areas like the non-traditional data services. There are cheaper ways of enhancing the SDH redundancy (for instance x-ing the links by two) if one is only concerned with making the currently available basic voice and conventional data services fail-proof, which already is plagued by falling ARPU, low subscriber interest and high cost of customer acquisition, but if the eye is on the future and the intent is to remain "Forever Young", MPLS is the way to go.