The Global MPLS IP VPN Services Market is expected to reach USD 46.26 billion by 2020, according to a new study by Grand View Research, Inc. Despite considerably maturing over the last five years, the market is poised for high growth on account of appreciable growth potential exhibited by managed MPLS IP VPN services. Enterprises have increasingly started incorporating MPLS IP VPN services for leveraging benefits such as cost minimization and performance maximization. The market is expected to stay buoyant as a direct consequence of declining ATM/frame relay implementation.
Convergence of video, voice, and data on a single platform from different sources and the ability to provide scalable bandwidth is expected to encourage MPLS IP VPN services adoption. As MPLS supports multipoint full-mesh connectivity, organizations adopting cloud computing to address growing concerns pertaining to network security and IT costs can easily manage multiple locations in their network.
Stringent regulations pertaining to the use of VPN for personal applications, especially in the Middle East countries and China are expected to pose a challenge to the MPLS IP VPN services market growth over the forecast period.
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Further key findings from the study suggest:
IT departments of institutions such as banks and government offices wishing to maintain control over their networking and routing related decision in order to address security issues have started preferring layer 2 VPN (L2VPN) services. IT departments of enterprises which opt for outsourcing their networking and routing decisions usually prefer layer 3 VPNs (L3VPNs). Multi-branch organizations have increasingly adopted hybrid L2VPN L3VPN services based on specific requirements at individual locations.
As MPLS offers a high Quality of Service (QoS) which is the primary requirement for VoIP, video conferencing is expected to emerge as a key application area over the forecast period. Substantial bandwidth offered by MPLS IP VPN services between the user’s equipment and the service provider’s network helps suffice VoIP’s requirements. Audio conferencing is projected to be a fast growing and profitable application sector.
North America and Asia Pacific constituted key regional MPLS IP VPN services markets in 2013 on account of the presence of prominent market players satiating the needs of an increasing consumer base. Influx of international carriers in the North American market to serve their existing MNC clients has favorably impacted the regional MPLS IP VPN services market growth.
Competitive solutions particularly tailored for MNCs having relatively smaller international presence are offered by prominent international MPLS IP VPN services operators such as AT&T, BT Global Services, Verizon, and Orange Business Services. After penetrating major regional markets, service providers focus on investing funds towards building backbone networks for supporting MPLS. The success of emerging MPLS IP VPN services market players hinges on establishing technical support partnerships and Network-To-Network Interface (NNI) relationships with an emphasis on customer service and flexible service offerings.
For the purpose of this study, Grand View Research has segmented the global MPLS IP VPN services market on the basis of service, application, and region:
MPLS IP VPN Service Outlook (Revenue, USD Million, 2012 - 2020)
Layer 2 VPN (L2VPN)
Layer 3 VPN (L3VPN)
MPLS IP VPN Services Application Outlook (Revenue, USD Million, 2012 - 2020)
MPLS IP VPN Services Regional Outlook (Revenue, USD Million, 2012 - 2020)
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