Controlling Costs in the Enterprise Network: Layer 2 vs. Layer 3


Part two of a three-part “Improving the Enterprise Network” blog series addressing how private Carrier Ethernet can benefit the campus network, and the specialized WAN. To read part one, click here.

In my last blog, I explained how the perfect storm of increased bandwidth, higher reliance on the network, and unbounded cost of the infrastructure is creating a headache for enterprise and government agency technology managers. Whether managing a campus network or specialized enterprise wide area network (WAN), cost control is a paramount concern as IT budgets are under constant pressure and return on investment is routinely scrutinized. In this blog, I’ll address how enterprise and government organizations can get their costs under control.

While the first generation of packet infrastructure has been based on extending pre-existing Layer 3 (L3) routed infrastructure, today’s challenges have called into question the complexity of continually throwing more routers at the problem. Given the extensive use of Ethernet as a link-layer in most LANs, the use of Layer 2 (L2) technologies for campus and the WAN is gaining a lot of attention.

The use of L3 infrastructure for transporting IP application traffic to mitigate the problem simply adds complexity and cost that ultimately are redundant to the L2 transport function provided by Carrier Ethernet. In contrast, an L2 network architecture ideally suits the creation of a rich menu of IP-based applications, whether L3 services such as IP-based VPNs and VPLS connections, or simply L2 transport of L3 functions such as Web access, video transmission, or data center connectivity. In other words, use of an L2-based infrastructure does not preclude support of IP applications; on the contrary, it complements it nicely while significantly simplifying the overall network and providing overall cost savings.

In fact, generalized studies indicate the lower the layer technology, the simpler the hardware, the fewer modalities of operation, and hence, the lower the cost.

An L3 infrastructure requires routers at all sites, while L2 can make use of Ethernet switches with a subset of the router functionality. For instance, MPLS-TP provides a simpler but robust set of functions, giving network operators improved price/performance alternatives. A broad portfolio of right-sized Ethernet switches with carrier-class functions and attributes provides the best of both worlds at an optimized cost-point.

Future strategies will see further application cost reduction and network simplification, with the introduction of Network Functions Virtualization (NFV). NFV is the concept of replacing proprietary hardware appliances such as routing, encryption, and firewalls with software-based versions that run on low-cost server hardware and can be flexibly chained together to form unique services. A simpler, converged L2 network can thereby support L3-L7 applications.

By continuing to add router capacity to scale and support new applications, IT managers are incurring unnecessary capital and operational costs (CAPEX/OPEX). Formal OPEX studies are hard to come by, but it is clear that installation and commissioning tasks for new services are a key component of such costs. Ethernet’s simplicity has led to solutions such as Zero Touch Provisioning techniques, which allow moderately skilled field personnel to install service end-points with ease by automating the process from end-to-end, which also eliminates error-prone manual operations.

Remote configuration and service turn-up and testing also allow high confidence that the right parameters have been established for each connection and that the end-user or application is receiving the requisite Quality of Service (QoS). Looking toward the future, the adoption of software-defined networking (SDN) portends well for the simple forwarding architecture supported at L2 to be controlled by a centralized software entity.

The Bottom Line

Enterprises and government agencies are increasingly drawn to Carrier Ethernet WAN infrastructure to control costs and ensure business processes can scale effectively, while maintaining security and control over critical network functions. Network resources are easily shared among many end-user communities, and new applications can be introduced quickly without network redesigns. In my next blog, I’ll take a closer look at the key advantages of using Ethernet in the WAN or campus network.

Whether managing a campus network or specialized enterprise wide area network (WAN), cost control is a paramount concern as IT budgets are under constant pressure and return on investment is routinely scrutinized.

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