Ethernet Pricing

 

The following is extracted from the Research Report entitled:  The Falling Costs of Wide Area Networks - a 2008 Research Report

For this report, we asked vendors to price three scenarios with the option of either supplying Internet access through their MPLS cloud, or connecting it to the main IT office of an organisation. Each vendor was given the same site locations to quote for.

 

The 10Mb Ethernet line costs the same as the 10Mb leased line and installation costs are identical.  More vendors are offering Ethernet now, sometimes replacing their leased line offering and at better prices too, with the lowest price for a 10Mb Ethernet being about £700 per month for London and between £800 and £900 per month anywhere else.  Clearly, the traditional 10Mb line is being replaced by Ethernet for metropolitan areas.

 

But where the Ethernet option becomes really interesting is when upgrading to 100Mb or 1Gb, for while bandwidth increases ten times on each upgrade, monthly costs only double or triple.  The 1Gb Ethernet line which in London is available for under £3,000 per month, compared to 10Mb, provides, a hundred times the bandwidth at barely four times the price.

100Mb Ethernet prices are basically the same whatever city the circuit is installed.  Where there is a difference is for 1Gb, which for most vendors is still only offered in London.  Still 1Gb is being introduced rapidly everywhere else, even though at this time prices are much higher outside of London, ranging from £8,000 to over £10,000 per month for Birmingham and Manchester.

 

Such prices are bound to drop rapidly as Ethernet takes hold and future 10Gb and even 100Gb generations of technology are introduced.  Such high bandwidths at such low prices should pressure down the price of a 10Mb line, perhaps making it the standard entry point.

 

 

Ethernet pricing