IP VPN services to take off in Europe from 2001, says IDC

London — 01/14/2000 — Rapid take up of Internet access and subsequent intranet development have led to demand for the natural next step ? the connection of geographically dispersed company sites over IP. Service providers are meeting this demand with IP Virtual Private Networks (IP VPNs), a robust middle-ground service between public Internet connectivity of sites and fully managed frame relay and ATM services.

International Data Corporation (IDC) predicts that IP VPN services in Europe will gather significant momentum from 2001 onwards when revenues will top $800 million, rising to more than $2.3 billion by 2003.

The benefits of IP VPNs over existing methods of corporate connectivity include cost-effectiveness, scalability, ubiquity of access and the trend toward network convergence," said James Eibisch, Research Manager for IDC,s European IP Services and European Application and Web Hosting Services Programmes. However, significant obstacles remain to be overcome before IP can be considered suitable for mission-critical applications support.

"In Europe, IP cannot, at present, compete with private circuit WANs or frame relay/ATM services in terms of bandwidth prioritization and reservation, traffic shaping and performance and availability guarantees," said Eibisch. For this reason, as well as users, inevitable reluctance to adopt leading-edge services for their core applications, IDC regards successful IP VPN strategies as those that initially target the periphery of IT environments. In using IP VPN for applications such as email and file transfer, companies can gain customer buy-in and demonstrate proof of concept before moving inwards to target mission-critical applications and services.

"Users are aware of several significant obstacles that remain to be overcome before IP services are fully able to support mission-critical networking requirements," said Eibisch. These include the perceived lack of security, the lack of native class and quality of services mechanisms and the lack of interoperability between IP VPN equipment. "These limitations will be partially resolved through competitive innovation and the introduction of formal standards by 2001," said Eibisch.

European IP VPN Services, 1998-2003 (IDC#HP03FB) forecasts the IP VPN services market in 16 Western European countries in terms of dial and dedicated connections and associated revenues and discusses market positioning, drivers and inhibitors, and user perspectives. Profiles of a selection of IP VPN service providers are also included.

About IDC

IDC delivers dependable, relevant, and high-impact data and insight on information technology to help organizations make sound business and technology decisions. IDC forecasts worldwide IT markets and technology trends and analyzes IT products and vendors, using a combination of rigorous primary research and in-depth competitive analysis. IDC is committed to providing global research with local content through more than 500 analysts in 42 countries worldwide. IDC's customers comprise the world's leading IT suppliers, IT organizations, and the financial community. Additional information can be found at http://www.idc.com.

IDC is a division of International Data Group , the world's leading IT media, research, and exposition company.

((M2 Communications Ltd disclaims all liability for information provided within M2 PressWIRE. Data supplied by named party/parties. Further information on M2 PressWIRE can be obtained at http://www.presswire.net on the world wide web. Inquiries to info@m2.com)).