How will AI impression enterprise networks?
That is the large matter I am tackling with information from TeleGeography’s WAN Price Benchmark—a custom-made platform that makes it straightforward to mannequin and observe your WAN community prices.
That is the second put up on this sequence. Try the primary put up right here to study which elements we’re contemplating and the way we’re evaluating varied situations that mannequin potential AI-driven WAN configurations.
The purpose of the sequence is to match the overall price of possession (TCO) of a legacy MPLS community—one which represents many multinationals’ WANs nonetheless in 2025—to varied hybrid or internet-first options designed to accommodate the adjustments AI and cloud are bringing to the trendy enterprise IT group.
Whereas our argument for SD-WAN-enabled hybrids at first of the last decade was largely about price, it’s now rather more about getting the community right-sized for the approaching AI-driven bandwidth crunch, resiliency, app-specific coverage and efficiency, and full utilization of cloud.
Your Price range + Your Legacy Community + AI
On this put up we’re wanting on the budgetary impression of constructing your legacy community able to handing the AI growth by evaluating two variations of the ‘tiered community’ technique that breaks the community into web site varieties. This technique makes it simpler for community groups to alter merchandise and bandwidths and right-size to the wants of that location. For our hypothetical community situations, we broke every of our hypothetical community’s 150 international websites into 4 tiers:
- Information Facilities (DCs) = 7 websites.
- Tier 1, bigger websites that want extra bandwidth and the most effective resiliency, usually downtown or in close-in suburbs = 18 websites.
- Tier 2, medium websites which may want much less bandwidth however nonetheless require resiliency = 49 websites.
- Tier 3, the smallest websites with the least bandwidth and fewer want for resiliency = 76 websites.
A particular word for DIA service: More and more, we’re discovering that carriers provide DIA for the port-only worth when the shopper constructing is on-net and even near-net, which means there isn’t a extra native entry cost. That is commonest in city areas in aggressive well-developed metros, so in these places, we’ve got dropped extra entry costs when switching MPLS service to DIA throughout all situations.
Conservative Tiered Hybrid WAN
Our Conservative Tiered Hybrid situation imagines an enterprise that may be early of their AI journey and usually a bit cautious. Their community group desires to make the transfer to SD-WAN and native web breakouts, however has safety or compliance issues, proprietary apps or on-prem information facilities, or only a conservative outlook on IT that retains it from going internet-first. This firm doesn’t but want large bandwidth will increase, however is seeking to the SD-WAN hybrid as a means to make sure resiliency, enact utility specific-policies, and facilitate cloud utilization with native breakouts. These are the adjustments at every tier:
- DCs—Maintain twin MPLS.
- Tier 1—Maintain twin MPLS, add a single DIA port as a tertiary reference to separate entry traces.
- Tier 2—One MPLS port and one DIA port with separate entry traces the place relevant.
- Tier 3—Twin DIA ports (active-active) with redundant entry traces the place relevant.
- All tiers—Fundamental Managed SD-WAN for the overall encrypted throughput of all underlay providers at every web site.
Common Complete Bandwidth per Web site in Every Subregion—Twin MPLS WAN vs. Conservative Tiered Hybrid WAN
Word: Every bar represents the typical complete web site bandwidth, together with a number of ports or underlay providers, throughout all websites within the listed subregion.
- The ensuing community will increase the typical out there bandwidth at every web site by about 8%, largely as a result of tertiary hyperlinks added at Tier 1 websites. For essentially the most half, the bandwidth at any given web site is much like the unique Twin MPLS.
Distribution of Complete Web site Speeds—Conservative Tiered Hybrid WAN
Word: Every part represents the proportion of complete web site bandwidths that fall inside every bandwidth vary.
- A majority of the websites fall inside a complete web site bandwidth vary of 200 Mbps or beneath, a reasonably cost-conscious quantity of bandwidth.
- The most common websites within the community are between 100 and 200 Mbps throughout all underlay providers.
- Roughly 14% have a complete web site bandwidth of greater than GigE.
Now, earlier than we take a look at costs, let’s check out the same community arrange from a extra aggressive IT group who’s already feeling the AI bandwidth crunch and is extra keen so as to add web into the combination to reap the benefits of decrease price per bit.
Tiered Hybrid WAN
The Tiered Hybrid WAN represents an enterprise that is a little more prepared than the conservative situation to push in the direction of web, however not prepared to go away MPLS behind all collectively. They’re additionally keen to strive broadband, however solely in markets the place they’re sure the ISPs are prepared to supply an enterprise stage of service. Most significantly, they’ve began to make the most of AI and have seen cloud workloads and site visitors improve. They should increase bandwidth with out breaking the financial institution. Whereas they’re retaining some MPLS, they’re including DIA at bigger ports as a result of decrease price per bit. These are the adjustments at every tier:
- DCs—Twin DIA ports.
- Tier 1—One MPLS port and one DIA port with separate entry traces.
- Tier 2—Twin active-active DIA ports with redundant entry the place relevant.
- Tier 3—Twin active-active DIA ports in most international markets, however one DIA port and one enterprise broadband connection within the U.S., Western Europe, and some different aggressive ISP markets.
- China is an exception to the foundations, as we’ve got saved twin MPLS at these websites.
- All tiers—Fundamental Managed SD-WAN for the overall encrypted throughput of all underlay providers at every web site.
Common Complete Bandwidth per Web site in Every Subregion—Twin MPLS WAN vs. Tiered Hybrid WAN
Word: Every bar represents the typical complete web site bandwidth, together with a number of ports or underlay providers, throughout all websites within the listed subregion.
- We elevated the bandwidth out there at websites world wide to about the identical diploma because the excessive capability Twin MPLS community, with common bandwidth growing about 62% per web site.
Distribution of Complete Web site Speeds—Tiered Hybrid WAN
Word: Every part represents the proportion of complete web site bandwidths that fall inside every bandwidth vary.
- A slim majority of web sites fall within the greater than GigE to 2,000 Mbps complete web site bandwidth vary.
- Solely about one-third of web sites have a complete bandwidth of 500 Mbps or much less.
Complete Price of Possession Comparisons
The tiered community situations give us an image of two methods for the trendy community beginning to accommodate cloud and AI. The Conservative Hybrid situation represents an enterprise that desires to modernize their community to facilitate cloud with out altering the finances. The Tiered Hybrid situation reveals us an instance of an enterprise that has already felt the AI-bandwidth crunch and needs to spice up speeds with out boosting budgets.
This TCO comparability consists of the high-capacity Twin MPLS WAN for example the budgetary advantages of going hybrid, past the resiliency, utility efficiency, and cloud-first drivers.
Authentic Twin MPLS, Excessive Capability Twin MPLS, Conservative Tiered Hybrid, and Tiered Hybrid WAN State of affairs TCOs
Word: Every column represents the overall annual price of possession for that WAN situation, damaged out by product in every coloration part.
- The annual TCO for the Conservative Tiered Hybrid elevated capability over the Twin MPLS barely–8%–however the fee went down by about 9% from $8.1m to $7.4m.
- The Tiered Hybrid and Excessive Capability Twin MPLS each elevated the typical bandwidth out there per workplace by greater than 60%, nevertheless, the Tiered Hybrid TCO solely rose by 18% going from $8.1m to $9.6.
- Evaluate the above level to the excessive capability Twin MPLS which went up 43%. That is additionally with retaining a inflexible, utility unaware, and centralized breakout legacy community.
It needs to be no shock {that a} hybrid community is a greater price choice at this level, however it’s price absolutely understanding the budgetary stability. DIA and particularly broadband are clearly less expensive than MPLS, however once more, the enterprise that’s working headlong into AI must have a sooner and extra versatile community, not only a cheaper one. Multinationals with websites world wide want to grasp how product alternative, bandwidth, and geography impression their mission to discover a community that may deal with the longer term calls for of the quickly altering IT group. Subsequent time we are going to check out the enterprise that has gone absolutely into cloud and realized this will help them lower prices on actual property by foregoing a return to workplace coverage and thus chopping the community footprint.
