The original version of this post was first published here. It is the seventh instalment of a series of posts called “Wargaming your WAN” – you can read the series from the beginning at TeleGeography’s blog.
In a previous entry, we found that ditching MPLS in favor of DIA or broadband can increase bandwidth while decreasing cost. Today I’m going to continue down that all-internet rabbit hole and look at how adopting an alternative sourcing strategy can impact network costs.
Thus far, all of the networks we’ve looked at have included broadband prices sourced directly from ISPs around the world. But network managers hoping to include broadband & DIA at all or many sites across a multinational WAN might hesitate to source internet from the ISPs themselves. And DIY internet sourcing might add overhead costs or other headaches for several reasons:
It’s difficult to determine if your broadband or DIA is actually diverse, particularly in countries that have local loop unbundling where competing ISPs might be using the incumbent’s infrastructure.- TeleGeography
If the thought of trying to source, install, and manage internet from disparate suppliers across a network is enough to make your eye twitch, you’re not alone. Faced with these challenges, many WAN managers have turned to internet aggregators or carriers to source their broadband & DIA.
Internet aggregators source and consolidate multiple internet connections across your global network. Using them as an alternative sourcing strategy allows you to move overhead costs of managing contracts out-of-house and provides a single point of contact overall.
These services come at a cost.
For simplicity, we’ve assumed that a broadband circuit sourced from a third party rather than an ISP-direct plan will be twice the price we have. So we tested our aggregator-sourced broadband scenarios by simply doubling the broadband prices. Also for simplicity, we have kept DIA prices the same due to the relatively small uplift on higher unit pricing and consolidated bargaining power meaning aggregators would expect to be able to achieve a better buying rate than enterprises independently.
The configurations of these networks are all identical to the previous all-internet scenarios, except that we doubled the annual broadband price. You can check out the product mix and bandwidth breakdown for those networks here.
First, let’s look at the DIA-broadband hybrid WAN.
How does adding an aggregator to the DIA-broadband hybrid affect total cost of ownership?
Image 1 - Original MPLS & On-net DIA-Aggregator Broadband Hybrid WANs with Unmanaged SD-WAN Annual TCOs.
In the “local ISP” DIA-broadband hybrid, broadband made up only 6% of the TCO. Doubling the cost sourcing from an aggregator pushes that closer to 10%. Starting with such a small piece of the network didn't change the big picture very much. We went from a 54% discount on the original MPLS to a 51% discount.
Let’s look at how adding a broadband aggregator will affect the cost of our dual broadband SD-WAN network.
How does adding an aggregator to the full internet network affect the total cost of ownership?
Image 2 - Original MPLS & Dual Aggregator Broadband Hybrid WANs with Unmanaged SD-WAN Annual TCOs.
In the original dual broadband network, broadband costs account for 20% of the TCO. Doubling broadband prices pushed that to 33%, but this is 33% of a very inexpensive network.
The dual broadband had been a 76% discount on the original MPLS; this aggregator version is 72%.
Going with an internet aggregator can be a good alternative for those who want to capture some of the cost savings of migrating to the internet, but also want to offload some of the management overhead.
Going with an internet aggregator can be a good alternative for those who want to capture some of the cost savings of migrating to the internet, but also want to offload some of the management overhead.- TeleGeography
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