Service providers and some large enterprises are building out multiprotocol label switching (MPLS) networks for a number of reasons. Simplification is a major driver—reducing the number of protocols and technologies in the network. Another important requirement is the increased number of deployed network services and the range of devices used to access those services. The high cost of building out networks means that the legacy case is always present, and it’s a measure of the success of MPLS that it can transport traffic from Layer 2 technologies such as ATM, frame relay, Ethernet, and so on. By this means, many Layer 2 devices can be eliminated from the network—reducing costs and keeping the accountants happy!
It’s important to remember that MPLS is now being deployed in both service provider and enterprise networks. In the former, the service is usually sold on to users, and financial transfers take place. For enterprise networks, the service may also be sold on to divisions and departments of the host organization, but there may be no actual financial settlements. For clarity, I’ll use the term service provider to apply to both network types, although there may be some differences in operational contexts. For example, at the moment network-related revenue management is almost certainly more of an issue for service providers than for enterprises.