PSI Net mentioned in Wed March 11/98 Investors Business Daily article on Virtual Private Networks:
<<VPN expenditures for integration, or outsourcing, will rise to almost $2 billion in 2001 from only $425 million in 1999 and a mere $45 million in 1997, says San Jose, Calif.-based Infonetics.
Most corporations already lease private-line connections from long-distance phone carriers. With a VPN, companies can lower costs by using the existing Internet instead of building their own, more expensive, private networks, says David Goodtree, an analyst at Forrester Research Inc. in Cambridge, Mass.
Security is one reason companies hire third-party firms to manage their VPNs. Even large corporations can lack the in-house skills needed to start a VPN and put security in place.
Among companies offering VPN services are the leading long- distance phone companies: AT&T Corp., MCI Communications Corp. and Sprint Corp.
Companies also can opt to farm out the VPN to a big Internet service provider, such as PSINet Inc. or GTE Corp.'s BBN Unit, or to companies that set up and maintain computer systems, such as Plano, Texas-based Electronic Data Systems Corp.
Outsourcing VPN work to a network-savvy phone or systems company makes sense, says Dan Merriman, an analyst at Giga Information Group in Cambridge, Mass.
The communications system, rather than any hardware or software, is the key to VPNs, he says. ''With a VPN, you're really building security capability onto a communications service,'' Merriman said.
He points out that phone carriers already specialize in providing highly reliable, consistent performance - essential for VPNs.
Sprint offers several outsourcing options, says Sue Sentell, Sprint Business vice president of marketing.
Companies may need help designing a VPN, setting it up or operating it day to day, she says. Sprint will do any or all of those tasks.
Designing a VPN often involves replacing leased phone lines in an existing wide-area network. Many companies lease Frame Relay lines from carriers for high-speed data traffic.
That's where AT&T thinks it has an edge.
''We think customers want support in a hybrid networking environment, where they have public networking (the Internet), private networking over Frame Relay, and virtual private networking,'' said Eric Wohlford, director of AT&T Worldnet business service marketing.
Wohlford says companies may be able to reuse many existing connections to set up their VPNs.
To attract customers, AT&T promises to carry VPN traffic on its own Internet backbone, or connections. This provides a higher level of network availability.
Washington, D.C.-based MCI's strategy is similar, said Bob Smith, MCI's senior manager of Internet marketing.
Moving a customer's VPN to MCI's own Internet backbone offers added security, he says.
''Security is a core competency of ours,'' Smith said.
In fact, many companies setting up VPNs are expected to outsource just the security aspect of those networks. Managing security consists of several parts: authentication - determining who is trying to access data; encryption -scrambling data so they can't be read by unwanted people; and authorization -overseeing which software applications or data can be accessed and by whom.>> |
