Choosing the Right Ethernet Solution for Your WAN

Choosing the Right Ethernet Solution for Your WAN xo.com

Choosing the Right Ethernet Solution for Your WAN Table of Contents Contents 2 Abstract 3 Introduction 3 The Benefits of Ethernet 5 Types of Ethernet Services 6 Connection Options 11 Ethernet Across Vertical Industries 13 Which Ethernet Solution is Best for You? 15 What to Look for When Choosing an Ethernet Service Provider 15 Conclusion 15 XO Ethernet Services 16 Glossary of Abbreviations 19 2 Solutions you want. Support you need.

XO Communications Abstract Ethernet is one of the most widely deployed networking options in the world, and its adoption is growing across all industries. In an increasingly converged networking universe, where the diversity of traffic demands not only high bandwidth but also Quality of Service (QoS), Ethernet has emerged a winner. Many enterprises are optimizing their Ethernet investments by extending Ethernet over the Local Area Network (LAN) to the Wide Area Network (WAN). With the wide array of Ethernet services available today, marketplace terminology and offerings can be difficult to sort through. This white paper describes the Ethernet service marketplace including drivers for its adoption, benefits, the technology behind Ethernet services at a business level, and some of the Ethernet services available today. It also provides an overview of adoption across vertical industries and popular applications for the different Ethernet services. With this information, you should have an understanding of why Ethernet services popularity is growing, why businesses are adopting it, and what the basic deployment options are in order to better evaluate the best options and best vendor for your business. Introduction Ethernet services are being quickly adopted by enterprises of all sizes, across all industries to connect locations and transport applications, data and information. In fact, IDC predicts that Total Ethernet revenue in the U.S. is expected to grow from $3.4 billion in 2010 to $8.2 billion in 2015. 1 Since its introduction years ago, Ethernet has evolved from a relatively primitive networking technology into a sophisticated, exceptionally high bandwidth solution for transporting every kind of media traffic. Over the past decade, Ethernet has moved beyond the LAN as a preferred last-mile and WAN service to support VoIP, IP VPNs, video, and other high-traffic applications. In an increasingly converged networking universe, where the diversity of traffic demands not only high bandwidth but also Quality of Service (QoS), Ethernet has emerged as one of the most widely deployed networking options in the world today. Drivers of Ethernet Growth Often driving demand for Carrier Ethernet are IP applications high-traffic, bandwidth-intensive applications like VoIP, IP VPNs, and video. Some other examples include: Distance learning and corporate training Medical imaging Secure file transfer Offsite storage Transparent LAN services Data center interconnection 1 IDC, U.S. Carrier Ethernet Services2011-2015 Forecast, December 2011. 3

Choosing the Right Ethernet Solution for Your WAN Table 1. Top Applications of Ethernet Services Applications Layer 2 VPNs for IT Infrastructure Cloud Computing Distributed Storage Area Networks Software as a Service (SaaS), Service Orientated Architecture (SOA), Distributed Imaging Internet Access Site-to-Site Access, Server Consolidation Business continuity/disaster recovery Video Applications Server Consolidation VoIP CCTV Key benefits Performance Security, Deterministic, Dynamic Performance, Bandwidth Transparency, Standardization at all locations, management Bandwidth Reliability Performance, Bandwidth Performance, Bandwidth QoS Simplicity Cost Cost ubiquity Source: Metro Ethernet Forum, Ethernet Business Services, MEF Reference Presentation, November 2011, slide 5, http://www. metroethernetforum.org/ppt_documents/reference-presentations/nov-2011/carrier-ethernet-for-business-mef-reference- Presentation-2011-11-26.pptx, accessed March 2012. Figure 1: Business applications for Ethernet Services include Dedicated Internet Access (DIA), Ethernet Private Lines, Ethernet LAN/VPLS, and Ethernet access to other network services (e.g., IP/ MPLS VPNs, Frame Relay, etc.) Worldwide revenue for Business Ethernet Services mounts steadily to nearly $40.2 billion by 2014 Source: Metro Ethernet Forum 2 2 Metro Ethernet Forum, Carrier Ethernet Access, Extending Ethernet into the First Mile, MEF Presentation January 2011, slide 14, http://metroethernetforum.org/ppt_documents/reference-presentations/anoverviewofthemef-2011.ppt, accessed March 2012 4 Solutions you want. Support you need.

XO Communications The Benefits of Ethernet Since 2001 when the MEF was formed, Carrier Ethernet services and networks have grown from almost zero to a US$22 billion in 2008 to US$34 billion in 2013 having a $142 billion 5-year total 2009 2013. Metro Ethernet Forum 3 Ethernet s popularity is owed to a number of factors, including: Cost-Effectiveness Minimal infrastructure investment is typically required beyond what is already in place as Ethernet uses existing infrastructure no major capital outlay for a new network. Supports legacy network integration and emerging IP based applications. Direct cost savings: XO Communications estimates that 10 Mbps Internet service provisioned over Ethernet can save 50% to 65% in cost per Mbps over legacy T1 and bonded T1 service. Scalability Standards-compliant interfaces are available for data communication / telecommunication devices at line rates from 10/100/1000 Mbps to 100 Gbps. Unlike TDM-based Private Line solutions, Ethernet can be deployed without frequently upgrading speeds in small increments. Simplicity Single connection: A single Layer 2 protocol connects everything, no need for complex protocol conversions. Familiarity: Because Ethernet has been around a long time, IT personnel are comfortable with its capabilities and are, therefore, willing to accept its use. Performance Support for Diverse QoS Levels: As network traffic becomes more diverse, it demands support for multiple levels of QoS. Inherent in the Ethernet protocol is a field specifically assigned to carry QoS information, giving Ethernet the ability to support varying traffic flows according to application. These range from a best-effort service for low-priority data flows such as e-mail, to the very high-priority requirements of voice and video. Universal Interoperability: Ethernet is fully interoperable with MPLS, the leading WAN solution for multi-site connectivity. Ethernet s QoS capabilities mesh seamlessly with the capabilities of MPLS, thus ensuring full interoperability between the two protocol domains. Because IP and Ethernet are so widely deployed, they present a level of interoperability that is unequalled in the networking world. As a consequence, Ethernet is widely viewed as a perfect access partner for IP. Support for Convergence: Ethernet interfaces seamlessly with IP and MPLS, supports diverse traffic types and needed QoS levels, within the context of a widely deployed, well understood technology that is service and cost effective. 3 Metro Ethernet Forum, Global Interconnect Overview. http://metroethernetforum.org/page_loader.php?p_id=127, accessed March 2012. 5

Choosing the Right Ethernet Solution for Your WAN Types of Ethernet Services Ethernet is fast becoming the communication platform of choice within the small and big enterprise community to drive Next Generation Application adoption. itvar News 4 Ethernet network services those services offered by telecommunications carriers or service providers that extend Ethernet beyond the LAN are based on standardized definitions developed by the industryorganized Metro Ethernet Forum (MEF). The MEF helps define and standardize Ethernet services in terms of bandwidth, resilience and service multiplexing and other characteristics. This helps facilitate SLAs and allows customers to compare Ethernet service offerings. That said, service providers offer innumerable, ever-changing arrays of Ethernet services, many with proprietary naming conventions. To help navigate the marketplace, it can help to be familiar with the basic terminology and framework for Ethernet services set forth by the MEF. E-Line versus E-LAN All Ethernet services fall under two primary types: E-Line and E-LAN, point-to-point and multipoint-tomultipoint services, respectively. The point-to-point E-Line covers the needs of many businesses, although it is not a solution for the WAN, which requires the multipoint-to-multipoint connectivity of E-LAN. E-Line services include: Ethernet Private Line Ethernet Virtual Private Line E-LAN services (which extend Ethernet beyond the LAN across the metro and WAN) include: Ethernet Virtual Private LAN VPLS the classic example of an E-LAN service and the focus of this white paper. Table 2. Ethernet Services Service Description Port-Based (All-to-One Bundling) VLAN-Based (Service- Multiplexed) E-Line Point-to-Point Replaces Private Line, Frame Relay, Internet Access Ethernet Private Line (EPL) Ethernet Virtual Private Line (EVPL) E-LAN Multipoint-tomultipoint Extends LAN to WAN Ethernet Private LAN (EP-LAN) Ethernet Virtual Private LAN (EVP-LAN) 4 Kalpana SInghal, Technology of Choice, that s Ethernet for Enterprise itvarnews.com, January, 25, 2011, http:// www.itvarnews.net/news/12085/technology-of-choice-that%e2%80%99s-ethernet-for-enterprise_.html, accessed March 2012. 6 Solutions you want. Support you need.

XO Communications Ethernet Private Line (EPL) Replaces TDM Private Line Port-based service with single service (EVC) across dedicated UNIs for siteto-site connectivity Typically delivered over SDH (Ethernet over SDH)Universal interoperability Most popular Ethernet service due to simplicitycosteffective Ethernet Private Line Replaces TDM Private Line E-Line, Point-to-Point Ethernet Private Line (EPL) Service provides a point-to-point Ethernet Virtual Connection (EVC) between two end points, the type of connectivity previously provided by TDM Private Line. Ethernet Private Line service is used to support connections between sites: cross town or cross country. It is also used to replace the Private Line connections frequently used to connect to the Internet. EPL can deliver a variety of service levels to accommodate the demands of disparate SLAs. At its most basic level, EPL offers symmetrical, best-effort, two-way bandwidth between traditional 10 Mbps Ethernet systems. However, it isn t limited to this level of service, depending on the specific service provider s offering. Advantages of Ethernet Private Line With EPL, enterprises benefit from high-speed, full-duplex, point-to-point connections. Because bandwidth capacity is solely dedicated to the customer s use 24/7, enterprises select EPL to send extremely time-sensitive or mission-critical communications with top speeds and reliability. EPL services offer security, resiliency, high-speed connectivity and low latency (delay). Companies can rapidly send large volumes of data across a single connection without the need of a local loop and at significantly lower costs per megabyte than older technologies. EPL circuits are good when you need to connect two sites, but can get costly if you need to connect multiple locations. Pricing can also be geographically sensitive, creating a drawback for businesses with locations in some areas. Popular uses for EPL: Secure transport of data Internet Live streaming video Television, movies Bulk transfer of data among storage access networks or data center Industry applications: distance learning, medical imaging, financial transactions, engineering Figure 2: A dedicated User Network Interface (UNI) specifies procedures and protocols between customer equipment (CE) and the Carrier Ethernet Network. The UNI is the physical interface or port (10Mbps, 100Mbps, 1Gbps, 10Gbps, 100Gbps) that is the demarcation between the customer and service provider. The service provider always provides the UNI. Ethernet Private Line (EPL) Source: Metro Ethernet Forum 5 5 Metro Ethernet Forum, Introducing the Specifications of the MEF, December 2011, slide 20, http://metroethernetforum.org/ppt_documents/reference-presentations/technical-overviews/overview%20of%20mef6-%20 1_10-2_and_10-2-1_v6.ppt. 7

Choosing the Right Ethernet Solution for Your WAN Ethernet Virtual Private Line (EVPL) Replaces Frame Relay or ATM L2 VPN services Supports hub & spoke connectivity similar to Frame Relay or Private Line hub & spoke For higher bandwidth, end-to-end services Multiple services delivered over single connection Ethernet Virtual Private Line Replaces Frame Relay or ATM Layer 2 VPN E-Line, Point-to-Point Ethernet Virtual Private Line Service (EVPL) provides a replacement for Frame Relay or ATM. This Layer 2 point-to-multipoint configuration provides one physical connection to customer equipment that fans out to Virtual Ethernet Local Area Network (VLAN) or multiplexed sites to support multiple virtual connections. An EVPL service is similar to a Private Line service, in that the network transports traffic in real-time over a dedicated connection. However, the connection is virtual, using Pseudowire technology, to transmit Layer 2 protocols usually over an MPLS-based IP network. This type of connection works by creating the connection using virtual tunnels across the packet network. Advantages of Ethernet Virtual Private Line The EVPL approach offers a number of advantages over Frame Relay or ATM. One advantage is lower networking costs for multi-location enterprises, by simplifying the network with fewer, higher-capacity interconnections between the primary data centers and the network, or among HQ and branches. Instead of buying last-mile access from many local phone companies to connect locations to a network, the enterprise buys one or two large Hub connections at very high-speeds, and these connections extend to virtual connections with other sites. In this way, an EVPL uses an MPLS-based network to virtually connect smaller branch locations. EVPL also makes it easier and faster to add new locations. In Frame Relay, new locations require the addition of new Permanent Virtual Circuits (PVCs). In Ethernet, new locations are added to a pre-existing multipoint Ethernet Virtual Connection, making the process of service configuration more efficient. Depending on the service provider, EVPL can offer guarantees for frame loss, jitter, and delay parameters between two communicating end points. It also allows organizations to maintain separation of traffic as it converges over a single connection. Figure 3: Ethernet VPL allows one physical connection (UNI) to customer equipment (CE) for multiple virtual connections. Ethernet Virtual Private Line (EVPL) Source: Metro Ethernet Forum 6 6 Metro Ethernet Forum, Introducing the Specifications of the MEF, December 2011, slide 21, http://metroethernetforum.org/ppt_documents/reference-presentations/technical-overviews/overview%20of%20mef6-%20 1_10-2_and_10-2-1_v6.ppt. 8 Solutions you want. Support you need.

XO Communications Virtual Private LAN Service - Extends Ethernet to WAN using MPLS E-LAN, Multipoint-to-Multipoint With Ethernet Virtual Private LAN Service (VPLS), sometimes referred to as E-LAN or Layer 2 multipoint VPN, the service provider uses an MPLS-based network to virtually connect multiple sites using a meshed design. VPLS is the pinnacle solution for Ethernet. It supports multipoint Ethernet services through packet replication and has the ability to learn and rely on source-based, Medium Access Control (MAC) addresses for point-to-multipoint VPN support. VPLS allows the customer to provision a virtual switch (Layer 2) over an IP MPLS network (Layer 3). This arrangement, consisting of IP and MPLS in the core and Ethernet at the edge, supports connectivity among multiple enterprise locations within a metro network or across the wide area. In VPLS, each customer-provisioned edge router is connected via a single connection to the local service provider edge router, which is in turn part of the IP MPLS core (Figure 4). The elegance of this solution is that an enterprise can continue to operate an existing Layer 2 network while exercising great control over its Layer 3-routed network and the services transported across each. Popular Uses of VPLS: Enterprise-wide applications and centralized, diversely deployed applications, including: Supply chain support Enterprise Resource Planning (ERP) Customer Relationship Management (CRM) Connecting high value data centers, call centers, or media centers Delivering special high-bandwidth applications such as video transfer, storage area networks, and VoIP among data centers and other mission-critical areas. Often used by: Organizations that already have an MPLS-based network and want Ethernet at specific sites to complement an overall WAN design Companies that want to run their own, or utilize another provider s, MPLS IP-VPN or Private Line network VPLS Advantages VPLS uses Pseudowire technology to virtually connect remote LANs into a single, bridged WAN. Since familiar and ubiquitous Ethernet interfaces connect the network, VPLS greatly simplifies LAN to WAN connectivity. With all sites appearing to be on the same Ethernet interface, every part of the user experience has the same ease and familiarity as using the local office network. With Ethernet VPLS, it is easier than with MPLS IP-VPN for IT departments to control access and networking among separate domains, special applications or departments regardless of where the users are located. In addition, for parts of a network that require special security, Ethernet VPLS provides complete privacy and full control of routing. Ethernet VPLS often is an easier and less costly solution for companies to implement than an MPLS-based network because it usually doesn t need as many connections and equipment, accepts multiple protocols and doesn t require special IT expertise and training unless the company needs to connect hundreds of locations. For all of these reasons, Ethernet VPLS is a good choice for enterprises that require a high-speed, simplified network for a smaller number of sites, when it is necessary to control routing and management. Many 9

Choosing the Right Ethernet Solution for Your WAN Ethernet Virtual Private LAN Service (VPLS) In Ethernet Virtual Private LAN Service (VPLS), an E-LAN or Layer 2 multipoint VPN, the service provider uses an MPLS-based network to virtually connect multiple sites using a meshed design. Ethernet VPLS uses Pseudowire technology to virtually connect remote LANs into a single, bridged Wide Area Network. enterprises are in the process of replacing their older ATM and Frame Relay circuits with Ethernet VPLS services for greater WAN routing control and cost reduction. MPLS IP-VPN or Ethernet VPLS? Due to the popularity of VPLS with organizations that already have an MPLS-based network and companies that want to run their own, or utilize another provider s MPLS IP-VPN or Private Line network, Ethernet VPLS networks typically involve fewer sites and larger bandwidth needs than MPLS IP-VPN networks. Ethernet VPLS is a newer offering than MPLS IP-VPN, sometimes touted as the latest WAN technology. Certainly, upcoming Metro Ethernet Forum adoption of official E-NNI interoperability standards and Operating, Administration and Maintenance standards could make Ethernet VPLS the preferred WAN solution for specific circumstances within the overall WAN design. Total public U.S. Ethernet revenues grew from 2.5 billion in 2009 to $4.1 billion in 2011, and are projected to nearly triple by 2016. Both Layer 3 (IP VPN) and Layer 2 (VPLS) VPNs rely on MPLS as the underlying protocol, and share features and functionality, such as Class of Service. The difference between MPLS IP VPN and VPLS is that with MPLS IP VPN, traffic is routed based upon IP addresses, and with VPLS, the customers sites are discovered by the network based on the MAC addresses associated with their routers and/or switches. In other words, the technologies are not mutually exclusive; they complement each other. And there are solid reasons why many enterprises have elements of both technologies within their total Wide Area Network. Figure 4: With VPLS, geographically dispersed VPNs can interconnect and communicate over an IP MPLS network as if they were on the same LAN. Ethernet VPLS Source: Metro Ethernet Forum 7 7 The Insight Research Corporation, Carriers and Ethernet Services: Public Ethernet in Metro & Wide Area Networks 2011-2016, August 2011, p. 6. 7 Metro Ethernet Forum, Carrier Ethernet Services, PowerPoint presentation, November 2011, slide 14, http://www. metroethernetforum.org/ppt_documents/reference-presentations/nov-2011/carrier-ethernet-services-overview- Reference-Presentation-R03-2011-11-15.pptx. 10 Solutions you want. Support you need.

XO Communications Hybrid WAN Solutions Most enterprise WAN are comprised of hybrid solutions that combine some aspects of more than one network-based VPN service and point-to-point Private Line services. Organizations often consult with service providers to custom build the WAN that best meets the myriad of special requirements that confront IT WAN managers. These requirements may be based on multiple and sometimes conflicting objectives for the WAN and may include user access needs, location access needs, reliability, scalability, ease of management and cost savings. What s more, network-based VPN solutions with Quality of Service guarantees are preferable. Network administrators should carefully consider the cost-saving benefits of consolidating services with a single provider, thereby eliminating duplicative lines and equipment and making it easier to move, add or delete sites. The WAN solution should support existing and planned equipment and infrastructure technologies, and in this way, support multiprotocol and access agnostic connectivity. Connection Options In Ethernet adoption, coverage is key. Historically, most Ethernet services have only been available via fiber optic connections, which are very limited. Now, Ethernet can reach hundreds of thousands of business locations through a combination of access capabilities including fiber, copper, coax and wireless. It has become a practical, cost-effective solution for extending the LAN to the WAN. Each option has been extensively tested and deployed, and each offers advantages depending upon the deployment situation it best serves. In addition, hybrid solutions can also be created to meet specific circumstances (Figure 5). Figure 5: Carrier Ethernet offers multiple options for enabling LAN connectivity within and between metropolitan areas in a costeffective way (copper, fiber, coax, wireless). 11

Choosing the Right Ethernet Solution for Your WAN Mid-Band Ethernet (Ethernet over Copper, or EoC) Mid-Band Ethernet is an easy, affordable, and immediate solution for providing feature-rich, high-speed access and services. Ubiquitous throughout the first mile: Thanks to legacy voice and the widespread deployment of DSL, twisted-pair copper is relatively ubiquitous throughout the first mile. Consequently, Mid- Band Ethernet is ideal as a deployment topology for residential neighborhoods and office complexes. Preferred to DSL or T-1: Mid-band Ethernet is a preferred solution over business-class DSL service (768 Kbps 6 Mbps) or T-1 (1.5 Mbps) for business customers seeking an affordable 10 Mbps solution with guaranteed throughput. Widely available: Deployment is widespread and available from a number of service providers. Standards are ratified and mature for mid-band Ethernet, and it offers a powerful and compelling option to higher cost, more complex options. Can coexist with ADSL, VDSL, ISDN, and PSTN in the same cables, bringing native Ethernet to the first mile over a twisted-pair access network. Ethernet over DS-1 or DS-3 For customers beyond the distances reachable by fiber and/or copper pairs, Ethernet over DS-1 or DS-3 connections are also valid options for offering carrier- class Ethernet services and solutions. DS-1s can be bonded and handed off to SONET rings in standard 10 Mbps Ethernet DS-3s can be offered as standalone 44 Mbps Ethernet, or bonded to offer 87 or 100 Mbps Ethernet solutions. Wireless Carrier-Class Ethernet Wireless Ethernet has established itself as a killer application through the proliferation of WiFi deployed within buildings and at WiFi hotspots. Wireless Ethernet is also being deployed to support first-mile access for business locations, campuses, and municipal networks. Businesses seeking wireless Ethernet connectivity in the first mile should investigate a range of licensed and unlicensed services that have emerged over the years. Licensed solutions are the best bet for interference-free, carrier-class wireless Ethernet with the highest reliability. For example, the service provider may provide a licensed wireless Ethernet as a redundant link for backup service in the event that the fiber optic link is ever severed (Figure 4). Figure 6: Wireless Ethernet is ideally suited as a redundant backup service for Enterprises, offering a separate entrance facility not affected by fiber cuts. Wireless Ethernet is Ideally Suited as a Redundant Backup Service 12 Solutions you want. Support you need.

XO Communications Ethernet across Vertical Industries In the Enterprise, the first segments to benefit from Ethernet Services were Health Care, Finance, Education and Manufacturing. Ethernet enabled or greatly enhanced applications in site-to-site access, server consolidation, disaster recovery, Service Orientated Architecture and Internet access. Enterprise IT departments found a compelling value proposition in Ethernet s control, reliability, performance, scalability, cost reduction and simplicity of implementation, especially in organizations that were usually under-resourced. The success of the early adopters was a good indicator for success in many industries. Early Adopters of Business Ethernet Services Education: In education, a low-cost, high-bandwidth solution was needed to support multiple diverse applications simultaneously. ATM was not cost-effective, and Frame Relay didn t offer the bandwidth or flexibility. Ethernet was an optimal solution for distance learning programs, LAN-to-LAN wide area connectivity, transferring large files, and Internet access. Already widely deployed throughout higher education as a high-speed, campus-to-campus connectivity solution, Ethernet integrated seamlessly. Financial Services: Federal and state regulators who oversee financial institutions demand high levels of security, confidentiality, and privacy for customer records and transactions as well as data backup and disaster recovery. Network performance is critical in the financial vertical, and QoS backed up by rigid and stringent SLAs is an absolute requirement. Ethernet proved to be an ideal solution in meeting the demands of financial services. Healthcare: Among the most highly regulated industries in the United States, healthcare s mandates are numerous. One specifies that caregivers remain in constant contact with one another with an immediate and guaranteed ability to share information, sometimes in the form of large image files like X-rays, MRIs, and CAT scans. Ethernet s proven performance and QoS capability made it a natural fit for the healthcare industry. Manufacturing: The manufacturing supply chain is critical disruptions in commerce can alienate customers, lose opportunities, and quickly add up to long strings of zeroes. Corollary technologies, such as the Radio Frequency Identification (RFID) inventory tracking solution, inject massive quantities of real-time information into the overall process and add to network load. Ethernet s bandwidth, universality, reliability, and relative simplicity have made it an ideal solution for transporting global supply chain information. Table 3. Ethernet Services Today Top Vertical Markets Vertical Most Used Finance 33% Medical 15% Education 6% Data Center / Storage / IT 9% Real Estate 9% Legal 6% Retail 9% Wholesale Telecom 9% Media 6% Source: Metro Ethernet Forum, Ethernet Business Services, MEF Reference Presentation November 2011, slide 6, http://www.metroethernetforum.org/ppt_documents/reference-presentations/nov-2011/carrier-ethernet-for- Business-MEF-Reference-Presentation-2011-11-26.pptx, accessed March 2012. 13

Choosing the Right Ethernet Solution for Your WAN Ethernet Services for Mission-Critical Applications by Industry Ethernet Services are being used for mission critical applications across a number of vertical markets. Examples of its use in health care, finance, education, government and media are shown in Table 4. Table 4. Mission Critical Applications by Vertical Market Mission Critical Applications Carrier Ethernet Service Relevance by Vertical Market Health Care Finance Education Government Media Application Profile Regulatory issues Imaging driving storage HIPAA compliance Performance and scalability requirements TCO/ROI critical Data integrity via distributed, closely-controlled, simplified architectures Regulatory compliance (SOX, SEC, GLB) Increased demands of community partnerships using educational infrastructure, TCO/ROI critical Web based applications Flexible SLAs TCO/ROI Scalability Reach Convergence demands on low latency, high performance networks Video, streaming media Top Applications Site-to-site access Server consolidation Disaster recovery Service orientated architecture Internet access Site-to-site access Server consolidation Disaster recovery Service orientated architecture Internet access Site-to-site access Research Internet access Site-to-site access Server consolidation Disaster recovery Service orientated architecture Internet access Site-to-site access Server consolidation Source: Metro Ethernet Forum, Ethernet Business Services, MEF Reference Presentation November 2011, slide 6, http://www.metroethernetforum.org/ppt_documents/reference-presentations/nov-2011/carrier-ethernet-for- Business-MEF-Reference-Presentation-2011-11-26.pptx, accessed March 2012. 14 Solutions you want. Support you need.

XO Communications Which Ethernet Solution is best for you? All too often, technologists begin with a technology and then try to back into an application for it. As a user of the technology, it is far more important to start with the need, and then determine the appropriate technology to address it. On the road to selecting an Ethernet solution, ask yourself these questions: What is the business challenge that I am attempting to resolve? What is my budget for resolving this issue? What is the cost of not resolving it? Will my bandwidth and location needs change frequently in the future? What facilities and customer premise equipment (CPE) are already in place that I might be able to reuse, thereby eliminating the need to add costly resources? What to Look for When Choosing an Ethernet Service Provider A service provider should demonstrate that it has the following: A good track record with regard to technology deployment Extensive metro and long-haul network assets Well-designed service management organization Broad range of service deliverables Clear understanding of your business environment and connectivity requirements Option for managed solution or flexibility in supporting CPE Conclusion Ethernet Services have been designed to satisfy the diverse and growing demands of the enterprise. Ethernet supports the transport requirements of applications that have traditionally been best served by such technologies as Private Line and Frame Relay, and also lends itself to emerging IP networks, including VPNs. Ethernet offers a compelling value to the enterprise customer in providing simple, cost-effective ways to connect locations and deliver applications, data and information to flow seamlessly over the LAN and WAN with high levels of performance and reliability. Ethernet s ubiquitous and cost-effective characteristics and its familiarity to those who have worked with Ethernet on the LAN make it a highly viable solution for extending the LAN to the WAN. Its scalability allows for bandwidth increases as business needs grow, without having to deploy new or costly equipment. Ethernet offers a range of QoS levels to support all types of traffic, including voice and video. It interfaces seamlessly and transparently with IP and MPLS, and offers universal interoperability now and the foreseeable future. Because it can reuse pre-existing infrastructure elements, it reduces the need for capital outlay to build a new network. Finally, Ethernet is an ideal technology for the converged network, for all the reasons cited above. As enterprise traffic continues to become more media-intensive and places greater demands on the network, Ethernet is a reliable solution to satisfy those demands, now and in the future, with appropriate QoS and service level agreement support. 15

Choosing the Right Ethernet Solution for Your WAN XO Ethernet Services XO Ethernet Services provide simple, cost-effective ways to connect your business locations and deliver applications, data and information to flow seamlessly over your Local Area (LAN) and Wide Area Networks (WAN) with the performance and reliability your business requires. Ethernet VPLS: Multipoint-to-multipoint Ethernet WAN ideal for enterprises to connect key locations, transport special applications with protocol transparency, and maintain separation of different network domains Ethernet Private Line: Point-to-point Ethernet connectivity ideal for businesses looking for dedicated bandwidth between office locations Ethernet Hub: Point-to-multipoint Ethernet solution ideal for connecting branches or offices to centralized headquarters or data center Ethernet Access: Affordable, scalable Ethernet access to deliver Dedicated Internet Access, VoIP and MPLS IP-VPN services across your enterprise Table 5. XO Ethernet Speeds and Applications Support a Broad Range of Speeds and Applications across 60 Markets Type Description Best Apps* Availability Speeds 10 Mbps 100 Mbps Gig E 10 Gig E Ethernet over DS1 Serial/bonded 1 Now, 60 markets Yes NA NA NA Ethernet over DS3 Serial/bonded 2 Now, 60 markets Yes 44 87 100 NA NA Ethernet over Copper (Mid- Band) Copper loops, 390+ serving offices 1 Now, 60 markets Yes NA NA NA Ethernet over Fiber Thousands of XO-lit buildings in 60 markets supported by close to 900,000 metro fiber miles 2 Now, 60 markets Yes Yes Yes Yes Ethernet over Wireless Licensed and secure spectrum 1 36 markets Yes Yes NA NA * 1 2 Dedicated Internet Access, Virtual Private Networking (VPN), Private Line (point-to-point), converged data and voice Same as 1, plus Hub or aggregation point for VPN or private networking 16 Solutions you want. Support you need.

XO Communications Figure 7. XO Managed Metro Ethernet Cross-town or cross-country scalable solutions A multi-location Enterprise replaces Private Line or Frame Relay network with XO metro and longhaul Ethernet solutions. Figure 8. XO Ethernet Access Solutions Ethernet Connectivity Powers XO MPLS IP VPN Network The array of expanding metro and long-haul Ethernet access options that XO offers over copper, fiber, and wireless* optimizes the performance of an Enterprise MPLS Network. 17

Choosing the Right Ethernet Solution for Your WAN Figure 9. XO Communications Network Serving Businesses Nationwide with a Range of Converged Services XO operates an 19,000-route mile nationwide network that connects 85 metropolitan markets, and operates close to over a million miles of metro fiber. *Not all connection types and speeds are available in all locations. 18 Solutions you want. Support you need.

XO Communications Glossary of Abbreviations ADSL Asymmetric digital subscriber line MEF Metro Ethernet Forum ATM Asynchronous Transfer Mode MPLS Multiprotocol Label Switching CE Customer Equipment PSTN Public Switched Telephone Network CoS Class of Service PVC Permanent Virtual Circuits CPE Customer Provided Equipment QoS Quality of Service DIA Dedicated Internet Access SDH Synchronous Digital Hierarchy DS-1 Digital Signal 1 SLA Service Level Agreement DS-3 Digital Signal 3 TDM Time-division Multiplexing DSL Digital Subscriber Line UNI User Network Interface E-LAN Ethernet LAN VDSL Very-high-bit-rate Digital Subscriber Line E-LINE Ethernet Line VLAN Virtual Ethernet Local Area Network E-NNI External Network Network Interface VoIP Voice over Internet Protocol EoC Ethernet over Copper VPLS Virtual Private LAN Service EPL Ethernet Private Line VPN Virtual Private Network EVPL Ethernet Virtual Private Line WAN Wide Area Network EVC Gbps IP IP VPN ISDN LAN MAC Mbps Ethernet Virtual Connection Gigabits per second Internet Protocol Internet Protocol Virtual Private Network Integrated Services Digital Netowork Local Area Network Medium Access Control Megabits per second 19

About XO Communications XO Communications is a leading nationwide provider of advanced broadband communications services and solutions for businesses, enterprises, government, carriers and service providers. Its customers include more than half of the Fortune 500, in addition to leading cable companies, carriers, content providers and mobile network operators. Utilizing its unique combination of high-capacity nationwide and metro networks and broadband wireless capabilities, XO Communications offers customers a broad range of managed voice, data and IP services with proven performance, scalability and value in more than 85 metropolitan markets across the United States. For more information, visit www.xo.com. For more information on XO WAN Services and XO Ethernet Services visit http://www.xo.com/services/network/pages/overview.aspx. For XO updates, follow us on: Twitter Facebook Linkedin SlideShare YouTube Flickr Copyright 2012. XO Communications, LLC. All rights reserved. XO, the XO design logo, and all related marks are trademarks of XO Communications, LLC. XOESWP-0412