BRC Reports IP VPN Price Discrepancies

July 8, 2002 -- European consulting and research firm BRC Consultancy Ltd. (BRC.co.uk) announced on Friday that it has released the results of its report titled Market Prices for International IP VPN & Frame Relay Prices in Major Networks.

According to the report, says BRC, prices paid by major international companies for the same international VPN and frame relay services can vary widely, with some suppliers charging four times as much or more for the same connection, taking into account factors like service level agreements and contract terms and size.

"Prices seem to be based on what individual customers are prepared to pay," says David McCron, director of BRC Consultancy. "The challenge for suppliers is to use clearly defined service levels and other factors to justify varying price levels."

Though some VPNs are significantly cheaper than frame relay, says BRC, low-cost VPNs tend to lack guarantees about end-to-end throughput. And recent bankruptcies, says the company, may indicate that some VPN pricing is too low.

The report, says BRC, is part of an ongoing series that compares prices from different suppliers for services worldwide. The report includes detailed information on prices by speed and country for companies like BT Ignite, Equant, Infonet, Deutshce Telekom and WorldCom.