VPNs: Is The Time Now?

When Virtual Private Networks arrived on the scene, they promised bulletproof security for enterprises at a fraction of the leased-line cost. However, enthusiasm for VPNs waned as the encryption technology available failed to match expectations of high-speed performance and maximum-security requirements. But times have changed.
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When Virtual Private Networks (VPNs) arrived on the technology scene they promised bulletproof security for corporate networks at a fraction of the leased-line cost. As time passed, the enthusiasm for VPNs waned - the encryption technology available didn't match companies' dual expectations of high-speed performance and maximum-security requirements.

This technology hurdle has now been addressed with sophisticated developments in high-speed crypto ASIC design and production. VPN infrastructure manufacturers are now meeting expectations with the highest level of security (IPSec using 3DES - CBC mode) at speeds of 2G bit/sec. These performance improvements are essential in reflecting the momentum of VPN adoption. Both service providers and company managed networks have focused expectations relative to return on investment, flexibility and better-centralized management. By meeting these expectations, VPN product revenues more than doubled to $706 million in the first half of 2001, up from $313 million in the first half of 2000, according to Infonetics Research.

VPNs are maturing at a time when secure network accessibility is becoming increasingly important to companies with multiple branches, telecommuters and workers-on-the-go. Companies are also embracing VPNs for their intrinsic ability to slash operating costs and prevent unauthorized access to sensitive corporate information. VPNs are so compelling that over 50 percent of all companies plan on deploying VPNs by 2002, according to analysts.

Enterprises aren't the only ones embracing VPNs. Telcos and service providers also gain a competitive advantage by offering VPN capability bundled with their existing applications and services. For these providers, VPN solutions are deployed seamlessly to customers at a fraction of the cost individual companies could implement a comparable VPN. Reselling VPN services is a lucrative opportunity for telcos and service providers. A VPN solution combined with an IPSec client and a firewall secures access to critical corporate resources and provides solid protection against unwanted Internet intrusion.


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