The document compares the costs of MPLS VPN connectivity versus point-to-point leased line connectivity for links over 500km and within a city. For long-distance cross-country links over 500km, the point-to-point leased line option is 58.73-74.3% cheaper than the MPLS VPN option even after discounts. Similarly for intra-city links, point-to-point leased lines are 20.21-20.73% cheaper. The tables provide a detailed cost breakdown and comparison of the different cost components for each connectivity option.

1. COMPARISON OF COSTS
MPLS VPN – VS – POINT-TO-POINT LEASED LINES
Let us consider connectivity between two points A and B at a chargeable distance
(1.25 x crow flight or radial distance) of more than 500km for a 64 kbps link
The Table below shows the comparison of costs between a point-to-point and MPLS
VPN connection.
TABLE 1
CROSS COUNTRY LINK
Sl Head of charge MPLS Point-to- Point-to- Remarks
VPN point leased point leased
line as per line after
Web site new
circular
1 End link 5 km at A NA 11500 17811
2 End link 5 km at B NA 11500 17811
3 NTU rent at A NA NA 3500
4 NTU rent at B NA NA 3500
5 Long distance NA 51000 51000
charge between A
&B
6 Port charge at A 63000 NA NA
7 Port charge at B 63000 NA NA
8 Total cost 126000 74000 93622
9 Service tax @12% 15120 8880 11234
10 Education Tax 2% 2520 1480 1872
11 Total cost based 143640 84360 106728 Based on
on rack prices and Rack prices
inclusive of taxes
and levies
12 Percentage of 100% 58.73% 74.30% Point-to-
MPLS VPN cost point leased
lines are
much
cheaper
13 Possible bulk 40% 25 to 30% 25 to 30%
discounts
Page 1 of 2

2. A similar comparison may be made of intra-city connectivity as shown in Table 2
below.
TABLE 2
INTRA-CITY LINK
Sl Head of charge MPLS Point-to- Point-to- Remarks
VPN point leased point leased
line as per line as per
Web site 15 Web site 25
km km
1 Total circuit charge NA 25463 19116
3 NTU rent at A NA NA 3500
4 NTU rent at B NA NA 3500
6 Port charge at A 63000 NA NA
7 Port charge at B 63000 NA NA
8 Total cost 126000 25463 26116
9 Service tax @12% 15120 3056 3134
10 Education Tax 2% 2520 509 522
11 Total cost based 143640 29028 29772 Based on
on rack prices and Rack prices
inclusive of taxes
and levies
12 Percentage of 100% 20.21% 20.73% Point-to-
MPLS VPN cost point leased
lines are
much
cheaper
13 Possible bulk 40$ 25 to 30% 25 to 30%
discount
Page 2 of 2