Data Watch: Reducing Data Costs to Remote Sites

If you're a food processor with enterprise software that's linked to multiple production, distribution and corporate facilities, here's a tip for saving money on your data transport costs - and adding affordable data backup capabilities at the same time.

Faribault Foods, a canner and distributor of vegetable and meat products headquartered near the Twin Cities in Faribault, Minnesota, has sliced nearly 20% off its data-related telecommunications bill by working with its service provider to simplify its frame relay network with a routing protocol called Multi-Protocol Label Switching (MPLS). The same cost-cutting strategy can be used for ATM networks.

Faribault now pays its service provider, Milwaukee-based Norlight Telecommunications, just $7,500 a month to connect two primary and seven remote locations that send and receive data to and from the company's PeopleSoft EnterpriseOne enterprise resource management system. That's a drop from $9,000 a month, despite the fact that Faribault has increased bandwidth at three of its remote sites and added a T1 line for backup between its main office and an off-site warehouse a few miles away.

"Without the extra capacity and T1 line we added, we would probably be paying just $6,000 a month," says Faribault IT Manager Scott Bellefeuille. "In an apples-to-apples comparison, we actually cut our costs by one-third."

Faribault was able to retain its existing frame relay network with no additional capital expenditures because implementation of the MPLS service was primarily a matter of reconfiguring routers. No hardware or infrastructure changes were required on Faribault's end.

Before adopting Norlight's MPLS service in late 2003, Faribault was paying to maintain two Permanent Virtual Circuits (PVCs) at each of its facilities, essentially providing two separate data paths for redundancy purposes. One path led to the company's main data center. The other led to a secondary site that served as a hot standby.

Unfortunately, since the network was configured to route all data through Faribault's host site, any outage in the main office would shut down the data flow at all facilities. Setting up a truly fail-safe backup system would have required expensive infrastructure modifications.

MPLS technology solved the backup problem, as well as slashing monthly bills, by providing two key benefits. First, it eliminated the need to funnel all data through Faribault headquarters. Second, it enabled the company to maintain and pay for only one PVC at each facility instead of two.

All data now travels over Faribault's frame relay connection to an IP network core at Norlight's data center in Brookfield, WI. MPLS routers and switches situated at and maintained by Norlight then send the information on to the appropriate destination.

This is possible because MPLS routes traffic to any location by creating and attaching special "labels" to each data packet. Each label contains information such as the packet's origin, destination, and required bandwidth. Routing by label, rather than packet, allows data traffic to follow multiple routes rather than a single path - and therefore take a detour around a failed connection.

In Faribault's case, that means that traffic headed for the company's primary data center can be automatically rerouted to the backup site if the primary site is out of commission. This eliminates the need for a second PVC for disaster recovery. "Now one site can be down," Bellefeuille notes, "and the other six can still be working."

In addition, traffic between remote sites can now get where it's going without traveling through the host location. This creates an "any-to-any" network that eliminates bandwidth inefficiencies by allowing any site to talk to any other site directly.

Performance is equal to or better than before, according to Bellefeuille. That's as it should be, because the MPLS protocol was designed in part to speed up IP-based traffic over frame relay and ATM networks. Cost savings may not have been the primary goal, but there's no reason to look a gift horse in the mouth. If you have a distributed network like Faribault's, MPLS may be your ticket to lower telecom bills.