Private Line Declines While Local PL Stays Strong

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BOONTON, NJ. January 8, 2002:

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The market for long distance private lines is expected to decline over the next five years while a boom is expected in sales of local private line services, says a new report from Insight Research. Long distance private lines, which traditionally provided the best solution for secure communications over wide areas, will increasingly lose ground to virtual private networks (VPNs) while local private lines will experience a growth surge as carriers bundle several different types of services onto a single private line. 

According to Private Line Services 2002-2007, over the next five years there will be a significant shift away from buying private lines for private wide area networks (WANs). VPNs using highly secure encryption and transmitting over the public Internet are proving to be viable alternatives to dedicated private line networks for all but the most security-conscious buyer. While the long distance PL market will steadily decline over the forecast period, local private lines will experience double-digit growth as increasing numbers of wholesale and retail customers purchase the local private lines needed to connect to service providers within the local exchange area. 

"Pundits have long written off private line services," says Insight president Robert Rosenberg. "And they may be right in the long distance portion. But local PL is going to boom, in part because it is an attractive vehicle to offer bundled services-such as toll-free and Internet access-on a single local private line by utilizing integrated access devices (IADs)." 

Private Line Services 2002-2007 examines the history and development of private line services, explains current trends and future applications, profiles network providers, and forecasts private line revenue and circuit counts. The report presents PL revenue by carrier type, wholesale vs. retail, and local vs. long distance. Circuit count projections are presented for DS-1, DS-3, and OC-3 through OC-768. 

A free report excerpt, table of contents, and ordering information is online at www.insight-corp.com/pl2002.asp. 

Private Line Services 2003-2008

Donna Savino

at Insight Research