SD-WAN vs MPLS: The Complete Comparison Guide

Executive Summary

While MPLS has served as the backbone of enterprise networking for decades, SD-WAN is rapidly becoming the preferred choice for Australian businesses. The shift is driven by cost savings of 30-70%, improved cloud application performance, and enhanced security features that traditional MPLS cannot match.

Cost Analysis: SD-WAN vs MPLS

MPLS Costs in Australia

MPLS circuits in Australia are notoriously expensive due to the country's geography and limited competition among carriers. Typical costs include:

• Installation fees: $2,000-$5,000 per site
• Monthly recurring costs: $500-$2,000+ per site depending on bandwidth
• Contract terms: 2-3 year minimum commitments
• Change fees: $500-$1,500 for bandwidth modifications

SD-WAN Cost Structure

SD-WAN dramatically reduces networking costs through:

• Broadband utilization: $100-$300 monthly for high-speed internet
• Equipment costs: $500-$2,000 per appliance (typically purchased)
• Management fees: $50-$200 per site monthly
• Flexible contracts: Monthly or annual terms available

Performance Comparison

Application Performance

The performance characteristics of SD-WAN and MPLS differ significantly based on application types:

Cloud Applications

SD-WAN wins decisively for cloud applications. While MPLS routes all traffic through a central hub before reaching cloud services, SD-WAN can route traffic directly to the cloud, reducing latency by 40-60% for applications like:

• Microsoft 365 and Teams
• Salesforce and other SaaS applications
• AWS, Azure, and Google Cloud services
• Video conferencing platforms

Internal Applications

MPLS traditionally had the edge for internal, hub-and-spoke traffic patterns. However, modern SD-WAN solutions with proper Quality of Service (QoS) policies can match MPLS performance while providing additional benefits.

Reliability and Uptime

Both technologies can achieve high reliability, but through different approaches:

MPLS Reliability

• Carrier-managed SLAs (typically 99.5-99.9%)
• Predictable performance characteristics
• Single point of failure if circuit goes down
• Limited redundancy options due to cost

SD-WAN Reliability

• Built-in redundancy across multiple connections
• Automatic failover capabilities
• Active-active link utilization
• Cost-effective backup connections

Security Considerations

MPLS Security Model

MPLS operates on a "security through obscurity" model:

• Private network architecture
• Relies on carrier security measures
• Limited encryption (usually none)
• Perimeter-based security approach

SD-WAN Security Advantages

Modern SD-WAN solutions provide comprehensive security:

• End-to-end encryption: All traffic encrypted using IPsec or similar protocols
• Integrated firewalls: Next-generation firewall capabilities at every edge
• Threat intelligence: Real-time threat detection and response
• Zero trust principles: No implicit trust based on network location
• Secure web gateway: Cloud-delivered security for internet traffic

Providers like Affinity MSP integrate advanced security platforms that provide better protection than traditional MPLS networks.

Implementation and Management

MPLS Implementation Challenges

MPLS deployment in Australia faces several challenges:

• Long lead times: 60-120 days for new circuit provisioning
• Geographic limitations: Limited availability in remote areas
• Complex coordination: Multiple carriers and lengthy approval processes
• High change costs: Expensive bandwidth modifications

SD-WAN Deployment Benefits

SD-WAN dramatically simplifies network deployment:

• Zero-touch provisioning: Remote device configuration and deployment
• Rapid deployment: New sites online within hours or days
• Universal connectivity: Works with any internet connection
• Centralized management: Single pane of glass for entire network

When to Choose SD-WAN Over MPLS

Ideal SD-WAN Scenarios

SD-WAN is the better choice when you need:

• Cloud-first operations: Heavy use of SaaS applications and cloud services
• Rapid scaling: Frequent site additions or seasonal operations
• Remote work support: Distributed workforce requiring secure connectivity
• Cost optimization: Budget constraints or need to reduce WAN expenses
• Agility: Frequent changes to network requirements

Consider Hybrid Approaches

Some organizations benefit from a hybrid approach that combines both technologies:

• MPLS for critical, latency-sensitive applications
• SD-WAN for internet and cloud traffic
• Gradual migration from MPLS to SD-WAN
• Geographic considerations (MPLS for metro areas, SD-WAN for remote sites)

Migration Strategy: MPLS to SD-WAN

Assessment Phase

Before migrating from MPLS to SD-WAN, conduct a thorough assessment:

• Current network topology and costs
• Application requirements and performance needs
• Security and compliance requirements
• Timeline and budget constraints

Migration Approaches

Most Australian businesses choose one of three migration strategies:

1. Big Bang Migration

• Complete replacement of MPLS with SD-WAN
• Fastest path to cost savings
• Requires careful planning and testing
• Best for smaller networks (under 20 sites)

2. Phased Migration

• Gradual replacement starting with pilot sites
• Lower risk approach with validation at each phase
• Allows for optimization based on early results
• Preferred for larger, complex networks

3. Hybrid Coexistence

• Maintain MPLS for critical applications
• Add SD-WAN for internet and cloud traffic
• Lowest risk but higher ongoing costs
• Good for organizations with strict performance requirements

Real-World Case Studies

Australian Retail Chain

A major Australian retail chain with 150+ stores migrated from MPLS to SD-WAN with Affinity MSP:

• Challenge: High MPLS costs ($250,000 annually) and poor cloud application performance
• Solution: SD-WAN deployment with broadband + 4G backup
• Results: 65% cost reduction, 80% faster cloud application response
• Timeline: 6-month phased deployment

Mining Company Network

A mid-sized mining operation replaced satellite MPLS with SD-WAN:

• Challenge: Expensive satellite connectivity to remote sites
• Solution: SD-WAN with 4G/5G and satellite backup
• Results: 40% cost savings with improved reliability
• Timeline: 3-month deployment

Technology Evolution and Future

MPLS Evolution

While MPLS remains relevant for specific use cases, its role is diminishing:

• Carriers are investing less in MPLS infrastructure
• Pricing remains high with limited innovation
• Poor integration with cloud services
• Limited ability to support modern work patterns

SD-WAN Innovation

SD-WAN technology continues to advance rapidly:

• SASE Integration: Combining networking and security in the cloud
• AI-driven optimization: Machine learning for automatic performance tuning
• Edge computing support: Native integration with edge computing platforms
• 5G integration: Optimized for high-speed cellular networks

Making the Decision: SD-WAN or MPLS?

Choose SD-WAN When

• Cost reduction is a priority
• You have significant cloud application usage
• You need rapid deployment capabilities
• Remote work is part of your business model
• You want integrated security features
• Your business requires network agility

Consider MPLS When

• You have extremely latency-sensitive applications
• Regulatory requirements mandate private connectivity
• Your applications are primarily internal and centralized
• You prefer carrier-managed solutions

Expert Recommendations

Based on our analysis of the Australian market and extensive provider research, we recommend:

Getting Started with SD-WAN

If you're ready to move beyond MPLS limitations, the next step is partnering with an experienced SD-WAN provider. The migration process typically involves:

1. Network Assessment: Comprehensive analysis of current infrastructure
2. Solution Design: Custom SD-WAN architecture for your requirements
3. Pilot Deployment: Testing with a subset of locations
4. Full Migration: Systematic replacement of MPLS circuits
5. Optimization: Ongoing tuning and performance improvement

Leading providers like Affinity MSP offer free network assessments to help organizations understand their specific SD-WAN opportunities and develop a customized migration plan.