The digital age has made it necessary for organizations to rely heavily on the network infrastructure to run day-to-day operations. As such, choosing the right networking solution is critical for business success. With the rise of cloud computing and the increasing demand for more advanced solutions, there has been competition between traditional networking technology like MPLS and the next-generation SD-WAN.

Organizations everywhere are confused about choosing between these two networking solutions.

If you also face the same issue, this article aims to answer that question through a comprehensive comparison between SD-WAN and MPLS.

We will explore the pros and cons of each technology, highlight their differences, and offer insights on which solution might best suit your organization's unique requirements.

What is MPLS?

MPLS, or Multiprotocol Label Switching, is a protocol-agnostic technique for efficiently routing network traffic within wide area networks (WANs). MPLS networks utilize labels to direct packets across the network, resulting in faster and more efficient data transfer. MPLS has been a go-to solution for businesses seeking reliable and secure connectivity for several decades.

Use Cases of MPLS for Businesses

MPLS has long been favored by enterprises due to its reliability, predictable performance, and strong security features. It is ideal for businesses with the following use cases:

  • Connecting Multiple Locations: MPLS networks excel at connecting geographically dispersed locations, such as branch offices or data centers. It ensures consistent connectivity, allowing organizations to establish seamless communication and access critical resources.
  • Real-time Applications: MPLS offers low latency and minimal packet loss, making it suitable for applications requiring real-time data transmission, such as video conferencing, voice over IP (VoIP), and virtual desktop infrastructure (VDI).
  • Security and Compliance: MPLS networks provide inherent security features, including private connections and traffic segregation. This makes them an excellent choice for industries that handle sensitive data, such as healthcare, finance, and government sectors.

What is SD-WAN?

SD-WAN, or Software-Defined Wide Area Networking, is a modern networking approach that abstracts the underlying network infrastructure and enables centralized management and control of the WAN. By utilizing software-defined principles, SD-WAN provides organizations with increased flexibility, agility, and cost savings, making it a compelling alternative to traditional MPLS networks.

Use Cases of SD-WAN for Businesses

SD-WAN presents several compelling use cases that address the evolving needs of modern businesses:

  • Cloud Connectivity: With the increasing adoption of cloud services, SD-WAN offers optimized connectivity to cloud platforms. It can dynamically route traffic to the most suitable path, improving performance and minimizing latency. 
  • Cost Optimization: SD-WAN leverages multiple transport options, including MPLS, broadband, and LTE, enabling organizations to reduce reliance on expensive dedicated circuits. It provides intelligent traffic routing, allowing businesses to utilize cost-effective connections without compromising performance.
  • Scalability and Agility: SD-WAN's software-defined nature allows for rapid deployment and scalability. It simplifies the addition of new branch locations, reduces configuration complexity, and enables centralized management, saving time and resources.

SD-WAN vs. MPLS: The Core Differences

SD-WAN (Software-defined wide area network) and MPLS (Multiprotocol Label Switching) are two technologies that enable businesses to connect their sites to a wide area network (WAN).

While both technologies offer connectivity between remote sites, they differ in how they handle traffic, security, and cost.

Here are some of the core differences between SD-WAN and MPLS that you might want to consider:

Traffic handling

MPLS uses a dedicated physical network to route traffic, which means that the path is predetermined and may not be the most efficient route. In contrast, SD-WAN utilizes software to determine the optimal path for traffic based on network conditions. This results in the faster and more efficient transfer of data.


MPLS is a private network and is inherently secure. However, SD-WAN can provide additional security features such as encryption, firewalls, and intrusion detection, which can help protect against cyber threats.


MPLS is typically more expensive than SD-WAN due to the need for dedicated physical network infrastructure. On the other hand, SD-WAN uses existing Internet connections and can be managed through software, resulting in lower costs.


MPLS is a rigid network technology that is difficult to change or scale, while SD-WAN is flexible and can be easily modified or expanded to accommodate changing business needs.

Quality of Service (QoS)

MPLS provides a consistent and reliable Quality of Service (QoS) for voice and video applications, while SD-WAN can prioritize certain types of traffic to improve QoS.

Let's now take a look at the advantages of SD-WAN over MPLS.

Advantages of SD-WAN over MPLS

Below are five advantages of SD-WAN over MPLS that organizations can leverage:

Cost savings

SD-WAN comes with the benefit of cost savings as it reduces the need for expensive hardware and replaces it with low-cost internet connectivity.

Increased agility

With SD-WAN, you can adapt and scale your networks more quickly. It helps them to respond to changing business needs more easily.

Enhanced network visibility

SD-WAN offers more detailed network visibility and control, allowing network administrators to quickly identify and resolve network issues.

Better application performance

SD-WAN optimizes traffic flows and dynamically chooses the best traffic path, improving application performance.


In SD-WAN, you get redundant connections. It means failure of one connection will lead the traffic to reroute to a backup connection.

Comparing the Cost: SD-WAN vs. MPLS

Regarding the up-front costs of both options, SD-WAN tends to be cheaper. The setup cost of SD-WAN is typically lower than those of MPLS connections. 

Additionally, an SD-WAN setup often eliminates the need for special hardware like routers or additional infrastructure, reducing upfront costs.

In terms of recurring costs, an SD-WAN solution typically costs less over the long term than MPLS, especially when using public internet circuits as the underlying technology.

However, the pricing for each is determined by the data plan and can be based on usage or be more consistent regardless of usage. 

Down the line, it's clear that SD-WAN offers a cost-effective alternative to MPLS. Its low upfront costs, pay-as-you-go structure, and redundancy capabilities make it a more cost-efficient choice.

Network Performance: SD-WAN vs. MPLS

SD-WAN is known for its ease of use, fast deployment and reduced complexity and cost compared to MPLS. The solution is easy to set up, making it an ideal option for business applications like video and audio streaming, cloud applications and SaaS solutions. 

However, SD-WAN solutions typically offer less secure connection options and limited support for more sensitive and private data transfers.

On the other hand, MPLS networks are a more secure and private solution as data travels via private dedicated lines between sites and is well-suited for more complex, larger enterprise networks. While more expensive, it also offers a guaranteed service-level agreement.

Why is SD-WAN Better than MPLS?

SD-WAN comes with a handful of advantages over MPLS. It includes superior scalability, cost savings, and reliability compared to traditional Multiprotocol Label Switching (MPLS).

The increased flexibility and optimization of SD-WAN lets businesses benefit from multiple public networks to access private resources. This way, companies can ensure that customer demands are met more efficiently.

As an overlay technology, SD-WAN requires minimal investments in expensive infrastructure, enabling companies to save on network costs. It is also much easier to scale with increasing demand and offer dynamic network changes to maintain customer satisfaction.

In a nutshell, SD-WAN is a secure, reliable and scalable solution over MPLS.

The Right Time To Switch From MPLS To SD-WAN

MPLS has been the traditional backbone of enterprise WAN networks for more than two years. On the other hand, SD-WAN offers businesses increased visibility, application-specific routing and, more recently, security.

There are a few factors to consider for companies considering the transition from MPLS to SD-WAN.

Do you want your network to be easily scalable to keep up with future growth? How important is network performance? What services do you need to be deployed on the network? These questions can help you identify the best time to switch from MPLS to SD-WAN.

Simply put, it is up to you to assess your specific needs when deciding whether or when to transition from MPLS to SD-WAN. You must remember your requirements while partnering with a knowledgeable service provider.

How to Choose the Right Networking Solution for Your Organization

Selecting the appropriate networking solution for your organization requires careful consideration of various factors. Here are some key points to evaluate when choosing between MPLS and SD-WAN:

  • Business Requirements: Assess your organization's specific needs, such as connectivity, performance, security, scalability, and cost. Consider factors like the number of locations, applications used, and data sensitivity.
  • Network Traffic: Analyze your network traffic patterns and requirements. Determine if your business relies heavily on real-time applications, cloud services, or if you have high bandwidth
  • Budget Considerations: Evaluate your budget and cost constraints. MPLS networks typically involve higher upfront costs due to dedicated circuits, while SD-WAN offers cost savings by utilizing diverse transport options. Consider long-term ROI when making a decision.
  • Future Growth and Scalability: Consider the scalability of your organization. If you anticipate rapid growth, SD-WAN's agility and ease of deployment make it a viable option. MPLS may be more suitable for businesses with stable and predictable growth patterns.
  • Security and Compliance: Assess the security requirements and regulatory compliance standards of your industry. MPLS networks inherently provide strong security features, making them advantageous for organizations dealing with sensitive data. However, SD-WAN can incorporate robust security measures through encryption and advanced threat detection.
  • Vendor Evaluation: Thoroughly evaluate potential service providers or vendors. Consider their reputation, track record, expertise, and support capabilities. Ensure they align with your organization's goals and can deliver the required service levels.
  • Hybrid Approach: In some cases, a hybrid approach may be the best solution. By combining MPLS and SD-WAN, businesses can leverage the strengths of both technologies. MPLS can be used for critical applications requiring high reliability and security, while SD-WAN can be implemented for cost-effective connectivity to less sensitive locations.

Tata Communication's Secure SD-WAN Solution

Tata Communications is a leading provider of digital infrastructure services, including SD-WAN solutions. Our SD-WAN offerings are designed to help organizations simplify their network infrastructure and improve the performance and security of their applications.

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