SD-WAN vs MPLS: Understanding the Differences

In the realm of networking solutions, SD-WAN and MPLS stand out as two prominent options for businesses aiming to streamline their connectivity. SD-WAN, short for Software-Defined Wide Area Network, and MPLS, or Multiprotocol Label Switching, offer distinct approaches to managing and optimizing network traffic. Understanding the disparities between these two technologies is crucial for businesses striving to enhance their network performance while managing costs effectively. Let’s delve into the intricacies of SD-WAN vs MPLS to grasp the nuances and make informed decisions for your network infrastructure needs.



Understanding SD-WAN

In today’s dynamic business landscape, where agility and efficiency are paramount, SD-WAN emerges as a transformative solution for managing wide area networks. Let’s delve deeper into what SD-WAN entails, its benefits, and how it operates.

Definition and Overview

SD-WAN, which stands for Software-Defined Wide Area Network, simplifies the administration and functioning of wide area networks by separating the networking hardware from its control mechanism. SD-WAN differs from conventional WAN setups by using software instead of specialized hardware to smartly manage network traffic routing.

Benefits of SD-WAN

  1. Enhanced Performance: SD-WAN optimizes network performance by dynamically routing traffic based on real-time conditions. It can prioritize critical applications and select the most efficient path for data transmission, leading to improved performance and reduced latency.
  2. Cost Savings: By utilizing commodity internet links and reducing reliance on expensive MPLS connections, SD-WAN offers significant cost savings for organizations. The ability to leverage multiple transport technologies, including broadband, 4G/5G, and MPLS, allows for cost-effective network deployments.
  3. Flexibility and Scalability: SD-WAN offers organizations the ability to quickly expand their network infrastructure and adjust to evolving business needs, thanks to its flexibility and scalability. With centralized management and orchestration, adding new branches or adjusting network policies becomes seamless and efficient.
  4. Enhanced Security: SD-WAN solutions frequently integrate sophisticated security measures like encryption, segmentation, and threat detection to protect data transmission across the network. By enforcing security policies consistently across all network endpoints, SD-WAN enhances overall network security.

How SD-WAN Works

SD-WAN operates by abstracting the underlying hardware and transport technologies, allowing for centralized control and management of the network. Key components of an SD-WAN architecture include:

  • Edge Devices: These are physical or virtual appliances deployed at branch offices or remote locations. Edge devices establish connectivity with the WAN and enforce network policies.
  • Controller: The SD-WAN controller serves as the centralized orchestrator, responsible for configuring and managing network policies, traffic routing, and security functions.
  • Overlay Network: SD-WAN creates an overlay network that spans across different transport technologies, enabling seamless connectivity and traffic optimization.
  • Dynamic Path Selection: In SD-WAN, the most suitable route for transmitting data is dynamically chosen, considering factors like link performance, latency, and application needs. This ensures efficient utilization of network resources and enhanced application performance.

By leveraging these components and principles, SD-WAN transforms traditional WAN architectures, offering agility, cost-effectiveness, and improved performance for modern enterprises.


Understanding MPLS

In contrast to the innovative approach of SD-WAN, Multiprotocol Label Switching (MPLS) represents a more traditional method of managing wide area networks. Let’s explore what MPLS entails, its benefits, and how it functions.

Definition and Overview

MPLS, or Multiprotocol Label Switching, is a technique used in telecommunications networks to direct data packets along predefined paths through the network. It functions within a layer typically situated between the conventional routing and switching layers. MPLS labels packets with special identifiers (labels) that facilitate faster and more efficient routing decisions.

Benefits of MPLS

  1. Predictable Performance: MPLS networks offer predictable performance characteristics, including low latency, minimal packet loss, and high reliability. These attributes make MPLS well-suited for applications that require consistent performance, such as voice and video conferencing.
  2. Quality of Service (QoS): MPLS supports sophisticated Quality of Service (QoS) mechanisms, allowing network administrators to prioritize traffic based on application requirements. This ensures that critical applications receive the necessary bandwidth and priority over less time-sensitive traffic.
  3. Enhanced Security: MPLS inherently provides a level of security through its label-switching mechanism. Since MPLS networks are inherently private and isolated from the public internet, they offer inherent protection against external threats and unauthorized access.
  4. Traffic Engineering: MPLS enables network administrators to engineer traffic paths dynamically based on network conditions and requirements. This allows for efficient utilization of network resources and optimized traffic routing.

How MPLS Works

MPLS operates by assigning labels to packets at the ingress router and forwarding them along predetermined paths through the network. Essential elements of an MPLS network comprise:

  • Label Switch Routers (LSRs): These routers form the backbone of the MPLS network and are responsible for forwarding packets based on their labels.
  • Label Distribution Protocol (LDP): LDP is used to distribute labels between adjacent routers in the MPLS network, enabling the establishment of label-switched paths.
  • Forwarding Equivalence Class (FEC): FECs define groups of packets that should be treated similarly within the MPLS network. Packets with the same FEC are assigned the same label and follow the same path through the network.

By leveraging these components and mechanisms, MPLS networks provide reliable and efficient connectivity for businesses across various industries. Despite the emergence of SD-WAN and other technologies, MPLS remains a preferred choice for organizations seeking predictable performance and stringent security for their critical applications.


Differences Between SD-WAN vs MPLS

Understanding the disparities between SD-WAN and MPLS is essential for organizations evaluating their networking options. Let’s delve into the key differences between these two technologies, considering aspects such as cost, scalability, performance, and flexibility.

Cost Comparison

One of the most significant differences between SD-WAN and MPLS lies in their cost structures. While MPLS networks typically involve higher upfront costs due to the need for specialized hardware and dedicated circuits, SD-WAN offers a more cost-effective alternative. SD-WAN leverages commodity internet links and allows organizations to utilize multiple transport technologies, including broadband and 4G/5G connections, resulting in lower operational expenses.


Scalability is another crucial factor to consider when comparing SD-WAN and MPLS. MPLS networks can be challenging to scale, particularly when adding new branch locations or accommodating increased bandwidth requirements. In contrast, SD-WAN offers greater scalability and agility, allowing organizations to rapidly deploy new sites and adjust network configurations as needed through centralized management and orchestration.

Performance and Reliability

Performance and reliability are paramount considerations for network connectivity. While MPLS networks are renowned for their predictable performance and low latency, SD-WAN has made significant strides in this regard. Through dynamic path selection and application-aware routing, SD-WAN can optimize traffic flow and ensure efficient utilization of network resources, resulting in comparable performance to MPLS in many scenarios.

Flexibility and Management

Flexibility and ease of management are key advantages of SD-WAN over MPLS. SD-WAN centralizes network management and configuration, allowing organizations to implement changes quickly and efficiently. Additionally, SD-WAN enables organizations to prioritize critical applications, apply granular security policies, and integrate with cloud services seamlessly. In contrast, MPLS networks may require more manual intervention and are often less flexible in adapting to changing business requirements.

Overall, while MPLS has long been the preferred choice for organizations requiring reliable and secure connectivity, SD-WAN offers a compelling alternative with its cost-effectiveness, scalability, and flexibility. Understanding the specific needs and priorities of your organization is crucial in determining whether SD-WAN or MPLS is the best fit for your networking requirements.

Use Cases

Both SD-WAN and MPLS have distinct use cases and are favored by different industries based on their specific requirements and priorities. Let’s explore the industries that benefit from each technology and understand the reasons behind their preferences.

Industries Benefiting from SD-WAN

  1. Retail: Retail organizations with distributed locations benefit from SD-WAN’s agility and cost-effectiveness. SD-WAN enables seamless connectivity between stores, warehouses, and headquarters, facilitating efficient inventory management, POS transactions, and customer engagement.
  2. Healthcare: In the healthcare sector, where network reliability and security are critical, SD-WAN offers significant advantages. Healthcare providers leverage SD-WAN to ensure seamless communication between clinics, hospitals, and remote healthcare facilities, supporting telemedicine, electronic health records (EHR) systems, and medical imaging applications.
  3. Financial Services: Financial institutions rely on SD-WAN to enhance branch connectivity, support online banking services, and ensure compliance with stringent security regulations. SD-WAN enables secure and resilient connections between bank branches, ATM networks, and data centers, facilitating real-time transactions and customer service.
  4. Manufacturing: Manufacturing companies with geographically dispersed facilities benefit from SD-WAN’s ability to streamline operations and improve collaboration. SD-WAN enables seamless connectivity between production sites, supply chain partners, and headquarters, supporting inventory management, production control systems, and remote monitoring.

Industries Favoring MPLS

  1. Enterprise: Large enterprises with stringent performance and reliability requirements often prefer MPLS for their core network infrastructure. MPLS offers predictable performance, low latency, and guaranteed Quality of Service (QoS), making it ideal for mission-critical applications such as ERP systems, VoIP communications, and video conferencing.
  2. Government: Government agencies and public sector organizations prioritize security and reliability in their network infrastructure. MPLS provides a secure and private network environment, making it suitable for sensitive government applications such as law enforcement, defense, and emergency services.
  3. Education: Educational institutions, including universities and K-12 schools, rely on MPLS to support campus-wide connectivity and online learning initiatives. MPLS ensures consistent performance and reliable access to educational resources, enabling seamless collaboration among students, faculty, and administrative staff.
  4. Transportation and Logistics: Transportation companies and logistics providers require robust and resilient network connectivity to manage their operations effectively. MPLS offers the reliability and performance necessary to support tracking and tracing systems, fleet management applications, and supply chain logistics.

By understanding the unique requirements and priorities of different industries, organizations can make informed decisions about whether SD-WAN or MPLS is the most suitable solution for their networking needs.


Deployment Considerations

Before making a decision between SD-WAN and MPLS, organizations must carefully evaluate various factors to ensure the chosen solution aligns with their business objectives and technical requirements. Let’s explore the key considerations that organizations should keep in mind when deploying SD-WAN or MPLS.

Factors to Consider Before Choosing SD-WAN or MPLS

  1. Network Performance Requirements: Organizations should assess their performance requirements, including latency, packet loss, and bandwidth needs. While MPLS traditionally offers predictable performance, SD-WAN has evolved to provide comparable performance through dynamic path selection and application-aware routing.
  2. Cost Considerations: Cost is a significant factor in network deployment decisions. Organizations should evaluate the upfront and ongoing costs associated with SD-WAN and MPLS, considering factors such as hardware, software licensing, bandwidth fees, and maintenance expenses. While SD-WAN often offers cost savings compared to MPLS, organizations should conduct a thorough cost-benefit analysis to determine the most cost-effective option.
  3. Scalability and Flexibility: Scalability is essential for organizations looking to accommodate growth and adapt to changing business requirements. SD-WAN typically offers greater scalability and agility than MPLS, allowing organizations to rapidly deploy new sites, adjust network configurations, and integrate with cloud services seamlessly.
  4. Security and Compliance Requirements: Security is paramount in today’s threat landscape, particularly for industries handling sensitive data. While MPLS inherently provides a level of security through its private network architecture, SD-WAN offers advanced security features such as encryption, segmentation, and threat detection. Organizations should assess their security and compliance requirements and ensure that their chosen solution meets regulatory standards.
  5. Integration with Existing Infrastructure: Organizations must consider how SD-WAN or MPLS will integrate with their existing network infrastructure, applications, and services. Compatibility with legacy systems, cloud services, and third-party applications is crucial for seamless deployment and operation.
  6. Quality of Service (QoS) and Application Performance: Organizations should prioritize applications based on their criticality and performance requirements. MPLS offers robust Quality of Service (QoS) mechanisms, ensuring consistent performance for latency-sensitive applications such as voice and video conferencing. SD-WAN provides similar capabilities through application-aware routing and dynamic traffic prioritization.
  7. Redundancy and Failover: High availability and fault tolerance are critical considerations for mission-critical applications. Both SD-WAN and MPLS offer redundancy and failover capabilities to ensure uninterrupted connectivity in the event of network failures or outages. Organizations should evaluate the resiliency features of each solution and implement appropriate redundancy strategies.

By carefully evaluating these deployment considerations, organizations can make informed decisions about whether SD-WAN or MPLS is the best fit for their networking needs. Each organization’s requirements may vary, so it’s essential to conduct a thorough analysis and consult with network experts to determine the optimal solution.

Future Trends

The networking landscape continues to evolve rapidly, driven by advancements in technology and changing business requirements. Understanding the future trends in SD-WAN and MPLS is essential for organizations looking to stay ahead of the curve and leverage the latest innovations in network connectivity.

Evolution of SD-WAN and MPLS Technologies

  1. SD-WAN:
    • Cloud Integration: SD-WAN solutions are increasingly integrating with cloud services to support distributed workloads and applications hosted in the cloud. Future developments may focus on enhancing cloud-native capabilities, such as seamless integration with major cloud providers and improved performance for cloud-based applications.
    • Security Enhancements: With cybersecurity threats on the rise, SD-WAN vendors are investing in advanced security features to protect against emerging threats. Future SD-WAN solutions may incorporate machine learning, artificial intelligence, and zero-trust security principles to enhance threat detection and response capabilities.
    • Edge Computing: The proliferation of edge computing technologies is driving the convergence of SD-WAN and edge networking. Future SD-WAN solutions may incorporate edge computing capabilities to support latency-sensitive applications and improve overall network performance at the network edge.
  2. MPLS:
    • Hybrid Deployments: MPLS providers are embracing hybrid networking models that combine MPLS with SD-WAN and other connectivity options. Future MPLS deployments may leverage hybrid architectures to offer greater flexibility, scalability, and cost-effectiveness while maintaining MPLS’s reliability and performance characteristics.
    • SDN Integration: Software-Defined Networking (SDN) principles are increasingly being integrated into MPLS networks to enable centralized control, programmability, and automation. Future MPLS deployments may leverage SDN technologies to streamline network management, optimize traffic flow, and support dynamic service provisioning.
    • 5G Integration: The rollout of 5G networks presents new opportunities for MPLS providers to deliver high-speed, low-latency connectivity to their customers. Future MPLS deployments may leverage 5G technology to offer enhanced mobility, bandwidth, and coverage, particularly for mobile and IoT applications.

Predictions for the Industry

  1. Convergence of SD-WAN and MPLS: As organizations seek to balance performance, cost, and flexibility, we may see increased convergence between SD-WAN and MPLS technologies. Future networking solutions may combine the best aspects of both technologies to offer a unified approach to wide area networking that delivers the reliability of MPLS with the agility of SD-WAN.
  2. Focus on Automation and Orchestration: Automation and orchestration will play a crucial role in the future of networking, enabling organizations to streamline operations, reduce manual intervention, and improve overall efficiency. Future SD-WAN and MPLS solutions may incorporate advanced automation capabilities to simplify network management tasks and accelerate service delivery.
  3. Rise of Edge Networking: With the growing adoption of edge computing and IoT devices, edge networking will become increasingly important in the future. SD-WAN and MPLS providers may focus on enhancing their edge networking capabilities to support distributed edge deployments, improve application performance, and ensure seamless connectivity between edge devices and the cloud.

By staying abreast of these future trends, organizations can position themselves to capitalize on emerging opportunities and leverage next-generation networking technologies to drive business innovation and growth.


In conclusion, the comparison between SD-WAN vs MPLS underscores the dynamic nature of networking technologies and the diverse needs of organizations in today’s digital landscape. While MPLS has long been favored for its reliability and performance, SD-WAN offers compelling advantages in terms of cost-effectiveness, scalability, and flexibility.

As businesses continue to navigate evolving demands for connectivity, security, and agility, the decision between SD-WAN and MPLS requires careful consideration of factors such as network performance requirements, cost considerations, and integration with existing infrastructure. Looking ahead, future trends indicate a convergence of SD-WAN and MPLS technologies, driven by advancements in cloud integration, security enhancements, and the rise of edge networking.

By embracing these trends and adopting a strategic approach to network deployment, organizations can effectively meet their networking needs and capitalize on the opportunities presented by emerging technologies.


  1. What is the main difference between SD-WAN and MPLS?
    • The main difference lies in their approach to network management. SD-WAN utilizes software-defined networking to optimize traffic flow across multiple transport technologies, while MPLS relies on a private network infrastructure for predictable performance.
  2. Is MPLS still relevant with the rise of SD-WAN?
    • Yes, MPLS remains relevant for organizations requiring stringent performance guarantees and security. However, many businesses are supplementing or replacing MPLS with SD-WAN to achieve greater flexibility and cost savings.
  3. Can SD-WAN replace MPLS entirely?
    • While SD-WAN offers compelling advantages, it may not fully replace MPLS in all scenarios. Organizations with mission-critical applications or strict security requirements may continue to rely on MPLS for its reliability and performance.
  4. How does cost factor into the decision between SD-WAN and MPLS?
    • SD-WAN typically offers cost savings compared to MPLS, thanks to its use of commodity internet links and flexible deployment options. However, organizations must consider factors such as upfront investment, ongoing operational expenses, and the total cost of ownership.
  5. Are there any security concerns with SD-WAN compared to MPLS?
    • While both SD-WAN and MPLS offer security features, SD-WAN may raise concerns due to its reliance on public internet connections. However, SD-WAN vendors have implemented advanced security measures such as encryption, segmentation, and threat detection to mitigate these risks.

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