Virtual law Network

Facing the trend of globalization, no modern enterprises dare to ignore the importance of information. The innovations of computer and telecommunication technologies in the past decade have resulted in the soaring development of the Internet and the presence of the concept of e-business, which have had a great impact on the business strategies of corporations in every field. As operations are becoming more and more reliant on business information systems, choosing appropriate solutions for information systems is critical to corporations.

This essay will briefly introduce the concepts of three new technologies – Virtual Private Network (VPN), Wireless LAN, and Converged Voice/Data/Video Network, which reflect the trend of current developments in business information systems. Furthermore, their characteristics and applications will be discussed. Finally, the impact of these technologies on information management will be analyzed.

Virtual Private Network Before the concept of virtual private network (VPN) surfaced, corporations expended great amount of resource to build their private networks, namely, Intranets. These networks usually use leased line, Frame Relay and ATM to link different sites and for the access of remote users. While such networks ensure the speed of access, many small or medium-sized companies can not afford the expensive cost of dedicated leased lines. Therefore, they have to use low-speed switching service. The VPN technology provides a reliable, cost-effective, and manageable solution for enterprises.

Different vendors and service providers may have different definitions of VPN. Generally, "VPN is a data network that makes use of the public telecommunication infrastructure and the Internet, but information remains secure by the use of security procedures (Paul Bocij, 1999 p206)". VPN may connect dedicated sites and/or remote users to corporate sites, provide authentication of remote users, encrypt corporate data, and create tunnels between corporate sites or between remote users and the corporate LAN.

It can be built on the Internet or on a service provider's backbone infrastructure. Since the Internet is a shared public network with open transmission protocols, VPN includes a series of measures, such as packet encapsulation, encryption, key management and authentication, to ensure the secure transmission of sensitive data. Customers also have high flexibility to choose their VPN solution, either by building it by themselves or outsourcing VPN from service providers. According to its application, there are three types of VPN: VPDN (Virtual Private Dial Network), Intranet VPN, and Extranet VPN. These technologies have a great impact on the information management of enterprises.

First, VPN reduces cost for information exchanging. As VPN uses the Internet or service provider's network to exchange data, VPN users pay the Internet access fee instead of the expensive rental for dedicated leased lines and long distance charges, which are the mean costs of an enterprises network system. Second, new applications and value-added services are available on VPN, thereby improving productivity at low costs. IP VPN provides a reliable platform for new IP-based applications such as videoconferencing, voice over IP, e-commerce, and distance learning. These applications may greatly reduce the operation costs and contribute to higher work efficiency. For example, remote users and business travelers may connect the Intranet of their corporations by dialing into the network access server of local ISP.

Furthermore, "as the Internet became more and more accessible and bandwidth capacities grew, companies began to offload their Intranets to the web and create what are now known as Extranets to link internal and external users (Adtran Inc. 2000)". "Extranet IP VPNs enable enterprises to give one or many business partners restricted access to their corporate networks and resources for more efficient and effective working relationships (Bian Xing, 2001)".

Third, the outsourcing solution simplifies the management of information systems so that enterprises can concentrate resources on their core business. Buying VPN services from qualified service providers is a suitable new option for corporations that do not have adequate technical personnel. Compared with building a new VPN, outsourcing VPN needs less time to launch and have better extensibility.

While VPN once required expertise to implement, the development of technologies makes it easy build VPNs for corporations of all sizes. Generally speaking, VPN is appropriate to enterprises that have numerous remote branches and users, or to those multinational corporations that require frequent communication between international offices. Renault Spain provided a successful case of VPN application. In order to connect hundreds of automotive dealers and Renault business branches to the Intranet, Renault Spain chose Global One to deliver an appropriate VPN solution. The requirements include reducing the time between order and delivery of cars and spare parts, improving information sharing, decreasing sales report times, and flexible Internet access for thousands of users.

As the world leader in providing international communications to enable e-business, Global One owns the world's first MPLS-based commercial VPN, supporting Intranet, Extranet, and public Internet services for data and voice communication in 40 countries over the world. Global One's VPN service fulfills Renault's requirement. After the complete of the project , Renalt staff, partners, suppliers, and dealers in the hundred sites could now communicate with each other through the IP VPN. The time from order to delivery decreased from 40 to 60 days to 14 days. Network administration was simplified because of the automatic site-to-site connectivity.

Wireless LAN In the past decade, people have benefited a lot from the computer network technologies. The Internet, e-mail, and packet telephony have greatly changed our working life and life styles. However, people still wish that the computer network be movable so as to facilitate the users. Wireless LAN (WLAN), a flexible data communication system used as the extension to, or the alternative of the traditional wired LAN, meets that expectation. Based on the Radio Frequency (RF) technologies, WLAN transmits and receives data through the air. The data transmission between laptops and the wireless LAN is conducted by Wireless LAN Card, and Access Point (AP) is the bridge between the wireless LAN and the wired LAN. Thus, WLAN combines data connectivity with user mobility.

The unique characteristics of wireless LAN systems bring many benefits to the information management. First, WLAN provides users with access to the network anywhere in the covered area. Mobility improves working condition, thereby contributing to high productivity. Second, WLAN has better scalability than wired LAN. Since wireless LAN has several types of flexible configuration. It is easy to change according to the requirement of specific applications, ranging from peer-to-peer networks suitable for a small number of users to full infrastructure networks of thousands of users that require roaming over a broad area.

Third, wireless LAN system reduces the overall investments of networks. Since wired LAN is not flexible to expand or change, it is necessary to reserve enough information points for future while they are seldom used now. So the efficiency of the investment in wireless LAN is higher than that of wired LAN. While the initial investment required for wireless LAN hardware may be higher than that of wired LAN hardware, overall installation expenses and long term costs may be significantly lower.

In this sense, WLAN protects the long-term benefits of network owners. Finally, wireless LAN is easy to install and simplifies the administration of the network. In implementing computer network, cabling is the procedure that usually requires more time than others. WLAN reduces most of the workload of cabling. Deploying a temporary cabling system in exhibition sites is time-consuming and may mess up the environment. So WLAN is the best solution for this application.

In addition to the above-mentioned public sectors, WLAN is also facing a trend to be deployed in private sectors such as home, .Its market in the near future is predicted to be promising. Converged Voice/Data/Video Network In the past, enterprise level voice communication, data, video system were three independent networks. Due to the high growth rate of Internet after mid -1990s, data network has kept on growing much faster than voice network. It is possible that the amount of data traffic may soon exceed that of voice traffic. Based on the innovation of packet and cell switching technology in recent years, voice and video signals can now be sent over data networks (Voice over Frame Relay, Voice over IP, Voice over ATM, and packet video). Therefore, separate, single-service networks are substituted by cost-efficient multiservice networks.

The following figure shows the integration of voice and video system with the enterprise data network. The PBX is connected to the multiservice router, which converts the traditional voice signals to Frame Relay or IP packets. Other services such as LAN, video, and legacy flow to the WAN via the multiservice router as well. Using packet switching technologies, Frame Relay and IP insert data into frames or packets with variable size. ATM uses cell-switching technology, breaking traffic into fixed-length cells. "Their small size also allows the frames to be formed and routed almost entirely in hardware, which avoids the overhead of transfers between hardware and software for information processing (Forbes Gibb, 2002, p185)". This feature facilitates the fast cell switching of data in the network.

The packet switching and cell switching networks dynamically allocate bandwidth based on their transmission service. Since bandwidth is not reserved for any specific communication, the allocation of bandwidth follows the needs at any particular time. In contrast, the traditional voice adopts circuit switching technology, which reserves a fixed channel for each conversation even when there is no voice transmission. Moreover, new voice codecs (coder/decoders) require only 8 Kbps or even less bandwidth to produce acceptable voice quality, while traditional voice networks need 64Kbps. It is clear that packet and cell switching are more efficient than circuit switching in using network's bandwidth.

The packet video technology (with H323 and H.324 standards) converges the video system into the data network. The H.323 standard defines LAN-based video conferencing, and enables multi-vendor interoperability for the first time. H.324 defines video conferencing using plain old telephone system (POTS) lines.The multiservice Intranet is attractive to both service providers and enterprises, especially those multinational corporations that have branches in various countries.

For example, BASF established its global voice/data converged Intranet to link its branch offices all over the world; ABN AMRO migrated its separate voice, data network to a single multiservice network in Asia. Despite so, two aspects need further development. First, the voice quality of packet switching should be improved. As the packet switching (except for ATM) was designed for burst data traffic, it is less efficient than the circuit switching network in dealing with voice.

To achieve good voice quality, the delay of voice packets caused by shared nature of the packet switching must be minimal and fixed. Second, it is necessary to establish a comprehensive standard for the interoperation of IP, Frame Relay, and ATM networks. The development of packet technology, users will benefit from a universal infrastructure that integrates data, voice, and other types of service.


While there is no doubt that the three technologies can improve the overall performance of business information systems, whether to adopt them and how to implement them depend on the specific situation of the enterprises. Correct information strategy maximizes the effect of a technology so that it can contribute to the development of the corporations. Although leading technologies have advanced features, sometimes the advantages of such features may not fully fit the demands of certain corporations. In this sense, implementing advanced technologies does not necessarily ensure satisfactory outcomes. Moreover, it is always the case that corporations have to trade off between benefits and costs. Therefore, the best information strategy is the one that adapts to the context of the enterprises.


1. Paul B., Dave C, Andrew G, Simon H(1999), Business Information Systems, Edinburgh Gate, Harlow. P206

2. Adtran Inc. (2000), Understanding Virtual Private Networking, p2

3. Bian Xing, (2001), Recognize VPN,