Insight
2 June 2025
By
Keiran J
In today’s digitally connected world, choosing the right network solution is critical for business continuity, security, and performance. Whether you're managing a single office or a multi-branch enterprise, understanding the differences between MPLS, VPN, and SD-WAN can help you make a decision that supports your operations today and into the future. This article compares these three networking technologies and explores their strengths, limitations, and ideal use cases for New Zealand businesses.
What is MPLS?
Multiprotocol Label Switching (MPLS) is a traditional method of routing data across private networks. Instead of sending data based solely on IP addresses, MPLS uses labels to make data transfers more efficient and predictable.
Pros:
Highly reliable and consistent performance
Quality of Service (QoS) for prioritising traffic like voice or video
Strong SLAs for uptime and support
Cons:
Expensive compared to other solutions
Less agile — changes and new sites take time to provision
Best for: Large enterprises or organisations with mission-critical, real-time applications like VoIP or video conferencing that demand performance guarantees.
What is a VPN?
A Virtual Private Network (VPN) extends a private network across the public internet. It allows remote users and sites to access central resources securely via encrypted tunnels.
Pros:
Cost-effective and easy to implement
Suitable for remote work and mobile teams
Cons:
Dependent on public internet — subject to performance variability
Limited control and visibility for IT teams
Security risks if not properly managed
Best for: Smaller businesses or teams needing secure access to central systems without a complex infrastructure.
What is SD-WAN?
Software-Defined Wide Area Networking (SD-WAN) is a modern networking solution that dynamically routes traffic across multiple connection types — Fibre, Broadband, LTE, even MPLS — based on real-time conditions and application needs.
Pros:
Greater flexibility and scalability
Optimises performance across multiple internet links
Centralised control with real-time monitoring
Cons:
More complex than VPNs to configure and manage
May still require premium internet services to ensure performance
Best for: Growing businesses, multi-site operations, or those looking for cost-effective performance without the rigidity of MPLS.
Comparison Table
Feature | MPLS | VPN | SD-WAN |
|---|---|---|---|
Cost | $$$ | $ | $$ |
Reliability | High | Medium | High |
Flexibility | Low | Medium | High |
Performance | Consistent | Variable | Optimised |
Setup Time | Weeks | Minutes | Days |
Best For | Legacy WANs | Remote workers | Agile businesses |
Which Should You Choose?
There’s no one-size-fits-all answer. Your decision should be based on:
Number of locations
Type of applications used (real-time vs cloud-based)
Bandwidth needs
Budget and internal IT capabilities
If your business is expanding, relies heavily on cloud apps, and wants resilience with flexibility, SD-WAN is likely your best bet. If you still rely on legacy systems and demand low latency and strong SLAs, MPLS could be justified. For small teams or cost-sensitive scenarios, VPN remains a viable choice.
Conclusion
Choosing the right network solution is more than just a technical decision — it's a strategic one. At CloudX, we help Kiwi businesses navigate this landscape with connectivity solutions tailored to your size, goals, and digital maturity.
Need help deciding between SD-WAN, MPLS, or VPN? Talk to our team today for a customised recommendation that works for your business.
CloudX is a New Zealand-owned business communications provider helping organisations thrive with smart, reliable, and scalable connectivity solutions.
