Revenue from Ethernet services are expected to continue their strong growth through 2011, according to the latest findings from Infonetics Research.

The research firm - which also recently peered into the future of wireless - said that worldwide Ethernet service revenue grew 33% from 2006 to 2007, to $12.5 billion. Meanwhile, IP MPLS VPN service revenue grew 20%, to $13 billion.

Infonetics says both markets should see strong growth through 2011. On the way out are frame relay, ATM, and legacy private-line services.

The advantage is, as usual, one of simple economics. Ethernet services offer customers more bandwidth at a lower cost than traditional WAN services, on a per-bit basis.

For example, Infonetics says the cost for 100Mbps Ethernet is about $50 per megabit per second in North America. By contrast, DS-3s or SONET will cost about $180 per megabit per second. That price differential creates a pressure to move to Ethernet services, and of course it's nothing new - Ethernet in some form or another has undercut other technologies because of its lower cost for years.

Revenue for "mid-band" Ethernet services, or MBE, will increase 120% from 2007 to 2011, Infonetics predicts. These are Ethernet services in the 1Mbps to 10Mbps range, or in the 10Mbps to 50Mbps range.

Other findings of note from the report include the fact that Europe, the Middle East and Africa account for more than one-third of worldwide IP MPLS VPN service revenue, and that transparent-LAN services are the Ethernet service growing the fastest.

Jeff Caruso is site editor at Network World.