European companies are leading US rivals in migrating to multi-protocol label switching (MPLS) based IP virtual private networks (VPNs), and as a result are benefitting from cost savings.

Where just 33 percent of North American companies surveyed said they had fully deployed the technology, the number of European companies with no plans to deploy MPLS networks dropped from 37 percent in 2005 to 16 percent this year.

Phil Sayer, Forrester Research European telecoms and networks senior analyst told Techworld: "Plenty of companies are rolling out things like video-conferencing, which is driving voice-over-IP in particular, as that's the first application of IP technology companies go for. The first and main driver for this is undoubtedly cost savings."

Sayer said there was no way of knowing for sure from the responses of the 301 telecoms decision-makers interviewed for the annual report why European companies are more open to IP deployment than their US counterparts.

But he speculated: "Cost is more of a driver for European companies than US ones because they are paying international roaming prices for calls and video-conferencing, which gives them a much bigger incentive to adopt IP technology."

The research also found Europe leading the US in terms of managed service adoption, while security and mobility were high on agendas on both sides of the Atlantic.

Only 18 percent of European companies don't use managed services, while that figure rises to 53 percent in the States. And mobile products and services account for one-third of budgets across the board, putting security at the forefront of most respondents' minds.

"There is certainly data to suggest European companies are generally more open to outsourcing of offshoring non-core operations than American ones," said Sayer.

"And email or internet access is still generally the first mobile deployment these companies say they're doing, for executives, home workers and field-force workers.