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Network slows down when VPN is in use

Background:
IPSec VPN between two offices. Both Netopia R910 routers. Office A is on a T1, Office B is on 3.0/1.5 DSL. Exchange servers on both ends (same domain).

I've been experiencing random traffic spikes on Office A's network over the last few weeks. After many packet captures, it appears that when any traffic (Exchange replication, smtp, basic file transfers, etc.) traverses the VPN, Office A's network compeltely bogs down. Local ping times from my workstation to the gateway range between 500ms and 1000ms.

I am able to replicate the problem by starting a ping to my gateway, and starting a small file transfer to the server in Office B. Before the transfer begings I get a 1ms ping, but after the file transfer starts, the ping time jumps up to 300ms or higher and brings any external traffic to a crawl.

I have already switched out the R910 in Office A, and that does not affect the issue. Could it have something to do with the encapsulation, or the IPsec not translating correctly?

 
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Bill Bach
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The Netopia Router spec sheet (at http://www.netopia.com/equipment/pdf/spec/r910.pdf) does not indicate the type of CPU provided.  Is it possible that the unit has such a slow CPU that it cannot easily handle a VPN connection AND its other tasks?  Would seem unusual, but you might be able to check this with the management software included.

It would also be worthwhile to try flashing a new firmware onto the device, to see if code updates have alleviated this problem in the past.
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