In order to pave the way to B-ISDN, one of the most important issues for network providers is to identify the most efficient B-ISDN introduction strategy. This paper focuses on the costs of introducing ATM transmission systems into backbone transport networks which must provide highly reliable broad band transmission capability. In this context, the main rival to ATM is Synchronous Transfer Mode (STM); recent Synchronous Digital Hierarchy (SDH) equipment supports the establishment of advanced STM-based high speed transport networks. This paper offers a cost comparison of ATM and STM based backbone transport networks. A digital path network in STM has a hierarchical structure determined by the hierarchical multiplexing scheme employed. The minimum cost STM path network can only be determined by developing a path design method that considers all hierarchical path levels and yields the optimum balance of link cost and node cost. Virtual paths have desirable features such as non-deterministic path bandwidth and non-hierarchical and direct multiplexing capability into high speed optical transmission links. These features make it possible to implement a non-hierarchical VP network with ATM cross connect systems which can handle any bandwidth VP with a universal cell switching function. This paper shows that the non-hierarchical VP routing, which strongly minimizes link cost, can be implemented without significantly increasing node cost. Network design simulations show that the virtual path scheme, possible only in an ATM network, yields the most cost effective path network configuration.