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We consider the problem of designing a network which minimizes the total cost of the switching facilities and the fiber links, by choosing the subset of nodes at which to install switching functionality and the subset of the available fiber links to employ for interconnecting nodes. This objective addresses jointly two of the most significant costs in the design of a communications network - the number of switching sites and the total linear distance of the utilized links - and results in substantial cost benefits. Since relative costs vary depending on specific circumstances, we characterize the tradeoff between the number of switching sites and the total link length. Our study is performed for a network supporting full connectivity between all nodes, rather than for a specific traffic matrix, and thus reveals fundamental properties inherent to the given topology. We address both the unprotected and the protected cases, and we present heuristic algorithms to solve the problem.