Good News, Bad News on Optical Networks

I was somewhat taken aback to hear one analyst firm describe 100-Gbps wavelengths as the “single most anticipated” network technology, the implication being that network operators are impatiently waiting to deploy it in their networks. We at Synergy Research will soon be releasing our numbers on the optical market, but in the course of speaking with vendors I’m hearing somewhat differently regarding 100-Gbps wavelengths. What they are telling me is that the cost of even 40-Gbps wavelengths, in comparison with 10-Gbps wavelengths, is currently not economical for many network operators. So while there have been some demos and trials of 100-Gbps technology, to date only one vendor, Ciena, has announced a commercial 100-Gbps network, and that too for an enterprise application, as noted in a previous blog post. Unless a network operator is severely fiber constrained, I would think capex considerations would make it favor 40 Gbps over 100 Gbps. Further, I think that the global economic uncertainty will also force network operators to delay plans for 100-Gbps technology. And it’s not good news when, for the first time in 20 years, the Telecommunications Industry Association expects worldwide 2009 equipment revenues to be down 3.1 percent. So unless I see an uptick in switch/router revenues, I’m not going to be particularly optimistic about 100-Gbps optical transport.

On a somewhat related issue, while the switch/router market isn’t exactly rosy, it is good to see that some of the top optical equipment vendor are testing EVPL (Ethernet Virtual Private Line) service over optical networks using the Optical Internetworking Forum’s (OIF) UNI  2.0 specification. The tests, which have been underway in carrier labs, showcase EVPL service across multivendor equipment, from SONET/SDH ADMs to ROADMs. A few years ago, the OIF did something similar for another point-to-point service, EPL (Ethernet Private Line).

But for some reason, the OIF will not be providing a list of the specific products that performed successfully in the tests. Instead, it will be up to the individual vendors to make those types of announcements. Considering we are talking about an Ethernet service here, one thing I particularly like about the Metro Ethernet Forum is that it maintains an up-to-date list of certified vendor equipment and carrier services, which raises the confidence of both network operators and their customers. Having a list of certified products might be something for the OIF to consider.