12 December 2003 Nashua, NH Lightwave -- Between new regulations borne of the events of 9/11, growing bandwidth demands, and greater requirement complexity, enterprises increasingly find their T1 and T3 network links inadequate. Some companies solve this problem by building their own networks; others turn to managed services offered by a local carrier. Either choice increases the market opportunity for WDM technology, according to Brian McCann, chief marketing & strategy officer at Adva Optical Networking.
Nowhere in the United States is this trend more apparent than in New York City. The city is home to large financial institutions and other companies that need to move large amounts of data quickly. The growing emphasis on disaster recovery means these firms must invest in new infrastructure -- which also has led them to reevaluate their network requirements.
This combination is good news for optical equipment vendors and their carrier customers. "We've been talking for years about disaster recovery, and I think the biggest application we had in our early history was data center backup using ESCON, migrating to FICON and now Fibre Channel-type applications," McCann says of Adva, which supplies CWDM and DWDM equipment. Conventional links won't do the job because "you can't back up a 60-Tbyte data center real time, because with a DS3 it takes you five months," he asserts. "With [single-wavelength] optical, you're down to a week or two. And then, by using WDM with optical, you're down to under a shift. Now, regulation is actually mandating that the disaster recovery time in which you have to get your business up and running has got to be under two hours as a goal."
In addition to supporting higher speeds, networks must also accommodate network nodes a greater distance apart. "They were trying for 300 mi, and that didn't work because the storage technology couldn't deal with that kind of distance," McCann explains. "But we've certainly seen the distances extended now -- and not just in the New York area but worldwide -- from a typical 10 to 20 km now to 50 to 75 km in terms of the minimum distance between a primary and a backup data center."
As a result, Adva has had success selling its metro CWDM and DWDM gear to both large end users and to carriers hoping to offer managed services. An example of the latter is AboveNet, the former Metromedia Fiber Network. As reported in the September issue of Lightwave, AboveNet has supplied optical networking services to the New York Mercantile Exchange using Adva FSP 3000 equipment.
"They duplicated their whole trading floor. So they set up a mini-trading floor that allows them to do full trades," McCann says. "And all of that means not only the disaster recovery traffic ¿ these dozens to hundreds of Fibre Channel, FICON, ESCON applications -- but also all the LANs as well, because now you have users. So they were putting in Gigabit Ethernet as their LAN service, now interconnected across the entire metropolitan area."
The choice of doing-it-yourself versus handing the responsibility to a carrier hinges on the company's size, budget, and requirements, McCann says. "I think if a company is going to look at building their own optical network, they've got to have at least eight wavelengths or more to justify the hassle and [realize] the cost savings to do it themselves. If it's less than that, and a wavelength service is available, they're much better off just buying it. Because it's just like buying T1s," he explains.
Disaster recovery isn't the only reason companies might look to upgrade their networks, according to McCann. Server clustering is an increasing trend. Also, the ability to use remote locations can be particularly attractive in an area where real estate is as expensive as downtown Manhattan. McCann says he has seen companies pay for their network extensions through the cost savings of moving facilities out of pricey parts of town.
Other incentives for network upgrades can come from changes in the business environment, as one brokerage house found. "They were having a problem keeping up at the [market] opening. There was so much reserve trading that was ready at the beginning of the day that they couldn't execute fast enough. Their business case for upgrading their optical network across their facilities was based on the money they were losing at the opening, the first 15 minutes, of every trading day," McCann relates. "This was a company whose capex was cut more than 10 percent year-on-year -- one of the major financial firms. And yet they're still spending a lot more on their optical storage and high-speed LAN interconnect, essentially the server interconnect of any type, because it's money."
And money -- or at least the new economics of abundant bandwidth -- should spur network upgrades next year as well. "In general, it's Gig-Es and Fibre Channel natively for the price of a T3 -- 50 times the bandwidth," McCann says. "It's really compelling. And so that's the way we're really pushing right now with these guys out there."
-- Stephen Hardy