Storm gathers forces to cross the Atlantic

May 1, 2001

In a recent Yankee Group report, "European Telecom in 2001: Reversal of Fortune," restructuring savvy has been cited as a key success factor for European telecommunciations operators due to the sharp reversal of the investor community. One of Europe's new-entrant carriers, Storm Telecommunications, recently has been showing just how quickly a whirlwind of optical-networking activity can reposition a carrier into a new breed of service provider.

"The carriers who survive through 2001 will be those who spin off under-performing businesses or restructure to maximize revenue growth and profitability," says Camille Mendler, director of Convergent Communications Europe for the Yankee Group in London. "They will have to demonstrate clear and focused strategies, both for growing existing business and cutting costs to improve profits. They will probably be carriers that do not try to be all things to all customers."

Under the leadership of CEO Steve Sanderson and a group of seasoned telecom managers, Storm is clearly trying to rewrite the rules of bandwidth provision in Europe and now in key North American cities from Boston to Washington, DC. Unlike other new-entrant carriers, this United Kingdom-based operator has achieved a management buyout, made several multimillion-dollar optical equipment purchases, and created one of the first pan-European optical-switched service providers.

"It is extremely rare that the opportunity to be 'first' presents itself in the dynamic and evolving communications sector," says Sanderson. "Riding on the back of the revolution in optical-switched technology, Storm's strategy will deliver flexible, affordable services that scale. Moving away from 'dumb' WDM networks, we will deliver valuable intelligent optical-networking solutions that will enable new e-business markets by providing practical solutions that enhance growth. Storm customers will also enjoy unprecedented levels of service and control offered by Storm's intelligent Web-based network provisioning and management system."

Storm's optical mesh network is now built in the United Kingdom, France, Germany, Norway, Sweden, and Denmark, extending to the Netherlands and United States by this summer (see Figure). Storm's new intelligent optical network targets Internet service providers, application service providers, enterprise multimedia customers, and other carriers working the e-business challenges. Through dark-fiber leasing deals with Telia, Carrier1, and Metromedia Fiber Network (MFN), Storm's geographical coverage quickly expanded in to most European metropolitan areas (22 cities). This intelligent optical network enables Storm to extend its optical-switched networking solutions, branded Storm Wave, to include "last mile" connectivity to end-user premises.
Storm Telecommunications has planned an aggressive build-out that includes metropolitan centers in Europe and the United States.

Using MFN's "Fiber- Bank" concept, Storm can build city rings across 16 metro areas in Europe and 51 in North America. "Our contract with Storm highlights the value of MFN's carrier-neutral fiber-optic infrastructure and represents a significant step for us in expanding our European customer base," says Nick Tanzi, president and chief operating officer of MFN.

Storm's chairman, Stephen Carroll, explains that "this MFN fiber deal will be coupled with others to ensure a prompt and timely expansion into the North American broad-band access market. Customers will now be able to use this international optical network capable of delivering point-and-click bandwidth provisioning of IP traffic."

The current industry issue of providing the bandwidth "fix" in the access market is a good example of how Storm can offer a new service-internation-al Gigabit Ethernet. Storm's high-speed backbone network is based on intelligent transport equipment from Sycamore Networks. Sycamore integrates three key elements: state-of-the-art optical-networking software, the intelligence of the SDH layer, and the capacity of DWDM.

"There is no need for SDH sophistication. Our maintenance cost is cheaper and provision is quicker as we wouldn't put SDH boxes in the network," explains Andy Wood, chief technical officer at Storm. "We use a duplex channel through the Sycamore equipment, so there are no issues with contention."

The Sycamore solutions enable an efficient mesh-based network topology, giving the Storm network the advantages of greater flexibility and resilience.

"By using Gigabit Ethernet, Storm eliminates network complexity, as 95% of all IP [Internet Protocol] traffic originates over 802.3 [Ethernet]," points out Tracey Vanik, technical director at industry analyst RHK. "Bandwidth build-outs are less cost-constrained in intelligent optical networks. This type of broadband service that rolls out Gigabit Ethernet across the network opens the door to international application service provision."

Edward Harroff writes on telecommunications issues from Bellevue, Switzerland, for the GEID Press Agency (Paris).