The need for speed

Early adoption of optical technology in carrier networks almost always hinges on the symbiotic relationship between need and cost. Initial deployments can be expected to occur when the need becomes so great that some carrier is willing to pay a relatively high initial cost for early generation technology.

That tipping point arrived for 100 Gbps with the announcement last month that Verizon (www.verizon.com) has deployed the first such link in a carrier network. (You can read about the first deployment in a private civilian network on page 17 of this issue.) While indicating that the price of the Nortel equipment was at least tolerable, Glenn Wellbrock, director of backbone network design at Verizon, explained the carrier’s rationale for deployment now and in the near future had as much to do with need as cost.

In particular, routes where traffic is expected to grow strongly in the next year and on which existing 10-Gbps channel capacity has exceeded 50% would be targets for further 100-Gbps deployments, Wellbrock told me. “I think we’ll always use 100G instead of 10x10, at least at the cost points we see it coming at, because of the spectral efficiency,” he said.

Observers will note that one carrier doesn’t make a market, even one as big as Verizon. However, a study from Infonetics Research (www.
infonetics.com) indicates that Verizon may not be alone in its thinking. A survey of carriers revealed that a cost-per-bit improvement of only 20% would lead to “significant interest” from carriers in 40- and 100-Gbps technology, according to the market research firm.

“The widely accepted ‘four times the capacity at two-and-a-half times the cost of the previous generation’ maxim isn’t reflected in carrier responses here,” noted Andrew Schmitt, directing analyst for optical at Infonetics.

The point is not that cost is irrelevant, but that “the right price” can vary depending upon a carrier’s circumstances. And based on the Infonetics survey, it appears that the circumstances are right for several major carriers worldwide to begin deployments of 100-Gbps technology—and step up 40-Gbps installations—over the next few years.

Stephen M. Hardy
Editorial Director
& Associate Publisher
stephenh@pennwell.com

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