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    Gettin Gig-E With It

    Written by

    eWEEK EDITORS
    Published May 28, 2001
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      Gigabit Ethernet is the latest buzz to rumble through the networked economy, but the new technology is a bit elitist, addressing the bandwidth needs of only the tiny fraction of urban businesses that are already wired to expensive fiber-optic networks.

      Even a decade from now, about 60 percent of the mostly suburban enterprise customers in the U.S. wont have Gig-E as an option, some insiders say.

      “Maybe it will take another round of Wall Street mania to give telecom [companies] a few billion dollars for those suburban locations to be hooked up,” says Darren Kelly, senior director of metro enablement at Level 3 Communications.

      Still, advances in Gig-E technology are delivering mind-boggling savings to enterprise customers: Businesses already wired with optical fiber could get up to 10 times more bandwidth for their money. A financial-services customer with 10 office locations recently wired by Metromedia Fiber Network is now paying $6 per megabit, instead of $57, says Otto Chan, MFNs senior vice president of enterprise services in North America.

      Level 3 will introduce a wide area network Gig-E product in June that will allow businesses to buy Ethernet-based point-to-point long-distance at a fraction of the cost of traditional dedicated connections.

      Carriers that are building metropolitan networks that enable Gig-E and other broadband activity in major cities — such as Level 3, MFN and XO Communications — as well as those that lease networks — such as Telseon and Yipes Communications — cant say enough about what has become known as the Gig-E Revolution.

      “I think that it [Gig-E] is a true category-killer, going against the common data services sold today in the metro,” says John Curran, vice president of Internet technology at XO. “Fiber-based Ethernet services are simply a less expensive way to move data around than private-line, frame relay or ATM [Asynchronous Transfer Mode]. Customers looking at renewing or expanding such networks would be wise to get an Ethernet quote for comparison.”

      Customers Concur

      “We have a 50-megabit-per-second pipe into Exodus [Communications], and we originally wanted a DS-3 [45 Mbps], which a carrier promised to deliver in nine months. And then Telseon was able to get us a 50-Mbps pipe in nine days,” says Andrew Feldman, vice president of marketing at Riverstone Networks. Riverstones networking gear supports many Gig-E deployments, including Telseons.

      Gig-E services, however, hit a wall when businesses that are not connected to fiber-optic networks come calling.

      Metro equipment vendor Ocular Networks, recently moved to a new office minutes away from Dulles Toll Road in the highly wired Northern Virginia corridor, only to find that installing one 3-Mbps Ethernet line would cost the same as two T1 (1.5-Mbps) lines. And true Ethernet connectivity would take up to six months to materialize.

      “We were told that fiber doesnt come to our building, and we would have to sign a three-year connectivity contract if we were to order it,” says Doug Green, Oculars vice president of marketing. Ocular ended up wiring its 150 employees to the outside world with four T1 lines.

      Where the Fiber Meets the Foundation

      Trenching, or building laterals, is where the rubber meets the road as far as enterprise customers go. Executives at carriers such as Level 3, MFN and XO that own large metropolitan area footprints say that fiber construction remains largely a fixed cost that doesnt decrease as technology improves.

      Level 3s Kelly estimates that a lateral shorter than 1,000 feet would cost $50,000 to $200,000, and digs more than a mile would cost $500,000 to $1.5 million.

      So, carriers are extremely selective about choosing which buildings should receive fiber loops. Metro ring carriers such as Level 3 shy away from locations that would generate less than OC-12 (622 Mbps) worth of bandwidth sales per month on the low end. Companies such as MFN that connect businesses to the metro ring go after customers that already buy DS-3 to OC-3 (155-Mbps) connections.

      “People doing Gig-E are focused on cherry-picking the same buildings that already have fiber,” Green says.

      Its no wonder; forecasts for fiber deployment are not rosy. Morgan Stanley Dean Witter & Co. predicts that as many as 60 percent of U.S.-based businesses — 10.9 million out of 18.2 million — will not have fiber by 2009, leaving a digital divide of sorts between businesses in highly networked areas and those in infrastructure-poor neighborhoods.

      That doesnt affect only small and midsized businesses such as Ocular. This month, Broadwing joined the ranks of other large network-based carriers, with the launch of specialized Gig-E-based offerings aimed at early-adopter vertical markets, including financial services and pharmaceutical and media companies.

      Broadwing execs say that local television stations would be a potential market for a Gig-E product used to stream broadcast-quality video over fiber. However, they acknowledged that since many of these locations dont currently have fiber connections, the first Gig-E connectivity that the company would sell might get backhauled into the network over leased copper lines.

      Broadwings competitors scoffed at the likelihood of TV stations evolving as large customers. “There is a request for proposals out there to connect all TV stations with fiber,” says Brian Horsfield, Level 3s vice president of global Internet Protocol services. “But because of their remote locations, these are very expensive projects. We have estimated that one location would cost as much as $20 million to wire.”

      Other Options

      But there are other options. Riverstone, which sells switching equipment enabling connectivity for Gig-E mainstays such as Telseon and Yipes, is looking to other technologies to connect secondary-and-beyond markets.

      “We believe that wireless is a great option for cities that dont have an NFL [National Football League] team,” Riverstones Feldman says.

      Increasingly, vendors selling into the metropolitan space are pitching products that would support networks running over copper as well as fiber. Oculars Green says carrier customers often run into situations in which they are asked to wire buildings that are both on and off fiber, both on their and other carriers networks. Ocular addresses this need by selling equipment that supports both types of connectivity.

      More vendors are cropping up, pitching technologies that substitute for fiber builds. Three-year-old Actelis Networks plans to introduce products later this year using patented Spatial Division Multiplexing technology to deliver fiber-equivalent performance over copper lines.

      Industry participants say that applications, if nothing else, are expected to drive up demand for Gig-E and new fiber builds, over a period that some say could be close to a decade.

      “Five years from now, with significantly new applications which help business processes — perhaps payroll applications, perhaps videoconferencing, perhaps holographic sharks with lasers — whatever this thing that everyone needs is, you will need Ethernet and fiber. All of a sudden, the justification will be there to spend $50,000 to dig a lateral,” Level 3s Kelly says.

      eWEEK EDITORS
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