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Technology Stocks : MRV Communications (MRVC) opinions?
MRVC 9.975-0.1%Aug 15 5:00 PM EST

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To: Sector Investor who wrote (10014)8/13/1998 11:41:00 AM
From: Regis McConnell  Read Replies (1) of 42804
 
Here's another slant on OCCs ....

Bandwidth Boom: Over The Horizon 2000 To 2005: Wave
Division Multiplexing Drives Optical Evolution

( InternetWeek )

There will be no countdown; No precise crossover to new and improved optical networks. As with most other innovations, get ready for an evolution-not a revolution-with hybrid solutions driving
incremental improvements.

Wavelength division multiplexing vendors are boosting the number of wavelengths that can be transmitted per fiber, boosting the distance optical signals can travel without being regenerated
electrically. Activity is so intense that the WDM market is expected to double in the next few years, to $4.4 billion by 2001. The industry is also developing optical cross-connects that eliminate the need to
convert waves into electronic signals. Optical networks have a major management issue, as well. Sonet is the manager of choice today, but
vendors are focusing on optical management systems that can more readily handle high-speed IP and ATM traffic.

In its labs, Lucent Technologies Inc. has run transmission rates of 1 terabit per second of data using 100 wavelengths at 10 Gbps each over distances of about 250 miles. Vendors are also working on increasing the capacity per wavelength- with potential rates as high as 40 Gbps compared to the 2.5 Gbps or 10 Gbps per wavelength used today.

The next generation of optical amplifiers will effectively double the potential number of wavelengths that can be transmitted on one fiber by operating at a slightly higher frequency, says Jack Wimmer,
MCI's executive director of network technology and planning. "That technology is at the labs and it isn't far along, but we think it will show up, even though it's more expensive to build systems at other frequencies," Wimmer says.

Once vendors reach 100 or more wavelengths-per-fiber systems, management becomes the biggest challenge. Sonet Add-Drop Multiplexers convert optical signals to electrical so traffic can be added or
dropped as needed. As IP routers and ATM switches get faster, it's inefficient to convert signals to add or drop bandwidth.

Fujitsu Network Communications Inc. is working on an optical add-drop multiplexer that can automatically add and drop wavelengths depending on traffic demand, says Pawan Jaggi, manager of optical networking.

Cross-connects that can do restoration and survivability in an optical rather than an electrical domain will be a necessity. Vendors know the requirements for optical add/drop multiplexers, but the
performance requirements of optical cross-connects have not been identified yet, according to Fujitsu's Jaggi. "We have met with various vendors that are beginning to work in this arena, and we are not seeing a consensus as to what the technology will be. That tells me there is some applied development work that has to occur here," says AT&T's Dan Sheinbein.

Optical cross-connects can use wavelength paths-essentially a point- to-point connection with no signal conversion-or virtual wavelength paths that adapt to traffic requirements and create dynamic
configurations, Jaggi says. MCI last year built a five-node network using Hitachi optical cross- connects to see if restoration or
provisioning in an optical domain could work. "Our conclusion was that even though it's not ready for prime time, it's very feasible," MCI's Wimmer says.

Optical networking will be one way to achieve greater cost efficiencies in the network of the future. That means having OC192 services coming straight from a router with an OC192 interface rather than going through a Sonet multiplexer. "The functionality you have with Sonet-protection, restoration, manageability and survivability-eventually will move to different layers of the network," says Mat Steinberg, a consultant at Ryan Hankin Kent in San Francisco.

Even if optical transmission takes on some of Sonet's functionality, no one is predicting the death of Sonet-just as no one is predicting the death of voice traffic. A revolutionary approach to optical networking would throw out Sonet and rely on emerging
high-speed routers instead. But an evolutionary approach, which will probably prevail, will keep Sonet in place and integrate WDM into it, explains Denny Bilter, director of marketing at Ciena Corp.

Ciena is already working with Cisco to develop IP routers and ATM switches that connect directly to Ciena's WDM products without going through a Sonet multiplexer. And eliminating the Sonet layer of
equipment from the network will make the network simpler and less expensive to operate. Optical networking will be a complement to the existing Sonet infrastructure. Its role will be accommodating the growth coming from terabit or gigabit IP routers or ATM switches, Ciena's Bilter says.

Another stumbling block for optical networking is the absence of any standards to ensure the interoperability of different vendors' products. The International Telecommunication Union and the American National Standards Institute both have study groups working to develop optical standards, but those standards might not be viable until after
2000. Ciena and Cisco together developed the idea of an optical networking group that would contribute to standards efforts. Ninety companies attended the organizational meeting, and the Optical Networking Forum had its first official meeting last month.
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