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To: SteveG who wrote (10254)2/6/2000 11:39:00 PM
From: SteveG  Respond to of 10479
 
<A> Research bodes well for DWDM equipment markets

lw.pennwellnet.com

The worldwide market for dense
wavelength-division multiplexing (DWDM) gear
will more than double in the next five years, as
service providers around the globe use the
technology to provide bandwidth at lower costs,
says a new report from Communications
Industry Researchers Inc. (CIR--Charlottesville,
VA). Other industry research supports this view
and highlights the opportunity for vendors
making products for the DWDM market,
specifically optical components and switches.

The new CIR report Wave Division Multiplexing,
Photonic Switching and the Coming of All
Optical Networks 1999-2000, Volume 2,
International Market Opportunities points to the
fact that while most service providers are still
installing DWDM only on especially busy routes,
DWDM will become major strategic technology
for many service providers as competition heats
up for them. According to the report,
expenditures on DWDM equipment for
deployment outside of North America will
amount to approximately $1.2 billion this year,
growing to $2.9 billion in 2004.

The report notes that, internationally, such
trends have gone the furthest in Western
Europe, where an ever-growing number of
service providers are building backbone
facilities. According to the report, the European
DWDM market is expected to increase from
$580 million now to $1.2 billion in 2004. CIR
foresees that there also will be a growing need
for metropolitan DWDM systems, especially in
Europe, and expects these expenditures to grow
from $72 million in 2000 to $231 million by
2004. The submarine DWDM market is also
large and growing; according to CIR, $400
million will be spent on submarine DWDM
systems worldwide in 2000, and this figure will
grow to $900 million by 2004.

Such growth will demand an increase in the
optical components market, and new statistics
issued by Ryan Hankin Kent Inc. (RHK--South
San Francisco, CA) support that. The firm
reports that the market for key terrestrial
DWDM optical components grew to $1.4 billion
in 1999, and predicts that these components
will experience an annualized growth rate of
50% through 2003, reaching $7 billion. Jay
Liebowitz, co-director of RHK's optical
component service, explains that improvements
in optical components contribute to growth in
telecom traffic, which leads to greater demand
for optical components. "We see the cycle
perpetuating throughout the forecast period,"
says Liebowitz.

According to CIR, the growing intensity of
competition is causing service providers to seek
new ways of lowering the cost and time to
market for new high-bandwidth services. DWDM
and other optical networking systems, such as
optical switches, will provide a way of meeting
such goals. Core Optical Networks: Market
Opportunities for Optical Switching Systems in
DWDM Networks, the latest report from Pioneer
Consulting (Cambridge, MA), has quantified the
long-term demand for optical switching
systems.

In North America and Europe, where
DWDM-based fiber-optic networks are being
rapidly deployed, the need for optical switching
systems will create a 5-year, $31-billion market
opportunity for vendors of optical switching
systems. In North America, the market for
these systems will expand from a projected
$427 million 2000 to over $10 billion in 2004. In
Europe, the market is forecast to grow from
$116 million in 2000 to over $4 billion in 2004.

"The rules are changing in the optical networks
market," says Scott Clavenna, principal analyst
and author of the Pioneer report. "Capacity is
not enough today, rather the ability to manage
this new optical layer with intelligent, dynamic
systems that actually create service
opportunities and increase reliability of terabit
networks will be the key to success in the
coming decade." CIR agrees, stressing in
Volume 1 of Wave Division Multiplexing,
Photonic Switching and the Coming of All
Optical Networks 1999-2000 that success in the
optical networking market over the next few
years will have less to do with suppling huge
chunks of bandwidth than it will with managing
that bandwidth to provide value-added features
over an optical physical layer.



To: SteveG who wrote (10254)2/6/2000 11:45:00 PM
From: SteveG  Read Replies (1) | Respond to of 10479
 
<A> Optical switches: Is one technology better than the other for carriers today? by Rick Dodd, Ciena Corp (click on link for enlargible diagrams)

lw.pennwellnet.com

As proponents debate the merits of opaque
versus transparent switching systems, future
networks may benefit from both approaches.

Unbridled demand for data-centric services and
the continuing growth of voice are causing
carriers to rapidly expand their networks to
better serve customers. RHK, a South San
Francisco, CA-based telecommunications
analysis firm released its SONET and DCS
forecast that reports data growth rates are
exceeding 60% per year in some cases. Several
carriers are describing their growth as violent.
Even voice services continue to grow rapidly,
with one carrier showing 53% growth per annum
on voice services alone.

In this rapid growth environment, carriers
quickly discover that traditional circuit switching
and multiplexing systems can hamper
profitability. The Synchronous Optical
Network/Synchronous Digital Hierarchy
(SONET/SDH) model does not scale well; legacy
systems are either too costly, too operationally
complex, and most often, both. To reduce
network cost and complexity, carriers must
adopt high-bandwidth optical-switching
systems, which offer a scalable solution to
control optical bandwidth in the Internet era.

Optical-switching systems intended to meet
these requirements can be broadly categorized
into two classes: opaque and transparent. Not
surprisingly, there is lively debate about the
merits and deficits of the basic technology
behind these switching systems, as advances
make both approaches viable.

While specific requirements for
optical-switching systems may differ from
carrier to carrier, the following characteristics
are near the top of the list for all:

Scalability to accommodate high capacity
and rapid growth
Bandwidth granularity to support a range
of transport services
Rapid protection to quickly recover from
network or equipment faults and meet
customers' required service levels
Performance verification to monitor
bit-error rates (BERs) for service-level
verification
Bottomline economics, including initial
capital costs and the ongoing cost of
ownership.

Unlike traditional SONET/SDH circuit switching
and multiplexing systems, optical
switches--opaque or transparent--can help
carriers fulfill these requirements.

An opaque system requires one or more
optical-to-electrical conversions, whereby an
optical carrier is terminated in a photodiode and
converted to an electrical signal. Within the
electrical domain, the digital information carried
by the signal can be monitored, managed, and
eventually switched, using traditional,
very-large-scale-integration technology.

A "truly" transparent system switches traffic
without any conversions to electronics.
Optical-component switches are commonly
considered transparent because switching
occurs only in the optical domain without any
electrical conversion between the primary-end
transmission points.

Advocates of opaque switching point out that
the optical termination and electrical conversion
required in these systems reduce the
technology risks relative to emerging
optical-switching elements. Moreover, as the
cost of integrated circuits continues to decline
while performance improves, opaque switching
systems offer the scalability required for
switching--and configuring--hundreds of
high-speed channels. Opaque networks also
allow a clean, standard interface between the
optical-transport elements and the
optical-switching elements; thus, the
engineering of each is independent and simple.
Isolating problems is easier due to well-defined
monitoring points throughout the transmission
and switching path.

Advocates of transparent switching hold a
different view. This camp believes that
transparent switching offers capital cost savings
because it eliminates the
optical-electrical-optical (O-E-O) conversion.
Similarly, proponents point out there is an
operational savings because transparent
switching promises simple upgrades to faster
data rates and new services. The reasoning
behind this belief is that the optical-switching
element, whether a micro-electromechanical
switch, conventional lithium-niobate crystal, or
any of a variety of technologies, switches light
without regard to its bit rate or framing format.

Despite these arguments and the differences in
the underlying technology, opaque and
transparent switching systems will both meet
carriers' needs-in different ways and to varying
degrees.

Scalability issues
Given the current growth rate of traffic on
carriers' networks, scalability is generally near
the top of any requirement list for
optical-networking systems. Today, vendors
tout upcoming systems capable of switching
hundreds of 2.5-Gbit/sec streams. Almost all of
the systems slated for availability this year
take advantage of opaque switching
technologies, implemented by high-density
application-specific integrated circuits (ASICs)
and standard O-E-O converters. The base
technology, high-speed IC technology, is well
known and used by the developers of
Internet-protocol routers, Asynchronous
Transfer Mode switches, Gigabit Ethernet
switches, and other networking products.
Optical-networking vendors can build
ASIC-based switching elements with hundreds
of input and output ports, without requiring new
manufacturing or process technology.

Today's transparent components cannot support
the same number of input and output ports as
those based on electronics. Thus, in the near
term, the scale of transparent systems is
limited. Network operators can "cascade"
multiple switching elements to create larger
fabrics, until this approach is limited by either
physical size or insertion loss. With certain
technologies, integrating multiple optical
switches on a chip can also overcome this
limitation.

Carriers deploy optical-transport systems at 10
Gbits/sec or 2.5 Gbits/sec, yet still must sell
services such as private line at lower speeds.
Therefore, carriers also need to deploy
switching systems for multiplexing these
services. For example, a digital-crossconnect
system can switch a dozen DS-3
(44.736-Mbit/sec) streams into an OC-12 (622
Mbits/sec). Then, an add/drop multiplexer can
multiplex the OC-12 into an OC-48 (2.5
Gbits/sec) for handoff to a DWDM system.

As customers' networking requirements evolve,
the carrier may need to "groom" the network.
The grooming process, which involves
re-switching existing circuits to more optimal
paths, is key to maintaining network efficiency
and freeing "fragmented" and under-utilized
capacity. Because the multiplexing and
grooming functions rely on manipulation of bit
streams operating at different rates, operation
in the electrical domain is required--making this
function achievable only in opaque systems.

Switch performance directly affects service
levels. Switching time-the time required for the
optical system to redirect a signal from one
path to another-is critical to a carrier's
restoration capabilities. Switches unable to
meet the standard 50-msec recovery times
offered by SONET/SDH systems today leave
carriers at a disadvantage.

Opaque switching systems meet these
requirements today. These systems can offer
reliable switch performance due to degradation
of digital parameters such as BER. This BER
performance is typically read at each
optical-to-electrical and electrical-to-optical
conversion and can be used to trigger a
protection switch.

There is no technical reason why most
transparent systems cannot meet this 50-msec
switching time, as well. Technologies such as
lithium niobate crystal switches can switch in
the nanosecond time frame, although today's
components require high power and display
sensitivity to polarization--limiting scalability.
Switches using polymer waveguides are
relatively inexpensive but suffer from long
switching delays-on the order of hundreds of
milliseconds. We expect component advances
to minimize these sorts of tradeoffs by
improving cost and size as well as other
physical characteristics such as polarization
dependence, crosstalk, and loss.

Performance verification * Another carrier
requirement today is robust performance
monitoring (PM). These capabilities can isolate
network problems and verify service-level
agreements. Carriers want PM capability at each
switch node for problem "sectionalization"-not
just at the input and output of the network.

PM support on opaque systems is relatively
simple to implement because the optical signal
is converted to an electrical one, allowing
silicon-based processing to analyze overhead
bytes, perform checksums, and in some cases,
correct errors. In transparent systems,
performance monitoring is available, but it is
typically analog in nature. Thus, PM is limited
to power levels, and in some cases, noise
levels.

In transparent systems, insertion loss can
contribute to BER. Insertion loss arises from
both fiber coupling into the switch matrix and
inherent switch loss. Insertion loss can severely
affect a system's BER performance. Reduced
signal levels can limit the total transmission
distance. If optical amplification is added, the
optical signal-to-noise ratio is degraded.
Technology advances, however, should reduce
this problem as vendors develop less-expensive
and lower-noise optical gain devices.

As with any system, the chosen optical-switch
technology affects several network costs. First
is capital cost. One element of cost with
opaque switching systems is indeed the
expensive of the O-E-O conversions. Most
vendors assert, however, that as the cost of
transceivers and ICs continues to fall, opaque
systems will benefit from these price declines in
the foreseeable future. Similarly, price drops
will continue as optical and electrical
component integration further reduces the size
and increases the functionality of transceivers.

The cost savings from eliminating O-E-O
conversions is, of course, a primary motivation
behind transparent switching systems. As the
market matures and production volumes
increase, carriers can better take advantage of
these savings. Manufacturing advances will
further reduce costs. Today, transparent
components involve a significant amount of
manual labor--largely for splicing the fiber and
for the optical alignment required at the time of
assembly--which drives up costs. Automation in
the manufacturing process should improve the
economics of transparent switching.

Click here to enlarge image


In today's rapid growth environment, carriers
need systems that are easy to engineer into a
network. Opaque systems have an advantage in
providing a regeneration point for optical
signals. Regeneration eliminates accumulated
optical loss and cleans the signal of any
deformations due to optical impairments such
as dispersion (see Fig. 1).

With transparent switching systems, the
tradeoff for equipment cost savings is often
operational complexity. The transparent
systems do not "clean up" the optical signal.
Carriers, therefore, need to consider analog
issues when engineering a transparently
switched network (see Fig. 2). With building
rings, for instance, a wavelength may have a
working path that is significantly shorter than
the protection path. The network designer will
then need to consider the longer path's loss
and dispersion characteristics when engineering
the working path. Network engineers must also
consider the channel plan for wavelengths
passing through the switch to ensure that the
protection path's channel plan does not include
a signal using the same wavelength. If it does,
service could be interrupted during use of the
protection link.

Click here to enlarge image


While this is a complex problem for ring-centric
optical networks, it becomes even harder for a
mesh network. Solutions to this problem, such
as dynamic dispersion-shifting components or
wavelength translation devices, will likely
emerge in the future. Today, however, this
single issue is a primary reason to opt for the
opaque solution.

Finally, the choice of opaque or transparent
switching systems can affect operational costs.
Because opaque switching is required in the
network for multiplexing, adding transparent
switching effectively adds another layer of
equipment to manage. In the near term,
opaque systems have the advantage of using
the O-E-O conversions as a clean demarcation
between the transmission side and switching
device, allowing carriers to engineer the
transport network without regard to the type of
switching system.

Rick Dodd is director of product management
for the core switching division of CIENA Corp.
(Cupertino, CA).



To: SteveG who wrote (10254)2/7/2000 9:06:00 AM
From: Bryon Bothun  Read Replies (2) | Respond to of 10479
 
"ONI will go public by 2Q00, hasn't filed yet, ............
Sorrento will IPO by 2000 March/April"

Just curious about how you've reached these dates. I hope FIBR is still on track for March/April.

"will almost for certain be NASDAQ and is a direct Sorrento (FIBR) competitor."

I haven't heard anything about ONI's IPO yet though I am impressed by their Homepage. I think the announcements made by FIBR in June of last year will eventually make FIBR and ONI look very similar.