OT warning...long post Gary, Are you sure about the BGP issue? I know a great BGP guy that was there early...
there is no specific mention of BGP here, but this might be of interest for a quick read on their view of the industry and their product....Industry Background
Demand for Data Services is Fueling Network Growth
Data traffic over today's communications networks is growing at an
exponential rate, far exceeding the growth in voice traffic. Ryan Hankin and
Kent, an industry research firm, estimates that North American data traffic
reached 350,000 terabytes per month in December 1999, compared to 50,000
terabytes per month for voice traffic in the same period. This proliferation
of data traffic is being driven by a number of factors, including increases
in:
. the number of Internet users worldwide, which according to
International Data Corporation, an industry research firm, is expected
to increase from approximately 144 million at the end of 1998 to
approximately 602 million by the end of 2003; and
. business use of the Internet for applications such as e-commerce, video
streaming and virtual private networks, or VPNs.
To keep pace with the growing demand, transmission speeds have increased from
kilobits per second to megabits per second to gigabits per second. Pioneer
Consulting LLC, an industry research firm, estimates that peak-hour Internet
bandwidth demand in North America alone will grow from 0.33 terabits per
second in 1999 to 17.92 terabits per second in 2004, representing a compound
annual growth rate exceeding 120%.
Limitations of the Existing Public Network Infrastructure
The existing public networks are largely built on technologies that were
originally designed to provide only voice services. These networks are based
on circuit switch technology, which dedicates a line, or circuit, for the
duration of a call even while there are pauses in the conversation. Although
adequate for voice traffic, circuit switch technology is inefficient for the
transmission of large volumes of data traffic, which tends to occur in large,
intermittent bursts. As data traffic carried over the existing network
infrastructure began to increase, carriers increased the capacity of their
networks by overlaying devices designed to increase data transmission rates
and that are based on network standards such as Synchronous Optical Network,
or SONET.
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At the same time, carriers also sought to increase the efficiency of data
transmission through their networks by adopting packet switching technologies,
such as Asynchronous Transfer Mode, or ATM, and Internet Protocol, or IP,
which divide data traffic into individual packets and transmit them
independently over the network. These packet-switching technologies enable
carriers to use data packets from multiple senders to fill existing capacity
in a circuit, thereby substantially reducing the bandwidth wasted using
circuit switch technology. With much of the growth in data traffic
attributable to the increasing use of the Internet, IP has become the
predominant standard for transmitting data across networks. Nevertheless,
carriers have been forced to adopt and deploy multiple protocols and a variety
of devices within their networks in an effort to manage the proliferation of
IP-based data services. The following diagram illustrates the limitations of
the existing public network infrastructure:
[DIAGRAM APPEARS HERE]
[Symmetric diagram with wavy line at center representing the fiber cable, which
is labeled "Carrier Optical Transport." Aligned on the horizontal axis extending
from each of the left and right sides of the "Carrier Optical Transport" wavy
line is a box with caption reading "DWDM and Optical Switches." Connected by a
bold line to both of the "DWDM and Optical Switches" boxes is a brick wall with
star-shaped icons on either side. Underneath each brick wall is the caption
"Mismatch Between Transmission Speeds" with arrows pointing from the caption to
both sides of the brick wall. Seven lines lead from each of the outside star-
shaped icons to a vertical row of boxes with the caption "Existing Carrier
Equipment" above. From top to bottom, the boxes are labeled as follows: "Gigabit
Routers," "VoIP Gateways," "SONET," "Digital Subscriber Line Aggregation,"
"ATM," "Gigabit Ethernet" and "Cable Modem Termination."]
The advent of Dense Wave Division Multiplexing, or DWDM, an optical
technology that multiplies the amount of data that can be carried over
existing fiber optic lines, has provided carriers with substantial raw
capacity in the core of their optical networks. The widespread deployment of
DWDM technology by carriers has now shifted their focus away from the
deployment of additional fiber lines toward packet switch equipment that can
transmit and route data in volumes and at speeds that take advantage of the
expanded bandwidth enabled by DWDM. Carriers are therefore primarily focusing
on routers, devices designed to forward IP-based data packets, as the
equipment of choice for harnessing the benefits of DWDM.
Limitations of Existing Routers
Optical transmission capacity is increasing at a greater rate than the
transmission capacities of routers. This has created a chasm between the
capabilities of existing routers and the optical transmission network and has
produced bottlenecks in the public network. This chasm results in large part
because of the limited ability of existing router architectures to adapt to
the evolving and increasing bandwidth demands of carriers. For example,
current router offerings employ a centralized architecture, which inherently
limits the number of interfaces available and, accordingly, the ability to
incrementally increase the bandwidth capacity of a router. This limitation
requires that carriers either cluster multiple routers to emulate the
functionality of a single large router with greater capacity or undertake
large-scale upgrades, known as forklift upgrades, to address the increases in
optical transmission speeds.
The following diagram illustrates the growing chasm between router speeds
and optical transmission capacities as well as the periodic deployment of new
core router equipment and the redeployment of existing core routers to the
edge of the carrier network.
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[DIAGRAM APPEARS HERE]
[Diagram with cloud labeled "Carrier Optical Transport" at the center. To the
right of the "Carrier Optical Transport" cloud is a caption reading "Transport
Evolution Over Time," with a vertical arrow pointing down from the caption.
Within the "Carrier Optical Transport" cloud is a vertical row of three boxes,
each labeled "DWDM and Optical Switches." Horizontal lines extend to the left
from each of the three boxes, and the lines are labeled "OC-12," "OC-48" and
"OC-192," respectively. A star-shaped icon indicates the intersection of each
of these horizontal lines with the "Carrier Optical Transport" cloud. The lines
then continue to the left, with the respective labels "OC-3," "OC-12" and "OC-
48," and connect to three boxes aligned vertically, each containing two disks
representing routers. The disks within each box increase in size from top to
bottom. An arrow leads from the top box down and to the left, and connects to
another box containing two slightly larger disks representing routers. An arrow
leads from the middle box down and to the left, to another box with two slightly
larger disks representing routers. The caption "Router Deployment Over Time"
appears above the boxes containing the router depictions. Underneath the boxes,
a horizontal two-way arrow contains the captions "Edge" on the left-hand side
and "Core" on the right-hand side.]
Forklift upgrades require substantial periodic expenditures by carriers to
remove old router equipment from the core of their networks and deploy newer
products as they become available. Historically, router vendors have
introduced new router architectures every 12 to 18 months.
Clustering routers requires that a significant number of interfaces, which
are the links between routers and the rest of the network, be dedicated solely
to interconnect multiple router chassis. Therefore, clustering has proven to
be inefficient. Ryan Hankin and Kent estimates that approximately 70% of these
expensive interfaces are used for interconnection instead of transmission.
At the same time, existing routers are unable to communicate with the newer
generation of optical transmission equipment to dynamically change bandwidth
or enable the provisioning of new services without disrupting the entire
network. This limitation increases the time and effort required for carriers
to deliver new services or reconfigure the network in the event of sudden
changes in bandwidth demand.
Carrier Requirements for a New Architecture
To respond to the challenges created by the increasing volume of data
traffic on the existing public networks, carriers are not only focused on
optimizing their next-generation optical networks for more efficient data
transmission, but are also searching for a means to rapidly provision new
revenue-generating data communications services. As a result, carriers are
demanding solutions with the following attributes:
Scalability Without Disruption. Carriers want a cost-effective means of
increasing capacity on a continual basis. As a key building block of the
public network, routers must therefore have the ability to expand capacity
without forklift upgrades or other significant disruption of the network.
Carrier-Class Reliability. The equipment that carriers deploy within their
networks must offer the highest level of up-time and redundancy. To meet this
requirement, known as carrier-class reliability, router designs must minimize
any single points of failure and provide automatic recovery from network
failures and device errors.
High Performance. In order to capitalize on the increasing capacity offered
by optical technologies, carriers demand high levels of performance and
flexibility. Although there are different measures for determining performance
of routers, we believe the most critical measure is the ability to process and
forward packets at transmission rates matching the line rates available over
the fiber optic core.
Quality of Service Functionality that Enables New Revenue-Generating
Services. Routers must provide Quality of Service, or QoS, functionality over
IP without adversely affecting performance. QoS is essentially the
30
ability to assign different priorities to different traffic types, which is
crucial to the delivery of time-sensitive data streams, such as voice and
video. Routers must incorporate packet prioritization, network engineering,
traffic congestion management and control and ultimately, bandwidth management
to enable carriers to deliver QoS guarantees to their customers.
Reduced Network Cost and Complexity. In addition to the cost of deploying
routers, carriers incur substantial capital costs in deploying and
interconnecting multiple layers of networking equipment. More importantly, the
operational costs of running a network are significant. Not only must each
router be managed as an independent element of the network, but each
additional network layer and additional network element increases the
complexity of network architecture and management. Carriers are demanding
solutions that consolidate the number and types of network elements and
optimize the technologies employed in their networks.
Interoperability. Due to economic constraints associated with upgrading an
entire network to accommodate new technologies, it is critical that new
network equipment support the protocols and devices already deployed in
carrier networks.
Currently available routers were designed to handle lower capacities and
transmission speeds and cannot economically address carrier requirements, much
less the enhanced functionality demanded by carriers. Instead of trying to
adapt older technologies or interim solutions that provide only incremental
increases in capacity, carriers are now seeking a new solution that will
enable them to cost-effectively build next-generation optical networks
designed to capitalize on the opportunities created by the growth of the
Internet and the proliferation of data traffic.
The Avici Solution
Our high-performance TSR is engineered to provide a long-term solution for
the next-generation carrier networks by providing a platform for growth and
enabling intelligent control of bandwidth. The following diagram illustrates
the role of the Avici TSR in the next generation of optical networks:
[DIAGRAM APPEARS HERE]
[Symmetric diagram with wavy line at center representing the fiber cable, which
is labeled "Carrier Optical Transport." Aligned on the horizontal axis
extending from each of the left and right sides of the "Carrier Optical
Transport" wavy line is a box with caption reading "DWDM and Optical Switches."
Connected by four bold lines to both of the "DWDM and Optical Switches" boxes is
a three-dimensional rectangular box representing the Avici TSR. The caption
"Avici Composite Links" appears above the four bold lines, and an ellipse,
representing a ring around the "Avici Composite Links" lines, is found at the
center of these lines. A box containing the label "Avici TSR" appears
underneath each of the icons representing the Avici TSR. Seven lines lead from
each of the icons representing the Avici TSR to a vertical row of seven boxes
with the caption "Existing Carrier Equipment" above. From top to bottom, the
boxes are labeled as follows: "Gigabit Routers," "VoIP Gateways," "SONET,"
"Digital Subscriber Line Aggregation," "ATM," "Gigabit Ethernet" and "Cable
Modem Termination."]
Our solution provides the following key benefits:
Long-term Carrier Solution. Our TSR has been designed to meet the current
and evolving performance and bandwidth requirements at the core of carriers'
optical networks. The Avici TSR has been designed to scale as demands on the
optical layer evolve and increase, thereby eliminating expensive clustering
designs, forklift
31
upgrades and network disruption. We believe that this scalability and
flexibility positions the Avici TSR as a long-term solution for carriers.
In-Service Scalability. The TSR enables carriers to incrementally add
capacity in a cost-effective, non-disruptive manner. This capability for
dynamic, non-disruptive bandwidth provisioning enables carriers to service
existing customers while rapidly adapting to changes in bandwidth
technologies, new service offerings and increased usage.
Carrier-Class Reliability. The Avici TSR has been designed and manufactured
to provide carrier-class reliability. We believe the TSR's technologically-
advanced features, such as our distributed architecture, Velociti switch
fabric and Composite Links, will enhance the reliability and performance of
carrier networks. The TSR's proprietary ASIC-based design and redundancy
features provide high levels of system reliability.
Ability to Intelligently Manage High Volumes of Network Traffic at High
Speeds. Our TSR, through our Composite Link technologies, is capable of
processing data packets at virtual line rates exceeding 10 gigabits per
second, thereby achieving virtual performance beyond OC-192. Our TSR can
achieve these transmission rates at full utilization of network interfaces
without sacrificing packet throughput performance. In addition, the TSR
provides the ability to intelligently direct and manage IP traffic through QoS
features without any loss of transmission speeds.
Ability to Offer New Revenue-Generating Services. Our TSR provides an
effective foundation for the delivery of next-generation data communication
services. The TSR enables carriers to dynamically provision additional
capacity for new services without network disruption and to prioritize IP data
traffic to effectively provide QoS guarantees and new services. As a result,
carriers are able to offer and charge for new and enhanced services, such as
VoIP and video streaming, and can also dynamically modify their service
pricing structures.
Cost-Effective Network Expansion and Operation. Our solution reduces the
need for previously required layers of network equipment, such as ATM and
SONET devices and optical integration equipment. Our built-in redundancy also
eliminates the need for costly back-up equipment. Our high speed interfaces
reduce the need for additional fiber capacity. In addition, our solution
reduces ongoing network operating expenses through the TSR's high port density
and proprietary ASICs, which reduce requirements for floor space and power
consumption. The TSR's key interoperability features preserve carriers'
investments in their legacy network equipment.
Strategy
Our goal is to design, develop and provide the next generation of reliable
high-speed, intelligent data networking equipment that will power the core of
carriers' optical networks and establish new standards for performance. The
key elements of our strategy are to:
Extend Technological Leadership. We have developed a product architecture
closely connected to the optical transport layer and designed to be a long-
term solution within the core of carriers' optical networks. We plan to
continue to invest heavily in research and development, particularly in
developing proprietary ASICs and software, to satisfy the requirements of
next-generation carrier networks. We plan to enhance the features of the TSR
and bring to market new, complementary products. For example, during the
second half of 2000 we plan to deliver for customer trials MultiProtocol Label
Switching, or MPLS, traffic engineering capability and line card modules for
OC-192c, Gigabit Ethernet and ATM. We take a leading role in industry
standard-setting forums and promote the interoperability of our products with
those of key optical switch vendors and legacy router vendors.
Continue Penetration of Key Carrier Accounts. We strive to capture the
market opportunity presented by carriers demanding additional capacity as well
as carriers seeking the means to deliver additional services. We have
initially focused on a select group of leading carriers, and we are currently
participating in a number of customer trials. We intend to broaden our target
market focus to include all carriers with fiber optic backbones.
32
We are expanding our direct sales force and customer service organization as
well as partnering with international distributors, customer service
organizations and complementary product companies to expand our market
presence.
Provide Technology to Enable New Carrier Service Offerings. We work closely
with our customers and prospective customers to understand their network
requirements and service opportunities. We use this knowledge to develop new
features and functionality to enable carriers to deliver new revenue-
generating services. For example, we are working with Enron Broadband Services
to enable the delivery of video streaming. We intend to integrate our planned
MPLS to enable controlled traffic flow and allow carriers to offer services
such as VPNs. We will seek opportunities to enhance our product features and
promote the TSR as an effective means for carriers to capitalize on new
service opportunities.
Expand into New Geographic Markets. We intend to sell our products globally.
We have established relationships with leading distributors and vendors of
telecommunications equipment in Asia, and we intend to develop a direct Asian
salesforce to support our indirect sales channels. In addition, we have begun
to establish a direct European sales presence as well as relationships with
key distributors in that market.
Rely on Strategic Outsourcing. Our outsourcing strategy enables us to focus
our resources on our core competencies of product design and development,
sales and marketing. Although we design and develop our ASICs and other
proprietary technologies, we select and work closely with ASIC fabrication and
electronics manufacturing services providers to promote the cost-effective,
timely and reliable manufacture and testing of our products. To complement our
internal customer service organization, we plan to enter into a global service
and support arrangement for our products with a third party.
Products and Technology
Product Architecture
Our architecture has been designed to provide a critical building block for
carriers seeking to build resilient IP-based networks that can capitalize on
the raw capacity provided by DWDM and other optical technologies. We utilize a
parallel and distributed architecture to address the large volume of packet
forwarding and increasing traffic volume requirements of the Internet. By
using a distributed architecture that incorporates processing and packet
routing functionality in our line card ASICs, our TSR is designed to provide
carriers with a smooth upgrade path from OC-48 to speeds of OC-192 and higher
by changing or bundling line card modules as they become available rather than
upgrading the entire chassis. Accordingly, this architecture provides
intelligent scalability and preserves the initial investment in our TSR.
Product Portfolio
The TSR is a 40-slot chassis which can be configured with the following
current and planned line card modules:
Link Type Link Speed Status
------------------------------------------------------------------------------------
Packet over SONET OC-3c Commercially available
------------------------------------------------------------------------------------
Packet over SONET OC-12c Commercially available
------------------------------------------------------------------------------------
Packet over SONET OC-48c Commercially available
------------------------------------------------------------------------------------
Packet over SONET OC-192 In customer evaluation
------------------------------------------------------------------------------------
Packet over SONET OC-192c In development
------------------------------------------------------------------------------------
Gigabit Ethernet 1 Gigabit In development
------------------------------------------------------------------------------------
Asynchronous Transfer Mode OC-3c In development
------------------------------------------------------------------------------------
Asynchronous Transfer Mode OC-12c In development
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IPriori Carrier System Control Software
IPriori is an advanced software system that has been developed to optimize
and control switching and routing in the TSR. IPriori is built on a
distributed architecture model, which provides increased levels of reliability
and scalability, and is specifically designed to address the system
requirements arising from a large number of ports. IPriori implements industry
standard routing protocols that are used in the Internet today, and has
undergone extensive interoperability testing in laboratory and field
environments to ensure compatibility with existing installed equipment. It
also forms the basis for advanced capabilities such as Composite Links, QoS
and MPLS.
Composite Links
The Avici TSR connects to the optical transport layer through Composite
Links. A Composite Link combines multiple physical network interfaces into a
single virtual network interface to enable a carrier to add additional lines
or increase or decrease transmission speeds on a particular link without
disrupting the network. This allows carriers to offer faster service
provisioning to their customers. Our Composite Links enable carriers to
achieve virtual line speeds of OC-192 and beyond. Each Composite Link can be
configured with up to 16 network interfaces. Composite Links are also able to
recognize heavy or light traffic demand at the edge of the network and
dynamically adjust the number of links in the composite group. As physical
links are added to or removed from a composite group, the TSR communicates
this information to the optical equipment to maintain optimum traffic routing.
Because our Composite Links operate with no network disruption, they enable
the rapid provisioning of additional bandwidth for Internet traffic flows
while maintaining a stable and reliable environment for IP services.
We intend to complement our Composite Links with our planned MPLS
functionality to provide traffic engineering capabilities and enable carriers
to control and efficiently balance data traffic across their networks. We
believe MPLS is a key component of differentiated IP-based services and, when
combined with other QoS mechanisms, will enable carriers to deliver enhanced
network services.
Velociti Switch Fabric
Our Velociti switch fabric provides direct communication between the line
card modules in a TSR. This direct communication provides high performance,
and as system capacity is increased, allows economical scalability. All
forwarding, switching and general processing has been incorporated into the
line card ASICs, making the Velociti switch fabric capable of supporting
higher speed line cards with no forklift upgrade as carriers upgrade their
networks. The Velociti switch fabric also includes path diversity which makes
our TSR highly fault tolerant.
ASIC-based Packet Routing Technology
We have consolidated all data-flow and control processes, including packet
input/output framing, forwarding, scheduling, and switching, into our
programmable ASICs that reside on our line card modules. These ASICs enable
line rate packet forwarding performance regardless of packet address and route
table size.
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Our ASICs are designed to provide the following functions and benefits:
ASIC Function Customer Benefits
------------------------------------------------------------------------------------------
Input Framer Analyzes and identifies incoming IP Enhances ability to manage
packets and marks them for network traffic to enforce QoS
prioritization
------------------------------------------------------------------------------------------
Forwarding Determines packet destination and Maintains network performance
forwards the packet at line rates as bandwidth demand increases
------------------------------------------------------------------------------------------
Packet Scheduling Manages intelligent prioritization Ensures optimal system
and efficient use of the TSR's performance across high volumes
switching capacity of traffic flows
------------------------------------------------------------------------------------------
Fabric Switching and Provides Velociti switch fabric that Creates high performance and
Packet Memory is responsible for communication economical scalability
among line card modules
------------------------------------------------------------------------------------------
QoS Prioritizes packets for transmission Enables the creation and
delivery of differentiated IP-
based services
------------------------------------------------------------------------------------------
Output Framer Shapes outbound traffic flows to Provides additional control of
ensure conformance to QoS packet flows to ensure network
requirements stability
Sales and Marketing
We sell and market our products primarily through our direct sales force,
systems integrators and distributors. Our sales cycle to carriers typically is
a lengthy and deliberate process. After preliminary discussions with our sales
organization, prospective customers may receive evaluation equipment to
encourage formal testing. The sales cycle normally includes laboratory testing
in which the TSR is evaluated against competing products for performance,
scalability, reliability, interoperability and other measures. Upon completion
of the laboratory tests, one product is typically selected for field trials in
which the product is deployed in a carrier's network in a limited and
controlled fashion. Only after successful completion of field trials will
carriers place orders and commercially deploy equipment across their networks
over time.
Our direct sales efforts are focused on the largest carriers. As of April
30, 2000, our sales and marketing organization consisted of 24 employees, of
which 15 were located in our headquarters in North Billerica, Massachusetts,
eight were located in a total of four sales and support offices around the
United States and one was located in the United Kingdom.
Our marketing objectives include building market awareness and acceptance of
Avici and the Avici TSR as well as generating qualified customer leads. In
addition to traditional marketing activities, we plan to sponsor an optical
partner program with key optical industry leaders to demonstrate the
interoperability of the TSR with their products.
Our international sales are conducted through systems integrators and
distributors. We have two systems integrators in Japan and one in Korea. In
addition, in order to further our international sales objectives, we are
identifying and establishing relationships with a number of additional
country-specific distributors.
Customers
Our target customer base includes new and established telecommunications
carriers and Internet service providers, and we expect to broaden our focus to
include all carriers with fiber optic backbones. Our TSR is deployed in a
segment of The National Transparent Optical Network, an Internet initiative
known as SuperNet. Enron Broadband Services and Williams Communications have
agreed to future purchases of the TSR, subject to satisfactory completion of
field trials. While there has been no commitment to purchase equipment for
deployment, the TSR has successfully completed laboratory testing at AT&T and
has been selected by AT&T for
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field trials. We have also shipped the TSR to international systems
integrators, including Nissho Electronics Corporation, Itochu and Samsung, as
well as to a limited number of other customers and prospective customers.
Customer Service and Support
We believe that a broad range of support services is critical to the
successful installation and ongoing support of the TSR, the development of
long-term relationships with customers and the generation of additional sales
of the TSR to our customers. We are committed to providing our customers with
the highest levels of service and support. As of April 30, 2000, we employed
nine people in our customer service and support organization. To complement
our internal customer service organization, we plan to enter into a global
service and support arrangement for our produ |
