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Strategies & Market Trends : VOLTAIRE'S PORCH-MODERATED -- Ignore unavailable to you. Want to Upgrade?

To: Jill who wrote (3446)	9/24/2000 1:35:23 PM
From: Jill	Read Replies (1) \| Respond to of 65232

From lightreading: Optical networking has gained an incredible following among investors over the past year, as one startup vendor after another in this field gets acquired for billions of dollars or stages an initial public offering that catapults its market value to breathtaking heights. The big idea driving this speculative buzz is that optical networking won’t simply revolutionize telecom services but will turn the world economy on its head. It’ll blow away bandwidth bottlenecks, virtually eliminate Internet delays, and, consequently, usher in huge changes in how companies are run in general and how they conduct their IT functions in particular. Big companies will end up outsourcing almost everything from manufacturing to marketing, so goes the buzz. As a result, they’ll “hollow out” — revenues will be big, but employee numbers small. A myriad of specialized service providers will emerge, offering applications that target business processes such as inventory control, accounting, payroll, and human resources. The telecom networks over which they run will be taken for granted (see Automate or Suffocate ). Simultaneously, the software industry is expected to undergo a dramatic shakeup, as users stop buying applications and start renting their use on remote servers. That, in turn, could deal a big blow to the PC market because many users will employ inexpensive information appliances to access these applications. It’s a fantastic vision. If realized, corporate IT managers could be in for a turbulent time. More and more of them may find themselves working for one of these new-style service providers rather than in a traditional enterprise environment. In the short term, however, lies the tricky task of figuring out the best way of exploiting current developments in optical networking. That means getting a realistic view of when these technologies will start delivering the goods — namely, drastic reductions in bandwidth prices, much faster installation times, and serious performance guarantees. As usual, the situation is complicated. Best hopes hinge on a new breed of startup carrier that is rolling out services based on optical networking technologies. In some instances, they're using cost-cutting dense wavelength-division multiplexing (DWDM) and gigabit Ethernet in their networks. In other instances, they're deploying new types of equipment so they can offer a complete range of services within buildings, at the drop of a hat. In either case, coverage is spotty and is likely to be limited to major metropolitan areas for the next couple of years. Even so, it’s more than you’ll get from an incumbent carrier, says Deb Mielke, principal analyst at Treillage Network Strategies Inc., a market research firm. "The regional Bell operating companies will wait until they see that people are eating their lunch before they finally make a move [in optical networking]," she says. So, how to cash in on the opportunities that optical networking is beginning to deliver? Light Reading has prepared the following report to help readers get a grasp on the underlying technologies and identify service providers leading the charge: Bandwidth Bottleneck The MAN Plan The Last Mile Not so Fast lightreading.com