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Pastimes : The New Qualcomm - write what you like thread. -- Ignore unavailable to you. Want to Upgrade?

To: Souze who wrote (3171)	7/20/2001 5:27:01 PM
From: Souze	Read Replies (2) \| Respond to of 12231

Study finds fiber-optic glut is 'just baloney' Oklahoma firm disputes report by Merrill Lynch By Peter J. Howe, Globe Staff, 7/20/2001 Challenging the widely accepted consensus that telecommunications carriers are plagued by a ''fiber-optic glut,'' a Tulsa, Okla. -based consulting firm this week released a route-by-route study that finds in most cases - including major segments serving Boston - fiber lines are actually operating at close to current capacity and will need to be expanded soon. The study by TeleChoice Inc. evaluated actual ''lit fiber'' capacity among Boston and 11 other big US cities and compared it to projected typical peak business and homeowner demand for voice calling, Internet access, and high-speed data services. Of traffic passing over 22 city-pair routes studied, only three showed signs of major overcapacity that will take years to absorb. Three others had some level of overcapacity that could take a year or 18 months to be worked down. But in all others, demand is at or close to the point where carriers typically would need to ''light up'' more installed fibers, or add new gear to squeeze new light waves or faster streams of data through already active fiber-optic lines. Between Boston and New York, for example, TeleChoice chief strategy officer Russ McGuire said the firm calculated there is now capacity to carry 1.5 terabits of data, or 1.5 trillion bits, each second over lines operated by companies such as AT&T, Level 3, Qwest, and WorldCom. But about 80 percent of that, or 1.2 terabits, has already been reserved, McGuire said. That does not mean that 1.2 terabits of voice and data traffic are ever actually flowing between the two cities, but rather that phone and Net companies have reserved that much of the capacity to cover peak traffic demands, typically with a cushion to cover the next several months of projected growth and contingencies. Likewise, McGuire said, the Boston-Chicago route has about 1.25 terabits per second of capacity, but peak demand is projected at 1.2 terabits (some of which may be served by indirect routes through Canada or the South between Boston and Chicago). TeleChoice calculated demand through projecting consumer and business use, in regions surrounding the 12 cities and 22 routes, of 28 telecommunications services, including voice calls, Web surfing, e-mail, and specialized high-speed business data access. The notion of a huge oversupply of fiber-optic capacity that could take years or decades to be used up has contributed to plunging stock prices and bankruptcy for companies including 360Networks of Vancouver, British Columbia. That in turn has affected the shares of many optical networking manufacturers, such as Sycamore Networks of Chelmsford, whose shares have dropped by more than 90 percent in the last year. The ''fiber glut'' argument got a major boost earlier this summer from a new Merrill Lynch report contending only 2.7 percent of US fiber-optic capacity - including billions of dollars' worth built in the last four years - is actually in use in the average moment. TeleChoice president Christine Heckart said looking at actual traffic routes, rather than treating the entire US fiber network as one big pipe, proves that the notion of a systemic glut ''is just baloney. There may be a lot of unused capacity in the middle of Nebraska... but there is not in the high-growth corridors.'' The only routes TeleChoice found to have major overcapacity were New York-Washington, Denver-Los Angeles, and Los Angeles-San Francisco. Heckart added that ''we're not saying these [Merrill Lynch] numbers are wrong, we're saying these numbers are completely useless.'' While TeleChoice is nationally known for independent research, the route-by-route study was funded in part by Williams Communications, a major national provider of high-capacity optical lines for phone and Net companies that has been aggressively challenging the notion of a price-depressing fiber glut. Heckart and McGuire said the study should be welcomed as good news for local optical networking providers, including Sycamore and Lucent Technologies' North Andover plant, as well as start-ups like Axiowave Networks in Marlborough, Mintera Networks in Lowell, and PhotonEx in Bedford, which are all developing higher-speed optical systems. ''There are a lot of routes that should be being overbuilt right now,'' Heckart said. Peter J. Howe can be reached by e-mail at howe@globe.com. This story ran on page 1 of the Boston Globe on 7/20/2001. © Copyright 2001 Globe Newspaper Company. boston.com [ Send this story to a friend \| Easy-print version ]