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Technology Stocks : Nortel Networks (NT) -- Ignore unavailable to you. Want to Upgrade?

To: Stocker who wrote (2275)	3/21/1999 10:30:00 AM
From: Kenneth E. Phillipps	Read Replies (1) \| Respond to of 14638

Nortel defends Layer 3 upgrade policy on new switch By JIM DUFFY Network World Fusion, 03/19/99 SANTA CLARA, CALIF. -- Nortel Networks this week defended its plan to force users into a significant hardware upgrade to Layer 3 capabilities on its new LAN switch. The Accelar 8000, a 6- and 10-slot modular 10/100 and Gigabit Ethernet switch for enterprise wiring closets and core backbones will ship in April with Layer 2 switching modules. Layer 3 modules will ship in October and will require users to replace the Layer 2 modules if they want what Nortel Networks refers to as a "full featured" routing switch, says Basil Alwan, vice president and general manager of Nortel Networks' enterprise products division. The Accelar 8000 chassis and backplane, meanwhile, can be spared. But Alwan says users are not likely to swap out all Layer 2 modules for Layer 3. The Layer 2 Accelar 8000 will function as a chassis-based wiring closet switch at the network edge, linking workgroups to a Layer 3 Accelar 8000 or Accelar 1200 - Nortel Network's first generation routing switch - in the network core. Still, users do not like the prospect of having to forklift modules out of the Accelar 8000 chassis if they want Layer 3, whether it be at the edge or the core of their networks. "I can't say that I'm happy about that," says Phil Freyer, manager of global network architecture at Beckton Dickinson in Franklin Lakes, N.J. "Anytime I have to go back into closets or into my backbone and swap modules, it's not the best thing in the world for me to have to do." Nortel Networks is not alone in requiring users to undergo a significant hardware upgrade to a full routing switch. Users of 3Com's CoreBuilder 9000 will face the same line card swap-out situation when 3Com ships Layer 3 modules for that switch later this year. Users of Cisco's Catalyst 5500, meanwhile, will have to upgrade to a whole new switch chassis - the Catalyst 8500 -- if they want full-featured routing at the line card level in the network core. The Accelar 8000 Layer 3 modules, which will carry the brand name Accelar 8600, will cost about $1,000 per 10/100 port, Alwan says. The Layer 2 Accelar 8100 modules cost about $300 per 10/100. Once the Accelar 8600 modules start shipping, Nortel Networks expects some cannibalization of Accelar 1200 sales. Nortel Networks has been offering the Accelar 1200 for a couple of years and it has been successful, garnering Nortel Networks the lion's share of the Layer 3 market, according to the Dell'Oro Group in Portola Valley, Calif. Alwan does not expect the drop off in Accelar 1200 sales to be dramatic, though. "The 1200 will continue to be the primary player in the core," he says. "Most customers that have the 1200 are not going to rip them out. They're going to (transition to the Accelar 8000) over time, carefully. A very, very small number of 1200s will be retired one and a half years from now." Alwan says Nortel Networks will continue to invest in the 1200 beyond this fall. Packet-over-SONET and wire-speed IPX routing modules are forthcoming for the switch, as are software upgrades for switch failover capabilities. Still, it's interesting to note that Nortel Networks, which has always claimed to revolutionize or pioneer the routing switch market, came out with Layer 2 blades for the next generation Accelar far ahead of Layer 3. "We had Layer 2 ASIC availability first," Alwan says. "Good product development takes time." Nortel Networks spent $100 million over two years to develop the Accelar 8000. Alwan also notes that 80% of the dollars to be made in LAN switching are at the edge of enterprise networks, while 20% are at the core. Lastly, Nortel Networks may be a bit sentimental about the Accelar 1200 to the point of delaying its retirement as long as possible. "It's in a lot of big networks and it's our pride and joy," Alwan says.