& cplSiteName &

Nortel's HDX: The Future Under Fire

Light Reading
OFC/NFOEC News Analysis
Light Reading
2/27/2002
50%
50%

As the carrier spending environment chills to the bone, optical equipment makers look to use the downtime to prepare their next-generation strategies.

In the case of Nortel Networks Corp. (NYSE/Toronto: NT), this raises the question: What's up with the HDX optical switch, the company's marquee next-generation product?

Last week, news leaked out that Cisco Systems Inc. (Nasdaq: CSCO) was preparing an STS1 grooming switch; and, just last month, Lucent Technologies Inc. (NYSE: LU) announced plans for its LambdaUnite, an OEO grooming switch (see Cisco Preps Stealth Switch and Lucent's LambdaUnite Busts Out). Meanwhile, Nortel's OpteraConnect HDX platform, which has been in development for over two years now, still hasn't been officially launched.

There are two possible explanations for the delay. One: The product just isn't ready for prime time. Two: It's ready to sell, but the carriers don't like it and the company hasn't found the "launch" customer.

According to analysts covering the company, Nortel said last summer that the HDX would be in customer trials by the third quarter of 2001 and would be generally available in the first quarter of 2002.

So far, Nortel has announced that Genuity Inc. (Nasdaq: GENU) is one of the trial customers. But it hasn't announced that the product is generally available.

Carrie Kasten, a spokesperson for the company, claims that Nortel never specifically stated when the product would be generally available; instead, when the company referred to delivery dates, it was talking about customer or testing availability and not general commercial availability.

"I know, it's very confusing," she says.

Kasten says the product will be "showcased" at the Optical Fiber Communication Conference and Exhibit (OFC) set for Anaheim, Calif. the week of March 17.

"It is available now and in customer trials," Kasten asserts. "[Furthermore], we have been consistent with our expectations on delivery dates for the HDX for the past year, meeting the commercial availability projection of end of year 2001 as it was placed into two North American customer trials."

In any case, the HDX appears to have lost credibility with Wall Street, which grumbles that the company isn't handling the product launch particularly well. That's not good, because it is seen by many as the key to the company's future.

Some analysts say the delay might be the result of lackluster support from customers. UBS Warburg analysts Nikos Theodosopoulos and Michael Urlocker stated their concern over the product in a note they published late last year.

"Based on recent feedback from several major U.S. carriers, we believe that Nortel’s new HDX optical crossconnect may be poised for a weak reception by U.S. carriers," they wrote. "In our informal survey of eight major U.S. carriers, not one has indicated a strong interest in deploying or putting into trial the HDX."

Contacted this week, Theodosopoulos and Urlocker declined to add any comment on the HDX.

Market research analyst Mark Lutkowitz, vice president of optical networking research at Communications Industry Researchers Inc. (CIR), says he has heard similar grumblings: "Service providers I’ve talked to say there is a huge problem with the cost and size of the box. I don’t see any of them deploying it in any big way."

The UBS Warburg analysts listed four main problems with the HDX box. First, it may be too big. The OperaConnect HDX has four times the capacity of the CoreDirector, a hot-selling switch from Ciena Corp. (Nasdaq: CIEN). HDX supports 7.68 Tbit/s per bay with scaleability to 40 Tbit/s per system. This makes for a high startup cost and is currently viewed as overkill. The product itself is rather large and consumes more power than some service providers can justify.

But Nortel's biggest problem may be in committing to and selling a new architecture. For this reason, Nortel appears to be hedging its bets between a ring-based or mesh-based optical network, and that may have caused part of the delay on the HDX.

It all adds up to a puzzle for the company, which will likely try to spin the product's delay, if it happens there are no willing buyers of the current product. That could force Nortel to rework the product to fit customer needs.

"Without the HDX, I don’t know where Nortel will go optically," says CIR's Lutkowitz. "They’re already late to the market, so you have to figure it will be a problem for at least a few years."

— Marguerite Reardon, Senior Editor, Light Reading
http://www.lightreading.com

(34)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View        ADD A COMMENT
<<   <   Page 2 / 4   >   >>
melao
50%
50%
melao,
User Rank: Light Beer
12/4/2012 | 10:52:16 PM
re: Nortel's HDX: The Future Under Fire
Hi LeCastor71,

I really think you-re right, but umustbejokin has a point.

As he said the HDX is MUCH bigger than the CoreDirector. Which means that, the market is a bit different, i mean, the Ciena box fits just well to the market nowaday. Maybe in the future with the evr increasing need for bandwidth and provision automatization, the HDX may play a big part on the game.

MAYBE, we don-t know how this market is going.

I used to work at NT, and i-ve read some papers about HDX development, it was supposed to add MPLS to HDX as far as i know. I have to take a closer look on some papers i have though.

But indeed HDX is way late, in 2000 i was at NT, they-ve made a HUGE announcement like -HDX the first multi-terabit optical switch on the market blah blah blah- and now it-s 2002 and nothing happened.

So to end this post i-ll say: I don-t know what to expect from NT. Maybe they-ll, and maybe not.

The only thing i can see is Alcatel gaining market share quarter after quarter...
edgecore
50%
50%
edgecore,
User Rank: Light Beer
12/4/2012 | 10:52:12 PM
re: Nortel's HDX: The Future Under Fire
Heard a good rumor the other day in Ottawa...Nortel may be canning their long haul portfolio...sounds kind of unrealistic, thoughts?

EC
hyperunner
50%
50%
hyperunner,
User Rank: Light Beer
12/4/2012 | 10:52:11 PM
re: Nortel's HDX: The Future Under Fire
Sorry for the basic questions, but I'm having an intellectual problem with this all-optical stuff.

- Is the HDX the 3D MEMS OXC that Nortel bought from Xros (is that the right spelling...it was something like that, right?)?

- How is 3D MEMS actually doing as a technology? Surely carriers would prefer not to have big switches with thousands of moving parts in them. And I hear 3D MEMS needs a ton of control code. Aren't Lucent claiming a million lines or so? That can't be good.

- Who actually wants one of these things? Lucent seem to be first out the gate with a 3D MEMS box, and I hear they've actually got some in customer sites. Are these revenue shipments or just loaners? How many boxes are they claiming?

- I guess one of the prime contenders for a 3D MEMS switch would be AT&T. Rumour has it that they're not using the LU switch, but are trialling Calient. But the Calient switch is pretty expensive - lots of transponders on there I think.

- So for "big" cross-connects we have LU, NT and Calient. None of them seems to be completely "optimal" designs (am I wrong here?). Is this why Ciena, Tellabs, Tellium and the other OEO crowd are still doing OK (of course nobody is actually doing *well*, I guess it's all relative).

Is the problem with the technology or the hype surrounding the all-optical network?

hR
laser_boy
50%
50%
laser_boy,
User Rank: Light Beer
12/4/2012 | 10:52:11 PM
re: Nortel's HDX: The Future Under Fire
LeCastor71 can you elaborate on your CD comments? Lousy operations, poor syslog to be specific.

Thanks
manoflalambda
50%
50%
manoflalambda,
User Rank: Light Beer
12/4/2012 | 10:52:05 PM
re: Nortel's HDX: The Future Under Fire
- Is the HDX the 3D MEMS OXC that Nortel bought from Xros (is that the right spelling...it was something like that, right?)?

The Xros OXC is now the PX.

...
- Who actually wants one of these things? Lucent seem to be first out the gate with a 3D MEMS box, and I hear they've actually got some in customer sites. Are these revenue shipments or just loaners? How many boxes are they claiming?


Global Crossing and Japan Telecom are paying customers for LambdaRouter to date. There are other trials/"try and buys" in progress as well. Probably a couple dozen total to date.

- I guess one of the prime contenders for a 3D MEMS switch would be AT&T. Rumour has it that they're not using the LU switch, but are trialling Calient. But the Calient switch is pretty expensive - lots of transponders on there I think.


I had heard something about some Calient-Cisco collaboration. Was that in AT&T?

Where are the transponders in the Calient OXC? To provide a 3R or PM feature?

Salute,
Manoflalambda
Twistall
50%
50%
Twistall,
User Rank: Light Beer
12/4/2012 | 10:52:02 PM
re: Nortel's HDX: The Future Under Fire
melao sez:

Maybe in the future with the evr increasing need for bandwidth and provision automatization, the HDX may play a big part on the game.

As master of the obvious, I have to point out that the problem is, while NT is waiting for their market to materialize, components are getting more highly integrated, power consumption goes down, and some hot shot has figured out how to do what it does, better, and for less money.
hyperunner
50%
50%
hyperunner,
User Rank: Light Beer
12/4/2012 | 10:51:52 PM
re: Nortel's HDX: The Future Under Fire
Thanks for the clarification, manoflalambda.

I guess GX might not be classed as a "paying" customer now ;-)

In terms of the AT&T/Calient thing, I overheard an AT&T person and a Calient person speaking at a standards meeting. So I'm repeating gossip without a means to back it up as neither would want to be named. In addition I'd stress that the content of the discussion wasn't detailed enough for me to understand if this was a pilot or a rollout.

The Calient-Cisco thing is news to me. I know Calient has an "understanding" with Juniper, but I'd guess that just extends to the Ethernet formatting of optical control plane messages. This isn't covered in OIF UNI 1.0.

For transponders I'm basing this on a presentation by John Drake of Calient at a conference last year. He was highlighting the need for them in the context of interoperability rather than 3R, although his point was that with transponders you get 3R "for free".

hR
ericdu
50%
50%
ericdu,
User Rank: Light Beer
12/4/2012 | 10:51:51 PM
re: Nortel's HDX: The Future Under Fire
I am a green-hand, could you give me a explanation on grooming switch?

melao
50%
50%
melao,
User Rank: Light Beer
12/4/2012 | 10:51:51 PM
re: Nortel's HDX: The Future Under Fire


"As master of the obvious, I have to point out that the problem is, while NT is waiting for their market to materialize, components are getting more highly integrated, power consumption goes down, and some hot shot has figured out how to do what it does, better, and for less money."

Yeah that-s a very good point, but in the point of view of a product, probably in the meantime HDX will be a mature product, what can be a good marketing for HDX. Even though there will be a better box out it could be an unproven box.

I really believe that Nortel is missing the time.

Do you know if Ciena with is know-how on CD is looking forward to make a box more integrated than HDX ? Or any other vendor ?

Thanks,
Melao
puddnhead_wilson
50%
50%
puddnhead_wilson,
User Rank: Light Beer
12/4/2012 | 10:51:50 PM
re: Nortel's HDX: The Future Under Fire
>Do you know if Ciena with is know-how on CD is looking forward to make a box more integrated than HDX ? Or any other vendor ?

in their last couple CCs they talked about higher integration of CD, K2, and ONI metro gear.

Not sure if that's what you're asking but hope it helps.
<<   <   Page 2 / 4   >   >>
Featured Video
From The Founder
Light Reading is spending much of this year digging into the details of how automation technology will impact the comms market, but let's take a moment to also look at how automation is set to overturn the current world order by the middle of the century.
Flash Poll
Upcoming Live Events
November 30, 2017, The Westin Times Square
December 5-7, 2017, The Intercontinental Prague
March 20-22, 2018, Denver Marriott Tech Center
May 14-17, 2018, Austin Convention Center
All Upcoming Live Events
Infographics
SmartNICs aren't just about achieving scale. They also have a major impact in reducing CAPEX and OPEX requirements.
Hot Topics
When Will 6G Arrive? Hopefully Never, Says BT's McRae
Iain Morris, News Editor, 11/21/2017
Let's Talk About 5G Efficiency, Not Wacky Services
Iain Morris, News Editor, 11/21/2017
Top 5 Tech Turkeys 2017
Dan Jones, Mobile Editor, 11/22/2017
AT&T's Lurie Leaps to Synchronoss as New CEO
Dan Jones, Mobile Editor, 11/17/2017
Wireless Could Arrive Soon in NYC Subway Tunnels
Dan Jones, Mobile Editor, 11/20/2017
Animals with Phones
Live Digital Audio

Understanding the full experience of women in technology requires starting at the collegiate level (or sooner) and studying the technologies women are involved with, company cultures they're part of and personal experiences of individuals.

During this WiC radio show, we will talk with Nicole Engelbert, the director of Research & Analysis for Ovum Technology and a 23-year telecom industry veteran, about her experiences and perspectives on women in tech. Engelbert covers infrastructure, applications and industries for Ovum, but she is also involved in the research firm's higher education team and has helped colleges and universities globally leverage technology as a strategy for improving recruitment, retention and graduation performance.

She will share her unique insight into the collegiate level, where women pursuing engineering and STEM-related degrees is dwindling. Engelbert will also reveal new, original Ovum research on the topics of artificial intelligence, the Internet of Things, security and augmented reality, as well as discuss what each of those technologies might mean for women in our field. As always, we'll also leave plenty of time to answer all your questions live on the air and chat board.

Like Us on Facebook
Twitter Feed
Partner Perspectives - content from our sponsors
The Mobile Broadband Road Ahead
By Kevin Taylor, for Huawei
All Partner Perspectives