Gradual separation of "R" from "D": While other types of test gear are consolidating, R&D appears to be undergoing mitosis. Once, research and development were assumed to be a single entity. Today, there appears to be a growing distinction between the two.

While the gear needed to devise and fine-tune product concepts (the research piece) uses lots of highly specialized tools, the process of getting prototypes into production (the development piece) is starting to call for equipment that's more closely wed to manufacturing.

The key reason for this is clear: Many broadband startups lost their shirts attempting to build products through repetitive creation of prototypes, in trial-and-error fashion. A much more efficient approach is to improve design tools so that minimal resources are wasted once a product design is ready for implementation.

Market strength: Despite an overall downturn in telecom spending, the R&D test market remains robust, albeit comparatively small. Equipment makers, the primary buyers of R&D test gear, appear to believe that no matter how challenged the bottom line is, any hopes of thriving once the market returns depend on keeping investment going in R&D.

In a nutshell, the R&D test equipment market continues to thrive, although it faces tougher challenges than ever. This report describes the state it's in and the key trends in its evolution to meet the ongoing needs of broadband vendors. Here's a hyperlinked summary:

Market Overview
A look at the size and state of the market for R&D test and measurement gear.

Squeezing Fiber to the Max
The challenges of meeting ever-denser DWDM specs.

Faster and Finer
Speeds up to 40-Gbit/s call for new test parameters – and new capabilities for testers.

New Protocol Testing
Testing GMPLS, MPLS, UNIs... not to mention the proprietary stuff.

Modularity
Why testers are gaining more "snap-on" functions.

— Carl Weinschenk, Senior Editor, Light Reading
http://www.lightreading.comMost leading R&D test equipment makers have managed to bypass some of the more drastic pain of the current telecom recession. There are several reasons for this. For one thing, the tough technical requirements of this segment have kept down the number of players, while demand for ever better equipment has remained constant.

Indeed, it seems companies hoping to survive in the long run have a keen interest in keeping their development efforts going, albeit on a somewhat smaller scale than they did during the boom time between 1998 and 2000.

"There is a lot of product innovation," says Mario Larose, VP of marketing at EXFO Electro-Optical Engineering Inc. (Nasdaq: EXFO; Toronto: EXF), which supplies a range of test gear for manufacturing and R&D. "[End users] want new technology with higher capabilities at lower costs. The only way to get there is through R&D, and that's why companies are spending money."

Others note that the current telecom downturn is due in large part to postponed purchasing decisions that eventually will have to be made – ones that, in the meantime, don't affect the ongoing progress of R&D at many companies.

"Labs around the world continue to push the state of the art," says Mike Resso, product manager in the Lightwave Division of Agilent Technologies Inc. (NYSE: A). "There is a definite holding pattern with capital expenditures today, but people aren't canceling R&D orders."

According to research from Morgan Stanley Dean Witter & Co., worldwide revenues for R&D and lab test equipment totaled more than $2.5 billion in 2001, or about 35 percent of an $8 billion overall market in communications test equipment.

As revenue levels continue to rise in the overall test segment, R&D will continue to comprise more than 30 percent of the take, the firm says – at least for the foreseeable future.

A priority in today's R&D test market is dense Wavelength Division Multiplexing (WDM), or DWDM. Carriers, the fundamental starters in the optical networking food chain, say they want more bandwidth. At the same time, they've cut back drastically on the amount they're willing to pay for it.

The answer, for equipment vendors, is to help carriers squeeze as much voice and data onto their existing facilities as possible. DWDM is a way to do that, since it increases the efficiency and capacity of optical links.

There's plenty of room for growth here. Most DWDM systems on the market now max out at about 96 wavelengths, each delivering rates of 2.5 Gbit/s or 10 Gbit/s. But work is underway to double those counts. Suppliers are looking over the next 18 months to increase DWDM platform capacities to 160 and even 300 wavelengths at data rates up to 40 Gbit/s.

R&D test gear needs to evolve in order to cram the optical rush-hour subway car to its fullest capacity. What's needed is test gear with higher resolution and accuracy. In this context, resolution refers to the ability to differentiate between tightly packed wavelengths; accuracy, to getting good readings in real time at high speeds.

Resolution is of prime importance: Currently, the spacing between DWDM channels is about 50 nanometers, but product designers are looking to achieve spacing as tight as 12.5 nm. They also are looking to move out of the C-band of frequencies they've been using (1520 to 1570 nm) and into the L-band (1570 to 1620 nm) and S-band (1490 to 1530 nm).

To get the job done, R&D test equipment makers need to be able to measure DWDM channel spacing and other parameters more finely than ever before. That can be tricky: As more channels are squeezed into the C-band, for instance, the more difficult it can be to find the "noise floor" or baseline measurement from which to gauge performance.

Other issues emerge from expanding the useable spectrum into the L- and S-bands. As broader wavelengths are used, measuring equipment needs to expand its reach, too. Yesterday's gear, designed for C-band wavelengths, won't be able to "see" into the new realm of optical channels.

There are other challenges: Chromatic Dispersion and Polarization Mode Dispersion (PMD) – negative effects caused by wavelengths traveling at different speeds and with different polarizations through fiber – are especially sticky problems as DWDM channels are more tightly packed. Testers need to be beefed up with special instrumentation to avoid these problems in the design phase and to identify them in prototypes.

Companies and Products

Agilent Technologies Inc. (NYSE: A)

Agilent says two new lasers (81640B/642B and 81480B/482B) will enable users to cover four complete spectral bands (E, S, C, L), maximizing flexibility from test setup and reducing cost. The Agilent 81672B also covers coarse wavelength division multiplexing (CWDM) applications in the 1300nm band, the vendor says.

Anritsu Corp.

Anritsu uses a combination of specially designed sensors and tunable lasers to help developers avoid problems such as chromatic dispersion and PMD. The company's MA9331A and MU931431A are high-powered sensors that measure characteristics of active devices as part of the MT8910A optical test set. The sensors are optimized for the C-, L-, and S-bands and are geared for long-haul network measurements, including characterization of Erbium Doped-Fiber Amplifiers (EDFAs) and Raman Amplification. Anritsu’s three-port MG9541A Tunable Lasers source is designed to characterize WDM components across the C- and L-bands. The ME7894A optical component test system offers an advanced tunable laser source, an optical power meter, and a high-sensitivity sensor and control software.

EXFO Electro-Optical Engineering Inc. (Nasdaq: EXFO; Toronto: EXF)

EXFO’s FPMD-5600 Femtosecond Polarization Mode Dispersion Analyzer is based on a new reference test method called Poincare Sphere Analysis. This test method enables users to measure very small levels of PMD in narrowband DWDM channels and broadband components, the company claims. The device measures a range of problems, including second-order PMD for group delay and related conditions. The instrument, according to EXFO, takes measurements very quickly, increasing the accuracy of designs.

Keithley Instruments Inc. (NYSE: KEI)

Keithley’s 64085 Picoammeter relies on a 22- to 28-bit analog-to-digital converter to take 1,000 measurements per second. The unit is sensitive to elements such as dark current and breakdown voltage, according to product manager Paul Meyer. It is customized for low voltage applications.

NetTest

NetTest uses sophisticated filtering techniques to tease out individual wavelengths for testing in dense C-band implementations. It's also got a new system, the NetTest WALICS-Reference that features an active internal feedback loop to accurately measure across 115 nanometers, encompassing C-, L-, and S-band spacing. NetTest claims this device's high resolution allows it to design systems with wavelengths spaced as closely as 12.5 nm.

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Higher-speed equipment will reduce a range of costs for telecom operators by providing more bandwidth for delivery of new services. Sonet OC192 (10 Gbit/s) is rapidly expanding into the carrier network, and 10-Gbit/s Ethernet is starting to gain mindshare. Service providers also are eyeballing 40-Gbit/s data rates for use in the not-too-distant future.

These high-speed trends are creating special challenges for equipment vendors – and the R&D test suppliers they rely on. For one thing, R&D test gear needs to be faster than the devices under development. For another, it needs to do so with increased sensitivity to network conditions.

Let's take faster first. "The speeds at which networks are running are demanding that research and development test and measurement gear operate at the femtosecond level," says EXFO's Larose. That’s pretty darn fast: a femtosecond is one quadrillionth – 1/1,000,000,000,000,000 – of a second. There are several reasons testers must be faster than ever before when it comes to higher data rates:

Let's look now at finer. Emerging testers need to be more than fast. Indeed, a key goal of today's R&D test suppliers is to create optical analyzers that operate at high rates without losing sensitivity. A couple of key issues are involved:

Given all the challenges of "faster and finer" R&D, it's not surprising that, so far, just three vendors – Agilent, Anritsu, and Spirent – offer testers capable of developing 40-Gbit/s equipment (see below).

But other gear is emerging that, while not designed specifically for the creation of 40-Gbit/s transmission gear, nevertheless will play a role in next-generation networks.

Some equipment makers, for instance, are starting to create high-speed optical backplane connectors to speed up the inner workings of routers and switches, in order to avoid I/O bottlenecks on high-speed links. And they need special testers, which are just starting to emerge.

One of the first came early in March 2002, when test vendor Wavecrest Corp. announced it would supply R&D gear to Xanoptix Inc., which makes short-reach interface modules for optical network OEMs (see Xanoptix Picks Wavecrest Tester).

The lowdown is that R&D test equipment needs not only to run faster but to maintain new levels of error compensation and test sensitivity. While we're not there yet, test gear vendors say they're accelerating the rollout of new products as the market picks up momentum.

Companies and Products

Agilent Technologies Inc. (NYSE: A) Agilent was among the first to market with 40-Gbit/s testers, including the Agilent ParBERT 81250 43G and BERT E2150A 43G, which the vendor announced in July 2001. Both of these units, which generate and then monitor the bit error rates of OC768 or STM256 components or systems, are now shipping, Agilent says.

Agilent's gear operates at 43.2 Gbit/s, which spokespeople say is more than sufficient to cover FEC development. Indeed, they seem puzzled by claims that more bandwidth – even a bit more – is better. "You need to reserve six percent of the signal for FEC," says Alexander Frew, application engineer at Agilent. "Six percent added to 40-gig makes 43.2."

Agilent also offers an 86107A module for its 86100A digital communications analyzer that it says enables jitter measurement in the 200-femtosecond range, a great advantage when measuring at speeds greater than 40 Gbit/s. The company has also introduced the 81910A Photonic All-Parameter Analyzer, which tests insertion loss, polarization-dependent loss, chromatic dispersion, and PMD. The unit is available as a standalone or as an upgrade to the Agilent Lightwave Measurement System.

Anritsu Corp.

Anritsu last year released its ME7750A tester, which includes a pattern generator and error analyzer and operates at speeds to 43.5 Gbit/s.

Ixia (Nasdaq: XXIA)

Ixia's XENPAK is a load module offering wire-speed traffic generation, capture, analysis, and routing protocol performance verification tools for testing multiple interfaces within a single platform.

SHF Communication Technologies AG

SHF’s 5002A demutiplexer already is capable of 50-Gbit/s operation. The BPG 44 and 44E – two pattern generators – operate at up to 44 Gbit/s. Speeding them up to 50 Gbit/s presents no overwhelming technical challenge, according to Bernhard Schweiger, North American sales manager. The goal, Schweiger says, is to create analyzers that operate at these high rates without losing sensitivity.

Spirent Communications

Spirent Communications’ OTA 4400, which the company says is designed to characterize 40-Gbit/s devices, combines bit error rate testing and analyzes jitter and FEC characteristics. According to Spirent, it offers physical layer tests, as well as tests of protocols used in the optical control plane, such as Multiprotocol Label Switching (MPLS). The OTA 4400 provides 39.813-Gbit/s bit error rate testing, and the vendor plans to release 43.2 Gbit/s at a later date.

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In order to survive and prosper, service providers need to make more money from their existing infrastructures, and they also need to slash costs. Well, guess what? That's exactly what a range of new Optical Signaling Systems aim to do.

As a result, however, next-generation networks are shaping up to be an alphabet soup of new protocols, such as MPLS (multiprotocol label switching), GMPLS (generalized multiprotocol label switching), and Optical UNI (user network interface).

For the record, MPLS and GMPLS are in standards development at the Internet Engineering Task Force (IETF). The Optical Internetworking Forum (OIF) – not an official standards body but a consortium founded in 1998 by AT&T Corp. (NYSE: T), Ciena Corp. (Nasdaq: CIEN), Cisco Systems Inc. (Nasdaq: CSCO), Hewlett-Packard Co. (NYSE: HWP), Telcordia Technologies Inc., Sprint Corp. (NYSE: FON), and WorldCom Inc. (Nasdaq: WCOM) – has taken charge of the Optical UNI.

Generally speaking, these protocols are aimed at creating a so-called "optical control plane," a method of controlling and managing optical services on carrier networks automatically, with as little human intervention as possible.

Ultimately, the hope is that an optical control plane will manage the new dynamic optical network with a common language, derived from MPLS. What this control plane will look like is still open to question.

What's not open to question is the need for test gear that can accommodate the creation of these newfangled protocols and test for conformance to specs as they emerge. Also needed is a way to create and test customized and proprietary control plane implementations, which are emerging more rapidly than standardized ones.

As if this weren't enough, equipment makers need to support the slew of so-called "legacy" protocols – the ones associated with Asynchronous Transfer Mode (ATM), frame relay, and other networking techniques.

A tall order for alphabet soup. So far, it's being tackled chiefly by Agilent and Spirent. But more is on the way. Stay tuned.

Companies and Products

Agilent Technologies Inc. (NYSE: A)

Agilent offers a GMPLS RSVP protocol conformance test suite on its RouterTester platform. The vendor says this product provides network equipment manufacturers with a tests to verify that each GMPLS function operates properly and meets the standard's specifications. The suite includes tests for the new Link Management Protocol (LMP), used to manage and monitor interconnections among nodes in the GMPLS network.

Spirent Communications

Spirent’s Adtech AX/4000 Broadband Test System supports MPLS testing and emulates a UNI client or UNI network device to test OIF UNI implementations, the vendor says.

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R&D is a complex process. It's also one that's changing, as testers evolve to cope with a range of economic and technological forces.

The trend toward making test gear more modular reflects these changes. On the one hand, sources say it's likely that the research side of R&D will continue to require lots of specialized devices that engineers can use to model their ideas. But once those ideas start to get closer to the development phase, it's getting vital that test gear be set up to fit more smoothly into the production process.

The idea is to have a basic test platform, or mainframe, to which specialized modules can be added via software – and occasionally via hardware – at different stages. This eliminates or reduces redundant training, debugging, and testing along the way.

It's important not just to merge certain kinds of tests onto a single platform, but to make it easy to access them there, according to Keithley Instruments' Paul Meyer. Meyer says Keithley's made a goal of collapsing formerly disparate tests into a single unit – then creating links that allow test scripts to be set up fast.

"We've created hooks in hardware that allow automation scripts to be written easily," he says, which should allow a higher proportion of work to get done more accurately and quickly.

Companies and Products

Acterna Corp. (Nasdaq: ACTR)

Acterna has introduced the ONT-50, a portable unit intended to test 10.7-Gbit/s networks for compliance with ITU-T G.709 “digital wrapper” protocols, which facilitate intelligent network operations. The unit combines optical and digital testing of DWDM and Sonet/SDH.

Circadiant Systems

Circadiant's A3300 Optical Standards Tester offers automation of multiple tests "on the fly," the vendor claims. The device stores test results, which enables easy comparison between different test runs. A 10-Gbit/s version of the platform, called the A33-6, was introduced in March.

Digital Lightwave Inc. (Nasdaq: DIGL)

Digital Lightwave’s NIC (Network Interface Computer) Plus can stress gear at the development phase with any number of high bit-rate streams, the company says.

JDS Uniphase Inc. (Nasdaq: JDSU; Toronto: JDU)

The Multiple Application Platform (MAP) from JDS Uniphase is a modular unit designed to accept up to eight cassettes that add functions. A master/slave controller can manage as many as eight chassis, meaning that 64 cassettes can be managed simultaneously. The device is operated via a keypad or remotely via a general purpose information/interface bus (GPID) or RS232 interface.

Keithley Instruments Inc. (NYSE: KEI)

Keithley’s 7001 and 7002 Switching Mainframes, according to the company, are available with switching cards for a range of optical R&D tests.

NetTest

NetTest's TUNICS-Evolution is designed to perform all the major tests for DWDM, combining what were formerly four discrete pieces: a tunable laser, a wavelength meter, an optical power meter, and the host PC. The company says TUNICS-Evolution covers wavelengths from 1425 to 1625 nm and operates in both step and sweep modes, eliminating the need to manually readjust the instrument to test different channels.

Tektronix Inc. (NYSE: TEK)

Tektronix says that its CSA8000 now comes with an internal clock that manages optical-to-electrical conversions, eliminating the need to attach a separate clocking device. The unit, which also has an integrated power monitor, operates at OC3, OC12, and OC48 data rates. It has about 100 automated tests, the vendor says.

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