The Business Case for Routed Optical Networking

Service providers are exploring approaches to meet changing market conditions, including rising operational costs and increasingly flat revenue. Concurrently, they are facing challenges in addressing the exponential traffic growth on their networks. Drastic traffic growth continues – from video, gaming, and virtual and augmented reality, as well as from the introduction of 5G and future technologies. The majority of the services consuming this increased capacity are also causing lower Average Revenue Per User (ARPU) and higher operational costs for service providers as they build and upgrade network infrastructure to scale and support the capacity growing at an exponential rate.

Compounded market conditions

These compounded market conditions require strategic decisions that enable the massive growth of IP services without incurring cost increases in Capital Expenditures (CAPEX) and Operating Expenditures (OPEX). In the not so distant past, service providers had to regularly upgrade their networks to deliver new services, leading to high OPEX increases for each upgrade due to the new ways to plan, manage, and deploy the upgrades. Currently, operational expenditures are about $5 for every $1 spent on network infrastructure. The increasing costs are a result of the complexity of managing multiple layers, the power and space constraints, and lifecycle management.

Previously, IP and optical integration (IPoWDM) was constrained by density tradeoffs and a wide array of different technological advancement cycles. Organizational boundaries decelerated, impacting the potential to leverage oncoming advances in automation. This mode of operation makes it extremely difficult to effectively optimize any network.

There’s a tremendous transformational architecture opportunity for service providers to consider when compared to their present operations. Network Processing Units (NPUs) in routers are now able to scale from 10s to 100s of Terabits, and 400G optics are reduced in size and power, providing an opportunity to design and architect the network in very different ways than before. Scaling router platforms has always been a challenge, leading to the creation of router bypass and ROADMs.

Reimagine your network architecture

There’s a new paradigm that delivers massively scalable routers and new optics that provide investment protection for years to come given the scalability of the electronics. These latest technologies – in particular the Cisco 8000 router, 400G ZR/ZR+ coherent optics, simpler DWDM line systems, telemetry software and automation – all lead to a new network model that’s a game changer for service providers looking to save costs and increase revenue.

That new network is called the Routed Optical Network. The Routed Optical Networking solution works by merging IP and private-line services onto a single Internet Protocol/Multiprotocol Label Switching (IP/ MPLS) network where all switching is done at Layer 3. Routers are connected hop-by-hop over point-to-point Wavelength Division Multiplexing (WDM) links with standardized optics. Flexible management models are enabled through a single network layer for model-driven programmability, providing automated turnup and provisioning. This simplified architecture enables open data models and standard APIs, allowing a provider to focus on automation initiatives for a simpler network topology. A multi-phased approach to adopting this architecture leverages existing infrastructure.

The commitment

The economics of networking are transforming with a new generation of massively scalable routers and 400G optics, enabling the collapsing of layers that result in simpler topologies and a lower cost per bit. Network optimization provides efficient network utilization and accelerated time to service. “The disruptive and transformational architecture is designed to simplify the network and lower the TCO, and we are fully committed to the Routed Optical Networking architecture,” said Jonathan Davidson, SVP/GM, Cisco Mass-Scale Infrastructure Group.

— Bill Gartner, SVP/GM Optics and Optical, Cisco

This content is sponsored by Cisco.