Ethernet equipment

BT Still Coy on Ethernet

BT Group plc (NYSE: BT; London: BTA) is still acting all shy about its Ethernet technology plans, with industry sources suggesting that tension remains between different factions within the carrier.

The British incumbent has just announced a major five-year, managed backhaul services contract with mobile operator Telefónica UK Ltd. , which will use "BT’s new 21st Century Network-enabled Ethernet service," as the press release puts it. (See BT Wins New O2 Deal.)

While BT hasn't revealed the value of the contract, it says that the new O2 deal -- a deal similar to the one concluded with Vodafone UK in April -- and another five-year managed backhaul contract signed with T-Mobile (UK) in July 2007, are together set to be worth more than £700 million (US$1.36 billion) in revenues.

When the T-Mobile deal was announced, a BT spokesman told Light Reading that the backhaul service would "be a PBT-based Ethernet product." (See BT Sells PBT-Based Backhaul Service and A Guide to PBT/PBB-TE.)

So what of the O2 deal? Will that be utilizing BT's PBT deployments, too? The carrier says it's not ready to discuss technology issues at the moment, adding only that the work for O2 is based on already launched 21CN Ethernet capabilities. (See BT Touts 21CN Progress, New Service.)

That suggests that BT is, behind the scenes, still in a state of flux about its key carrier Ethernet technology decisions, as we reported in April. (See BT Reconsiders PBT Plans.)

Industry sources say there has been something of a technology roadmap power struggle in recent months, following an influx of MPLS-friendly staff -- a number of whom have built out significant MPLS-based networks at Level 3 Communications Inc. (NYSE: LVLT) and Infonet (now part of BT Global Services) -- who have questioned the PBT-based Ethernet strategy developed by CTO Matt Bross and others. (See BT Counters PBT Claims, BT Goes Live With PBT, BT Pressures Vendors Over PBT, and Nortel, Siemens Win PBT Deals at BT.)

Those sources say there is still strong support within parts of the BT empire for PBT, but that the likes of Nortel Networks Ltd. can likely temper expectations about the level of business that BT might ultimately put their way.

That's not to say PBT will not be deployed: Even during the recent silence, BT, at the recent Sofnet industry event in London, talked of PBT being used to connect enterprise data centers to the 21CN core network.

BT says it's hoping to able to discuss its Ethernet strategy plans in more detail in a few weeks' time.

— Ray Le Maistre, International News Editor, Light Reading

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