ATM: Over and Out?

ATM: Over and Out? -- Stephen Saunders

October 9, 2000

4 Min Read
ATM: Over and Out?

Stephen Saunders, US editor, Light ReadingIt's a funny old world, isn't it? Take ATM. Complicated. Expensive. Doesn'tscale well. Smells horrible (Okay, I made that last one up). Yet carriersswear by it -- and at it.

That could be about to change. Don't take my word for it; just ask Dr.Lawrence "Larry" Roberts. He's one of the four Magi who are widely creditedwith creating the Internet, as we know it. (Extra credit for naming theother three. No? It was Leonard Kleinrock, Vinton Cerf, and RobertKahn).

Now, Roberts has a brain the size of a small planet. So if he thinks it's all upfor ATM, you better pay attention. And that's exactly what he told me justthe other day, when we were shooting the breeze about scaleability problemson the public network. "Steve," he said (he always calls me Steve), "it's clear that ATM isn't going tobe around long enough to make it worth fixing."

Shocking stuff, eh? And, on the face of it, an outrageous assertion! Afterall, long-distance carriers continue to use ATM as the foundation for theirnetworks. And some equipment startups -- including Équipe Communications Corp. -- are still developing products based on ATM technology, another sign that life remains in this market.

So why am I even giving space to this ATM antagonism? (Other than the factthat I get paid by the word).

Quite a few reasons, actually. Let's start with price. From a costperspective, getting rid of ATM is the logical thing to do. Today's carrierstypically have to deploy a veritable Dagwood of protocols (IP, over ATM, over Sonet,over DWDM). It makes sense to eliminate the gnarliest and most expensive ofthese: ATM.

This explains why ATM players are having a tough time of it. Some have had enough, and they're not going to take it any more. NetworkEquipment Technologies Inc. (NYSE: NWK), for example, recently morph'd itself into a service provisioning vendor after its market cap fell to around $200 million -- less than the value of oneof David Huber's big toes.

It may also explain why Ignitus, an ATM startupspun in by Lucent Technologies Inc.(NYSE: LU), has disappeared without a trace.

There's another reason why word of ATM woes should be taken seriously: AsDylan -- Bob, not Thomas -- put it, "The times they are a-changin’."ATM-free services are no longer future tense, theoretical propositions;carriers like Exodus CommunicationsInc. (Nasdaq: EXDS),Phonoscope Communications Ltd., and Yipes Communications Inc. have already deployed ATM-free zones.

Are they going out on a limb? Yes and no, he equivocated. Admittedly, these packet-basednetworks are still largely lacking in key areas such as reliability. Butthen again, ATM isn't keeping pace with the evolution of transmissiontechnology. The ATM community has only just agreed on a standard for 10-gigabitinterfaces, for example. And while ATM is okay for integrating voice anddata, it's going to be hopeless for handling video, which will probablyrepresent most of the traffic on the public networks of the future.

The reason that more service providers have not followed in the tracks ofoutfits like Yipes is that the current limitations of packet-basedtechnologies restrict these operators from offering crucial services likevoice. But that's changing, too, as technology is developed that for thefirst time could allow carriers to replace ATM without sacrificing qualityof service (QOS).

For instance, in the metro market, equipment startups like Mayan Networks Inc. and Redback Networks Inc. (Nasdaq: RBAK) areworking on switches that combine IP with Sonet to deliver voice, video, anddata -- sans ATM.

Their counterparts in the core, such as Chiaro Networks (which just received $100million in a third round of funding -- see Chiaro Gets $100M for "Optical Router" ) and Caspian Networks (which was founded bythe great Larry Roberts himself -- see Internet Pioneer Plots IP Revolution), are aiming to do thesame thing for long-haul nets, by combining optical technologies withadvanced IP implementations.

Standards, too, are helping (for once). Service providers already have theoption to replace ATM by using RSVP (resource reservation protocol) to set up MPLS (multiprotocol label switching) circuits across a packetbackbone. Now the IETF is working on a new specification, calledMulti-Protocol Lambda Switching (MPLambdaS), which could extend the samebenefits into the optical domain (see Sycamore Faces "Moment of Truth").

MPLS and MPLambdaS have the potential to dinosaur ATM, although it's stillearly days.There's a huge irony here, because the more folk like the IETF fiddle aroundwith these protocols, the nearer they get to reinventing good oldcircuit switching, the technology that's proved so successful at deliveringQOS in telephony.

It's all jolly exciting, isn't it? Carriers have put up with ATM for years,but only because they had to. Give them an alternative that’s cheaper and easier touse, and their boot heels will be wanderin’.

Stephen Saunders, US Editor, Light Reading

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