Viatel Rises Again

European operator aims to capitalize on the Ethernet services craze

April 12, 2005

3 Min Read
Viatel Rises Again

New Ethernet service launches are coming thick-and-fast these days, and Phoenix-like Viatel Holding (Bermuda) Ltd. (OTC: VTLAF) is the latest operator to launch a shiny new multipoint service (see Viatel Touts Ethernet Service).

The European service provider is in fact emerging, again, with three types of wide-area Ethernet service, aiming to cover all bases: a Layer 1 point-to-point private line service, a Layer 2 point-to-multipoint virtual private line service, and a Layer 3 Ethernet LAN service, which provides any-to-any connections over VPLS (Directory: {dirlink 4|398}, {dirlink 4|201} and {dirlink 4|399}).

Although the Ethernet services market is hugely competitive, Light Reading’s Ethernet Services Directory shows that VPLS services are only just beginning to emerge. U.K. carrier NTL Group Ltd. (Nasdaq: NTLI), for example, was one of the first to launch a nationwide service last month (see NTL Casts a Wide Ethernet). Viatel is aiming to go one better with a range of services that have points of presence in the U.K., the Netherlands, Belgium, France, Switzerland, and Germany, as well as New York.

Viatel has something of a stormy past, realigning its focus several times and emerging from Chapter 11 in 2002, before appointing a new CEO, and snagging more funding. (See Viatel Announces Realignment, Level 3 Grabs Piece of Viatel, Viatel Completes Restructuring, Viatel Emerges From Chapter 11, Woods Takes Helm at Viatel, and Viatel Completes $52M Round.)

The company has shifted from essentially a wholesale voice operation to a full service provider targeting both wholesale and retail markets, according to Roberto Bonanzinga, senior VP of marketing and business development. After former WorldCom exec Lucy Woods took the helm in May 2003, Viatel began building its own IP network, launching an IP VPN service in January last year, followed by an MPLS VPN service in July, and now, Ethernet.

“For us, virtual Ethernet was one of the key parts of the puzzle that we were missing,” says Bonanzinga.

The emphasis is on flexibility. “The ability to provide different services from one network is very important,” according to Bonanzinga. The three types of service act as “building blocks” that Viatel can use to meet customer needs more closely, he says. “For example with a large organization we can provide a Layer 2 Ethernet VPN for the headquarters, but for their branch offices it might be better to provide a Layer 3 service, and an IP VPN for smaller offices.”

"We can pick and choose depending on what the customer requires," adds Steve Best, Viatel's chief technology officer. Having built its own IP network, the operator can quickly and cheaply roll out additional points of presence as required. The New York POP, for instance was deployed in response to demand from a single customer, he says.

The network itself is a combination of Viatel's own international footprint with leased capacity from other providers tacked on as needed. It uses Huawei Technologies Co. Ltd. and Juniper Networks Inc. (Nasdaq: JNPR) routers, the latter enabling it to prioritize applications and make more efficient use of bandwidth, again adding to the flexibility factor.

Operators are catching on to the demand for more advanced Ethernet services and starting to play catchup. Recent examples include:

  • BT Group plc (NYSE: BT; London: BTA) has recently announced a wide-area service over next-generation SDH (See BT Joins WAN Bandwagon and Directory: {dirlink 5|21}).

  • Teleglobe International Holdings Ltd. (Nasdaq: TLGB) has launched a point-to-point service over MPLS (Directory: {dirlink 5|187}).

  • Global Crossing Holdings Ltd. (Nasdaq: GLBC) last week introduced an international private line service (See Global Crossing Touts Ethernet Private Line and Directory: {dirlink 5|71}).

    — Nicole Willing, Reporter, Light Reading

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