Carrier Ethernet Makes Its Move
Having conquered the LAN, Ethernet is making a serious push for the carrier space. In fact, "a relatively small but growing number"
of carriers are considering the phaseout of Sonet/SDH in favor of Ethernet, according to "Carrier Ethernet Equipment Market Outlook," a new report from Heavy Reading, the paid research arm of Light Reading.
"This could be one of the big stories in 2006," writes Stan Hubbard, author of the report. He cites 's interest in Ethernet as an example, noting that the company has described itself as building "the world's largest Ethernet network."
The report is being released in conjunction with Heavy Reading's Carrier Ethernet Switch/Router Quarterly Market Tracker, which will deliver quarterly revenue and market-share figures for equipment vendors in the sector (see HR Launches CESR Market Tracker).
By 2007, carrier Ethernet could create a $1 billion market for "feature-rich" switches and routers, according to Heavy Reading's numbers. What's key is that Ethernet gear is covering more of the territory previously ceded to Sonet/SDH -- QOS and fast restoration times, in particular, Hubbard writes.
That's made Ethernet a realistic option for carriers. At the same time, carriers' priorities no longer lie with cutting expenses, but with generating new services -- to the dismay of vendors that answered the call to lower operating expenses (see Switches Face IP Challenge). Ethernet services fit the new agenda neatly, giving carriers an attractive offering.
But this isn't just an enterprise story; Ethernet services have implications for broadband access as well. Roughly 45 percent of the operators deploying carrier Ethernet equipment are doing so to support present or upcoming residential triple-play services, the report finds.
None of this spells doom for other types of equipment. "Operators will also invest a lot more money on multiservice routers, service gateway and router products, and optical platforms that support Ethernet service delivery, transport, and/or Ethernet aggregation," Hubbard writes.
As for which vendor leads the carrier Ethernet market... Oh, come on, you don't need a report to tell you it's But some might be surprised to see Riverstone Networks Inc. (OTC: RSTN.PK) and Atrica Inc. in the Numbers 2 and 3 slots, respectively. The report also credits and with some rapid share gains lately.
The report notes that future Heavy Reading research will address other aspects of the Ethernet equipment and services sectors, including the Ethernet-over-optical equipment market and Ethernet service deployments in Europe and Asia/Pacific.
— Craig Matsumoto, Senior Editor, Light Reading
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