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Optical/IP

BT Joins WAN Bandwagon

As NTL Group Ltd. (Nasdaq: NTLI) launched its national wide-area Ethernet service in the U.K. last week, BT Group plc (NYSE: BT; London: BTA) found a way of going one better (see BT Extends Ethernet Reach and NTL Launches National Ethernet).

The U.K. incumbent announced that its Ethernet services won't be limited to the U.K. anymore. They will now span key cities in Belgium, Germany, Ireland, the Netherlands, Spain, and the Nordic region, as well as New York City. This is in addition to metro services already offered within some of those cities.



“We’ve been offering long-haul Ethernet internationally on a bespoke basis,” says Martin Maters, general manager of bandwidth and Ethernet services at BT Global Services. “Now we're offering it as a formal part of our portfolio.”

BT's offerings are based on next-generation Sonet/SDH technologies such as Virtual Concatenation (VC), Generic Framing Procedure (GFP), and Link Capacity Adjustment Scheme (LCAS), dubbed "the Holy Trinity" by Maters.

These technologies have their plus points, notably in enabling BT to reuse existing SDH infrastructure and offer service-level agreements (SLAs). However, they also have their minus points. In particular, they're typically used to provide point-to-point connections, an alternative to private circuits. The Ethernet services launched by NTL last week offer the equivalent of a fully-meshed frame relay network, providing any-to-any connectivity across multiple sites using the MPLS-based Virtual Private LAN Service.

All the same, both types of Ethernet service offer enterprise users a lot more bandwidth, which is the main market driver, according to analyst firm RHK Inc. (see RHK: Enterprises Demand WAN Ethernet). In a study conducted by RHK for the Metro Ethernet Forum (MEF), 98 percent of respondents cited bandwidth as a factor and 36 percent called it a “critical” factor in their preference for Ethernet.

"For service providers, the central issue that needs to be addressed is a lack of availability of Ethernet services," RHK analyst Brian Van Steen writes. “Unfulfilled demand for WAN Ethernet exists due to a lack of availability across a broad geographic base.”

Van Steen goes on to assert that lack of ubiquity “is limiting Ethernet adoption,” and that large enterprises are holding back on taking up Ethernet until they can get the services at all of their locations.

BT’s Maters agrees, noting “a large number of corporate customers are not aware of long-haul services.”

“Ethernet service features like the ones offered by BT -- low latency and support for applications like storage extension -- have a key role to play in helping enterprises make that smooth transition to what IBM calls ‘on-demand business,’ ” says Stan Hubbard, senior analyst at Heavy Reading.

Light Reading’s growing directory of Ethernet services lists 24 services in the U.K. providing multipoint WAN connections (including transatlantic links into London) and 57 in North America, compared with 33 point-to-point MAN services in the U.K. and 105 in North America.

— Nicole Willing, Reporter, Light Reading

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