In my opinion the interesting question now is not if Ethernet is going to make it. After all, Ethernet is inexpensive and easy to provision and scale. It’s also a very attractive interface on all types of telecom and data communications gear, thanks to the inexorable rise of IP networks and services.
Instead, we should be asking which of the approaches to deploying Ethernet is going to win out. Ethernet may have the local area locked down, but how are service providers going to transform it into a wide-area wonder — and make some money in the process?
Currently, Ethernet service providers fall into two camps: First, startup carriers like Cogent Communications Inc., Telseon, and Yipes Communications Inc., that are building their networks from scratch, renting dark fiber from Metromedia Fiber Network Inc. (MFN) (Nasdaq: MFNX) and similar outfits. These so-called EtherLECs aggregate and transport native Ethernet end-to-end, using Layer 3 switches and IP routers.
Second, incumbent providers that are looking to roll out Ethernet across the Sonet networks they have already installed. Among incumbents, the IXCs are in the strongest competitive position because they typically own a piece of the Internet backbone and have tremendous capacity built into their network cores.
On the face of it, the EtherLECs appear to be winning this battle. Their simple, streamlined scheme lets them deliver 10 or even 100 Mbit/s for the price of a typical T1 (1.544 Mbit/s). They also are garnering the lion’s share of the attention from press and analysts. And the fact that they’ve already signed customers only gives them something else to smile about.
But I think it’s too early to count out the incumbents. In fact, I’ll go further and say that I think that their Sonet-based networks could actually be an advantage, not a problem, in their forthcoming battle with the EtherLECs.
No, I’m not blind to Sonet’s traditional shortcomings. It wasn’t originally intended to carry LAN services – and it shows. For instance, Sonet doesn’t offer an easy way to efficiently share bandwidth amongst customers, or deliver granular services. That’s why it’s typically relegated to inflexible point-to-point “private line” offerings.
However, incumbent carriers have found a way around these problems by installing next-generation Sonet multiplexers and using them to deliver “Ethernet private line” services.
Sonet products that support these services are available from Appian Communications; Ciena Corp. (Nasdaq: CIEN), via its acquisition of Cyras; Cisco Systems Inc. (Nasdaq: CSCO), via its acquisition of Cerent; Mayan Networks Inc.; Ocular Networks Inc.; Sycamore Networks Inc. (Nasdaq: SCMR), through its acquisition of Sirocco; and others.
Next-generation Sonet systems are typically installed in the basement of the customer premises. The customer sends Ethernet traffic to the Sonet box over a simple 10- or 100-Mbit/s Ethernet LAN. The mux aggregates multiple Ethernet streams and maps them onto an OC12 (622 Mbit/s) or OC48 (2.488 Mbit/s) for transport over the embedded (legacy) Sonet network.
From what I’ve seen, Appian has the solution to watch. Its product can map individual ports or services to separate, secure Sonet channels with end-to-end committed bit rates. Other vendors’ offerings tend to map an entire Ethernet interface to a Sonet channel, which may compromise security or result in less-than-optimal bandwidth utilization.
The benefits to the incumbent service provider are clear. They can manage the service the same way they manage private lines, while reducing their customers’ cost of ownership considerably (giving them more of the proverbial bang — bandwidth — for the buck).
There’s more good news for the incumbents. Ethernet over superstable Sonet translates into five 9s (99.999%) reliability and the sort of security associated with TDM (time-division multiplexing) links. The best the EtherLECs can do is three or four 9s, max.
Ethernet over Sonet also gives the incumbents a way to start exploring more complex service offerings like Ethernet virtual private lines and Ethernet virtual private networks. The latter should be able to mimic frame relay at much lower cost and far greater scaleability.
How does all this compare to the EtherLECs, with their native Ethernet services? As noted, native Ethernet is catching on with startups because it lets them build lower-cost, data-centric networks that make more efficient use of metro bandwidth. The architectures are simple and elegant; the customer interface, familiar: a port on a LAN switch. A service-optimized Layer 3 gigabit Ethernet switch (like the Alpine product from Extreme Networks Inc. [Nasdaq: EXTR]) sits in the basement of the customer premises, aggregating lower-speed traffic onto a gig Ethernet pipe and adding QOS (quality of service) and service classes. This traffic is shunted over leased dark fiber to a network POP (point of presence), where it’s handed off to a router that peers with long-haul IP backbones from the likes of Genuity Inc. (Nasdaq: GENU), Qwest Communications International Corp. (NYSE:Q), and UUNet.
It may not be readily apparent, but that router represents a critical junction: The EtherLECs lose their hold on customer packets at this point (because their networks only cover metro areas), surrendering them to the best-effort IP backbone. Some EtherLECs, however, may opt for bypassing the routed core network and provision direct links between GigE switches using GigE over DWDM. This solves the control problem, but may come at significant cost of operations. It's a bit early to tell.
What about the incumbents? The ones that support Ethernet private lines can offload customer traffic onto their Sonet optical transport backbone, preserving the integrity of the “circuit” across their long-haul network.
When it comes to resiliency on the metropolitan ring, EtherLECs also have fewer options. They can go with spanning tree, which gets them two-second restoration, or the upcoming fast spanning tree, which cuts restoration to less than a second. For Sonet-like failover and protection they can opt for a vendor that supports resilient packet ring — such as Cisco, Lantern Communications, Luminous Networks Inc., Nortel Networks Corp. (NYSE/Toronto: NT), or Riverstone Networks. That will get restoration down to 50 milliseconds, as well as effectively double the capacity of each metro ring — a big plus for service providers that are leasing their fiber. A final alternative is GigE over DWDM. In this scenario, the GigE's are multipelxed onto wavelengths, which are protected by the DWDM system, not by the switches.
So what’s the best bet? Despite the limitations I’ve outlined, the EtherLEC solution seems to make more sense — at least for now — to data-oriented service providers. The network is flat, with only Ethernet equipment between the customer and the network core. That should make operations more efficient, speed service provisioning, and reduce latency. In many ways Yipes and Telseon are pointing the way to tomorrow’s pure IP networks.
At the same time, the way these service providers manage and monitor their native Ethernet is more complex than it should be. VLANs are tagged and double-tagged for security; SNMP passes for service management; and not much of anything is used for fiber plant management except some vendor-specific proprietary schemes that most incumbents wouldn’t recognize.
And what about the Ethernet private line? It’s a smart start, and it’s worth watching this year. Incumbents, especially the big IXCs, aren’t about to let the EtherLECs waltz away with their customers. The private-line approach keeps them in the game until they’re ready to roll out more sophisticated services. And now that capital markets are getting tight, it’s worth remembering that big carriers have big bankrolls. They realize that Ethernet is about to revolutionize service delivery. The time and money they’ve invested in their Sonet nets have not been wasted. There is definitely no reason to count them out of a race that is just getting started.
Where do you stand on the native Ethernet vs. next-gen Sonet debate? Is the private line approach something cooked up by the big carriers to make the best of a bad situation (Sonet by another name)? Or is this a second lease on life for two transports: Ethernet and Sonet? If so, does it mean an end to the all-packet-is-better philosophy that has ascended during the past few years?
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— Scott Clavenna is president of PointEast Research LLC and director of research at Light Reading http://www.lightreading.com