Copper Ethernet Snares an RBOC
BellSouth announced its "midband" Ethernet in July, promising tiers of 2-, 4- and 8-Mbit/s Ethernet offered over copper or fiber. Early this week, Hatteras Networks Inc. stepped forward to say it was the vendor chosen for the deployment. (See BellSouth Expands Ethernet and Hatteras Wins Deal.)
Hatteras says it won the deal back in November and has spent the last nine months working with BellSouth on service definition.
BellSouth already offered Ethernet services from 10 Mbit/s to 1 Gbit/s. The idea behind the slower "midband" speeds and the use of copper is to reach a larger swath of potential customers -- smaller businesses just outgrowing T1s, and those that aren't on the fiber net. "The problem is that fiber only covers about 12 percent of businesses," says Gary Bolton, Hatteras vice president of marketing.
Ethernet services are becoming increasingly important to U.S. carriers, partly because businsses want a cheaper alternative to leasing multiple T1 lines. Separately, cellular operators are beginning to consider Ethernet for backhaul networks. (See Copper Ethernet Makes Strides .)
But the spread of Ethernet onto copper lines has been slow -- with some vendors theorizing that RBOCs didn't want to cannibalize their T1 business. (See RBOCs Moving on MidBand Ethernet?) "Last year was everybody getting comfortable with the technology. We added a lot of customers, but rollouts were slow," Bolton says.
Analyst Michael Howard of Infonetics Research Inc. thinks Hatteras could take an early market-share lead in copper-based Ethernet. (See Hatteras Closes $21M Round.) Other companies, including Actelis Networks Inc. and Aktino Inc. , are pushing Ethernet over copper, but Hatteras claims its gear offers more Layer 2 functionality than theirs.
Other Ethernet-over-copper contenders include ADVA Optical Networking , ANDA Networks Inc. , Ceterus Networks Inc. , and Overture Networks Inc.
Even though the other RBOCs were said to be considering Ethernet-over-copper last year, they haven't quite caught BellSouth's love for the technology.
Verizon Enterprise Solutions -- the piece of Verizon Communications Inc. (NYSE: VZ) incorporating the former MCI -- already offers Ethernet services between 1 and 10 Mbit/s, in 1 Mbit/s increments, over its fiber network. The introduction of copper to the equation just isn't a priority, says Alla Reznich, Verizon Business's group manager of Ethernet services.
"This is something we are considering for 2007, but we don't have firm plans to deploy that," Reznich says. "In our territory, we have very strong fiber availability, so at this point we don't really feel a need to push to use our copper plant."
In part, Verizon Business is waiting for the technology to mature. Reznich notes that the carrier's engineers aren't "100 percent confident" in the technology's ability to support stringent service-level agreements. They've yet to put Ethernet-over-copper through rigorous lab tests, although they might take a peek as future versions of the technology emerge, she says.
Reznich added that while it might be true that fiber covers a minority of businesses -- she didn't have a percentage available offhand -- it's also true that a majority of Verizon Business's prospective revenues happen to sit on the fiber-connected parts of the network.
BellSouth's eventual merger partner, AT&T Inc. (NYSE: T), likewise isn't offering Ethernet services over copper yet. Its Opt-E-Man offerings, which got a boost to 22 new cities on Aug. 1, include speed grades as low as 5 Mbit/s, delivered only on fiber so far. An AT&T spokesman says the carrier finds Ethernet-over-copper "promising" and is evaluating it for markets in the original SBC territory. (See AT&T Expands on Ethernet .)
— Craig Matsumoto, Senior Editor, Light Reading