Europeans Tug on Next-Gen B-RASs

European carriers are issuing loads of requests for proposals, quotes, and information for the latest edge equipment as they deal with the massive uptake of broadband connections, according to equipment vendors.

Demand is particularly hot for second-generation broadband remote access servers (B-RASs), according to executives from Laurel Networks Inc., Network Equipment Technologies Inc. (net.com) (NYSE: NWK), and Nortel Networks Corp. (NYSE/Toronto: NT). All three note a particular upturn in RFP, RFQ, and RFI activity from operators in Western Europe over the past three months.

The vendors credit the massive uptake of broadband, the need to plan new services, and a greater availability of capex money for the hot interest (see Carrier Capex Set for 2004 Rebound). The major European operators are adding hundreds of thousands of new DSL customers each quarter as more and more local exchanges become enabled, carriers benefit from cheaper equipment and economies of scale, and monthly customer charges fall. Deutsche Telekom AG (NYSE: DT) today announced that it added a further 300,000 DSL subscribers to its network in the last quarter of 2003, taking its total to 4 million (see Deutsche Telekom Boosts B'band). A year earlier the carrier had about 290,000 DSL customers.

The German carrier is not alone (see Europe Doubles Down on DSL and DSL Connections Pass 55M Mark). Now the carriers need to move to the next stage -- coping with the increasing volume of connections and finding ways to provide profit-generating additional services to those broadband users -- and to do that they need to supplement their standing infrastructures and plan for a next-generation broadband network.

The interest in developing new services was evident at a TV-over-DSL conference in Paris last week, which was well attended by carrier executives (see Euro Telcos Flirt With TV ).

While the carriers are reluctant to divulge any specific procurement information, the vendors agree on what the region's leading broadband operators are looking for. "We are receiving a lot of requests from carriers, about two a week, for a range of edge products," says Colin Rhodes, director of European operations at Laurel. "Next-generation B-RASs are very hot," adds Rhodes. "And there are several RFQs relating to multiservice edge routing over a common IP/MPLS core. The activity started last September and has been accelerating. We've had requests from France, Germany, Spain, Scandinavia, and the Middle East."

The key issue relating to B-RAS requirements is "reliability, reliability, reliability, scale, and cost," says Rhodes, who adds that some carriers are looking for two B-RAS suppliers.

Tim Hubbard, Nortel's director of technical marketing, next-generation networks, says the mass market adoption of broadband means carriers are currently stuck with first-gen B-RAS units that are not up to the task.

"The carriers want to offer differentiated services to these large numbers of users, such as additional security and personal content portals -- something they can charge an extra few dollars for. But they need more scaleability than they have at present, and the ability to manage these new IP services."

Hubbard also notes a sharp demand for solutions that can manage the increasing volume of peer-to-peer (P2P) traffic running over their networks (see Report Points to P2P Problems). He says service providers need to control P2P levels before they can introduce services that demand greater quality-of-service levels, such as VOIP and video, and claims that Nortel's Shasta 5000 B-RAS has a function that restricts the number of "flows" to each DSL customer, so freeing up the network for bandwidth-hungry and time-critical applications.

And the Nortel man agrees with Laurel's Rhodes that converged multiservice edge functionality has moved on from being just a vision to being referenced in RFIs. "Carriers want to know how they can bring their Layer 2 and 3 networks together and run multiple services such as Frame Relay VPNs, IP VPNs, and Internet access on a single network."

Net.com's director of industry relations, Steve Shaw, has also seen a "a lot more activity, and not just in the big three or four European countries. It's like the carriers have decided it's time to invest and are particularly planning for services like VOIP and video over IP, though there are still a lot of issues to overcome in that area, especially from a business case. But we've definitely seen an upturn in activity related to the need for new service features and functionality."

The trend is "no surprise," says Graham Beniston, Heavy Reading's analyst at large and principal of Beniston Broadband Consulting, who predicted an access network upheaval in a recent report, Next-Generation DSL Equipment: The Path to Profitability. "All the carriers are moving towards QOS-enabled IP networks, and they need the new generation of B-RASs for those networks, whether they follow the DSL Forum's suggested architecture or not," says the analyst (see DSL Forum Tackles Premium Services).

— Ray Le Maistre, International Editor, Boardwatch