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Report: Next-Gen Gear Replacing Sonet

Light Reading
News Analysis
Light Reading
7/26/2001

Traditional Sonet/SDH gear designed to handle single-wavelength voice networks is going the way of the dinosaurs.

So says a recent report from research firm Frost & Sullivan. By 2002, DWDM-equipped systems with Sonet/SDH interfaces will finally outsell plain-vanilla Sonet/SDH gear. By 2006, annual worldwide sales of Sonet add/drop multiplexers, terminals, and other old-fashioned stuff will have dwindled to roughly half the year-2000 peak of $15.5 billion. This gear will represent less than a quarter of the total optical networking transmission gear (not counting digital crossconnects and optical switches).

In the same time frame, sales of next-generation systems, including those with multichannel DWDM and Sonet interfaces, will nearly quadruple, growing from $9 billion in 2000 to $35 billion in 2006.

The trend away from traditional Sonet/SDH gear is presenting a challenge to those vendors that built empires supplying this equipment. Faced by increasing levels of data traffic and increased demand for gear that handles voice and data together, incumbent vendors of Sonet/SDH add/drop multiplexers and terminals, such as Alcatel SA (NYSE: ALA; Paris: CGEP:PA) and Lucent Technologies Inc. (NYSE: LU), are finding they must create new offerings for existing customers in a timely way or fall by the wayside.

The situation has shaken the industry. "Vendors that do not adapt to rapid product cycles and embrace a distributed manufacturing model will perish," warns Mark Storm, optical networking program leader at Frost and author of the report. "However, vendors that prune their product mix and operations and embrace customer demand for multivendor network deployments will be very difficult to displace."

The push for more flexible, next-gen products has pushed companies such as Ciena Corp. (Nasdaq: CIEN) and ONI Systems Inc. (Nasdaq: ONIS) into stronger positions, although future success isn't guaranteed. These vendors, too, will be faced with future competition from the incumbents as well as startups.

Storm says he doesn't count some kinds of optical gear in his taxonomy. "I don't count crossconnects or optical switches in these figures, since that would make it tougher to track the winners and losers going forward," he says.

Crossconnects from companies such as Alcatel, Lucent, and Tellabs Inc. (Nasdaq: TLAB; Frankfurt: BTLA), and optical switches from the likes of Tellium Inc. (Nasdaq: TELM) are tracked in other reports, Storm says.

Storm concedes that it will get tougher to keep products compartmentalized this way, because traditional Sonet/SDH vendors are introducing next-gen equipment, and next-gen vendors are combining routing, transmission, DWDM, and switching functions in a growing variety of hybrid devices.

Winners and losers will emerge from all camps, Storm says, depending on how well and how quickly they can meet customer requirements.

- Mary Jander, Senior Editor, Light Reading
http://www.lightreading.com Want to know more? The big cheeses of the optical networking industry will be discussing this very topic at Opticon 2001, Light Reading’s annual conference, being held in San Jose, California, August 13-16. Check it out at Opticon2001.

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jmd
jmd
12/4/2012 | 8:02:12 PM
re: Report: Next-Gen Gear Replacing Sonet
Could somebody please tell me how to get this report? IG«÷ve followed the link to the website and after 5 minutes was still no closer to getting it. I then phoned Frost and Sullivan, got a live receptionist but then got transferred 4 times before getting somebodyG«÷s voicemail. I am not a customer of Frost and SullivanG«÷s G«™ I only want the report and I have a VISA card.
PPiazza
PPiazza
12/4/2012 | 8:02:06 PM
re: Report: Next-Gen Gear Replacing Sonet
jmd

I am the Vice President of Sales at Frost & Sullivan. I apologize for our lack of service. I assure you that this is going to be looked into. Please email me @ [email protected] and I will be sure you receive the information your are looking for.

Again my apologies

Paul Piazza
Vice President North American Sales
Frost & Sullivan


trends
trends
12/4/2012 | 8:01:58 PM
re: Report: Next-Gen Gear Replacing Sonet
Let's make some general statements about business needing to change to satisify customer demands which include the need for "multivendor network deployments." Then let's toss some numbers out there in a vain attempt to support the statements. Finally, start back-peddling from them by making statements that say "crossconnects or optical switches" are not "traditional Sonet/SDH gear" and so are not included.

It's nothing new that customers have been screaming for interoperability. They have been since shortly after the Ma Bell breakup. Nor is it news to make a statement claiming businesses that don't change to satisify their customer base will perish. The only thing new is that crossconnects and optical switches are not SONET/SDH gear and therefore should not be included in any blanket report that claims "Next-Gen Gear Replacing Sonet."

Now if the report had stated that traditional ADMs are being replaced by DWDM equipment, which seems to be all that is left, I could buy into that. Not that this is earth shattering, but at least it is not misleading.

Pitty the poor soul that PAID for this report.

Regards,
trends
uncle_optics@yahoo.com
[email protected]
12/4/2012 | 8:01:28 PM
re: Report: Next-Gen Gear Replacing Sonet
"Vendors that do not adapt to rapid product cycles and embrace a distributed manufacturing model will perish," warns Mark Storm, optical networking program leader at Frost and author of the report. "However, vendors that prune their product mix and operations and embrace customer demand for multivendor network deployments will be very difficult to displace."

Does anyone else here feel underwhelmed by this statement? Now I admit that what you say looks different by the time the reporter gets donw with it but.....Rapid product cycles and distributed mfg. have nothing to do with this. It comes down to having the right equipment when the customer wants to buy. It means being large enough for them to trust you. (lest of course you still believe that bullshit CLEC arguement that some people were writing about all of last year) It means that you also have a relationship with the customer from times gone by. It means that you can deliver the product that does the job that the customer wants. Period.



The push for more flexible, next-gen products has pushed companies such as Ciena Corp. (Nasdaq: CIEN - message board) and ONI Systems Inc. (Nasdaq: ONIS - message board) into stronger positions, although future success isn't guaranteed. These vendors, too, will be faced with future competition from the incumbents as well as startups.

Lightweight statement there....


Storm says he doesn't count some kinds of optical gear in his taxonomy. "I don't count crossconnects or optical switches in these figures, since that would make it tougher to track the winners and losers going forward," he says.


How lame!!!!! Too tough for you??? Then why are you writing reports like this?

----------------------------------------


Bottom line for me is why is LR spending time writing stories on third rate analyst firms like Frost or Public Relations firms like Yankee (who have a rep within PR companies as the place to go to buy covereage)?

What matters most is the experience of the people who cover the market and the reputations that they have for being credible. Seems however, that LR either plugs its own people or gives a bone now and then to the lessor firms. I don't recall seeing much from RHK's good analysts like Dana Cooperson or anything from CIR's networking people (Mark Lutkowitz wouldn't be caught dead writing some of the stuff that Clavenna passes off here) or any mentions whatsoever on KMI (who really are the people you should call when you want to know about fiber and who also happen to be owned by Pennwell Publishing.
melao
melao
12/4/2012 | 8:01:16 PM
re: Report: Next-Gen Gear Replacing Sonet
"Now if the report had stated that traditional ADMs are being replaced by DWDM equipment, which seems to be all that is left, I could buy into that. Not that this is earth shattering, but at least it is not misleading."

I can be totally wrong, because i don't have much visibility in the US, since i am in Brazil.
But, what are the equipments that feed the DWDM systems for long haul ?

It IS SDH/Sonet. It is very rare to have an ATM switch or POS interface in a router, above STM-4/OC-12. What is usually done is muxing those signlas to a higher rate and then transmit on DWDM systems at 10Gbit/s each wavelength.

I don't know much about the metro deployments so far, this should be the major driver for protocol diversity on DWDM.

Am i wrong ?

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