Gigabit Ethernet: Hope vs. Hype

Use of gigabit Ethernet in service provider networks could grow eightfold by 2005 -- with nearly 30 percent of revenues coming from 10-Gbit/s links. But Ethernet must become "carrier ready" to reach its full potential.

So says a recent report from Pioneer Consulting (see Report Sees Gig-E Growth). The firm says use of 1- and 10-Gbit/s Ethernet in access, metropolitan, and wide-area core networks will drive sales to carriers seeking lower-cost technologies to expand their facilities and offer new data-intensive services.

Industry sources bristle at Pioneer's projections, which estimate a gigabit Ethernet market of $44 billion by 2005. Even the most enthusiastic vendors in this market consider that figure excessive.

"The potential for metro optical Ethernet is large, but... I don't know what methodology they may have used," says Nan Chen, director of product marketing at Atrica Inc. and president of the Metro Ethernet Forum (MEF), an industry group.

Chen says it's not unrealistic to assume that the market for gigabit Ethernet in metro networks would double annually, reaching about $5 billion by 2005. But he says that estimate is contingent on vendors proving that Ethernet can perform reliably in carrier networks.

Pioneer Consulting's report concedes that carrier-class reliability and quality of service are still missing from the packet-driven, "best effort" world of Ethernet. And these features must be proven to service providers before the market can reach its full potential, the firm says.

Industry forces are trying to make this happen. At a meeting of the MEF last week, for instance, over 90 attendees from about 50 different companies reportedly agreed on a common method of matching Sonet's link recovery using MPLS (multiprotocol label switching) in Ethernet WANs.

"This was a breakthrough," says Chen. "We've developed a 50-millisecond protection model, when most people think Ethernet recovery takes 30 seconds."

Chen says the establishment of a protection scheme will be key to providing the value proposition carriers will require in order for the metro Ethernet market to take off as hoped.

Details of the spec need to be hammered out. Forum spokespeople say that a first draft spec is aimed for completion by February, with a final version due out in summer 2002.

The group also has started to define a QOS framework for Ethernet, within a set of predefined Ethernet services.

The Metro Ethernet Forum is one of two groups at the forefront of efforts at developing low-cost alternatives to ATM and Sonet/SDH for metro networks. The other group, the Resilient Packet Ring Alliance, has been pursuing its own standard within the Institute of Electrical and Electronics Engineers Inc. (IEEE). But industry sources say a range of issues, including higher cost, have brought RPR's goals into controversy, at least temporarily (see RPR: RIP?).

— Mary Jander, Senior Editor, Light Reading
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glass 12/4/2012 | 7:38:16 PM
re: Gigabit Ethernet: Hope vs. Hype I would venture to guess that over 95% of GigE shipments projected are within data centers, LAN and campus backbone, as opposed to in the metro core or the WAN. A lot of the GigE bashing may stop if Mr. Peterson would be kind enough to shed some light on the split of GigE shipments that his firm is forecasting. I tend to agree with a lot of what is said in previous messages - the GigE in the metro/WAN is going to be a small percentage over the next few years.
optigirl 12/4/2012 | 7:38:15 PM
re: Gigabit Ethernet: Hope vs. Hype Then again, I'm familiar with the saying, "There's no such thing as bad publicity"

or how about

"Denial is not a river in Egypt."

Douglas, and I really mean this in the nicest way, it is not a good idea to use outrageous hype to make name for yourself. When Mr. Chen even snickers at your numbers you should probably feel a bit silly. I know that the market needs good news and if there was something that you could point to that would make us change our mind we certainly would.

Until then.....

Lay of the weed, would ya?


dietaryfiber 12/4/2012 | 7:38:15 PM
re: Gigabit Ethernet: Hope vs. Hype
The total 2005 revenue from these products equates to about $40B.

Now lets see....current estimates of all US CAPEX next year is about $75B. Lets triple that for a worldwide CAPEX of $225B. Then lets grow that 10% a year to get to a Global CAPEX number of about $300B.

This is implies that 13% of the total telecom spend in the year 2005 is 1 GigE and 10 GigE products. From a base of much less than 1%. This sounds completely unreasonable on the face of it.

Apologies to Pioneer Consulting about the quality of their report and my analysis of it. Have a nice day.

dietary fiber
gea 12/4/2012 | 7:38:14 PM
re: Gigabit Ethernet: Hope vs. Hype Oops! Starting to feel a little cheesy, methinks...

"The anonymity of these comments strongly suggests the handiwork of rival market research firms or proponents of competitive technology"

Well, for anyone in the optical networking industry who's been around for more than a year or two, my initials make it fairly easy to determine who I am. But I work for a company that builds Metro Ethernet switches, and even I find those numbers silly.

Those numbers, along with Ethernet true believers, seem to rely on the following equations:

1) SONET=circuit switching
2) IP/data=Ethernet.

Would Pioneer consulting care to comment on why they feel that POS (Packet over SONET), for instance, will be wiped out by Ethernet? And don't cheat now...this is POS in concatenated OC-48s and OC-192s (as well as OC-3/12 of course) already rapidly becomming the standard in backbone transport (this is what 'IP over Optics' means in most trade blurbs).

By assuming "Ethernet everywhere" in their report (pretty much the only way to come anywhere near those numbers), Pioneer seems to be proclaiming the death of Layer 3 networks.Death of Layer 3
leathert 12/4/2012 | 7:38:13 PM
re: Gigabit Ethernet: Hope vs. Hype Douglas,

I think a clue is required here. I would not take negative posts to instantly be some Gartner plant. Until a few weeks ago I was an Architect for the largest Broadband network on the planet, all IP, NO circuits or 911 voice, and until Ethernet takes a few clues from SONET, like BER and LOS on the optical interface (like we have told MRV and Finisar many times), you simply cant get the diagnostics on Ethernet to match POS.

Lewis Eatherton
frmr Architect, Strategic Engineering
[email protected]
donethat 12/4/2012 | 7:38:13 PM
re: Gigabit Ethernet: Hope vs. Hype Wow! A lot of good stuff being discussed here. I'm now an independant consultant (after a 25 year career in optics at a major vendor) and two years ago I accepted a job working for one of the major Consulting Companies, researching and writing a report on an upcoming optical technology. From my experience, I know what it takes to introduce new technology to the major carriers, and reflected these difficulties in my report. That's when I found out these companies don't want the truth..they want rosy optimism that reflects their role as cheerleaders for the industry. They basically re-wrote my report (it turns out I was not pessimistic enuff!)and now they must look pretty silly. It's totally amazing to me that people will pay for this garbage.
wino 12/4/2012 | 7:38:12 PM
re: Gigabit Ethernet: Hope vs. Hype I believe the key word to all of this is
'marketing', which usually has nothing to do with reality. The market research usually reflects the
'that's neat and we would like to have it' reply
from executive management. The reality side says
'we have it but it costs too much'. Which one
is going to win ? we'll see......
HarveyMudd 12/4/2012 | 7:38:07 PM
re: Gigabit Ethernet: Hope vs. Hype Dear Mr. Peterson:

You have inherent conflict of interest and your views cannot be considered to be objective. You are simply interested in selling reports. You have never validated the contents of your report, neither have you a posted a copy of your report for feedback.
gea 12/4/2012 | 7:38:06 PM
re: Gigabit Ethernet: Hope vs. Hype Harvey Mudd:
Do you ever say anything positive?

Do you really think Pioneer consulting would post a copy of their report? Who then, would buy it? That IS how they pay their bills, after all.
HarveyMudd 12/4/2012 | 7:38:05 PM
re: Gigabit Ethernet: Hope vs. Hype Except for Yipes, Cogent and Telseon no ther vendor has committed to using Ethernet in the metro environment. Cost alone is not alone to tear down the Sonet/SDH rings currently deployed. There is no credible performance data that addresses the issue of TDM traffic. Currently, there are limited number 10 GbE vendor equipment.

Currently none of the Gigabit Ethernet vendors such as Appian, Lantern, Nortel, Luminous, etc, have any significant market share.
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