re: Report: Clear Skies for Optical M&AsI don't think that the changeover from SONET to IP-over-DWDM will drive a lot of consolidation per se.
More like the fact that there are way too many companies to go public. My list of firms (photonic components, telecom-ICs, optical-networking equipment, and optical test equipment)is within 15 names of being 1000 strong. My scenario for a lot of M&A activity is a little darker. There are far, far too many firms that tell investors and potential recruits about how they will be public in a year or so--in reality these firms are one-note acts or have gaping holes in their management team. Let's hope, for the poor saps (recruits only, I have no pity on the financial community) that bought into their pitches and the managements realize when the time is right to sell and act accordingly.
re: Report: Clear Skies for Optical M&AsI believe that there is still enough pull from legacy networks and applications, not to mention the inertia of larger carriers (see below)to also cause the transition from SONET to Next Gen to linger for a while before "next-gen" meshed IP networks take over, fully.
Even where backbone networks may be employing the newer meshed (non-SONETized) architectures, access to these networks from customer locations (and cross-country, often, when backhauling is a must for whatever reasons) will continue to use OC-3, OC-12, etc. pipes, because the MFN effect is not yet universal.
By this I mean that bringing dark into most commercial enterprise locations is still limited to the larger metro areas. And not even all of them at the moment, at that.
Suprirsingly, many of the larger ISPs and backbone providers wont even take a gigabit ethernet pipe handoff, even where they are availabe, prefering to accept bandwidth from enterprises in the mold of their "productized" services. This is changing somewhat now, but in many cases it still requires that one go through an ICB (Individual Case Basis) analysis by the carrier, and often incur additional "engineering" charges, which could range into the tens of thousands of dollars, to boot, before getting their nod.
Beyond this, there is still an absolutely huge presence of IBM SNA networks and other proprietary forms of delivery, some of which are actually getting larger instead of diminishing, as new demands are being made on them, spurred, peripherally, but the Internet boom.
Especially in such bandwidth intense applications as document/check/multimedia imaging apps. Check processing alone, and the imaging and OCR processes that are associated with it, for example, consumes boatloads of bandwidth every day that never get tallied into the total national Internet tab, both for real time processing and backing up in archives.
Notwithstanding, the next-gen model will move forward, unimpeded IMO, despite all of this. They are two distinct models that may not necessarily impact each other, each growing at their own pace, with the older of the two (the access space) still very much used as a feeder vehicle for the new ( core network bandwidth), but the newer clearly leading the way to the future.
One can easily see, however, that if the edge and core (as distinct from the access portion) grow by leaps and bounds, something must, by definition, feed it with proportionate amounts of bandwidth. And if the SONET pipes that are in place are all that you have for the foreseeable future for local access, then, for the intermediate term, at least, the SONET space will tend to grow, too. Comments and corrections are welcome.
re: Report: Clear Skies for Optical M&AsI believe that there is still enough pull from legacy networks and applications, not to mention the inertia of larger carriers (see below)to also cause the transition from SONET to Next Gen to linger for a while before "next-gen" meshed IP networks take over, fully.
Even where backbone networks may be employing the newer meshed (non-SONETized) architectures, access to these networks from customer locations (and cross-country, often, when backhauling is a must for whatever reasons) will continue to use OC-3, OC-12, etc. pipes, because the MFN effect.
By this I mean that bringing dark into most commercial enterprise locations is still limited to the larger metro areas. And not even all of them at the moment, at that.
Suprirsingly, many of the larger ISPs and backbone providers wont even take a gigabit ethernet pipe handoff, even where they are availabe, prefering to accept bandwidth from enterprises in the mold of their "productized" services. This is changing somewhat now, but in many cases it still requires that one go through an ICB (Individual Case Basis) analysis by the carrier, and often incur additional "engineering" charges, which could range into the tens of thousands of dollars, to boot, before getting their nod.
Beyond this, there is still an absolutely huge presence of IBM SNA networks and other proprietary forms of delivery, some of which are actually getting larger instead of diminishing, as new demands are being made on them, spurred, peripherally, but the Internet boom.
Especially in such bandwidth intense applications as document/check/multimedia imaging apps. Check processing alone, and the imaging and OCR processes that are associated with it, for example, consumes boatloads of bandwidth every day that never get tallied into the total national Internet tab, both for real time processing and backing up in archives.
Notwithstanding, the next-gen model will move forward, unimpeded IMO, despite all of this. They are two distinct models that may not necessarily impact each other, each growing at their own pace, with the older of the two (the access space) still very much used as a feeder vehicle for the new ( core network bandwidth), but the newer clearly leading the way to the future.
One can easily see, however, that if the edge and core (as distinct from the access portion) grow by leaps and bounds, something must, by definition, feed it with proportionate amounts of bandwidth. And if the SONET pipes that are in place are all that you have for the foreseeable future for local access, then, for the intermediate term, at least, the SONET space will tend to grow, too. Comments and corrections are welcome.
re: Report: Clear Skies for Optical M&AsThe other major factor not mentioned in the news wire feed is that IPO activity is effectively shut down. There are to many Metro System startup companies 18 months into their business plan with nearly complete products. Investors in these companies must weigh their options carefully!
More like the fact that there are way too many companies to go public. My list of firms (photonic components, telecom-ICs, optical-networking equipment, and optical test equipment)is within 15 names of being 1000 strong. My scenario for a lot of M&A activity is a little darker. There are far, far too many firms that tell investors and potential recruits about how they will be public in a year or so--in reality these firms are one-note acts or have gaping holes in their management team. Let's hope, for the poor saps (recruits only, I have no pity on the financial community) that bought into their pitches and the managements realize when the time is right to sell and act accordingly.
Photonboat