The announcements are significant for showing Nortel is ready to make an aggressive bet on 40-Gbit/s technology, perhaps even before telecom carriers are ready to deploy it. Nortel's early move into 10-Gbit/s, the last major upgrade of the network, was a key factor in its success in gaining market share, making it the leader in core optical transport technology.
Nortel's announced products, which will be available in the latter half of this year, include:
"It's a bet on 40-gig," says Greg Mumford, president of Nortel's optical Internet division. "Just like how we bet on a 10-Gbit/s [core] when no one else would.
“When we talk to chief information officers, they say they would gladly trade more bandwidth [at the network’s core] for additional processing [at the edge]."
The significance here is that Nortel's pushing for greater capacity at the network's core, something you’d think service providers would use when available. The catch, for now, is that the big service providers, Nortel’s bread and butter, are cutting spending and slowing build-outs, as the capital markets seize up and CLECs continue to wither.
There’s no doubt that Nortel’s long view -- that more and more bandwidth is needed because it's still being consumed as soon as its available -- is still on the mark. However, given the economic slowdown, it’ll be interesting to see whether service providers pick up on Nortel’s 40-Gbit/s vision as quickly as they did when it offered a way to extend voice-based Sonet networks to 10-Gbit/s networks primarily used to shuttle data.
Harry Bosco, president and CEO of startup OpNext Inc., says that OpNext is selling about a thousand 10-Gbit/s modules a month and he’s not seeing a slowdown there. All the same, he does see what’s coming over the horizon. “Router vendors are the ones driving demand for 40-Gbit/s,” he says. “They want it and they're pushing hard to get it.”
Other equipment providers agree with Nortel's reasoning, saying that service providers are interested in 40-Gbit/s core gear because the upgrade will help them cut costs. But it may be a year to 18 months before certain issues make a 40-Gbit product launch more feasible.
"We've got 40-Gbit technology in our labs now, but we're waiting for the right time to fold it into a product," says Thomas C. Mock, Ciena Corp.'s (Nasdaq: CIEN) senior director of transport product management. "There would be a much greater press if there were already specific applications [for that kind of bandwidth] waiting."
-- Mary Jander, senior editor, and Phil Harvey, senior editor, Light Reading http://www.lightreading.com