Level 3 Communications plans to start using 100G technology in its network within the next six months, Level 3 CTO Jack Waters tells Light Reading. Count the carrier among the growing gallery of industry voices saying that the economics of 100G have recently reached a tipping point where deployment makes sense.
Still, Level 3 Communications Inc. (NYSE: LVLT) has been slower to move toward 100G than some of those other believers, saying its network is so fiber-rich, it hasn't needed to rush into a 100G capacity boost. (See Level 3's Paul Savill: Not Hot on the Cost of 100G.)
Waters says, "Do our customers need and want 100G? Yes, we're starting to hear customers ask for it." He adds that the carrier has been fulfilling those needs with multiples of 10G up to 10x10G.
However, within Level 3's network, it has not seen much need yet to move past the 40G systems it has in place. Waters continued:
For our own internal needs, [moving to 100G] is a decision driven by our customer needs, but also by our own network scale, scope and economics. If you're an operator that's out of fiber and you need more capacity, you pretty much have one set of technology choices to make. If you have fiber, like we do, then you can continue to use that fiber versus more opto-electronics. But, ultimately, the unit cost of newer technology starts to catch up, and that is what we're seeing now, especially in the last quarter or so.
Because of its fiber position, Waters says Level 3 has been able to monitor the 100G market more patiently and to a finer degree of change than other carriers. "If you were too early putting 100 in you're your network, you are probably paying a premium," Waters says.
As it has monitored the 100G equipment market, Waters says Level 3 has consulted a detailed model consisting of equipment prices, initial capex as well as ongoing capex, ongoing opex, the ease and cost of provisioning 100G, and other factors. Its patience with 100G may befit a company that is trying to put aggressive, debt-inducing network investments behind it to focus more on services and profit. (See Level 3: 'Size Matters' Isn't Enough.)
— Dan O'Shea, Managing Editor, Light Reading
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