x
Optical/IP

Et Tu, Morin? Then Fall, CESR!

Following a leaked memo from Metro Ethernet Networks president Phillppe Morin, Nortel Networks Ltd. today emailed journalists to say it has decided to "refocus" its investment from Carrier Ethernet Switch/Routers (CESRs) to next-generation packet optical transport equipment.

In a statement sent to Light Reading, Nortel says it is cutting back on the money it puts behind its Metro Ethernet Manager (MEM) products, Metro Ethernet Services Unit 1800s, and Metro Ethernet Routing Switch 8600s.

To clarify, Nortel will still sell these bits of kit, but it will no longer have any big new features for, or revisions to, the CESR product lines, outside of a few periodic maintenance releases.

Why? Morin's memo offers a clue: "The overall market for Carrier Ethernet is not growing at anticipated rates and that will only worsen with the global economic downturn. We will continue to invest and increase our focus on maintaining our leadership in Optical."

Nortel says it will still serve, support, and ship products to its Carrier Ethernet installed base -- and it says that the CESR decision doesn't impact its Ethernet access and aggregation products, or its Enterprise ERS 8600 portfolio.

Nortel says it will focus its packet-optical and former CESR development dollars into two areas. First, it will keep adding packet capabilities to its Optical Multiservice Edge 6500 and Optical Metro 5000 series platforms. And it will invest in metro Ethernet access and aggregation solutions, as well as staying committed to its partners that make customer premises Ethernet gear (including ANDA Networks Inc. , Axerra Networks Inc. , and others).

"We are not abandoning our Carrier Ethernet technology innovation, but simply focusing our Carrier Ethernet investment away from the switch/router segment," Nortel's statement to Light Reading says. "This decision supports the goal to make Nortel a more focused company."

In his leaked memo, Morin's closing paragraph hinted at the jobs toll this move might take: "Even though this is the right business decision, I realize it's more tough news for employees and will impact the Carrier Ethernet team."

— Phil Harvey, Editor-in-Chief, Light Reading

Page 1 / 4   >   >>
heretoday 12/5/2012 | 4:10:28 PM
re: Et Tu, Morin? Then Fall, CESR! Guess there'll be some lab kit being returned soon.....

.... and maybe another Switched Ethernet Services RFP?

So in effect this kills PBB/PBT. Correct?

Soapstone's whole business/technology model was based on PBB/PBT provisioning... bet they are really happy with NT... guess this helps them make a decision on what to do next.

Not sure any of this is new news... the MERS PLM didn't jump ship because he was realy happy with the technology and investment directions.

It's a case of NT riding two horses with one butt. Enterprise folks want the ERS to go this- a-way... and the men from MEN want it to go that-a-way.

Sayonara PBB/PBT... hell0 MPLS and all of it's wonderful derivatives.....
opticalwatcher 12/5/2012 | 4:10:26 PM
re: Et Tu, Morin? Then Fall, CESR! As just a small cog in the machine, I don't understand. Maybe someone with at a Tier 1 with a high level overview can explain.

Presumably Tier 1s make most of their money from companies--like Safeway, Walmart, Prudential, etc. It was T1s and T3s. They had more consumer voice customers, but these made them money more in quantity than in margin.

So has this changed? Why are these Tier 1 companies investing in now to replace all these T1s and T3s? Aren't they replacing their networks with IP? All I hear about is the consumer side--the ADLS and fiber to the home. Lots of expenditure and very little profit. What about their business customers? How are these companies connecting up nowdays? What does the Tier 1 offer them?

I guess I'm just wondering why Carrier Ethernet isn't taking off like you would expect. Are the Tier 1s ignoring their highest paying customers? If not, what, exactly are they offering them? If it isn't Carrier Ethernet, what is it? Are they hoping that they just stick around with their Frame Relay and ATM so they can continue to make big bucks off of old infrastructure? Even in this case, how are they carrying this traffic on their IP networks?

I'm clearly missing something major here. Maybe someone can explain.
giles0 12/5/2012 | 4:10:25 PM
re: Et Tu, Morin? Then Fall, CESR! Carriers are indeed offering Carrier Ethernet services - generally using MPLS pseudowires as the transport mechanism.

They're also selling IP-VPNs (again carried over MPLS) to corporate customers.

Different carriers have different approaches as to how they'll migrate from their FR/ATM networks to IP/Ethernet. Some incentivise customers to migrate the services they buy (largely to IP-VPN), whereas others emulate FR and ATM over an IP/MPLS core (again using pseudowires).

In terms of how corporate customers are connected to IP/Ethernet networks carriers typically deploy Ethernet over point to point fibre to larger sites. To get to smaller, or off-net, locations it's a case of use what you have or can buy (TDM, PON, DSL, etc.)
heretoday 12/5/2012 | 4:10:24 PM
re: Et Tu, Morin? Then Fall, CESR! Good question tera. Tier 1's make money from lots of customer types in lots of different markets. Big guys like Verizon have legacy TDM networks spaning hundreds of Metros with different architecture and design philisophies with some $100 Billion invested in infrastructure. Not likely they are going to rip it any time soon.... though the entire telecom vendor world would love them to.

We're talking about two cases with this techology. One is a green field metro access paradigm where you have no TDM and you are going to over tripple play using Ethernet as a customer carrige and IP as an application carrige. There are lots of cost advantages to to do this if you can.

Second case is an overlay on present TDM (SONET) infrastructure where the carrier is looking to better pack the SONET pipes. SONET still has the expense associated, but maybe you can get more than one customer on a DS-3 by selling many instances of best or good effort multi-megabit services. You can book end the SONET pipes with either Routers with MPLS or Ethernet Swithes running PBB/PBT.

As another person mention, the predominant technology choice is MPLS becasue the cost efficiences of a green field are not the same, and not realized, for a legacy SONET network. And then there are the protocol wars, but Carriers will usually put those aside if there is a real, tangible cost saving.

Your TDM is safe for the forseable future.
Creagh 12/5/2012 | 4:10:24 PM
re: Et Tu, Morin? Then Fall, CESR! Guys, I think you are missing the point - there is a totally new paradigm emerging in Dynamic Optical Burst switching (aka NGN Optical Packet Transport). The carriers in europe are leading the way from IP/Ethernet/WDM to IP/OBS - why ? Massive CAPEX/OPEX cost reductions, with a big network performance uplift and huge power consumption savings 50 - 80%. The world has changed and the recession has just brought things forward here. The interesting question here is what do Nortel have ?? do they plan to acquire a start up in this space ? only two companies are out there....
opticalwatcher 12/5/2012 | 4:10:23 PM
re: Et Tu, Morin? Then Fall, CESR! "Different carriers have different approaches as to how they'll migrate from their FR/ATM networks to IP/Ethernet. Some incentivise customers to migrate the services they buy (largely to IP-VPN), whereas others emulate FR and ATM over an IP/MPLS core (again using pseudowires)."

I guess this route is my confusion. They are spending many billions migrating consumers to fiber. But they aren't going to rip up the wires of their highest paying customers? What gives?

I'd be pretty upset if I were a multi-billion dollar corporation, being told my network isn't being upgraded because they are going to milk me and their old networks for every penny they can while they spend all their money on low-paying consumers downloading movies at 10Mb/sec, a speed which my company paying many thousands per month would only see in its dreams.

And what of all this pseudowires/MPLS/PBB or whatever? Is this really being installed? If so, why are the companies that supply this going under? (which gets back to the article).

Something just doesn't smell right to me. I'm still not getting it.
OldPOTS 12/5/2012 | 4:10:21 PM
re: Et Tu, Morin? Then Fall, CESR! Tera,
'I'd be pretty upset if I were a multi-billion dollar corporation, being told my network isn't being upgraded because they are going to milk me and their old networks for every penny they can while they spend all their money on low-paying consumers downloading movies at 10Mb/sec, a speed which my company paying many thousands per month would only see in its dreams.'

-If it ain't broke don't fix it-
Most enterprise companies in today's market are happy to have something that works well and serves their business purposes. Right now is not the time to disrupt business to be a bleeding edge technologist as that requires adaption cost to the enterprise. Later when business comes back and the enterprise needs more (BW or lower cost) that they can afford to move. They want to focus on their enterprise business and not those support services.

But I will add telcom can be a big expense, so as soon as there is a business need/opportunity, then they will make a move, like "heretoday" said, one by one over a long time.

The cost of new interfaces are insignificant/irrelevant except to marketeers. The existing network people are familiar with the configuration so no expensive retraining costs to the enterprise. The training was a sunk cost.

OP
Bleading Edge Implementer of Enterprise Networks
paolo.franzoi 12/5/2012 | 4:10:21 PM
re: Et Tu, Morin? Then Fall, CESR!
tera,

There is incentive for the Enterprise customers to move away from legacy interfaces:

1 - The interfaces cost more money and (more importantly)
2 - Require specialists to manage

So, somebody will offer carrier ethernet. The question is how and why will people make money off of this if the price per bit continues to decline. That decline is the basic industry structural issue.

seven
heretoday 12/5/2012 | 4:10:21 PM
re: Et Tu, Morin? Then Fall, CESR! Oh I think we'll see FR/ATM for a while. I don't think any carrier is in the mood to strand any customer these days. But as migration options become available that are cheaper for them to operate or provide more of something, like bandwidth, to the customer you'll see change over time. After all back in the early '90's the same questions, concerns, were being asked about Frame Relay vs. x.25 vs leased lines.

Regarding the MPLS / Pseudowire companies... I don't see Cisco or Juniper going away anytime soon and as for the also rans.. we'll just have to see how risk adverse operators are to see how many bite the bullet.
heretoday 12/5/2012 | 4:10:20 PM
re: Et Tu, Morin? Then Fall, CESR! Rumor is that Phillippe Morin sent out a CYA note on the demise of Carrier Ethernet proclaiming its alive and well. Typical to Nortel it's a cloudy message because no one care to define what CARRIER ETHERNET is.

So here is the pointed and succinct question to Nortel. A simple YES/NO will suffice.

Will you continue the development of PBB/PBT/PBLS/PBB-TE/802.1ah in anything?

Last anyone checked it wasn't in any other product... and putting it in an ADM/ROADM is not likely a good play.
Page 1 / 4   >   >>
HOME
Sign In
SEARCH
CLOSE
MORE
CLOSE