Enterprises Take Back Nets

Lucent Technologies last week helped fuel a surprising trend toward private optical networks that could set today's managed service model on its ear.Lucent introduced OptiStar, network storage adapter cards and software designed to connect servers directly to an optical network and thus speed and simplify the process of connecting Gigabit Ethernet, Fiber Channel or other networks over the wide area.

Lucent Technologies last week helped fuel a surprising trend toward private optical networks that could set today's managed service model on its ear.

Lucent introduced OptiStar, network storage adapter cards and software designed to connect servers directly to an optical network and thus speed and simplify the process of connecting Gigabit Ethernet, Fiber Channel or other networks over the wide area.

In the process, Lucent is throwing fuel on an already burning fire - the deployment of optical network gear by private companies that lease dark fiber or even wavelengths from network operators and then set up their own connections between local area networks or large data centers.

This growing deployment flies in the face of conventional wisdom that businesses, particularly large businesses, are looking to outsource complex networking challenges. With greater availability of dark fiber in metropolitan areas being wired by multiple service providers, and the arrival of lower-cost optical networking gear from Lucent and others, some businesses are discovering tremendous financial incentives to stay with, or return to, a private network approach.

The trend should send a wake-up call to service providers, which stand to lose some of their best customers to a low-end service. It may also be an anomaly of the current competitive market and tariff systems, said Chris Nicholl, director of carrier infrastructure analysis at Current Analysis.

"I am a bit surprised by this trend," he said. "I think long term the private network is more on-campus than off."

Optical networking transmits data or voice signals as pulses of light, or wavelengths, over fiber-optic cable. Systems commercially available today cram up to 32 wavelengths on a single fiber-optic cable, with the promise of up to 200 within the next year. With that kind of bandwidth available and with the optical network gear coming onto the market today, many large businesses are following the lead of America Online, which is building its own optical network using equipment from Ericsson.

The data networking manager at one West Coast technology company, who didn't want to be identified by name, said he is looking at costs as low as $300 per mile per month to hook up seven campuses in the Bay Area.

He is conducting his own lab tests of optical network gear that will ultimately give him up to 192 wavelengths on that dark fiber. Only a year ago, the company put out a request for proposals for a Synchronous Optical Network (SONET) service from local carriers, but found that was too expensive, he said. The optical network option is much cheaper.

"With that kind of bandwidth available, we don't have to worry about sophisticated switches or other service restoration equipment," he said. "Initially, we will use our existing DS-3 [45-megabit-per-second] lines from Pacific Bell as a backup, but very quickly those will be inadequate. At that point, we will create a ring with dark fiber. There will be enough bandwidth available to back up any service we offer. And we get this for a fraction of the cost of a managed service - why would I do that now?"

Network operators, including Enron, GST Telecommunications, Level 3 Communications and Williams, are offering leased wavelength services. Others, such as Metromedia Fiber Network, are leasing dark fiber at prices attractive to major businesses.

The optical network approach is particularly powerful for companies that want to connect large mainframe systems or databases across a city, a region or even across the country. Using SONET services requires matching its preset interfaces at 155 Mbps with those of data networking protocols such as Gigabit Ethernet, Fiber Channel or ESCON, IBM's proprietary high-speed connection.

"The optical networking approach allows this critical data traffic to travel in its native protocol at its native speed," said Brian McCann, president of U.S. operations at ADVA Optical Networking, which sells gear to private companies.

Gerry Butters, president of Lucent's Optical Networking Group, classified the development as unleashing local data communications at the speed of light and said the OptiStar products will bring about the advent of the all-optical network.

Lucent's OptiStar product family, which is also geared to long-distance companies and Internet service providers, represents a further move to tie enterprise networks to optical networks.

"We are extending the high bandwidth and low latency of optical networks further into the enterprise space," said Tim Sullivan, vice president and general manager of optical area networks, a new classification at Lucent.

The OptiStar products include adapter cards that connect a server to the optical network at speeds of 622 Mbps or 2.5 gigabits per second. On the customer side of the server, Lucent is introducing Gigabit Ethernet and Fiber Channel cards to bring in traffic from those networks into a server that is connected to the optical network.

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