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|Subject: Re: Metro Products||Date: 3/3/2002 7:37 AM|
|Author: DirtyDingus||Number: 2587 of 2601|
Here is a summary post I did 2 years ago on wireless and optical players.
Its still reasonably current - as is/are the posts I did on the definitions of a switch vs a router etc.
Another post about metro network topologies is at http://boards.fool.com/Message.asp?mid=14858051
Slightly more recently I wrote an article for the RTW newsletters produced by MAtt Tomkins (Y2Krash) - its in the August 2001 issue available at http://y42.briefcase.yahoo.com/rtwnewsletter/ - about the challenges of metro deployment.
With that as background here is some answers to your questions. Let me start by saying that until Sept 01 I worked for Nortel as a product manager for the Passport 8600 which has quite a lot of featuress that make it applicable to the metro space so I was up until that point depply involved in the metro market. Since then I've changed tack rather dramatically (see profile if U care) so I am no longer plugged into the currents of the switch market.
I'm trying to identify: 1.] what the primary "metro products are? 2.] What are the companies producing the products?? 3.] Does it seem sensible to begin studying all the identifiable "metro" companies, or are there 2 or 3 that stand far enough better than others that it would be reasonable to narrow study to these 3:
See links above. Metro products are generally cheap SONET/SDH ADM's, (gigabit) ethernet l2 and L3 switches and relatively coarse WDM systems and combinations of the above.
Sorrento make switches I thought...now I find in their advertising they call it a "switch router." Would that be on layer 3?? They list smart-looking group of customers, but they show low income [< 50M/yr ...which is about their mark cap].
Well actually no. If you look at the above mentioned definition of a switch link and the sorrento product page (http://www.sorrentonet.com/products_11.asp) you see that Sorrento have a dynamic optical cross-connect. This is a layer 1 device as it is unaware of the protocols and packets passing on each wavelength.
I understood that the ONIS product also is a "switch", and I am trying to learn more about all this because the CIEN ceo said the ONI metro product would make CIEN more competitive in that space.
ONI's products seem to be somewhat more smart than Sorrento's but that is because they appear to (optionally at least) do an optical-electrical-optical conversion. Of course during the electric phase ONI can do clever things like packet-baed routing, SONET/SDH stream aggregation (i.e. add/drop multiplexing) and so on. They do not yet apparently do packet based routing although there is mention of an MPLS product and it looks like that sometimes they can be a pure optical device BUT compared to sorrento they are less pure optical and more complex and thus further up the OSI stack but still mostly no further up than Layer 1.1
What is the issue about metro space that matters whether the switching process occurs at layer 3 or layer 3?
Well its a case of scalability and flexibility. If you build a L1 network (as ONI/Sorento etc want you) have a very scalable system (in that you can build many endpoints and many fiber rings/meshes) but its extremely inflexible and hard to change what traffic goes where once its been set up. This is a problem because in the metro about the only constant is change. Also (and related) this kind of network is hard to engineer to be robust towards network outages such as equipment failureor fiber cuts without reserving two paths for every connection.
On the other hand if you build a layer 2 network using a packet protocol such as ethernet you have a lot of flexibility because every device can potentially see every other one at the expense of scalability - managing the resulting broadcast storms is a nightmare - and the number of VLANs (vitual networks) is limited to some fairly small number (generally about 4000 but with proprietary extensions can be more than that). An Ethernet L2 network gives you lots of flexibility and reasonably network recovery arounbf aoutages etc. but at a cost of significant scaling problems.
An L2 network using SONET/SDH looks just like the all optical L1 network with the disadvantage that available bandwidth is a lot less and the advantage that the flexibility in terms of changing where traffic flows is much improved. However although the network is flexible in terms of provisioning it is not so flexible in terms of coping with network outages as the packet based network would be - as with the L1 network the usual solution is to waste 50% of available bandwidth by carrying the every signal over two different paths.
An L3 network is forced to be a packet based network. An L3 network will generally combine with L2 or L1 networks in that it will use the L1/L2 bits for the initial access layers and the interconnects between the L3 nodes, however the L3 devices solve much of the redundancy/flexability/scalability issues in the pure L1/L2 designs simply because they reduce the required size and complexity of each L1/L2 network. The disadvantage of L3 is that it is further removed from the wire and thus the advantage gained by saving network bandwidth has to be paid off against as slower response tim ein the event of an outage (typically 30+ seconds rather than the 50ms response time of optical or L2 SONET networks). On the other hand the L3 network significantly eases provisioning and with MPLS and other related techniques permits security, efficient bandwidth usage so it seems like a mainly good idea. The big catch is that L3 devices are typically far mroe expensive than L2 or L1 devices for a given throughput because they HAVE to do so much more work, this is why you don't deploy them everywhere.
I note references to Cisco and NT as the 2 highest sellers in "metro space." I thought both their metro products were routers.
Absolutely not. Take a look at their websites.
Nortel has the Optera Metro 5000 series which is similar to the ONI/Sorrento product range, the passport 8600 (similar to the riverstone box) as an L2/L3 device as well as various SDH and SONET metro devices such as the Optera Metro 3500. Nortel will also resell Juniper routers if a more advanced L3 box is required.
Cisco has of course got its L3 routers but, while its pure optical devices seem to have been killed, its doing fine in the L2 SONET market and of course it practically owns the Ethernet switch market.
Are there other companies I should study relative to the metro space?
Once I find out what all the options for learning and investment in this area, I'm sure a point will come where narrowing the focus down to maybe 2 would be appropriate. One obvious way to do that would be to focus on the largest market cap companies [like CSCO and NT]; but its not clear to me what % of these company's revenues come from "metro."
I read otoh, that FIBR, ONIS [now CIEN], and RSTN, all get all their revenue from "metro." Does anyone have a suggestion about whether its obvious that any of these companies should well be winnowed out at an early stage....afterall, I've some limitations on time, and that's part of what I seek here.
One company I like in this space is a supplier called Finisar (FNSR), I was involved with them over the following nortel products http://www.nortelnetworks.com/products/library/collateral/55161.02-10-01.pdf
My other (related) Nortel legacy is Split MLT which has a whole set of pages here: http://www.nortelnetworks.com/corporate/technology/smlt/
IMO this solves a lot of the scalability problems in L2/L3 packet networks and in conjunction with the above WDM solutions allows an extremely flexible, and relatively inexpensive pure packet network to be deployed. Unfortunatels it will take considerable time before we see any of this actually in widespread use. Generally speaking the big problem at present is that the cost to deploy a boradband metro network is large and there is a lack of killer demand whihc means that payback periods are bound to be extremely extended. In the current climate this means that it is practically impossible for new entrants to raise the cash to start playing and even the existing carriers, whether incumbands or competitors are also extremely stretched.
Thus from a financial/economic point of view I personally would not invest in any broadband startup because I feel many of them are likely to go bust before they get enough customers. Companies such as Ciena are likely to survive but apart from an investment in JDSU and some Nortel stock that I forgot about (oops), I personally have no exposure to the Optical marketplace because I do not think there will be much upturn for another 12 months and by then it should be reasonably clear who the surviros will be. I expect Cisco to be one of the survivors but I doubt that its shares will go much beyond $20 in the next year so there isn't much point buying them given the potential downside risk.
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