Steady growth ahead in LAN fiber-optic cable global market

Premises Networks

Fiber-optic cable consumption is on the rise in LANs, from singlemode for greater distances to interconnects between network elements.

PETER T. JEWETT and DANIEL STEINBAUGH, ElectroniCast Corp.

Several trends are driving transport demands for LAN applications beyond the capability of copper lines. Data communication has been expanding steadily over the past 15 years, and this trend will continue over the next decade. The concept of distributed data processing, controversial in the mid-1970s, is now firmly accepted. The individual terminals and peripherals in the network are also becoming increasingly powerful. The increasing input and output at each node, multiplied by the growing complexity of data networks, is producing much higher data rates, which must be accommodated by the networks' primary channels. Networks are also interconnected by cable at increasingly large distances.

Fortunately, the performance of fiber-optic components has improved steadily, while their costs have continued downward. Today, fiber-optic cable links are approaching cost parity with copper links. A fiber-optic link or interconnect refers to the cable connecting two points or apparatus on the LAN, for example, the cable between a patch panel and network device-also known as a patch cord-or the cable between a wallplate connection and computer network interface card.

Fiber-optic cable is mandatory for most links above 200 Mbits/sec. Fiber offers the advantage of convertibility to much higher data-rate transmission as the system is upgraded. Fiber-optic links, therefore, will be strong candidates for installation in new buildings, and for installation in many pre-mid-'70s buildings, where the original installed copper lines are aging and not well marked.

The use of fiber-optic cable in commercial and private LANs worldwide is expected to grow rapidly, averaging 21.3% per year, until 2005, when consumption reaches $5.4 billion. This high growth is forecast to continue at an average rate of 20.9% per year to $14 billion by 2010 (see Table 1). Europe's share is expected to grow from 34% or $717 million in 2000 to $2 billion in 2005 and $4.5 billion in 2010. The most rapid growth of fiber-optic cable use will occur in South America (see Figure 1).

Multimode-cable use, dominated by North America, will grow at an average annual rate of 21.4% from $1.4 billion in 2000 to $3.85 billion by 2005. North America's share is significantly higher compared to other world regions, due to an earlier use of fiber optics in premises LANs and the subsequent rapid expansion. Recent technology advances such as easy-to-install, cost-efficient, small-form-factor, multifiber connectors and quantum well, vertical-cavity surface-emitting lasers (VCSELs), will help stimulate fiber deployment to the desk.

Multimode fiber is manufactured in 50- and 62.5-micron core sizes. Most of the North American installed base is 62.5-micron fiber, which has been the winning choice because of its favorable numerical aperture (NA), which expresses the optical-fiber core's ability to accept and propagate light. The higher the NA, the more light the fiber will accept. Therefore, 62.5-micron-core fiber can accept more light than 50-micron fiber.

The NA value is even more important if the optical signals are transmitted via light-emitting diodes (LEDs) as opposed to laser-based emitters. Less expensive LEDs are suitable for shorter link lengths; that has been the only optical-signal-emitting technology used at 850-nm transmission. The TIA/EIA-568A Commercial Telecommunications Building Standard specifies 62.5-micron fiber. FDDI's use of 62.5/125-micron multimode fiber with a simplex or duplex SC connector is supported by the EIA/TIA standards. FDDI, developed for 100 Mbits/sec, actually operates at 125 Mbits/sec with framing, address, and traffic-control bits for packet transmission. It is ideal for large commercial-building cable installations and for networks transmitting large volumes of data between several locations, since it can accommodate up to 500 network devices and support distances of up to 2,000 m (2 km). As the decade progresses toward 2005, the consumption of fiber-optic cable for >100-Mbit/sec LANs will grow rapidly to support multimedia applications.

Singlemode fiber provides longer distance and significantly higher bandwidth. However, longer distances and higher bandwidth also require higher-cost optoelectronics such as transmitters and receivers. Laser-diode-based transmitters and receivers are more expensive than the LED-based transmitters and receivers used for shorter distances over multimode fiber.

The elements of the telecommunications cabling system structure include horizontal cabling, backbone cabling, work area, telecommunications closets, equipment rooms, entrance facilities, and administration (EIA/TIA 606). The industry standard is based on a star topology in which each workstation is connected to a telecom closet situated within 90 m of the work area. Backbone wiring between communication closets and the main crossconnect is also organized in a star topology. However, direct connections between closets are allowed to accommodate bus and ring configurations. Distances between closets and the main crossconnect are dependent on backbone cable types and applications:

• The work area consists of the cable from the information outlets (wall outlets) to the end user's telephone, workstation, or terminal.
• The horizontal wiring includes the cable from the work area wall outlets to the communication wiring closets.
• The riser backbone consists of the cables between multiple closets within a building.
• The campus backbone provides the same functions as the riser backbone-cable connectivity between multiple closets-for connectivity between buildings. The standard maximum cable lengths are the same as those used in the riser application category. The main differences between the riser backbone and the campus backbone are the cable sheath (jacketing) types and the means of protecting the cables as these components enter each building.
• The equipment room connects equipment in main equipment rooms or satellite wiring closets to either the riser backbone or campus backbone subsystems. Cables (patch cords/cable assemblies) are used to connect such equipment as private branch exchanges, mainframe computers, fiber-optic multiplexers, network hubs, and media subsystems via copper and fiber-optic cabling.
• The administration subsystem provides linkage and connectivity among the other subsystems. This subsystem is considered the main hub of a structured cabling system, consisting of crossconnect hardware (installation apparatus), labels, jumper wire, and patch-cord/cable assemblies. All circuit modifications are done by rearranging patch cords or by placing jumper wires/cords.

Computers, especially supercomputers and mainframes, have rapidly in creased the number of parallel processors used per machine. To date, computer architecture has accommodated multiprocessors by multiplexing up to a higher-speed bus or by switching among processors. The upward trend, however, is making these approaches increasingly difficult and expensive.

An alternative is to convert each processor to the optical realm and interconnect to its driven function via optical fiber. That is leading to widespread development and evaluation of array optoelectronics, multichannel connectors, and ribbon cable, which in turn is expected to generate a substantial new components market.

Fiber-optic interconnect cable consumption reached $3.7 billion worldwide last year. An interconnect is any cable used to connect two apparatus in commercial or private LANs. This research includes interconnect cable used in educational facilities and building-to-building applications, but it does not account for cabling used in telecommunications companies' central offices or in military LANs. Fiber-optic interconnect consumption is expected to increase at an annual rate of 18.7% over the next five years to $8.7 billion in 2005, with high-volume growth partially offset by declining average prices. Over the 2005-2010 period, fiber-optic interconnect cable consumption is forecast to reach $18.2 billion.

North American LAN interconnect cable consumption is expected to reach $7.8 billion or 43% by 2010, fueled by several trends: higher data-rate input/ output per machine, the growing complexity and increasing node counts of LANs, and physical distance expansion of larger campus networks.

Backbone cable is so defined by its functional position in the hierarchy of the network. It transports a much higher data rate (typically 10 to 100x) than its tributary branches. The backbone cable can be singlemode or multimode optical fiber, coaxial cable, or Category 5 twisted-pair (TP) copper. Category 5, for example, can serve as a 100-Mbit/sec backbone for a dimensionally small LAN with a number of 1.5-Mbit/sec nodes; even a few Ether net or Token Ring nodes. The backbone is typically fiber-optic cable and relatively long distance, hundreds of meters to a few kilometers. Structurally, the backbone cable is the riser and campus (interbuilding) cable. Its jacketing can be either plenum- or riser-rated. The non-centralized layout design incorporates cable runs to active telecom closets located within 328 ft of the user (desktop). Category 5 copper is typically used in the horizontal run (closet to desktop/work area). In the centralized layout, fiber-to-the-desktop is accomplished utilizing a direct link between a single hub and each work area (desktop). All data electronics are located in one centralized area or room.

Smaller commercial-building data-network installations, with slower data-rate speed and lower bandwidth, often continue existing backbone wiring practices and install copper. The competition between copper and fiber as a backbone media depends on several factors. Electronics cost is one of the most significant.

The link from the wiring or telecom closet to the work area is defined as horizontal cabling. TP copper represented more than 70% of the North American horizontal interconnect cable in 2000. The copper cable is typically 100-ohm, 24-AWG (a standard specifying the diameter of the copper strand) unshielded-twisted-pair (UTP) four-pair and rated as Category 3 (16 MHz), Category 4 (20 MHz), or Category 5 (100 MHz) and Category 5E (100 MHz). Category 4 copper is seldom used. By 2010, TP copper will decrease to about 57% of horizontal cabling, as fiber moves closer to the desktop.

In 2000, singlemode fiber represented more than 56%, or $187 million of cable consumption for the campus backbone. While UTP copper and fiber-optic cables are typically the cables used for LANs, high-performance coaxial cables provide a high degree of immunity to electromagnetic interference (EMI) and radio frequency (RF) interference, which is important in "noisy" environments such as manufacturing. Coaxial cable, once so prevalent in LANs, is disappearing as the media of choice. It has been dropped from the standards-based model EIA/TIA-568A standard as a recommended media for new construction.

Category 3 and Category 4 TP copper cable is rapidly being displaced by Category 5 and Category 5E media. Category 6 copper cable, which is not yet standardized, will eventually take market share from Category 5 and Category 5E. The Category 3 and Category 4 market has peaked and will decline over the forecast period. Copper cable that is greater than Category 6, such as Category 7, is not expected to take substantial market share. Market share for cable with higher data-transfer capability will be given to optical fiber and high-quality coaxial cable.

Data-transmission rates of less than 100 Mbits/sec-especially less than 50 Mbits/sec-typically do not require the use of optical signals. Alternatively, these links use electronic transmission, via TP Category 5, Category 5E, or coaxial cable. There are several reasons why fiber optics is desirable for these applications, however:

• Link lengths are longer than 500 m.
• Requirement to be resistant to EMI and RF.
• Optical solutions have a much wider bandwidth capability and will not build up the larger electrical potential associated with long runs of coaxial cable.
• Possibility of ground loops is eliminated because of complete electrical isolation between the transceivers.
• Increased system security due to the near-impossibility of tapping into the optical-fiber cable, for example, closed-circuit TV for security systems.

The price of fiber-optic cable is expected to decrease, which in turn will increase the use of fiber optics and drive the demand for copper-to-fiber media converters. The price of the various configurations of both singlemode and multimode fiber-optic cables will drop at an average of about 2%-3% per year by 2010. This long-term price decline will be driven by the following trends:

• Increasing standardization and interchangeability between products of different suppliers, fueled by customer pressure.
• Higher production volumes of specific cable designs, with increased automation and redesign for lower-cost production.
• Increasing competition, as market volume becomes more attractive for new entrants.
• More fibers per cable, decreasing the relative added cost of cable jacketing.

The future of fiber optics for data-communication networks is encouraging. A rapidly increasing share of new installations will require links from FDDI rates up to several gigabits, as the number of nodes per network continues to increase and each node supports ever higher data rates.

Peter T. Jewett is a senior research analyst and Daniel Steinbaugh is a research analyst at ElectroniCast Corp. They can be reached at 650-343-1398 or by e-mail: [email protected].