ATM/SONET today, IP/Ethernet tomorrow

March 1, 2004

A survey of Lightwave readers in the service-provider space corroborates what many pundits have said for the past year—that IP and Ethernet will shortly become the dominant protocols, particularly in the metro. The same survey indicates those readers see the best current opportunities for optical products and services in the metro, but that the access space will quickly move to the fore.

Lightwave conducted the Internet-based survey last December by contacting 5,000 randomly selected readers and providing them with an URL to take the survey. The resulting respondents were grouped according to where they worked: OEMs, service providers/carriers, or systems integrators/distributors/resellers. A fourth group comprised end users; a report on their perceptions of optical technology will appear in next month's issue.

Our readers indicate that IP and other protocols�likely Ethernet�will supplant SONET/SDH and ATM in networks two years from now.

People who work at local-exchange carriers composed the largest subset of service provider/carrier respondents at 30.8%. "Other carrier/service-provider" (25.6%) and independent telco (15.4%) employees also responded in significant numbers. Not surprisingly given this composition, MAN services topped the list of offerings these readers provide at 41%; "national backbone services" best described company activity for 30.8% of respondents.

The networks our respondents currently operate carry a variety of traffic types. However, our service-provider readers expect the comparative weight of these types to shift significantly over the next two years.

SONET/SDH traffic is the most popular transport protocol in our readers' networks today; 77% of our respondents say their networks carry such traffic now. ATM appears on 54% of respondents' networks, making it the second most popular protocol. IP currently runs over 46% of respondents' networks, while "other" protocols—most likely Ethernet and frame relay—appear on 23%.

The picture changes dramatically when our respondents consider traffic loads two years from now. IP is expected to dominate, with 82% of respondents predicting their networks will carry such traffic. Similarly, "other" traffic—most likely Ethernet—will appear on 56% of reader networks, the respondents predict. SONET/SDH will remain a popular protocol; 56% of respondents believe their networks will carry such traffic in two years. But only 36% foresee ATM appearing on their networks.

Asked to forecast market opportunities for optical communications products and services, the respondents see fiber moving closer to the end user. The network edge currently presents the best opportunity; 56% of the respondents cite that space as offering "great" opportunities in the next year. The local loop garners affirmative nods from 46.2% of the readers, while the network core lags at 20.5%. Looking ahead two years, the edge still is seen positively by 53.8% of respondents. However, the local loop is seen as even more attractive, with 56.4% of readers tabbing that space as a growth area.

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