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Carrier Ethernet on the rise

Terral Shelby, IP Business Manager, Alcatel-LucentCarrier capital spending (capex) may be down during the current economic downturn but Carrier Ethernet is bucking that trend. Service provider investment in Carrier Ethernet gear is growing faster than telecom capital expenditures, according to Infonetics Research. That is probably not too difficult as telecom capex was down about 20% in the first quarter, according to UBS.

Service providers spent US$17 billion on carrier Ethernet equipment in 2008, according to Infonetics. The firm expects spending to top $32 billion in 2013, a compound annual growth rate of 13.5%, as service providers migrate to next-generation IP networks, and Ethernet transport from SONET/SDH.

The largest investments will be in IP core and edge routers, Carrier Ethernet switches and optical gear, Infonetics says. Ethernet microwave is expected to grow at a fast clip due to its use for backhauling mobile traffic, the firm says. And Ethernet services will be marketed as a lower cost-per-bit service than traditional WAN services with the ability to increase speeds without changing out equipment at the central office or customers premises, Infonetics says.

Carrier Ethernet takes center stage. For the first time in years, there's a real challenge to the dominance of Layer 3 MPLS in the WAN. Enterprises are turning in unprecedented numbers to carrier Ethernet services, driven primarily by ease of use and lower cost-per-Mbit/s. About 87% of enterprises that have tried it say they expect to purchase more in 2009.

Carrier Ethernet is a ubiquitous, standardized, carrier-class service defined by five attributes that distinguish it from familiar LAN-based ethernet. It brings the compelling business benefit of the ethernet cost model to achieve significant savings. Service providers worldwide are migrating their existing networks to deliver Carrier Ethernet services to enterprises, businesses and residential end-users. “Carrier Ethernet remains one of the hot topics in the industry and we expect telcos to continue investing in this area. Quite simply the main driver is lower cost. Ethernet totally dominates the LAN, it's estimated that 97% of data on the internet starts or terminates on an Ethernet port. This success has made Ethernet the lowest cost and most efficient network protocol we know today and the emergence of Carrier Ethernet brings this cost model to the wide area network for service providers to reap its benefits also,” says Eric Roelofs, Carrier Sales Director – Middle East, Nortel.

An opinion echoed by Terral Shelby, IP Business Manager, Alcatel-Lucent: “Telcos are concentrating efforts and budgets on technologies which bring them closer to a Core Packet Network (CPN). They are investing in the ability to deliver lower priced, higher speed Ethernet based services, because this allows for the delivery of High and Low end “Payable services”, or “Internet Consumables”.

Besides, Carrier Ethernet requires no changes to customer LAN equipment or networks and accommodates existing network connectivity in addition to the ability for millions to use a network service that is ideal for the widest variety of business, information, communications and entertainment applications.

Also, Carrier Ethernet offers more cost-effective connectivity than traditional WAN services. Moreover, Carrier Ethernet provides higher bandwidths to enterprises more affordably than traditional WAN services. Today, 10Mbps and GE services are readily available in most metro markets, with 10GbE availability also increasing, and work ongoing on 40 and 100 GbE standards well underway. “ This offers enterprises the opportunity to support a growing number of bandwidth intensive applications (e.g. server virtualization, video conferencing) which help improve productivity. Furthermore Carrier Ethernet allows enterprises to implement a simplified network model, consisting of end-to-end Ethernet connectivity. Compared to the traditional model which requires an additional stage of protocol conversion, Carrier Ethernet simplifies operations and management,” says Roelofs.

Many flavours

The MEF (Metro Ethernet Forum) is a global industry alliance which aims to accelerate the worldwide adoption of Carrier-class Ethernet networks and services. In support of this objective the MEF has developed a common set of definitions for Carrier Ethernet services, including E-Line (point-to-point), E-LAN (multipoint-to-multipoint) and E-Tree (point-to-multipoint). The three flavors of carrier Ethernet are:

— Ethernet access to MPLS services. Here, the carrier provides a direct Ethernet interface to “classic” Layer 3 MPLS services. The user's customer edge (CE) router connects with the carrier's provider edge (PE) router across an Ethernet interface, and the carrier routes the user's traffic across the cloud. The upside: higher-speed access to traditional MPLS services, with all the QoS support that MPLS provides. The downside: the carrier is involved in IP-layer routing.

— Point-to-point Ethernet services. Here, the carrier provides a direct Ethernet interface to the user, but only at Layer 2. The user's CE router connects to a carrier switch (typically MPLS) that transports traffic across the cloud, but looks and feels like a WAN Ethernet link. That is, the IP device that the user's CE router is connected to is another CE router across the cloud. The upside: a clean, simple link across the WAN — ideal for, say, high-bandwidth links between data centers. The downside: as the name implies, the link is point-to-point, meaning that the service doesn't scale to a full-blown WAN.

— Multipoint Ethernet services, or virtual private LAN services. Here, the carrier provides a direct Ethernet interface to the user, again at Layer 2. The user's CE routers interconnect across what looks, smells and feels like a “LAN across the WAN” — with all IP routing controlled and managed by the user. The upside: it's simple to install and configure, compared with MPLS. The downside: QoS isn't native (though carriers have different ways of prioritizing customer traffic at Layer 2). Additionally, there may be some challenges with scalability. I haven't seen any multipoint Ethernet networks larger than roughly 200 sites — MPLS networks, in contrast, are often several thousand sites.

Users are increasingly interested in adopting all flavors of carrier Ethernet, primarily due to the ease of configuration and lower cost of bandwidth. The key to doing so successfully? Know which one you want.


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