Media : Optical Gold Rush
David Braue
Jun 1, 2000, 09:30

Email this article
 Printer friendly page

The worldwide market for optical networking equipment is exploding; analyst firm Dell’Oro Group, for one, recently reported that the optical transport market grew 22 percent in the last quarter of 1999 to be worth $US4.9 billion – a run rate that should put this year’s market well over 1999’s $US15.3 billion.

DWDM equipment last year accounted for some $3.8 billion of this, with the rest accounted for by more-mature SONET/SDH (Synchronous Optical Network/Synchronous Digital Hierarchy). SONET (used in the US) and SDH (used in Australia and elsewhere) split raw fibre into manageable chunks of bandwidth that can be onsold as telecommunications services. These networks have traditionally provided high-speed connections between local and interstate telecommunications exchanges, which have been terminated at customer premises over the local cooper loop or, occasionally, local fibre connections.

Melbourne-based Haliplex Communication Systems is elbowing its way into the global optical networking market with two optical networking multiplexers that provide direct access to SONET/SDH optical networks already widely used by most carriers. But by distributing multiple smaller interfaces across their SDH network, Haliplex sales and marketing director Alan Kepper says carriers will be more able to scale xDSL and other broadband services to match market adoption without requiring the expense of full-on telecommunications exchanges. He believes Australian carriers will instead extend their SDH networks straight into local neighbourhoods using unobtrusive, traffic signal switch-sized multiplexers that can be installed in parking lots, on street corners, or anywhere else they’re needed.

"It’s a fundamental mathematical equation," Kepper explains. "You’ve got more and more high-speed access, and there’s technically no way of reticulating the bandwidth of everyone except over optical. When you’ve got all this access with people hooking up with [xDSL and] fibre, the core has got to be incredibly thick."

Although it’s seeking funding to take its technology into the world market, Haliplex will be stepping into the path of hungry competitors in an optical networking market that is expected to grow to more than $US13 billion in North America alone by 2003. Potential rivals include Nortel Networks, Lucent Technologies, Alcatel, Fujitsu, Marconi, and Ciena – and all are fighting startups such as Sycamore, Redback and Chromatis to dominate.

Not surprisingly, this mad dash has been fuelled by a number of big-budget takeovers: market leader Nortel, for one, has recently paid $US8 billion to buy laser and filter maker CoreTek and optical networking startups Xros and Qtera -- neither of which has even started shipping products. The company recently announced it will invest some $US660 million into optical networking to triple its production capabilities in Canada, the UK and US, and last month created a completely new business division, called High Performance Optical Components Solutions, to focus its optical networking development efforts. Competitors have been chasing the market equally hard. Cisco, for one, has shelled out over $US10 billion in the last year to purchase optical networking firms Cerent and Monterey Networks, and to acquire the optical networking-related assets of long-haul DWDM specialist Pirelli.

Last November, Redback Networks bought nascent Siara Systems for $US4.3 billion from its $US6 billion IPO last year. And in March, Lucent bought out optical networking startup Ignitus Communications for an undisclosed amount. Working in fierce competition, these companies – and others – are rapidly advancing the state-of-the-art. Later this year, for example, DWDM will be challenged by a proprietary standard from SilkRoad called SilkRoad Refractive Synchronization Communication (SRSC), which is said to offer up to 6 Tbps of transmission at a lower cost than DWDM because it uses a single laser beam.

New photonic switches from companies such as Xros and HP spinoff Agilent will provide a major boost for optical networking, since both solve a long-standing problem with optical networks – specifically, the need to convert photons received over the fibre cable into electronic signals, switch the traffic, and then convert the electrons back into photons for retransmission to their destination. This is because current equipment cannot pull the destination information it needs straight out of the light stream. Instead, Xros, Agilent and the inevitable stream of future competitors have created switching platforms that use arrays of microscopic mirrors to switch the light beams without having to convert them to electrical impulses. This will remove the overhead of photon-to-electron-to-photon conversion and pave the way for stunningly fast network switches.

Not one to be left behind, Intel has also made moves into optical networking, in March spending $US1.25 billion to purchase Danish optical networking chipmaker Giga A/S. But Intel will be following the lead of chip maker Broadcom, which last month lit a fire under equipment makers with the launch of a single $US88 chip providing 10 Gbps optical transmission. Broadcom’s chip will no doubt dovetail with current efforts by the IEEE to produce a 10-Gigabit Ethernet (10 GE) standard, IEEE 802.3ae, which will provide a standardised method for corporates and service providers to interface with massive optical networks. Pre-standard 10 GE equipment is expected from Cabletron and others late this year, and Dell’Oro recently predicted the market will pass $US1 billion by 2004.

© Copyright Haliplex

Top of Page

Haliplex Public Website HPX-1600 | HPX-800 | Optical Networking | HPX View Management
Contact Haliplex | Copyright © 2010 Haliplex Pty Ltd. All rights reserved. | Privacy Policy | News | Industry Features
OEM Partners : Nokia Siemens Networks, Force10 Networks, Coastcom, Bayly. Compliances: ISO 9001:2000, ISO 14001:2004, RoHS, WEEE.