April 7, 2009

Carrier-Class Ethernet Service Getting Serious

Carrier-class Ethernet service for the cable industry is fast becoming a reality as the typical customer expands to include regional business and multi-site markets. It could even replace the traditional T-1 architecture.

Those were the upbeat findings of Metro Ethernet Forum President Nan Chen during Thursday's CTAM business services track session, "Plugged In: Ethernet's Role in Driving Business Services Market Share."

"Ethernet is uptaking to cable, mobile and global connectivity and is now becoming a reality," Chen said. "Cable has an opportunity to replace T-1s, and there are business opportunities, too. There is significant growth worldwide with $16 billion in equipment opportunities, and Ethernet is now the majority of edge routers. We want Ethernet services to be a plug in the wall."

Business Ethernet grew by 43 percent in 2008, primarily because of the lower cost of bandwidth and a greater appetite for capacity, said David Hold, senior analyst of network services for Current Analysis. (For an example, click here.)

"Verizon's Ethernet revenues grew 60-80 percent per year the past 10 years," Hold said. "Yet Cox and Time Warner Cable have just 16 percent of the market, with Comcast next to nothing. That tells us there is a lot of market share to be had by cable."

Getting that market share has its challenges, however. Added Hold: "Cable does not have a unified national network, nor does it have the penetration of the larger telcos. But cable must roll out higher grade Ethernet services, which can help them grow their business services."

One crucial sector in dire need of cable's Ethernet help is higher education, which has suffered through a severe loss of funding during the recent recession. Its technical needs are many, maintained Kahlil Yazdi, CIO and vice president of information technology institutional research for the University of Mary Washington, and it is spending too much on unused bandwidth.

"We have customers relying on us continuously, so ubiquity of services is a critical path, and our bandwidth requirements are growing," Yazdi said. "How do we share multiple data files? It's a real challenge in the next decade."

And a challenge that the cable industry can help meet. Concluded Chen: "We are in phase 1 to allow the industry to deliver carrier-class services, and cable is well-positioned. Ethernet hasn't always been used for carrier-class service, but now it is, and it's because of its proven reliability, with QoS a huge attribute."

- Craig Kuhl

Read more news and analysis on Communications Technology's Web site at www.cable360.net/ct/news/.