Shaping the Future Development of the
Networking Industry
Managed Ethernet Solutions for the
Enterprise
Abstract: Customer empowerment is the new paradigm in the business of network
service offering. With the customer in full control of the service management, service
providers need to develop an intelligent and a flexible networking and integration
environment. Ethernet is the enabling technology to create a seamless managed
platform across MAN, WAN, and Global Area Networks (GAN). Application-aware
networks are required to support consistent, predictable, and highly available network
service performance benchmarks for demanding mission critical applications. A
holistic application-centric platform design and network technology integration using
Ethernet transport fortified with a traffic engineered backbone technology (e.g.,
MPLS/VPLS) are pre-requisites to create a reliable, highly resilient, dynamic, and
scalable service platform.
By
Dr. Kamran Sistanizadeh
Chief Technology Officer
KSistanizadeh@relianceglobalcom.com
Shaping the Future Development of the
Networking Industry
Browsers have enabled access to the Internet in a encompass a diverse set of application
ubiquitous manner. High speed access along with requirements in such disciplines as business
guaranteed Quality of Service (QoS) will in turn intelligence, business process management,
democratize the utility of the Internet, thereby knowledge management and collaboration, content
facilitating a uniform platform for computing and and document management, and
communications. Such an environment will, one day, compliance/governance and security concomitant
commoditize access to and utilization of a host of with traditional back-office operational systems such
applications over a globally distributed computing as CRM and XML-based enterprise application
engine. integration.
Such solutions will span a spectrum that includes Telecom industry pundits have been pontificating on
both a well-defined suite of applications and a host the availability of “bandwidth” as a “commodity” for
of yet-to-be-developed solutions fuelled by the the past two decades. The sacred catechism of
virtuous cycle of innovation. Innovation drives “communication anywhere, anytime, on any media,
demand, and demand fuels economic growth. It is with any bandwidth, for any application, with a
essential to keep innovation alive for enterprise and guaranteed Quality of Service (QoS)”still seems to
service providers by providing an economically be elusive at best.
nurturing environment with proper regulatory
incentives. There are similar nirvanas in the communication
industry. For example, the notion of “converged
There is a plethora of emerging applications in the network services” has been touted for more than a
communications and medical fields that are decade by IXCs and ILECs. And in the
emerging as a result of innovation. These semiconductor industry, companies such as Intel
applications will demand high quality network are avid proponents of a seamless communication
infrastructure for their growth and widespread utility. paradigm - “make any device interact seamlessly
Amongst such noted applications are peer-to-peer with any other device any time anywhere in the
communications, grid computing, telemedicine (tele- world” as quoted by Intel in public forums.
pathology, 3-D MR, remote medical diagnostics),
intelligent search agents, distance learning, Such usage attributes are not guaranteed rights for
entertainment quality content distribution, securities the user community, but rather earned privileges
exchange platforms (e.g., ECNs), electronic that are far from being perceived as commodities. In
discovery platforms per Sarbanes-Oxley compliance, the US telecom markets (and most of the developed
unified messaging spanning over wireline and countries) neither residential nor enterprise
wireless infrastructures, virtual reality (tele- customers have been able to attain such service
immersion with 3-D video calls), remote robotics, attributes –even in the midst of a purported
and biometric identification. “bandwidth overabundance.” The truth is that there
is no bandwidth over-abundance. Au contraire,
With the standardization of Web Services there is bandwidth scarcity - especially within the
Development (WSD) technology, there are a metro environment. What critics have mistakenly
multitude of enterprise class application platforms publicised are the myths around where the
that are fuelling the demand for a flexible and bandwidth abundance has occurred –rather than
dynamic service environment –e.g., on-demand understanding where the bandwidth will really be
bandwidth, application-based QoS, application- needed.
based storage and recovery schema, etc. Such
platforms have emerged on a wide spectrum of Furthermore, there needs to be a distinction
requirements –e.g., from a domain of regulatory- between usable (lit) and dormant (unlit) bandwidth
driven mandates to cost and efficiency-based infrastructure –e.g., according to a Merril Lynch
internal operational metrics of the enterprise. An report, there is currently about 39 million miles of
“intelligent” enterprise environment would fiber in US and only 10% of this fiber is in use. It
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Copyright 2005 © Reliance Globalcom, Inc. All Rights Reserved. May 2005
Shaping the Future Development of the
Networking Industry
should be noted that the penetration of the security, storage, backup and recovery, as well as
“broadband network” in the US –as measured under corporate network resiliency. These bright spots are
any equivalent criteria - is one of the lowest softening the effects of the recent downturn and
amongst the “info-structure” developed countries in may indeed be signs of a new up cycle.
the world.
In the midst of enterprise-bound technology Strong partner relationships have always been
proliferation, 80% of US-based enterprises have important in the telecom industry. New products,
bandwidth less than that of a T1 line (1.5 Mb/s.) services and technologies are seldom the product of
Although some contrarians would argue that there is organic development from entrenched players.
no application-driven demand for higher bandwidths, Network service providers, for instance, each have
a majority of the stakeholders would vehemently access to the same suppliers and equipment
argue that there is no infrastructure to provide manufacturers to assemble networks –i.e.,
higher bandwidth, thereby constraining application essentially offering similar services to an end
development. customer. Aside from pricing and minor differences
in feature/functionality, the real “value
differentiation” is how such services are provided
Innovation is an essential factor for the growth of and what the end-user experience would be. And
the telecom market and a critical driver for demand. those attributes are typically as unique as the
With no incentives to improve network infrastructure, partnerships that are embraced.
back-office, and operation support systems the
ability to refine quality and service profiles are
adversely impacted; thus demand growth Managed service has been in the telecom
decelerates. During the past three years the lexicon for more than a decade, either as a
telecom industry has been in a state of turmoil, Customer Network Management (CNM) or under
perhaps even chaos. In spite of the challenging Customer Services Management (CSM). In the
environment, the industry simply continues to former case, the service provider would monitor and
advance as it always has –within the orderly, manage the customer network, and in the latter
familiar patterns of economic cycles, technology case, the service profile would be managed based
cycles and business concept life cycles. on customer requirements. Despite technical
advances in both the enterprise as well as the
A basic truth is that economic, business, and backbone service provider environments, major
technology cycles are healthy. In times of economic improvements in metro infrastructure, network
growth and plentiful capital, up cycles spawn management technologies, information systems,
creative technologies, new business models, and and operation support systems are needed to fulfil
needed competition that forces entrenched the promise of CNM and CSM. Furthermore, past
providers to pay more attention to their products, clichés such as RAS (Reliability, Availability, and
services and customers. In the down cycles we see Serviceability) and FCAPS management (Fault,
consolidation and sometimes failure, as companies Configuration, Accounting, Provisioning, and
are forced to become more efficient, control costs, Security) are still sound benchmarking tools for
re-examine their place in the market along with the service activation within the enterprise environment.
sustainability of their business models. These are
the forces that push our industry forward; even if it is
not in a straight line, they help maintain efficiency, Customer empowerment is the new paradigm
generate innovation and create new businesses. in the business of network services offerings.
Customers should be “in control” of their service
Recent geo-political events have created a number management. Network service infrastructure should
of new high-growth niche markets, resulting from be able to keep pace with the advancement of
businesses addressing their new needs for data
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Copyright 2005 © Reliance Globalcom, Inc. All Rights Reserved. May 2005
Shaping the Future Development of the
Networking Industry
desktop application requirements and the customer Liquid bandwidth and application-based QoS
premises networking environment. Such attributes are required to satisfy a variety of enterprise
are the catalysts, and in some cases pre-requisites, application environments that are time dependent.
for the turn-around in the telecom services business. Such applications currently serve niche markets.
Real-time, transaction-oriented trading and
exchange requirements in financial verticals have
“Ethernet” is the underlying technology to enable spawned a new class of QoS-sensitive applications
“customer empowerment,” and help catapult with exacting demands on latency, jitter, and packet
demand. The customer needs to be in “the driver loss for deployment across wide geographic
seat” for the usage of network services, with the distribution areas. Electronic discovery and SEC
service provider executing based on customer compliance requirements have fuelled development
requirements for provisioning network resources. of advanced document management and
The interplay of “application-aware networks” and knowledge management search engines for legal
the “network-aware applications” can produce a and financial verticals. Such mission critical
powerful and highly productive environment. applications would constitute the overall
requirements for service providers’ transport and
In such an environment, the user would launch an transit technology platforms.
application –and the network would be sufficiently
intelligent to recognize the application, and request Research institutions and hospitals in healthcare
the network control systems to allocate the requisite verticals are adopting applications for transport of 3-
resources to set up, maintain, and guarantee the D volumetric radiology images. Although the
required QoS for the period that the application is notional value of videoconferencing has been touted
active. This resource allocation could also be for the past few years within the enterprise,
assigned through a pre-determined schedule inexpensive high quality bandwidth would cause its
depending on user requirements. proliferation on an extensive basis.
The network resources can be segmented via Another bandwidth intensive application is disaster
service classification (i.e., bandwidth usage, traffic recovery and business continuity planning.
prioritization, latency, and jitter) on an end-to-end Enterprises need to back-up, mirror, retrieve, and
basis. For obvious reasons, in such a service restore data on a distributed manner across offices
offering, service control and management across and data centres. Content Distribution Networks
boundaries of various network providers become a (CDN) are needed for the digital production
critical issue –and standards compliance and environments. Oil and Gas companies deploy large
interoperability collectively takes an even more bandwidth for transport of seismic data in the
pivotal role in the provisioning of services. exploration activities. CAD/CAM designs in the
automobile, aerospace and other high-tech
The requisite technologies to support an application- environments are also in need of large bandwidth
aware environment within metro and wide area not only at the enterprise level speed but also
networks are maturing. Although there exist a through the inter-enterprise.
variety of schemes to provide application
optimization (e.g., rate shaping of layers 3 through 7
of the ISO stack using compression or other Reduced complexity in data management is
proprietary techniques,) the objectives are all similar another pivotal driver in the growing data storage
–i.e., enable a consistent, predictable, and priority- needs of the enterprise. The enterprise computing
based application performance. environment demands efficient access and
management of data for analysis and collaboration
via XML and other web services technologies. In the
LAN environment, certain tasks need to be
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Shaping the Future Development of the
Networking Industry
automated such as virus scanning, encryption, and support a variety of enterprise application
software upgrades in an efficient manner. In requirements.
addition, the environment needs to be scalable to
ensure that such tasks are performed without
perceptible impact on the user community’s tasks. Metro areas are “choking points” that require to
keep abreast of capabilities of their interconnected
Although the price is a pivotal decision factor, such neighbouring networks –namely the core backbone
attributes as flexibility in bandwidth provisioning, network and enterprise environments. Throughout
scalability, on-demand network resource availability the late 1990’s the enterprise as well as the core
are key decision elements in the overall backbone experienced unprecedented growth in
procurement process within the enterprise. The capacity due to quantum leap progress in the
simplicity of the Ethernet deployment and the developments and productisation of both Ethernet
ensuing reduction in total cost of ownership (e.g., and optical technologies. However, during this
reduced training of the IT staff, lower resource period of massive change, the metro infrastructure
requirements, no protocol conversion devices, etc.) lagged in reaching equilibrium in performance and
provides another incentive to gravitate towards the service quality.
Ethernet technology vis-à-vis legacy based
technologies - e.g., SONET, ATM and Frame Relay. Optical networks within the enterprise LAN
environment have taken a major leap forward in
terms of affordability, simplicity and availability with
Multi-Protocol Label Switching (MPLS) is the the ratification of a series of optical Gigabit Ethernet
enabling protocol for Virtual Private Networks (VPN) standards. These standards are likely to have their
services in support of enterprise intranets and largest impact on carrier-based WAN services for
extranets applications. VPNs that are established the enterprise, which are seriously being considered
through MPLS or Virtual LAN (VLAN) based to take on a migration path from legacy
technologies depend on the service provider’s ATM/SONET protocols to Ethernet.
underlying network technology infrastructure. It is
estimated that such VPNs would be provisioned at Enabled by technology drivers such as MPLS,
40%-50% cost of the existing Frame Relay services. Resilient Packet Ring (RPR) transport, ASIC based
The majority of applications would be for remote wire-speed switching, and low cost deployment,
access and intranets followed by extranets and e- extending Ethernet into the regional metro and WAN
commerce business. VLAN-based networking environments should become increasingly attractive
solutions in the metro area will see a significant from a financial basis.
growth over the next couple of years. According to
published results (December/04 issue of Business
Communications Review) MPLS-based VPNs Global Area Networks (GAN) are next in the
market is estimated to reach $1.6B by 2008 which horizon to extend Ethernet on a multi-network multi-
will fuel the need to provision VLAN-based national basis. Powered by MPLS-based traffic
infrastructure in the metro area. engineering, spanning variety of network platforms,
the user community will experience similar service
MPLS can either enhance service features and attributes of flexibility and scalability as in the LAN
capabilities or reduce the provisioning cost of and metro environments on a global basis.
existing services. A scalable and traffic-engineered
“multi-point” virtual LAN service can be provisioned
by deployment of MPLS-based technologies such Ethernet technology advances have eclipsed
as VPLS. Although there are network Moore’s Law over the past decade through its
interoperability and integration challenges that need expansive capabilities in speed. The evolution of the
to be overcome, the foundation for QoS control and Ethernet based LAN technology enabled
end-to-end service management currently can
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Copyright 2005 © Reliance Globalcom, Inc. All Rights Reserved. May 2005
Shaping the Future Development of the
Networking Industry
deployment of 10-GigE in 2002, an order of Projected 10 GE Cost Trajectory and Port
magnitude increase in speed since 1999 when 1- Shipments
GigE was introduced into the mass market. Ethernet
technology has consistently been the winner in the
cost competition arena. The following Figure,
compiled by Dell’Oro Group in 2002, reflected
reasonably well the cost of providing the equivalent
of 1 GigE/sec bandwidth using SONET vs. Ethernet-
based switching technologies. Note that consistently,
Ethernet technology proved to be the winner in the
cost competition arena. It is believed that this trend
will likely continue throughout 2005 and beyond.
Cost Trajectory for GE and Legacy Technologies
Dell’Oro Group Projections –2004
Standard forums like Metro Ethernet Forum (MEF)
and IEEE sponsored groups, such as Ethernet in
the First Mile (EFM), are working to provide - as
technology integrators – cost effective “carrier-
grade” solutions for the metro access infrastructure.
The level of membership and active participation by
carriers as well as suppliers are solid indications of
the viability of the business model.
The new millennium ushered in the deployment of
the first semi carrier-grade optical Ethernet in
metropolitan area markets. Although the demand
Dell’Oro Group Projections –2002 was not as expansive as originally anticipated, the
last couple of years brought in an increased
deployment of Ethernet on a national basis.
It should also be noted that the proliferation of 10-G
Ethernet technology will take its own exponential
By all accounts, proliferation of Ethernet based
growth path in coming years. The following graph
services are increasing at an accelerated pace.
(as compiled by Dell’Oro) is the projected growth on
According to a series of 4Q/2004 reports, there is
10-G port shipments along with estimated port cost.
unanimity amongst analysts regarding double-digit
Companies such as Intel are already working on the
growth (upwards of 30%) in enterprise adoption of
second generation 10-GigE chip technology which
Ethernet-based services (see the following Table for
would further accelerate the cost reduction.
various estimates.)
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Shaping the Future Development of the
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Forecast of US Ethernet Services Market
(Light-Reading, December 2004) From a capacity expansion perspective there are
three viable scenarios for service providers:
2003 2008 CAGR expansion of the physical infrastructure by
deployment of fiber strands, adoption of wavelength
$385 $1.4
Vertical Systems 30.0% technology (i.e., DWDM, CWDM), or upgrade of the
million billion
$315 $1.2 switching platforms to 10-GigE. Although fiber
IDC 30.7% deployment might initially be perceived as the
million billion
$400 $4.0 smoothest expansion strategy, the cost of fiber can
Yankee Group 57.0%
million billion be an inhibiting factor. For incumbent Gig-E service
providers, 10-GigE technology is the seamless
option in the upgrade of backbone capacity - if the
Adopting a vernacular similar to “Video Dial Tone existing devices can sustain such an upgrade.
(VDT)” –the promised residential broadband service
offerings of the late 90’s - it is not unreasonable to For multi-protocol service offerings, DWDM/CWDM
anticipate the arrival of “λ-Dial Tone” to the desktop. technology offers the best solution. The existing
With the advent and cost-effective productisation of devices provide Fiber Channel, ESCON, OC-x, in
“tunable lasers” on a network interface cards, it is addition to GigE interfaces. Furthermore, for point-
economically viable to enable the desktop to accept to-point private networking solutions, with dedicated
very large capacity for high bandwidth applications. high capacity (1-GigE and above), WDM can be
highly competitive with 10-GigE. However, one of
It is envisioned that the scalability and low cost of the drawbacks of such a scenario is adoption of
Ethernet will prompt a fundamental paradigm shift different element management systems (EMS) and
on service providers’ TDM-based network its integration with the upstream network
architecture for transport. For example, instead of management system (NMS) which would potentially
carrying Ethernet over a voice-centric TDM circuits increase the OPEX.
as has been the norm, TDM circuits would be
carried over Ethernet.
Challenges that metro service providers face are
Regardless of the scope and timing to implement in two categories; first, build-out of the physical
such visions, one principle is emerging. Enterprises access infrastructure, and second, implementation
are poised to gain order-of-magnitude leaps in of cost-effective intelligent Operations Support
internetworking and communications capabilities as Systems (OSS) that are tailored towards metro
a result of carriers moving to offer optical Ethernet services. The characteristics of traffic pattern,
WAN services on a national scale. dynamic provisioning, churns on reconfiguration,
and the economics of the metro are quite distinct
from that of WAN and backbone technologies.
The access infrastructure can take any form of
either wireline (fiber and copper) or wireless Access infrastructure, service interoperability
technologies (WiMax, MMDS, LMDS, FSO, WiFi, (transcending across metro boundaries into the
and other unlicensed microwave spectrum) backbone), automated service provisioning, on-
depending on the throughput and QoS requirements. demand network scalability, service transparency,
Physical constraints to reach CPEs on the bandwidth liquidity, differentiated security, and
enterprise premises (i.e., build-out of the riser cable policy-based service profile management are
and/or using telephony grade twisted pairs) also requisite attributes to create seamless and flexible
play crucial and somewhat painstaking roles –and communication environments within intranet and
that is precisely the reason for the existence and extranet communities.
contributions of IEEE/EFM.
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Meanwhile, the David vs. Goliath battle will continue,
with cash-rich incumbents using their embedded
legacy plants fighting with emerging and innovative
start-ups that are bringing Ethernet to into the
mainstream of networking.
The customer acquisition battle will be won by
those who offer “managed value-add solutions” to
customers. Innovation and creativity are pre-
requisites for creating such solutions –and the
entrepreneurial spirit is needed to bring life into its
existence.
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About Reliance Globalcom For further information:
Reliance Globalcom, a division of Reliance Reliance Globalcom
Communications, spearheads the Global Telecom Units 1+2 Great West Plaza,
operations of India's largest Integrated Telecom Riverbank Way
Service Provider. Reliance Globalcom brings Brentford, Middx, TW8 9RE, UK
together the synergies of Reliance Communications T: +44 (0)20 8636 1700
Global Business encompassing Enterprise Services, F: +44 (0)20 8636 1700
Capacity Sales, Managed Services and a highly E: info-uk@relianceglobalcom.com
successful bouquet of Retail products & services W: www.relianceglobaclom.com
comprising of Global Voice, Internet Solutions and
Value Added Services. The company serves over
1400 enterprises, 200 carriers and 2 million retail
customers in 163 countries across 6 continents.
Reliance Globalcom owns the worlds largest private
undersea cable system spanning 65,000 kms
seamlessly integrated with Reliance
Communications over 110,000 kms of domestic
optic fiber provides a robust Global Service Delivery
Platform connecting 40 key business markets in
India, the Middle East, Asia, Europe, and the U.S.
With its recent acquisition of eWave World, a
pioneer in the global Wimax space, Reliance
Globalcom has the capability to launch 4G services
in over 50 countries. It has also acquired Vanco
Group, enabling the company to provide managed
services to over 230 countries and territories across
the globe.
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