BATM CEO: PON is wrong route

Declaring that the passive optical network (PON) has too many limitations, Zvi Marom, CEO of BATM, the parent company of Telco Systems, said carriers are making a mistake by not implementing active Ethernet architectures.

PON, which has been declared the preferred architecture of Verizon, AT&T and BellSouth, largely mimics what carriers are comfortable with, he added. However, the technical limitations and cost structure of PON make it the wrong choice.

“With high-definition video coming, there isn’t enough bandwidth in PON,” he said. “And it isn’t as cheap as people think.”

PON proponents traditionally have claimed that the cost of maintaining a passive network is cheaper than active options because it is based on not putting expensive electronics in the field. However, Marom said the numbers being used by PON vendors are based on best-case scenarios in which service providers are capturing the vast majority of the market for multiple services.

“The PON economic model doesn’t stand up,” he said. “The point of building a network is to bring customers service at the lowest possible cost. It’s not to reduce opex for companies under stress.”

By contrast, active Ethernet architectures can rely on the cost reductions made in Ethernet. Additionally, Ethernet-based architectures give carriers a lot more flexibility in developing new applications.

“The important part of IPTV is the IP part,” Marom said. “[Carriers] are not going to reinvent TV.”

Marom believe PON has its place—as a complementary technology for dense urban areas. In those markets, the cost differential between active and PON is about the same.

“But in every other area, active is cheaper,” he said.