DWDM slides on into metro

Now that dense wavelength division multiplexing has taken such a stronghold on the long-haul fiber optic network, the metropolitan market is starting to look sexy. In the long-haul market, DWDM was more economical than laying new fiber. But the gamble with the metropolitan market is when the need will be there and if carriers are putting it in the right areas.

The promise of the metropolitan market is not too far away, according to Erica Henkel, an industry analyst for Frost & Sullivan. "It is a very ripe market and one that we predict will have an annual compound growth rate in the United States of 58.7% from 1998 to 2005," she said. " Long-haul [networks], on the other hand, have a growth rate of 12.7%. The metropolitan market should open up in 2000."

At the Optical Fiber Conference in San Diego, there was much discussion about who is ready and who isn't. Nortel Networks' OPTera, Ciena's FireFly and Tellium's MetroXpress are currently available. The up-and-coming include Lucent Technologies' WaveStar AllMetro, NEC's Spectral Wave, Alcatel's Model 1690 and unnamed products from Optical Networks and Fujitsu.

"Metropolitan DWDM is really the beanie baby of optical networking," said Kathy Szelag, vice president of marketing-optical networking for Lucent. "It is nowhere near the revenue stream of long-haul, but it may be there a few years from now."

"The catch is that while metropolitan DWDM may be expected to have the highest growth rate, the revenues generated will be less," said Henkel. That will make it difficult for start-up companies to break into the market already claimed by larger companies such as Nortel and Ciena, she added.

One start-up, Optical Networks, is taking aim at the stalwarts. "With only about seven carriers in the long-haul market, there are around 180 in the short-haul, and more new ones are coming," said Hugh Martin, president and CEO of Optical Networks. While larger companies are focusing on the physical aspects of DWDM, Optical Networks' product will concentrate on software, he said. "The short-haul customers in general know a lot less about networks and equipment [than those in the long-haul area]," said Martin. "So while the engineering [knowledge] of the customer is going down, the software involved with our product will help bridge that gap."

Tellium goes along with that concept. Tellium's MetroXpress, which is an available software-focused product, "adds intelligence at the optical layer," said Dick Barcus, Tellium's vice president of marketing.

Lucent's ring-based WaveStar AllMetro, which will be available in the fourth quarter, offers systems varying in size-four, eight, 20 and 40 wavelengths. The AllMetro enables providers to mix and match systems of various sizes and add/drop capabilities in a given network, Szelag said. "Enterprise/business customers may be more interested in eight wavelengths, while customers like Ameritech may want 40."

Several regional Bell operating companies and competitive local exchange carriers are deploying metropolitan DWDM products, Henkel said. For example, GST Telecommunications has deployed Ciena's Firefly in Phoenix and Las Vegas.

"DWDM works well in long-haul-so why not put it in local loops," said Steve Hensley, vice president of engineering at GST. "Right now we are just making sure we accommodate future DWDM needs and each piece must pay for itself along the way."

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