GPON MARKET MAKES GIGABIT LEAP

Alcatel this week is unveiling its first optical line terminals based on gigabit passive optical networking, or GPON, the higher-speed sequel to the broadband PON widely deployed by Verizon Communications and others. While the move wasn't unexpected, it irreversibly wrests the GPON market from the hands of a single dominant vendor and opens up a more competitive multi-vendor market for the technology.

Alcatel's 7342 ISAM will be generally available in the second half of this year, along with a not-yet-revealed suite of customer premises-based optical network terminals (ONTs). Because it's based on the newest FSAN GPON standards, which are still evolving, Alcatel's gear offers higher speeds than that of the current GPON market leader, Optical Solutions (OSI). Whereas OSI's system provides 1.2 Gb/s downstream and 622 Mb/s upstream, Alcatel's offers 2.4 Gb/s downstream and 1.2 Gb/s upstream.

Vendors of all sizes are expected to introduce their own GPON gear in short order, though they're tight-lipped today. Tellabs, Lucent, Calix and Hitachi Telecom USA, for example, all admit that GPON is on their roadmaps, though they won't say exactly how close. Chip vendors are expected to join in, too, following Broadlight, which announced the sector's first merchant GPON “system on a chip” last week.

“At Supercomm, you're going to have everybody and his brother and sister announcing GPON [products],” said John Griffin, OSI's executive vice president of marketing. “This is looking like a real market now.”

GPON's higher bandwidth not only gives carriers plenty of capacity with which to deploy IP video services, it also leaves room for high-definition television, attributes that now have the eye of the nation's largest carriers. According to several industry sources, Verizon Communications, BellSouth and SBC — the same three carriers that collaborated on an influential request for proposals regarding BPON gear in 2003 — issued a request for information regarding GPON within the past few weeks.

Among other things, the Bells want to know how easily they can migrate their current BPON equipment to GPON. Verizon, sources say, wants to know how GPON would handle the RF video it currently uses in BPON networks. With debate ongoing among the authors of GPON standards, that RFI will help determine precisely what “flavor” of GPON — which line rates, framing procedures and optical reach — will see wide deployment and the cost benefits that come with it.

“Nobody wants to cut silicon until they narrow the focus of [GPON] service adaptation levels,” said KMI Research analyst Joe Savage just prior to the Broadlight announcement. “ONT suppliers know you've got to be cheap and integrated. They're waiting for GPON chipsets.”

Alcatel, using its own chips, is placing its bet now in order to get ahead of the broader market for GPON equipment that will emerge with merchant chips in the middle of next year. Basing its new gear on FSAN's GEM framing specification, Alcatel claims its BPON gear in the field can upgrade to GPON by inserting two processing modules from its new device and the requisite line cards. And though the 7342 will initially be set up for IPTV, RF video capabilities will come in 2006.

OSI, though it replied to the Bell RFI, will stay focused on smaller carriers and municipalities as competitors hone in on its technological turf, but it will keep an open mind to partnerships with larger vendors that could help win that Bell business. It might raise its speeds to Alcatel's level, “if that's the way the standard goes,” Griffin said. It might also use another vendor's chips. But, in any case, it hopes to reap the economic benefits of GPON's growing popularity.

“The more guys we can have doing GPON, the lower the [price of] components is going to be for all of us in the space,” Griffin said. “I hope Verizon deploys GPON and starts tomorrow.”