Q&A: Ciena’s CTO on networking and technology

In Part 2 of the Q&A, Steve Alexander, CTO of Ciena, shares his thoughts about the network and technology trends.

Part 2: Networking and technology

"The network must be a lot more dynamic and responsive"

Steve Alexander, Ciena CTO

Q. In the 1990s dense wavelength division multiplexing (DWDM) was the main optical development while in the '00s it was coherent transmission. What's next?

A couple of perspectives.

First, the platforms that we have in place today: III-V semiconductors for photonics and collections of quasi-discrete components around them - ASICs, FPGAs and pluggables - that is the technology we have.  We can debate, based on your standpoint, how much indium phosphide integration you have versus how much silicon integration.

Second, the way that networks built in the next three to five years will differentiate themselves will be based on the applications that the carriers, service providers and large enterprises can run on them.

This will be in addition to capacity - capacity is going to make a difference for the end user and you are going to have to have adequate capacity with low enough latency and the right bandwidth attributes to keep your customers. Otherwise they migrate [to other operators], we know that happens.

You are going to start to differentiate based on the applications that the service providers and enterprises can run on those networks. I see the value of networking changing from a hardware-based problem-set to one largely software-based.

I'll give you an analogy: You bought your iPhone, I'll claim, not so much because it is a cool hardware box - which it is - but because of the applications that you can run on it.  

The same thing will happen with infrastructure. You will see the convergence of the photonics piece and the Ethernet piece, and you will be able to run applications on top of that network that will do things such as move large amounts of data, encrypt large amounts of data, set up transfers for the cloud, assemble bandwidth together so you can have a good cloud experience for the time you need all that bandwidth and then that bandwidth will go back out, like a fluid, for other people to use.

That is the way the network is going to have to operate in future. The network must be a lot more dynamic and responsive.

How does Ciena view 40 and 100 Gig and in particular the role of coherent and alternative transmission schemes (direct detection, DQPSK)? Nortel Metro Ethernet Networks (MEN) was a strong coherent adherent yet Ciena was developing 100Gbps non-coherent solutions before it acquired MEN.

If you put the clock back a couple of years, where were the classic Ciena bets and what were the classic MEN bets?

We were looking at metro, edge of network, Ethernet, scalable switches, lots of software integration and lots of software intelligence in the way the network operates. We did not bet heavily on the long distance, submarine space and ultra long-haul. We were not very active in 40 Gig, we were going straight from 10 to 100 Gig.

Now look at the bets the MEN folks placed: very strong on coherent and applying it to 40 and 100 Gig, strong programme at 100 Gig, and they were focussed on the long-haul. Well, to do long-haul when you are running into things like polarisation mode dispersion (PMD), you've got to have coherent. That is how you get all those problems out of the network. 

Our [Ciena's] first 100 Gig was not focussed on long-haul; it was focussed on how you get across a river to connect data centres.

When you look at putting things together, we ended up stopping our developments that were targeted at competing with MEN's long-haul solutions. They, in many cases, stopped developments coming after our switching, carrier Ethernet and software integration solutions. The integration worked very well because the intent of both companies was the same.

Today, do we have a position?  Coherent is the right answer for anything that has to do with physical propagation because it simplifies networks. There are a whole bunch of reasons why coherent is such a game changer.

The reason why first 40 Gig implementations didn't go so well was cost. When we went from 10 to 40 Gig, the only tool was cranking up the clock rate.

At that time, once you got to 20GHz you were into the world of microwave. You leave printed circuit boards and normal manufacturing and move into a world more like radar. There are machined boxes, micro-coax and a very expensive manufacturing process.  That frustrated the desires of the 40 Gig guys to be able to say: Hey, we've got a better cost point than the 10 Gig guys.

Well, with coherent the fact that I can unlock the bit rate from the baud rate, the signalling rate from the symbol rate, that is fantastic. I can stay at 10GHz clocks and send four-bits per symbol - that is 40Gbps.

My basic clock rate, which determines manufacturing complexity, fabrication complexity and the basic technology, stays with CMOS, which everyone knows is a great place to play. Apply that same magic to 100 Gig.  I can send 100Gbps but stay at a 25GHz clock - that is tremendous, that is a huge economic win.

Coherent lets you continue to use the commercial merchant silicon technology base which where you want to be. You leverage the year-on-year cost reduction, a world onto itself that is driving the economics and we can leverage that.

So you get economics with coherent. You get improvement in performance because you simplify the line system - you can pop out the dispersion compensation, and you solve PMD with maths. You also get tunability. I'm using a laser - a local oscillator at the receiver - to measure the incoming laser. I have a tunable receiver that has a great economic cost point and makes the line system simpler.

Coherent is this triple win. It is just a fantastic change in technology.

What is Ciena’s thinking regarding bringing in-house sub-systems/ components (vertical integration), or the idea of partnerships to guarantee supply? One example is Infinera that makes photonic integrated circuits around which it builds systems. Another is Huawei that makes its own PON silicon.

The two examples are good ones.

With Huawei you have to treat them somewhat separately as they have some national intent to build a technology base in China. So they are going to make decisions about where they source components from that are outside the normal economic model. 

Anybody in the systems business that has a supply chain periodically goes through the classic make-versus-buy analysis. If I'm buying a module, should I buy the piece-parts and make it? You go through that portion of it. Then you look within the sub-system modules and the piece-parts I'm buying and say: What if I made this myself? It is frequently very hard to say if I had this component fully vertically integrated I'd be better off.

A good question to ask about this is: Could the PC industry have been better if Microsoft owned Intel? Not at all.

You have to step back and say: Where does value get delivered with all these things? A lot of the semiconductor and component pieces were pushed out [by system vendors] because there was no way to get volume, scale and leverage. Unless you corner the market, that is frequently still true. But that doesn't mean you don't go through the make-versus-buy analysis periodically.

Call that the tactical bucket.  

The strategic one is much different. It says: There is something out there that is unique and so differentiated, it would change my way of thinking about a system, or an approach or I can solve a problem differently.

"Coherent is this triple win. It is just a fantastic change in technology" 

If it is truly strategic and can make a real difference in the marketplace - not a 10% or 20% difference but a 10x improvement - then I think any company is obligated to take a really close look at whether it would be better being brought inside or entering into a good strategic partnership arrangement.

Certainly Ciena evaluates its relationships along these lines.

Can you cite a Ciena example?

Early when Ciena started, there was a technology at the time that was differentiated and that was Fibre Bragg Gratings. We made them ourselves. Today you would buy them.

You look at it at points in time. Does it give me differentiation? Or source-of-supply control? Am I at risk? Is the supplier capable of meeting my needs? There are all those pieces to it.

Optical Transport Network (OTN) integrated versus standalone products. Ciena has a standalone model but plans to evolve to an integrated solution. Others have an integrated product, while others still launched a standalone box and have since integrated. Analysts say such strategies confuse the marketplace. Why does Ciena believe its strategy is right?

Some of this gets caught up in semantics.

Why I say that is because we today have boxes that you would say are switches but you can put pluggable coloured optics in. Would you call that integrated probably depends more on what the competition calls it.

The place where there is most divergence of opinion is in the network core.

Normally people look at it and say: one big box that does everything would be great - that is the classic God-Box problem. When we look at it - and we have been looking at it on and off for 15 years now - if you try to combine every possible technology, there are always compromises.

The simplest one we can point to now: If you put the highest performance optics into a switch, you sacrifice switch density.

You can build switches today that because of the density of the switching ASICs, are I/O-port constrained: you can't get enough connectors on the face plate to talk to the switch fabric. That will change with time, there is always ebb and flow. In the past that would not have been true.

If I make those I/O ports datacom plugabbles, that is about as dense as I'm going to get. If I make them long-distance coherent optics, I'm not going to get as many because coherent optics take up more space.  In some cases, you can end up cutting by half your port density on the switch fabric. That may not be the right answer for your network depending on how you are using that switch.

While we have both technologies in-house, and in certain application we will do that. Years ago we put coloured optics on CoreDirector to talk to CoreStream, that was specific for certain applications. The reason is that in most networks, people try to optimise switch density and transport capacity and these are different levers. If you bolt those levers together you don't often get the right optimal point.

Any business books you have read that have been particularly useful for your job?

The Innovator's Dilemma (by Clayton Christensen). What is good about it is that it has a couple of constructs that you can use with people so they will understand the problem. I've used some of those concepts and ideas to explain where various industries are, where product lines are, and what is needed to describe things as innovation.

The second one is called: Fad Surfing in the Boardroom (by Eileen Shapiro). It is a history of the various approaches that have been used for managing companies. That is an interesting read as well.

Click here for Part 1 of the Q&A