Teraxion embraces silicon photonics for its products
Teraxion has become a silicon photonics player with the launch of its compact 40 and 100 Gigabit coherent receivers.
The Canadian optical component company has long been known for its fibre Bragg gratings and tunable dispersion compensation products. But for the last three years it has been developing expertise in silicon photonics and at the recent European Conference on Optical Communications (ECOC) exhibition it announced its first products based on the technology.
"You don't have this [fabless] model for indium phosphide or silica, while an ecosystem is developing around silicon photonics"
Martin Guy, Teraxion
"We are playing mainly in the telecom business, which accounts for 80% of our revenues," says Martin Guy, vice president, product management & technology at Teraxion. "It is clear that our customers are going to more integration and smaller form-factors so we need to follow our customers' requirements."
Teraxion assessed several technologies but chose silicon photonics and the fabless model it supports. "We are using all our optical expertise that we can apply to this material but use a process already developed for the CMOS industry, with the [silicon] wafer made externally," says Guy. "You don't have this [fabless] model for indium phosphide or silica, while an ecosystem is developing around silicon photonics."
The company uses hybrid integration for its coherent receiver products, with silicon implementing the passive optical functions to which the active components are coupled. Teraxion is using externally-supplied photo-detectors which are flip-chipped onto the silicon for its coherent receiver.
"We need to use the best material for the function for this high-end product," says Guy. "Our initial goal is not to have everything integrated in silicon."
Coherent receiver
A coherent receiver comprises two inputs - the received optical signal and the local oscillator - and four balanced receiver outputs. Also included in the design are two polarisation beam splitters and two 90-degree hybrid mixers.
Several companies have launched coherent receiver products. These include CyOpyics, Enablence, NEL, NeoPhotonics, Oclaro and u2t Photonics. Silicon photonics player Kotura has also developed the optical functions for a coherent receiver but has not launched a product.
One benefit of using silicon photonics, says Teraxion, is the compact optical designs it enables.
The Optical Internetworking Forum (OIF) has specified a form factor for the 100 Gigabit-per-second (Gbps) coherent receiver. Teraxion has developed a silicon photonics-based product that matches the OIF's form factor sized 40mmx32mm. This is for technology evaluation purposes rather than a commercial product. "If customers want to evaluate our technology, they need to have a compatible footprint with their design," explains Guy. This is available in prototype form and Teraxion has customers ready to evaluate the product.
Teraxion will come to market with a second 100 Gigabit coherent receiver design that is a third of the size of the OIF's form factor, measuring 23mmx18mm (0.32x the area of the OIF specification). The compact coherent receivers for 40 and 100Gbps will be available in sample form in the first quarter of 2013.
Teraxion's OIF-specification 100 Gig coherent receiver (left) for test purposes and its compact coherent receiver product. Source: Teraxion
"We match the OIF's performance with this design but there are also other key requirements from customers that are not necessarily in the OIF specification," says Guy.
The compact 100Gbps design is of interest to optical module and system vendors but there is no one view in terms of requirements or the desired line-side form-factor that follows the 5x7-inch MSA. Indeed there are some that are interested in developing a 100 Gigabit CFP module for metro applications, says Guy.
Roadmap
Teraxion's roadmap includes further integration of the coherent receiver's design. "We are using hybrid integration but eventually we will look at having the photo-detectors integrated within the material,” says Guy.
The small size of the coherent design means there is scope for additional functionality to be included. Teraxion says that customers are interested in integrating variable optical attenuators (VOAs). The local oscillator is another optical function that can be integrated within the coherent receiver.
In 2005 Teraxion acquired Dicos Technologies, a narrow line-width laser specialist. Teraxion's tunable narrow line-width laser product - a few kiloHertz wide - is available in the lab. "The purpose of this product is not to be deployed on the line card - right now," says Guy. "We believe this type of performance will be required for next-generation 100 Gig, 400 Gig, 1 Terabit coherent communication systems where you will need a very 'clean' local oscillator."
Teraxion is also working on developing a silicon-photonics-based modulator. The company has been exploring integrating Bragg gratings within silicon waveguides for which it has applied for patents. This is several years out, says Guy, but has the potential to enable high-speed modulators suited for short-reach datacom applications.
100 Gigabit 'unstoppable'
A Q&A with Andrew Schmitt (@aschmitt), directing analyst for optical at Infonetics Research.
"40Gbps has even less value in the metro than in the core"
Andrew Schmitt, Infonetics Research
A study from market research firm, Infonetics Research, has found that operators have a strong preference for deploying 100 Gigabit-per-second (Gbps) technology as they upgrade their networks.
Infonetics interviewed 21 incumbent service providers, competitive operators and mobile operators that have either 40Gbps, 100Gbps or both wavelength types installed in their networks, or that plan to install by next year (2013).
The operators surveyed, from all the major regions, account for over a quarter (28%) of worldwide telecom carrier revenue and capital expenditure.
The study's findings include:
- A strong preference by the carriers for 100Gbps transport in both Brownfield and Greenfield installations. Carriers will use 40 and 100Gbps to the same degree in existing Brownfield networks while favouring 100Gbps for new, Greenfield builds.
- The reasons to deploy 40Gbps and 100Gbps optical transport equipment include lowering the cost per bit, taking advantage of the superior dispersion performance of coherent optics, and lowering incremental common equipment costs due to the increased spectral efficiency.
- Most respondents indicate 40Gbps is only a short-term solution and will move the majority of installations to 100Gbps once those products become widely available.
- Non-coherent 100Gbps is not yet viewed as an important technology.
- Colourless and directionless ROADMs and Optical Transport Network (OTN) switching are important components of Greenfield builds; gridless and contentionless ROADMs are much less so.
Q&A with Andrew Schmitt
Q. A key finding is that 40Gbps and 100Gbps are equally favoured for Brownfield routes. And is it correct that Brownfield refers to existing routes carrying 10Gbps and maybe 40Gbps wavelengths while Greenfield involves new 100Gbps wavelengths? What is it about Brownfield that 40Gbps and 100Gbps have equal footing? Equally, for Greenfield, is the thinking: "If we are deploying a new lit fibre, we might as well start with the newest and fastest"?
A: The assumptions on Brownfield versus Greenfield are correct, the definitions in the survey and the report are more detailed but that is right.
It is more an issue that they [carriers] are building with 40Gbps now but will transition to 100Gbps where it can be used. Where it can't be used they stick with 40Gbps. There are many reasons why 100Gbps may not work in existing networks.
Q: Another finding is that 40Gbps is seen as a short-term solution. What is short term? And will that also be true for the metro or does metro have its own dynamic?
A: We didn't test timing explicitly for Greenfield versus Brownfield networks. It [40Gbps] doesn't necessarily peak, it is just not growing at the same rate as 100Gbps. And 40Gbps has even less value in the metro than in the core, particularly in Greenfield builds. With Greenfield 100Gbps combined with soft-decision forward error correction (SD-FEC), it is almost as good as 40Gbps.
Q: The study found that non-coherent 100Gbps isn't yet viewed as an important technology. Why do you think that is so? And what is your take on the non-coherent 100Gbps opportunity?
A: The jury is still out.
The large customers I spoke with haven't looked at it and therefore can't form an opinion. A lot of promises and marketing at this point but that doesn't mean it won't work. Module vendors are pretty excited about it and they aren't stupid.
Q: You say colourless and directionless is seen as important ROADM attributes, gridless and contentionless much less so. If operators are building 100Gbps Greenfield overlays, is not gridless a must to future-proof the network investment?
A: The gridless requirement is completely overblown and folks positioning it as a requirement today haven't done the work to understand the issues trying to use it today. This survey was even more negative than I expected.
100 Gig: Is market expectation in need of a reality check?
“It could easily be ten to 15 years before we see 100Gbps in a big way on the public network side”
Mark Lutkowitz, Telecom Pragmatics
Infonetics Research, in a published White Paper, says that 100Gbps technology will be adopted at a faster rate than 40Gbps was in its first years, and that the 100Gbps market will begin in earnest from 2013. Indeed this could even be sooner if China, which accounts for half of all 40Gbps ports being shipped, moves to 100Gbps faster than expected.
LightCounting, in its research, describes 100 Gbps optical transmission as a transformational networking technology for carriers, and forecasts that sales of 100Gbps dense wavelength division multiplexing (DWDM) line cards will grow to US $2.3 billion by 2015.
But one research firm, Telecom Pragmatics, is sounding a note of caution. It reports that the 40Gbps market is growing nicely and believes that it could be at least a decade before there is a substantial 100Gbps market.
“100G is not going to kill 40G and, if anything, we are bullish about 40G,” says Mark Lutkowitz, principal at Telecom Pragmatics. “I’m not talking about large volume ramp-up of 40G but there is arguably a ramp-up.”
100G Paradox
One reason, not often mentioned, why 40Gbps is being adopted is that it does not require as many networking changes as when 100Gbps technology is deployed. “There is additional compensation [needed] and it is not clear that all the fibres will work with 100G,” says Lutkowitz.
There is also what he calls the ‘100G Paradox’.
The 100Gbps technology will most likely be considered at pinch-points in the operators’ networks. Yet these are the same network pinch-points that were first upgraded to 10Gbps. As a result they are likely to have legacy DWDM systems such that upgrading to 100Gbps is a considerable undertaking. “It is questionable whether these systems can even work with 100G,” he says.
"We really think that 40G should be getting a lot more respect than it is getting”
”When you look at service providers they are willing to put up with a whole amount of pain before they buy something, and they will certainly not forklift electronics or fibre - they will only do that as a last resort.” Another attraction of 40Gbps for the operators is its growing maturity - it is a technology that has been available for several years.
Costs
Telecom Pragmatics also dismisses the argument made by component vendors that the market will move to 100Gbps especially if the cost-per-bit of 100G technology declines faster than expected.
“The first cost [point] is ten times 10G and really you need to get to something like six or seven times [the cost of] 10G before you consider 100G,” says Lutkowitz. But that is not the sole cost. Network protection is needed which means a second system and there are additional networking and operational costs associated with 100Gbps.
Moreover, to whatever extent 40G is deployed, it will put further pressure on 100Gbps as 40Gbps prices decline. “In the 10G market, prices continued to decline and that precluded 40G, now you have 40G - to whatever extent there is deployment - precluding 100G,” says Lutkowitz.
“It could easily be 10 to 15 years before we see 100G in a big way on the public network side,” says Lutkowitz. But he stresses that in the datacenter and for the enterprise, demand for 100Gbps technology will be a different story.
Meanwhile Telecom Pragmatics expects further operator trials at 100Gbps as well as new system announcements from vendors. “But we really think that 40G should be getting a lot more respect than it is getting,” says Lutkowitz.
MultiPhy eyes 40 and 100 Gigabit direct-detect and coherent schemes
MultiPhy's Avi Shabtai (left) and Ronen Weinberg
MultiPhy is developing transceiver designs to boost the transmission performance of metro and long-haul 40 and 100 Gigabit-per-second (Gbps) links. The start-up is aiming its advanced digital signal processing (DSP) chips at direct detection and coherent-based modulation schemes.
“We are the only company, as far as we know, who is doing DSP-based semiconductors for the 40G and 100G direct-detect world,” says Avi Shabtai, CEO of Multiphy.
At 40Gbps the main direct-detection schemes are differential phase-shift keying (DPSK) and differential quadrature phase-shift keying (DQPSK), while at 100Gbps several direct-detect modulation schemes are being considered. “The fact that we are doing DSP at 40G and 100G enables us to achieve much better performance than regular hard-detection technology,” says Shabtai.
Established in 2007, the fabless semiconductor start-up raised US$7.2m in its latest funding round in May. MultiPhy is targeting its physical layer chips at module makers and system vendors. “While there is a clear ecosystem involving optical module companies and systems vendors, there is a lot of overlap,” says Shabtai. “You can find module companies that develop components; you can find system companies that skip the module companies, buying components to make their own line cards.”
MultiPhy’s CMOS chips include high-speed analogue-to-digital converters (ADC) and hardware to implement the maximum-likelihood sequence estimation (MLSE) algorithm. The company is operating the MLSE algorithm at “tens of gigasymbols-per-second”, says Shabtai. “We believe we are the only company implementing MLSE at these speeds.”
MultiPhy's office is alongside Finisar's Israeli headquartersMultiPhy will not disclose the exact sampling rate but says it is sampling at the symbol rate rather than at the Nyquist sampling theorem rate of double the symbol rate. Since commercial ADCs for 100Gbps have been announced that sample at 65Gsample/s, it suggests MultiPhy is sampling at up to half that rate.
MLSE is used to compensate for the non-linear impairments of fibre transmission, to improve overall transmission performance. “We implement an anti-aliasing filter at the input to the ADC and we use the MLSE engine to compensate for impairments due to the low-bandwidth sampling,” says Shabtai.
“There is a good chance that 100Gbps will leapfrog 40Gbps coherent deployments”
Avi Shabtai, MultiPhy
MultiPhy benefits from using one-sample-per-symbol in terms of simplifying the chip design and its power consumption but the MLSE algorithm must counter the resulting distortion. Shabtai claims the result is a significant reduction in power consumption compared to the tradition two-samples-per-symbol approach: “Tens of percent – I won’t say the exact number but it is not 10 percent.”
Other chip companies implementing MLSE designs for optical transmission include CoreOptics, which was acquired by Cisco in May, and Clariphy. (See Oclaro and Clariphy)
Does using MLSE make sense for 40Gbps DPSK and DQPSK?
“If you use DSP for DQPSK at 40Gbps you can significantly improve polarisation mode dispersion tolerance, the limiting factor today of DQPSK transceivers,” says Shabtai. MultiPhy expects the 40 Gigabit direct-detect market to shift towards DQPSK, accounting for the bulk of deployments in two years’ time.
Market applications
MultiPhy is delivering two solutions: for 40 and 100Gbps direct-detect, and 40 and 100Gbps coherent designs. The company has not said when it will deliver products but hinted that first it will address the direct-detect market and that chip samples will be available in 2011.
Not only will the samples enhance the reach of DQPSK-modulation based links but also allow the optical component specifications to be relaxed. For example, cheaper 10Gbps optical components can be used which, says MultiPhy, will reduce total design cost by “tens of percent”.
This is noteworthy, says Shabtai, as the direct-detect markets are increasingly cost-sensitive. “Coherent is being positioned as the high-end solution, and there will be pressure on the direct-detect market to show lower cost solutions,” he says.
MultiPhy is eyeing two 100Gbps spaces
MultiPhy’s view is that direct-detect modulation schemes will be deployed for quite some time due to their price and power advantage compared to coherent detection.
Another factor against 40Gbps coherent technology will be the price difference between 40Gbps and 100Gbps coherent schemes. “There is a good chance that 100Gbps will leapfrog 40Gbps coherent deployments,” he says. “The 40Gbps coherent modules will need to go a long way to get to the right price.” MultiPhy says it is hearing about the expense of coherent modules from system vendors and module makers, as well as industry analysts.
Metro and long-haul
The company says it has received several requests for 40Gbps and 100Gbps direct-detect schemes for the metro due to its sensitivity to cost and power consumption. “We are getting to the point in optical communications where one solution does not fit all – that the same solution for long-haul will also suit metro,” says Shabtai.
He believes 100Gbps coherent will become a mainstream solution but will take time for the technology to mature and its costs to come down. It will thus take time before 100Gbps coherent expands beyond long-haul and into the metro. He also expects a different 100Gbps coherent solution to be used in the metro. “The requirements are different – in reach, in power constraints” he says. “The metro will increasingly become a segment, not only for direct-detect but also for coherent.”
Coherent: Already a crowded market
There are at least a dozen companies actively developing silicon for coherent transmission, while half-a-dozen leading system vendors developing designs in-house. In addition, no-one really knows when the 100Gbps market will take off. So how does MultiPhy expect to fare given the fierce competition and uncertain time-to-revenues?
“It is very hard to predict the exact ramp up to high volumes,” says Shabtai. “At the end of the day, 100Gbps will come instead of 10Gbps and when people look back in five and six years’ time, they will say: ‘Gee, who would have expected so much capacity would have been needed?’.”
The big question mark is when will coherent technology ramp and this explains why MultiPhy is also targeting next-generation direct-detect schemes with its technology. “We cannot come to market doing the same thing as everyone else,” says Shabtai. “Having a solution that addresses power consumption based on one-sample-per-symbol gives us a significant edge.”
MultiPhy admits it has received greater market interest following Cisco’s acquisition of CoreOptics. “While Cisco said it would fulfill all previous commitments, still it worried some of CoreOptics’ customers,” says Shabtai. The acquisition also says something else to Shabtai: 100Gbps coherent is a strategic technology.
Did Cisco consider MultiPhy as a potential acquisition target? “First, I can’t comment, and I wasn’t at the company at the time,” says Shabtai.
As for design wins, Shabtai says MultiPhy is in “advanced discussion” with several leading module and system vendor companies concerning its 40Gbps and 100Gbps direct-detect and coherent technologies.
Further reading
See Opnext's multiplexer IC plays its part in 100Gbps trial
Q&A with Rafik Ward - Part 1
"This is probably the strongest growth we have seen since the last bubble of 1999-2000." Rafik Ward, Finisar
Q: How would you summarise the current state of the industry?
A: It’s a pretty fun time to be in the optical component business, and it’s some time since we last said that.
We are at an interesting inflexion point. In the past few years there has been a lot of emphasis on the migration from 1 to 2.5 Gig to 10 Gig. The [pluggable module] form factors for these speeds have been known, and involved executing on SFP, SFP+ and XFPs.
But in the last year there has been a significant breakthrough; now a lot of the discussion with customers are around 40 and 100 Gig, around form factors like QSFP and CFP - new form factors we haven’t discussed before, around new ways to handle data traffic at these data rates, and new schemes like coherent modulation.
It’s a very exciting time. Every new jump is challenging but this jump is particularly challenging in terms of what it takes to develop some of these modules.
From a business perspective, certainly at Finisar, this is probably the strongest growth we have seen since the last bubble of 1999-2000. It’s not equal to what it was then and I don’t think any of us believes it will be. But certainly the last five quarters has been the strongest growth we’ve seen in a decade.
What is this growth due to?
There are several factors.
There was a significant reduction in spending at the end of 2008 and part of 2009 where end users did not keep up with their networking demands. Due to the global financial crisis, they [service providers] significantly cut capex so some catch-up has been occurring. Keep in mind that during the global financial crisis, based on every metric we’ve seen, the rate of bandwidth growth has been unfazed.
From a Finisar perspective, we are well positioned in several markets. The WSS [wavelength-selective switch] ROADM market has been growing at a steady clip while other markets are growing quite significantly – at 10 Gig, 40 Gig and even now 100 Gig. The last point is that, based on all the metrics we’ve seen, we are picking up market share.
Your job title is very clear but can you explain what you do?
I love my job because no two days are the same. I come in and have certain things I expect to happen and get done yet it rarely shapes out how I envisaged it.
There are really three elements to my job. Product management is the significant majority of where I focus my efforts. It’s a broad role – we are very focussed on the products and on the core business to win market share. There is a pretty heavy execution focus in product management but there is also a strategic element as well.
The second element of my job is what we call strategic marketing. We spend time understanding new, potential markets where we as Finisar can use our core competencies, and a lot of the things we’ve built, to go after. This is not in line with existing markets but adjacent ones: Are there opportunities for optical transceivers in things like military and consumer applications?
One of the things I’m convinced of is that, as the price of optical components continues to come down, new markets will emerge. Some of those markets we may not even know today, and that is what we are finding. That’s a pretty interesting part of my job but candidly I spend quite a bit less time on it [strategic marketing] than product management.
The third area is corporate communications: talking to media and analysts, press releases, the website and blog, and trade shows.
"40Gbps DPSK and DQPSK compete with each other, while for 40 Gig coherent its biggest competitor isn’t DPSK and DQPSK but 100 Gig."
Some questions on markets and technology developments.
Is it becoming clearer how the various 40Gbps line side optics – DPSK, DQPSK and coherent – are going to play out?
The situation is becoming clearer but that doesn’t mean it is easier to explain.
The market is composed of customers and end users that will use all of the above modulation formats. When we talk to customers, every one has picked one, two or sometimes all three modulation formats. It is very hard to point to any trend in terms of picks, it is more on a case-by-case basis. Customers are, like us at the component level, very passionate about the modulation format that they have chosen and will have a variety of very good reasons why a particular modulation format makes sense.
Unlike certain markets where you see a level of convergence, I don’t think that there will be true convergence at 40 Gbps. Coherent – DP-QPSK - is a very powerful technology but the biggest challenge 40 Gig has with DP-QPSK is that you have the same modulation format at 100 Gig.
The more I look at the market, 40Gbps DPSK and DQPSK compete with each other, while for 40 Gig coherent its biggest competitor isn’t DPSK and DQPSK but 100 Gig.
Finisar has been quiet about its 100 Gig line side plans, what is its position?
We view these markets - 40 and 100 Gig line side – as potentially very large markets at the optical component level. Despite that fact that there are some customers that are doing vertical integrated solutions, we still see these markets as large ones. It would be foolish for us not to look at these markets very carefully. That is probably all I would say on the topic right now.
"Photonic integration is important and it becomes even more important as data rates increase."
Finisar has come out with an ‘optical engine’, a [240Gbps] parallel optics product. Why now?
This is a very exciting part of our business. We’ve been looking for some time at the future challenges we expect to see in networking equipment. If you look at fibre optics today, they are used on the front panel of equipment. Typically it is pluggable optics, sometimes it is fixed, but the intent is that the optics is the interface that brings data into and out of a chassis.
People have been using parallel optics within chassis – for backplane and other applications – but it has been niche. The reason it’s niche is that the need hasn’t been compelling for intra-chassis applications. We believe that need will change in the next decade. Parallel optics intra-chassis will be needed just to be able to drive the amount of bandwidth required from one printed circuit board to another or even from one chip to another.
The applications driving this right now are the very largest supercomputers and the very largest core routers. So it is a market focussed on the extreme high-end but what is the extreme high-end today will be mainstream a few years from now. You will see these things in mainstream servers, routers and switches etc.
Photonic integration – what’s happening here?
Photonic integration is something that the industry has been working on for several years in different forms; it continues to chug on in the background but that is not to understate its importance.
For vendors like Finisar, photonic integration is important and it becomes even more important as data rates increase. What we are seeing is that a lot of emerging standards are based around multiple lasers within a module. Examples are the 40GBASE-LR4 and the 100GBASE-LR4 (10km reach) standards, where you need four lasers and four photo-detectors and the corresponding mux-demux optics to make that work.
The higher the number of lasers required inside a given module, and the more complexity you see, the more room you have to cost-reduce with photonic integration.
Alcatel-Lucent reveals its 100Gbps-coherent hand
“It would be irresponsible of any system vendor to overlook a solution that can bring a cost advantage to their customer”
Sam Bucci, Alcatel-Lucent
What is being announced?
- Alcatel-Lucent has a commercially available 100Gbps optical transmission system.
- 40Gbps coherent transmission is also supported.
- Implemented as part of the 1830 Photonic Service Switch (PSS), the platform has a capacity of 500 Gigabit-per-second (Gbps) per rack, or a bay – made up of three racks – capacity of 1.5 Terabit-per-second.
- The system specification includes 88, 100Gbps dense wavelength division multiplexing (DWDM) lightpaths at 50GHz spacing that span the extended C-band; a reach of between 1,500 and 2,000km using coherent-optimised optical amplifiers, and the ability to operate alongside existing 10 and 40Gbps wavelengths without needing a guard-band between them (for more detail, click here).
- Some 20 operators are lined up to trial the 100Gbps technology. These include operators that have deployed the 1830 PSS and new ones.
- Telefònica and Softbank Telecom are two operators known to be trialling the 100Gbps system, Alcatel-Lucent will announce a third next week.
Why is the announcement important?
Alcatel-Lucent is the latest system vendor to announce a commercially available 100Gbps system. Until now Nortel’s Metro Ethernet Networks unit, now owned by Ciena, and Ciena itself had commercially available systems. Indeed Verizon Business deployed Nortel’s 100Gbps system for a route linking Paris and Frankfurt in late 2009.
"What will be a significant differentiator is the control/ management plane interworking across platforms - the integration of IP MPLS with optical networking products."
Ron Kline, Ovum
Alcatel-Lucent claims to be the first vendor to offer a 100Gbps system using a single carrier. Ciena/Nortel’s current offering is an extension of its 40Gbps coherent system and uses two 50Gbps sub-carriers that fit into a 50GHz channel.
But analysts downplay the significance of the advent of a 100Gbps single-carrier system. “Technology leads are short-lived,” says Ron Kline, principal analyst, network infrastructure at Ovum. "I’m not sure if there is a preference between single- versus dual-carrier from service providers either.”
What will be a significant differentiator, says Kline, is the control/ management plane interworking across platforms - the integration of IP MPLS with optical networking products. “Alcatel-Lucent is one of the few vendors which do both well and may have an edge pulling it off,” he says.
Ovum’s Dana Cooperson thinks it is significant that, like Ciena, and unlike some others, Alcatel-Lucent is also doing 40Gbps coherent. “I’ve heard some folks say they think 40 Gig coherent isn’t going anywhere, but the reasoning hasn’t made sense to me,” says Cooperson, Ovum’s vice president, network infrastructure. “If you have bad fibre, which loads of carriers do, and you want a mixed channel capability, which all carriers do, you’ll expect to get both in the same product.”
What’s been done?
Alcatel-Lucent’s 100Gbps system implements polarisation multiplexing quadrature phase-shift keying (PM-QPSK) modulation with coherent detection. The coherent receiver is based on an in-house application specific integrated circuit (ASIC) that includes high-speed analogue-to-digital (a/d) converters and a digital signal processor (DSP).
Alcatel-Lucent would not say if the ASIC uses a 60nm or 45nm CMOS process or what the sampling rate of its a/d converters are but it did say that it has built-in sufficient headroom to operate at a 64Gsamples-per-second rate. The system also uses hard-decision forward error correction (FEC) but, according to Sam Bucci, vice president, terrestrial portfolio management at Alcatel-Lucent, it is looking at a soft decision FEC scheme for a future version “that is not too far away”.
Additional system performance characteristics, according to Bucci, include the ability for the lightpath to travel through as many as 20 reconfigurable optical add/drop multiplexers (ROADMs) before needing optical-electrical-optical (OEO) conversion. The system also has a tolerance of at least 30ps for polarisation mode dispersion and 60,000 ps/nm for chromatic dispersion, says Bucci.
For 40Gbps coherent transmission, Alcatel-Lucent is using polarisation multiplexing binary phase-shift keying (PM-BPSK). Since less information is encoded on the symbol streams, this is a more demanding implementation because the implementation operates at 20Gbaud-per-second rather than the 10Gbaud-per-second of 40Gbps PM-QPSK coherent systems.“We were looking for a solution that was applicable not just for terrestrial but for submarine,” says Bucci. “Therefore the reach we were looking to achieve was greater than perhaps could be accomplished by other modulation formats.”
Alcatel-Lucent says PM-BPSK is also better able to withstand non-linear effects such as cross-phase modulation.
Is Alcatel-Lucent open to adopting an ASIC from a third-party developer for its future 100Gbps systems? “It would be irresponsible of any system vendor to overlook a solution that can bring a cost advantage to their customer,” says Bucci. “If there is a solution that can fit into the scheme we have developed, then yes, we would have to consider it if it produces an economic advantage.” Such an 'economic advantage' would have to be significantly more than just a 10 percent cost-saving, he says.
Volume production of the 100Gbps system will begin at the end of June 2010. Two client-side interface boards are available: a 10x10Gbps and a 100Gbps native port using a pluggable CFP transceiver.
40 and 100Gbps: Growth assured yet uncertainty remains
Part 2: 40 and 100Gbps optical transmission
The market for 40 and 100 Gigabit-per-second optical transmission is set to grow over the next five years at a rate unmatched by any other optical networking segment. Such growth may excite the industry but vendors have tough decisions to make as to how best to pursue the opportunity.
Market research firm Ovum forecasts that the wide area network (WAN) dense wavelength division multiplexing (DWDM) market for 40 and 100 Gigabit-per-second (Gbps) linecards will have a 79% compound annual growth rate (CAGR) till 2014.
In turn, 40 and 100Gbps transponder volumes will grow even faster, at 100% CAGR till 2015, while revenues from 40 and 100Gbps transponder sale will have a 65% CAGR during the same period.
Yet with such rude growth comes uncertainty.
“We upgraded to 40Gbps because we believe – we are certain, in fact – that across the router and backbone it [40Gbps technology] is cheaper.”
Jim King, AT&T Labs
Systems, transponder and component vendors all have to decide what next-generation modulation schemes to pursue for 40Gbps to complement the now established differential phase-shift keying (DPSK). There are also questions regarding the cost of the different modulation options, while vendors must assess what impact 100Gbps will have on the 40Gbps market and when the 100Gbps market will take off.
“What is clear to us is how muddled the picture is,” says Matt Traverso, senior manager, technical marketing at Opnext.
Economics
Despite two weak quarters in the second half of 2009, the 40Gbps market continues to grow.
One explanation for the slowdown was that AT&T, a dominant deployer of 40Gbps, had completed the upgrade of its IP backbone network.
Andreas Umbach, CEO of u2t Photonics, argues that the slowdown is part of an annual cycle that the company also experienced in 2008: strong 40Gbps sales in the first half followed by a weaker second half. “In the first quarter of 2010 it seems to be repeating with the market heating up,” says Umbach.
This is also the view of Simon Warren, Oclaro’s director product line managenent, transmission product line. “We are seeing US metro demand coming,” he says. “And it is very similar with European long-haul.”
BT, still to deploy 40Gbps, sees the economics of higher-speed transmission shifting in the operator’s favour. “The 40Gbps wavelengths on WDM transmission systems have just started to cost in for us and we are likely to start using it in the near future,” says Russell Davey, core transport Layer 1 design manager at BT.
What dictates an operator upgrade from 10Gbps to 40Gbps, and now also to 100Gbps, is economics.
The transition from 2.5Gbps to 10Gbps lightpaths that began in 1999 occurred when 10Gbps approached 2.5x the cost of 2.5Gbps. This rule-of-thumb has always been assumed to apply to 40Gbps yet thousands of wavelengths have been deployed while 40Gbps remains more than 4x the cost of 10Gbps. Now the latest rule-of-thumb for 100Gbps is that operators will make the transition once 100Gbps reaches 2x 40Gbps i.e. gaining 25% extra bandwidth for free.
The economics is further complicated by the continuing price decline of 10Gbps. “Our biggest competitor is 10Gbps,” says Niall Robinson, vice president of product marketing at 40Gbps module maker Mintera.
“The traditional multiplier of 2.5x for the transition to 10Gbps is completely irrelevant for the 10 to 40 Gigabit and 10 to 100 Gigabit transitions,” says Andrew Schmitt, directing analyst of optical at Infonetics Research. “The transition point is at a higher level; even higher than cost-per-bit parity.”
So far two classes of operators adopting 40Gbps have emerged: AT&T, China Telecom and cable operator Comcast which have made, or plan, significant network upgrades to 40Gbps, and those such as Verizon Business and Qwest that have used 40Gbps more strategically for selective routes. For Schmitt there is no difference between the two: “These are economic decisions.”
AT&T is in no doubt about the cost benefits of moving to higher speed transmission. “We upgraded to 40Gbps because we believe – we are certain, in fact – that across the router and backbone it [40Gbps technology] is cheaper,” says Jim King, executive director of new technology product development and engineering, AT&T Labs.
King stresses that 40Gbps is cheaper than 10Gbps in terms of capital expenditure and operational expense. IP efficiencies result and there are fewer larger pipes to manage whereas at lower rates “multiple WDM in parallel” are required, he says.
“We see 100Gbps wavelengths on transmission systems available within a year or so, but we think the cost may be prohibitive for a while yet, especially given we are seeing large reductions in 10Gbps,” says Davey. BT is designing the line-side of new WDM systems to be compatible with 40Gbps – and later 100Gbps - even though it will not always use the faster line-cards immediately.
Even when an operator has ample fibre, the case for adopting 40Gbps on existing routes is compelling. That’s because lighting up new fibre is “enormous costly”, says Joe Berthold, Ciena’s vice president of network architecture. By adding 40Gbps to existing 10Gbps lightpaths at 50GHz channel spacing, capacity on an existing link is boosted and the cost of lighting up a separate fibre is forestalled.
According to Berthold, lighting a new fibre costs about the same as 80 dense DWDM channels at 10Gbps. “The fibre may be free but there is the cost of the amplifiers and all the WDM terminals,” he says. “If you have filled up a line and have plenty of fibre, the 81st channel costs you as much as 80 channels.”
The same consideration applies to metropolitan (metro) networks when a fibre with 40, 10Gbps channels is close to being filled. “The 41st channel also means six ROADMs (reconfigurable optical add/drop multiplexers) and amps which are not cheap compared to [40Gbps] transceivers,” says Berthold.
Alcatel-Lucent segments 40Gbps transmission into two categories: multiplexing of lower speed signals into a higher speed 40Gbps line-side trunk link - ‘muxing to trunk’ - and native 40Gbps transmission where the client-side, signal is at 40Gbps.
“The economics of the two are somewhat different,” says Sam Bucci, vice president, optical portfolio management at Alcatel-Lucent. The economics favour moving to higher capacity trunks. That said, Alcatel-Lucent is seeing native 40Gbps interfaces coming down in price and believes 100GbE interfaces will be ‘quite economical’ compared to 10x10Gbps in the next two years.
Further evidence regarding the relative expense of router interfaces is given by Jörg-Peter Elbers, vice president, advanced technology at ADVA Optical Networking, who cites that in overall numbers currently only 20% go into 40Gbps router interfaces while the remaining 80% go into muxponders.
Modulation Technologies
While economics dictate when the transition to the next-generation transmission speed occurs, what is complicating matters is the wide choice of modulation schemes. Four modulation technologies are now being used at 40Gbps with operators having the additional option of going to 100Gbps.
The 40Gbps market has already experienced one false start back in 2002/03. The market kicked off in 2005, at least that is when the first 40Gbps core router interfaces from Cisco Systems and Juniper Networks were launched.
"There is an inability for guys like us to do what we do best: take an existing interface and shedding cost by driving volumes and driving the economics.”
Rafik Ward, Finisar
Since then four 40Gbps modulation schemes are now shipping: optical duobinary, DPSK, differential quadrature phase-shift keying (DQPSK) and polarisation multiplexing quadrature phase-shift keying (PM-QPSK). PM-QPSK is also referred to as dual-polarisation QPSK or DP-QPSK.
“40Gbps is actually a real mess,” says Rafik Ward, vice president of marketing at Finisar.
The lack of standardisation can be viewed as a positive in that it promotes system vendor differentiation but with so many modulation formats available the lack of consensus has resulted in market confusion, says Ward: “There is an inability for guys like us to do what we do best: take an existing interface and shedding cost by driving volumes and driving the economics.”
DPSK is the dominant modulation scheme deployed on line cards and as transponders. DPSK uses relatively simple transmitter and receiver circuitry although the electronics must operate at 40Gbps. DPSK also has to be modified to cope with tighter 50GHz channel spacing.
“DPSK’s advantage is relatively simple,” says Loi Nguyen, founder, vice president of networking, communications, and multi-markets at Inphi. “For 1200km it works fine, the drawback is it requires good fibre.”
The DQPSK and DP-QPSK modulation formats being pursued at 40Gbps offer greater transmission performance but are less mature.
DQPSK has a greater tolerance to polarisation mode dispersion (PMD) and is more resilient when passing through cascaded 50GHz channels compared to DPSK. However DQPSK uses more complex transmitter and receiver circuitry though it operates at half the symbol rate – at 20Gbaud/s - simplifying the electronics.
DP-QPSK is even more complex than DQPSK requiring twice as much optical circuitry due to the use of polarisation multiplexing. But this halves again the symbol rate to 10Gbaud/s, simplifying the design constraints of the optics. However DP-QPSK also requires a complex application-specific integrated circuit (ASIC) to recover signals in the presence of such fibre-induced signal impairments as chromatic dispersion and PMD.
The ASIC comprises high-speed analogue-to-digital converters (ADCs) that sample the real and imaginary components that are the output of the DP-QPSK optical receiver circuitry, and a digital signal processor (DSP) which performs the algorithms to recovery the original transmitted bit stream in the presence of dispersion.
The chip is costly to develop – up to US $20 million – but its use reduces line costs by allowing fewer optical amplifiers numbers and removing PMD and chromatic dispersion in-line compensators.
“You can build more modular amplifiers and really optimise performance/ cost,” says Bucci. Such benefits only apply when a new optimised route is deployed, not when 40Gbps lightpaths are added to existing fibre carrying 10Gbps lightpaths.
Eliminating dispersion compensation fibre in the network using coherent detection brings another important advantage, says Oliver Jahreis, head of product line management, DWDM at Nokia Siemens Networks. “It reduces [network] latency by 10 to 20 percent,” he says. “This can make a huge difference for financial transactions and for the stock exchange.”
Because of the more complex phase modulation used, 40Gbps DQPSK and DP-QPSK lightpaths when lit alongside 10Gbps suffer from crosstalk interference. “DQPSK is more susceptible to crosstalk but coherent detection is even worse,” says Chris Clarke, vice president strategy and chief engineer at Oclaro.
Wavelength management - using a guard-band channel or two between the 10Gbps and 40Gbps lightpaths – solves the problem. Alcatel-Lucent also claims it has developed a coherent implementation that works alongside existing 10Gbps and 40Gbps DPSK signals without requiring such wavelength management.
100Gbps consensus
Because of the variety of modulation schemes at 40Gbps the industry has sought to achieve a consensus at 100Gbps resulting in coherent becoming the defacto standard.
Early-adopter operators of 40Gbps technology such as AT&T and Verizon Business have been particularly vocal in getting the industry to back DP-QPSK for 100Gbps. The Optical Internetworking Forum (OIF) industry body has also done much work to provide guidelines for the industry as part of its 100Gbps Framework Document.
Yet despite the industry consensus, DP-QPSK will not be the sole modulation scheme targeted at 100Gbps.
ADVA Optical Networking is pursuing 100Gbps technology for the metro and enterprise using a proprietary modulation scheme. “If you look at 100Gbps, we believe there is room for different solutions,” says Elbers.
For metro and enterprise systems, the need is for more compact, less power-consuming, cheaper solutions. ADVA Optical Networking is following a proprietary approach. At ECOC 2008 the company published a paper that combined DPSK with amplitude-shift keying.
“If you look at 100Gbps, we believe there is room for different solutions.”
Jörg-Peter Elbers, ADVA Optical Networking
“Coherent DP-QPSK offers the highest performance but it is not required for certain situations as it brings power and cost burdens,” says Elbers. The company plans to release a dedicated product for the metro and enterprise markets and Elbers says the price point will be very close to 10x10Gbps.
Another approach is that of Australian start-up Ofidium. It is using a multi-carrier modulation scheme based on orthogonal frequency-division multiplexing. Ofidium claims that while OFDM is an alternative modulation scheme to DP-QPSK, it uses the same optical building blocks as recommended by the OIF.
Decisions, decisions
Simply looking at the decisions of a small sample of operators highlights the complex considerations involved when deciding a high-speed optical transmission strategy.
Cost is clearly key but is complicated by the various 40Gbps schemes being at different stages of maturity. 40Gbps DPSK is deployed in volume and is now being joined by DQPSK. Coherent technology was, until recently, provided solely by Nortel, now owned by Ciena. However, Nokia Siemens Networks working with CoreOptics, and Fujitsu have recently announced 40Gbps coherent offerings upping the competition.
Ciena also has a first-generation 100Gbps technology and will soon be joined by system vendors either developing their own 100Gbps interfaces or are planning to offer 100Gbps once DP-QPSK transponders become available in 2011.
The particular performance requirements also influence the operators’ choices.
Verizon Business has limited its deployment of DPSK due to the modulation scheme’s tolerance to PMD. “It is quite low, in the 2 to 4 picosecond range,” says Glenn Wellbrock, director of backbone network design at Verizon Business. “We have avoided deploying DPSK even if we have measured the [fibre] route [for PMD].”
Because PMD can degrade over time, even if a route is measured and is within the PMD tolerance there is no guarantee the performance will last. Verizon will deploy DQPSK this year for certain routes due to its higher 8ps tolerance to PMD.
China Telecom is a key proponent of DQPSK for its network rollout of 40Gbps. “It has doubled demand for its 40Gbps build-out and the whole industry is scrambling to keep up,” says Oclaro’s Clarke.
AT&T has deployed DPSK to upgrade its network backbone and will continue as it upgrades its metro and regional networks. “Our stuff [DPSK transponders] is going into [these networks],” says Mintera’s Robinson. But AT&T will use other technologies too.
In general modulation formats are a vendor decision, “something internal to the box”, says King. What is important is their characteristics and how the physics and economics match AT&T’s networks. “As coherent becomes available at 40Gbps, we will be able to offer it where the fibre characteristics require it,” says King.
“AT&T is really hot on DP-QPSK,” says Ron Kline, principal analyst of network infrastructure at Ovum. “They have a whole lot of fibre - stuff before 1998 - that is only good for 2.5Gbps and maybe 10Gbps. They have to be able to use it as it is hard to replace.”
BT points out how having DP-QPSK as the de facto standard for 100Gbps will help make it cost-effective compared to 10Gbps and will also benefit 40Gbps coherent designs. “This offers high performance 40Gbps which will probably work over all of our network,” says Davey.
But this raises another issue regarding coherent: it offers superior performance over long distances yet not all networks need such performance. “For the UK it may be that we simply don’t have sufficient long distance links [to merit DP-QPSK] and so we may as well stick with non-coherent,” says Davey. “In the end pricing and optical reach will determine what is used and where.”
One class of network where reach is supremely important is submarine.
For submarine transmission, reaches between 5,000 and 7,000km can be required and as such 10Gbps links dominate. “In the last six months even if most RFQs (Request for Quotation from operators) are about 10Gbps, all are asking about the possibility of 40Gbps,” says Jose Chesnoy, technical director, submarine network activity at Alcatel-Lucent.
Until now there has also been no capacity improvement in submarine adopting 40Gbps: 10Gbps lightpaths use 25GHz-spaced channels while 40Gbps uses 100GHz. “Now with technology giving 40Gbps performance at 50GHz, fibre capacity is doubled,” says Chesnoy.
To meet trans-ocean distances for 40Gbps submarine, Alcatel-Lucent is backing coherent technology, as it is for terrestrial networks. “Our technology direction is definitely coherent, at 40 and 100Gbps,” says Bucci.
Ciena, with its acquisition of Nortel’s Metro Ethernet Networks division, now offers 40 and 100Gbps coherent technology.
“It’s like asking what the horsepower per cylinder is rather than the horsepower of the engine.”
Drew Perkins, Infinera
ADVA Optical Networking, unlike Ciena and Alcatel-Lucent, is not developing 40Gbps technology in-house. “When looking at second generation 40Gbps, DQPSK and DP-QPSK are both viable options from a performance point of view,” says Elbers.
He points out that what will determine what ADVA Optical Networking adopts is cost. DQPSK has a higher nonlinear tolerance and can offer lower cost compared to DP-QPSK but there are additional costs besides just the transponder for DQPSK, he says, namely the need for an optical pre-amplifier and an optical tunable dispersion compensator per wavelength.
DP-QPSK, for Elbers, eliminates the need for any optical dispersion compensation and complements 100Gbps DP-QPSK, but is currently a premium technology. “If 40Gbps DP-QPSK is close to the cost of 4x10Gbps tunable XFP [transceivers], it will definitely be used,” he says. “We are not seeing that yet.”
Infinera, with its photonic integrated circuit (PIC) technology, questions the whole premise of debating 40Gbps and 100Gbps technologies. Infinera believes what ultimately matters is how much capacity can be transmitted over a fibre.
“Most people want pure capacity,” says Drew Perkins, Infinera’s CTO, who highlights the limitations of the industry’s focus on line speed rather than overall capacity using the analogy of buying a car. “It’s like asking what the horsepower per cylinder is rather than the horsepower of the engine,” he says.
Infinera offers a 10x10Gbps PIC though it has still not launched its 10x40Gbps DP-DQPSK PIC. “The components have been delivered to the [Infinera] systems group,” says Perkins. The former CEO of Infinera, Jagdeep Singh, has said that while the company is not first to market with 40Gbps it intends to lead the market with the most economical offering.
Moreover, Infinera is planning to develop its own coherent based PIC. “The coherent approach - DP-QPSK ‘Version 1.0’ with a DSP - is very powerful with its high capacity and long reach but it has a significant power density cost,” says Perkins. “We envisage the day when there will be a 10-channel PIC with a 100Gbps coherent-type technology in 50GHz spectrum at very low power.” Such PIC technology would deliver 8 Terabits over a fibre.
Further evidence of the importance of 100Gbps is given by Verizon Business which has announced that it will deploy 100Gbps coherent-optimized fibre links starting next year that will do away with dispersion compensation fibre. AT&T’s King says it will also deploy coherent-optimised links.
Not surprisingly, views also differ among module makers regarding the best 40Gbps modulation schemes to pursue.
“We had a very good look at DQPSK,” says Mintera’s Robinson. “What’s best to invest? The price comparison [DQPSK versus coherent] is very similar yet DP-QPSK is vastly superior [in performance]. Put in a module it will kill off DP-QPSK.”
Finisar has yet to detail its plans but Ward says that the view inside the company is that the lowest cost interface is offered by DPSK while DP-QPSK delivers high performance. “DQPSK is in this challenging position, it can’t meet the cost point of DPSK nor the performance of DP-QPSK,” he says.
Opnext begs to differ.
The firm offers the full spectrum of 40Gbps modulation schemes - optical duobinary, DPSK and DQPSK. “The next phase we are focussed on is 100Gbps coherent,” says Traverso. “We are not as convinced that 40Gbps is a sweet spot.”
In contrast Opnext does believe DQPSK will be popular, although Traverso highlights that it depends on the particular markets being addressed, with DQPSK being particularly suited to regional networks. “One huge advantage of DQPSK is thermal – the coherent IC burns a lot of power”.
Oclaro is also backing DQPSK as the format for metro and regional networks: fibre is typically older and the number of ROADM stages a signal encounters is higher.
Challenges
The maturity of the high–speed transmission supply chain is one challenge facing the industry.
“Many of the critical components are not mature,” says Finisar’s Ward. “There are a lot of small companies - almost start-ups - that are pioneers and are doing amazing things but they are not mature companies.”
JDS Uniphase believes that with the expected growth for 40Gbps and 100Gbps there is an opportunity for the larger optical vendors to play a role. “The economic and technical challenges are still a challenge,” says Tom Fawcett, JDS Uniphase’s director of product line management.
Driving down cost at 40Gbps remains a continuing challenge, agrees Nguyen: “Cost is still an important factor; operators really want lower cost”. To address this the industry is moving along the normal technology evolution path, he says, reducing costs, making designs more compact and enabling the use of techniques such as surface-mount technology.
Mintera has developed a smaller 300-pin MSA DPSK transponder that enable two 40Gbps interfaces on one card: the line side and client side ones. Shown on the right is a traditional 5"x7" 300-pin MSA.
JDS Uniphase’s strategy is to bring the benefits of vertical integration to 40 and 100Gbps; using its own internal components such as its integrated tunable laser assembly, lithium niobate modulator, and know-how to produce an integrated optical receiver to reduce costs and overall power consumption.
Vertical integration is also Oclaro’s strategy with is 40Gbps DQPSK transponder that uses its own tunable laser and integrated indium-phosphide-based transmitter and receiver circuitry.
“[Greater] vertical integration will make our lives more difficult,” says u2t’s Umbach. “But any module maker that has in-house components will only use them if they have the right optical performance.”
Jens Fiedler, vice president sales and marketing at u2t Photonics,stresses that while DQPSK and DP-QPSK may reduce the speed of the photodetectors and hence appear to simplify design requirements, producing integrated balanced receivers is far from trivial. And by supplying multiple customers such as non-vertically integrated module makers and system vendors, merchant firms also have a volume manufacturing advantage.
Opnext has already gone down the vertically integrated path with its portfolio of 40Gbps offerings and is now developing an ASIC for use in its 100Gbps transponders.
Estimates vary that there are between eight and ten companies or partnerships developing their own coherent ASIC. That equates to a total industry spend of some $160 million, leading some to question whether the industry as a whole is being shrewd with its money. “Is that wise use of people’s money?” says Oclaro’s Clarke. “People have got to partner.”
The ASICs are also currently a bottleneck. “For 100Gbps the ASIC is holding everything up,” says Jimmy Yu, a director at the Dell'Oro Group
According to Stefan Rochus, vice president of marketing and business development at CyOptics, another supply challenge is the optical transmitter circuitry at 100Gbps while for 40Gbps DP-QPSK, the main current supplier is Oclaro.
“The [40Gbps] receiver side is well covered,” says Rochus.
CyOptics itself is developing an integrated 40Gbps DPSK balanced receiver that includes a delay-line inteferometer and a balanced receiver. The firm is also developing a 40 and a 100G PM-QPSK receiver, compliant with the OIF Framework Document. This is also a planar lightwave circuit-based design but what is different between 40 and 100Gbps designs is the phodetectors - 10 and 28GHz respectively - and the trans-impedence amplifiers (TIAs).
NeoPhotonics is another optical component company that has announced such integrated DM-QPSK receivers.
And u²t Photonics recently announced a 40G DQPSK dual balanced receiver that it claims reduces board space by 70%, and it has also announced with Picometrix a 100Gbps coherent receiver multi-source agreement.
40 and 100Gbps: next market steps
Verizon Business in late 2009 became the first operator to deploy a 100Gbps route linking Frankfurt and Paris. And the expectation is that only a few more 100Gbps lightpaths will be deployed this year.
The next significant development is the ratification of the 40 and 100 Gigabit Ethernet standards that will happen this year. The advent of such interfaces will spur 40Gbps and 100Gbps line side. After that 100Gbps transponders are expected in mid-2011.
Such transponders will have a two-fold effect: they will enable more system vendors to come to market and reduce the cost of 100Gbps line-side interfaces.
However industry analysts expect the 100Gbps volumes to ramp from 2013 onwards only.
Dell'Oro’s Yu expects the 40Gbps market to grow fiercely all the while 100Gbps technology matures. At 40Gbps he expects DPSK to continue to ship. DP-QPSK will be used for long haul links - greater than 1200km –while DQPSK will find use in the metro. “There is room for all three modulations,” says Yu.
|
40 100G market |
Compound annual growth rate CAGR |
|
Line card volumes |
79% till 2014 |
|
Transponder volumes |
100% till 2015 |
|
Transponder revenues |
65% till 2015 |
Source: Ovum
Ovum and Infonetics have different views regarding the 40Gbps market.
“Coherent is the story; the opportunity for DQPSK being limited,” says Ovum’s Kline. Infonetics’ Schmitt disagrees: “If you were to look back in 2015 over the last five years, the bulk of the deployments [at 40Gbps] will be DQPSK.
Schmitt does agree that 2013 will be a big year for 100Gbps: “100Gbps will ramp faster than 40Gbps but it will not kill it.”
Schmitt foresees operators bundling 10Gbps wavelengths into both 40Gbps and 100Gbps lightpaths (and 10Gbps and 40Gbps lightpaths into 100Gbps ones) using Optical Transport Networking (OTN) encapsulation technology.
Given the timescales, vendors still to make their 40Gbps modulation bets run the risk of being late to market. They are also guaranteed a steep learning curve. Yet those that have made their decisions at 40Gbps will likely remain uncomfortable for a while yet until they can better judge the wisdom of their choices.
For the first part of this feature, click here
For Part 3, click here
Jagdeep Singh's Infinera effect
Talking to gazettabyte, he reflects on the ups and downs of being a CEO, his love of running, 40 Gigabit transmission and why he is looking forward to his next role at Infinera.
"We are looking to lead the 40 Gig market, not be first to market.”
Jagdeep Singh, Infinera CEO
Ask Jagdeep Singh about how Infinera came about and there is no mistaking the enthusiasm and excitement in his voice.
During the bubble era of 2000 he started to question whether the push to all-optical networking pursued by numerous start-ups made sense. “The reason for these all-optical device companies was that they were developing the analogue functions needed,” says Singh. “Yet what operators really wanted was access to the [digital] bits.”
This led him to think about optical-to-electrical (O-E) conversion and the digital processing of signals to correct for transmission impairments. “The question then was: could this be done in a low-cost way?” says Singh. Achieving O-E conversion would also allow access to the bits for add/ drop, switching and grooming functions at the sub-wavelength level before using inverse electrical-to-optical (E-O) conversion to continue the optical transmission.
“We came at this from an orthogonal direction: building lower-cost O-E-O. Was it possible?” says Singh. “The answer was that most of the cost was in the packaging and that led us to think about photonic integration.”
Singh started out with his colleague Drew Perkins (now Infinera’s CTO) with whom he co-founded Lightera, a company acquired by Ciena in 1999. Then the two met with Dave Welch at a Christmas party in 2000. Welch had been CTO of SDL, a company just acquired by JDS Uniphase. “It was clear that he was not that happy and there were a lot of VCs (venture capitalists) chasing him,” says Singh. “He (Welch) recognised the power of what we were planning.” In January 2001 the three founded Infinera.
So why is he stepping down as CEO? The answer is to focus on long-term strategy. And perhaps to reclaim time outside work, given he has a young family.
He may even have more time for running.
Singh typically runs at least two marathons a year. “As a CEO your schedule is fully booked. There is so much stuff there is no time to think.” Running for him is quiet time. “I can get out and recharge the batteries. I find it invaluable. I can process things and it keeps the stress levels down.”
Being CEO
“There are two roles to being a CEO: running the business – the P&Ls (profit and loss statements), financials, sales – all real-time and urgent; and then there is the second part – setting the product vision: what products will be needed in two, three, four years’ time?” he says.
This second part is particularly important for Infinera given it develops products around its photonic integrated circuit (PIC) designs, requiring a longer development cycle than other optical equipment makers. “We have to get the requirements right up front,” says Singh.
And it is this part of the CEO’s role, he says, that gets trumped due to real-time tasks that must be addressed. Thus, from January, Singh will become Infinera’s executive chairman focussing exclusively on product planning. “If I had to choose [between the two roles], the longer term stuff is more appealing,” he says.
Looking back over his period as CEO, he believes his biggest achievement has been the team assembled at Infinera. “What I’ve learnt over the years is that the quality of success depends on the quality of the team.
“We started after the telecom bust,” says Singh. “There were world-class people that were never that locked in and [once on board] they knew people that they respected.” Now Infinera has a staff of 1,000, and had gone from a start-up to a publicly-listed company.
One downside of becoming a large company is that Singh regrets no longer personally knowing all his staff. “What I miss is that I knew everyone, I was part of a small team with a lot of energy,” he says. Another change is all the regulatory, legal and accounting that a public company must do. “I was also free to do and say what I wanted. Now I have to be a lot more careful.”
The Infinera effect
Asked about why Infinera is still not shipping a PIC with 40Gbps line rate channels, it is Singh-as-scrutinised-CEO that kicks in. “If we built 40 Gig purely using off-the-shelf components we’d have a product.” But he argues that the economics of 40 Gigabit-per-second (Gbps) are still not compelling. According to market research firm Ovum, he says, it will only be 2012 when 40Gbps dips below four times the cost of 10Gbps.
Indeed in Q3 2009 shipments of 40Gbps slipped. According to Ovum, this was in part due to what it calls the “Infinera effect” that is lowering the cost of existing 10Gbps technology. Only when 40Gbps is around 2.5x the cost of 10Gbps that it is likely to take off; the economic rule-of-thumb with all previous optical speed hikes.
“Our goal is to come in with a 40 Gig solution that is economically viable,” says Singh. This is what Infinera is working on with its 10x40Gbps PIC pair of chips that integrate hundreds of optical functions. “With the PIC we are looking to lead the 40 Gig market, not be first to market.”
This year also saw Infinera introduce its second class of platform, the ATN, aimed at metro networks. The platform was developed across three Infinera sites: in Silicon Valley, India and China.
Coupled with Infinera’s DTN, the ATN allows end-to-end bandwidth management of its systems. “Until now we have only played in long-haul; this now doubles the market we play in,” says Infinera's CEO. Italian operator Tiscali announced in December 2009 its plan to deploy Infinera’s systems with the ATN being deployed in 80 metro locations.
How are cheap wavelength-selective switches and tunability impacting Infinera’s business? Singh bats away the question: “We just don’t see it in our space.”
Singh agrees with Infinera’s Dave Welch’s thesis that PICs are optics’ current disruption. What developments can he cite that will indicate this is indeed happening?
There are several examples that would confirm this, he says: “PICs in adjacent devices such as routers or switches; you would need something like a PIC to reduce the power and space of such platforms.” Other areas of adoption include connecting multiple bays such as required for the largest IP core routers, and even chip-to-chip interconnect.
Surely chip-to-chip is silicon photonics not Infinera’s PICs’ based on indium phosphide technology? Is silicon photonics of interest to Infinera?
"We are an optical transport company. To generate light over vast distances requires indium phosphide,” says Singh. “But if and when there is a breakthrough in silicon to generate light efficiently, we’d want to take advantage of that.”
One wonders what ideas Singh will come up with on his two-hour runs once he can think beyond the next financial quarter.