Ovum on Infinera's Intelligent Transport Network strategy
Infinera announced that TeliaSonera International Carrier (TSIC) is extending the use of its DTN-X to its European network, having already adopted the platform in the US. Infinera has also outlined the next evolution in its networking strategy, dubbed the Intelligent Transport Network.
Dana Cooperson
Gazettabyte asked Dana Cooperson, vice president and practice leader, and Ron Kline, principal analyst, both in the network infrastructure group at market research firm, Ovum, about the announcement and Infinera's outlined strategy.
What has been announced
TSIC is adding Infinera's DTN-X to boost network capacity in Europe and accommodate its own growing IP traffic. TSIC already has deployed 100 Gig technology in its European network, using a Coriant product. The wholesale operator will sell 100 Gig services, activating capacity using the DTN-X's 'instant bandwidth' feature based on already-lit 100 Gig light paths that make up its 500 Gigabit super-channels.
Meanwhile, Infinera has detailed its Intelligent Transport Network strategy that extends its digital optical network that performs optical-electrical-optical (OEO) conversion using its 500 Gig photonic integrated circuits (PICs) coupled with OTN (Optical Transport Network) switching to include additional features. These include multi-layer switching – reconfigurable optical add/drop multiplexers (ROADMs) and MPLS (Multi-Protocol Label Switching) – and PICs with terabit capacity
Q&A with Dana Cooperson and Ron Kline
Q. What is significant about Infinera's Intelligent Transport Network strategy?
Dana C: Infinera is being more public about its longer-term strategy - to 2020 - which includes evolving from its digital optical network messaging to a network that includes multiple layers and types of switching, and more automation. Infinera is not announcing more functionality availability now.
Infinera makes much play about its 500 Gig super-channels. More recently it has detailed such platform features as instant bandwidth and Fast Shared Mesh Protection supported in hardware. Are these features giving operators something new and is Infinera gaining market share as a result?
Dana C: Instant Bandwidth provides a way for Infinera’s operator customers to have their cake and eat it. They can install 500 Gig super-channels ahead of demand, and not pay for each 100 Gig sub-channel until they have a need for that bandwidth. It is a simple process at that point to 'turn on' the next 100 Gig worth of bandwidth within the super-channel.
By installing all five 100 Gig channels at once, the operator can simplify operations - lower opex - and allow quicker time-to-revenue without having to take the capex hit until the bandwidth needs materialise. This is an improvement over the DTN platform, which gave customers the 10x10 Gig architecture to let them pre-position bandwidth before the need for it materialised and save on opex, but at the cost of higher up-front capex than was ideal.
Talking to TSIC confirm that this added flexibility the DTN-X provides has allowed them to win wholesale business from competitors while tying capex more directly to revenue.
Ron K: Although pay-as-you go capability is available, analysis of 100 Gig shipments to date indicate most customers are paying for all five up front.
Dana C: I have not directly talked with an Infinera customer that has confirmed the benefit of Fast Shared Mesh Protection, but the feature certainly seems to be of value to customers and prospects. Our research indicates the continued search for better, more efficient mesh protection. Hardware-enabled protection should provide better latency (higher speed).
Ron K: Resiliency and mesh protection are critical requirements if you want to participate in the market. Shared mesh assumes that you have idle protection capacity available in case there is a failure. That is expensive. However, with Infinera’s technology - the PIC and Instant Bandwidth - it is not as difficult.
Restoration is all about speed – how fast can you get the network back up. It is not always milliseconds, sometimes it is half a minute. But during catastrophic failure events such as an earthquake, where a user can loose entire nodes, 30 seconds may not be so bad. Infinera has implemented the switch in hardware, based on a pre-planned map, so it is quicker.
Dana C: As for what impact these capabilities are having on market share, Infinera has climbed to the No.3 player in 100 Gig DWDM in three quarters since the DTN-X has become available.
They’ve jumped back up to No.4 globally in backbone WDM/CPO-T (converged packet optical transport) after sinking to sixth when they were losing share because they were without a viable 40 Gig solution. They made the right call at that time to focus on 100 Gig systems based on the 500 Gig PIC rather than chase 40 Gig. They are both keeping and expanding with existing DTN customers, TSIC being one, and picking up new customers.
Ron Kline
Ron K:They are definitely picking up share. However, I’m not sure if they can sustain it. The reason for the share jump is they are selling 100 Gig, five at a time. Remember, most customers elect to pay for all five. That means future sales will lag because customers have pre-positioned the bandwidth.
Looking at the customers is probably a better indicator: Infinera has some 27 customers, maybe 30 by now, which provide a good embedded base. Still, 27 customers is low compared to Ciena, Alcatel-Lucent, Huawei and even Cisco.
When Infinera first announced the DTN-X in 2011 it talked about how it would add MPLS support. Now outlining its Intelligent Transport Network strategy it has still to announce MPLS support. Do operators not need this network feature yet in such platforms and if not, why?
Dana C: The market is still sorting out exactly what is needed for sub-wavelength switching and where it is needed. Cisco’s and Juniper’s approaches are very different in the routing world —essentially, a lower-cost MPLS blade for the CRS versus a whole new box in the PTX; there is no right way there.
Within packet-aware optical products, the same is true: What is the right level of integration of OTN versus MPLS? It depends on where you are in the network, what that carrier’s service mix is, and how fast the mix is changing.
Many carriers are still struggling with their rigid organisational structures, and how best to manage products that are optical and packet in equal measure. So I don’t think Infinera is late, they are just reacting to their customers’ priorities and doing other things first.
Ron K: This is the $64,000 question: MPLS versus OTN. I’m not sure how it will eventually play out. I am asking service providers now.
OTN is a carrier protocol developed for carriers by carriers (the replacement for SONET/SDH). They will be the ones to use it because they have multi-service networks and need the transparency OTN provides. Google types and cable operators will not use OTN switching - they will lean towards the label-switched path (LSP) route. Even Tier-1 operators who have both types of networks will most likely maintain separation.
"The trick is to optimise around the requirements that net you the biggest total available market and which maximise your strengths and minimise your weaknesses. You can’t be all things to all carriers."
If Infinera has its digital optical network, why is it now also talking about ROADMs? And does having both benefit operators?
Dana C: Yes, having both benefits operators. From discussions with Infinera's customers, it is true that the digital nodes give them flexibility, but they do introduce added cost. For those nodes where customers have little need to add/ drop traffic, a ROADM would provide a more cost-efficient option to a node that performs OEO for all the traffic. So, with a ROADM option customers would have more control over node design.
Infinera talks about its next-gen PICs that will support a Terabit and more. After nearly a decade of making PICs, how does Ovum view the significance of the technology?
Dana C: While more vendors are doing photonic integration R&D, and some - Huawei comes to mind - have released some PIC-based products, no one has come close to Infinera in what it can do with photonic integration. Speaking with quite a few of Infinera’s customers, they are very happy with the technology, the system, and the support.
Each generation of PIC requires a significant R&D effort, but it does provide differentiation. Infinera has managed to stay focused and implement on time and on spec. I see them as the epitome of a “specialist” vendor. They are of similar size to Coriant and Tellabs, which have seen their fortunes wane, and ADVA Optical Networking. So I would say they are a very good example of what focus and differentiation can do.
Now, is the PIC the only way to approach system architecture? No. As noted before, some Infinera clients have told me that the lack of a ROADM has hurt them in competitive situations, as did the need to pay for all the pre-positioned bandwidth up front (true for the DTN, not the DTN-X).
From my days in product development, I know you have to optimise around a set of requirements, and the trick is to optimise around the requirements that net you the biggest total available market and which maximise your strengths and minimise your weaknesses. You can’t be all things to all carriers.
What is significant about the latest TeliaSonera network win and what does it mean for Coriant?
Dana C: Infinera is announcing an extension of its deployments at TSIC from North America to now include Europe as well. When you ask what this means to Coriant, their incumbent supplier in Europe, the answer is not clear cut. This gives Infinera an expanded hunting licence and it gives Coriant some cause for worry.
TSIC values both vendors and both will have their place in the European network. TSIC plans to use the vendors in different regions.
I am sure TSIC will try and play each off against the other to get the best price. It is looking for more flexibility and some healthy competition.
Infinera adds software to its PIC for instant bandwidth
Infinera has enabled its DTN-X platform to deliver rapidly 100 Gigabit services. The ability to fulfill capacity demand quickly is seen as a competitive advantage by operators. Gazettabyte spoke with Infinera and TeliaSonera International Carrier, a DTN-X customer, about the merits of its 'instant bandwidth' and asked several industry analysts for their views.
Infinera has added a WDM line card hosting its 500 Gigabit super-channel photonic integrated circuit to its DTN-X platform
Pravin Mahajan, Infinera.
Infinera is claiming an industry first with the software-enablement of 100 Gigabit capacity increments. The company's DTN-X platform's 'instant bandwidth' feature shortens the time to add new capacity in the network, from weeks as is common today to less than a day.
The ability to add bandwidth as required is increasingly valued by operators. TeliaSonera International Carrier points out that its traffic demands are increasingly variable, making capacity requirements harder to forecast and manage.
"It [the DTN-X's instant bandwidth] enables us to activate 100 Gig services between network spans to manage our own IP traffic which is growing rapidly," says Ivo Pascucci, head of sales, Americas at TeliaSonera International Carrier. "We will also be able to sell in the market 100 Gig services and activate the capacity much more rapidly."
What has been done
Infinera has added three elements to enable its DTN-X platform to enable 100 Gigabit services.
One is a new wavelength division multiplexing (WDM) line card that features its 500 Gigabit-per-second (Gbps) super-channel photonic integrated circuit (PIC). Infinera says the line card has 500Gbps of capacity enabled, of which only 100Gbps is activated. "The remaining 400Gbps is latent, waiting to be activated," says Pravin Mahajan, director of corporate marketing and messaging at Infinera.
Infinera uses the DTN-X's Optical Transport Network (OTN) switch fabric to pack the client side signals onto any of the 100Gbps channels activated on the line side. This capacity pool of up to 500 Gbps, says Infinera, results in better usage of backbone capacity compared to traditional optical networking equipment based on individual 100Gbps 'siloed' channels.
A software application has also been added to Infinera's network management system, the digital network administrator (DNA), to activate the 100Gbps capacity increments.
Lastly, Infinera has in place a just-in-time system that enables client-side 10 Gigabit Ethernet optical transceivers to be delivered to customers within 10 days, if they out of stock. Infinera says it is achieving a 6-day delivery time in 95% of the cases.
Advantages
TeliaSonera International Carrier confirms the advantages to having 100 Gigabit capacities pre-provisioned and ready for use.
"Having the ability to turn up large bandwidth is critical to our business, especially as the [traffic] numbers continue to grow"
Ivo Pascucci, TeliaSonera International Carrier
"If it is individual line cards across the network when you have as many PoPs as we do, it does get tricky," says Pascucci. "If we have 500 Gig channels pre-provisioned with the ability to activate 100 Gig segments as needed, that gives us an advantage versus having to figure out how many line cards to have deployed in which nodes, and forecasting which nodes should have the line cards in the first place."
The operator is already seeing demand for 100 Gigabit services, from the carrier market and large content providers. The operator already provides 10x10Gbps and 20x10Gbps services to customers. "With that there are all the challenges of provisioning ten or 20 10 Gig circuits and 10 or 20 cross-connects for each site," says Pascucci. The operator also manages one and two Terabits of network capacity for certain customers.
"Having the ability to turn up large bandwidth is critical to our business, especially as the [traffic] numbers continue to grow," says Pascucci.
Analysts' comments
Gazettabye asked several industry analysts about the significance of Infinera's announcement. In particular the uniqueness of the offering, the claim to reduce rapidly bandwidth enablement times and its importance for operators.
Infonetics Research
Andrew Schmitt, directing analyst for optical
Schmitt believes Infinera's announcement is significant as it is the first announced North American win. It also shows the company has a solution for carriers that only want to roll out a single 100 Gbps but don't want to buy 500Gbps.
More importantly, it should allow some carriers to deploy extra capacity for future use at no cost to them and that opens up interesting possibilities for automatically switched optical network (ASON) management or even software-defined networking (SDN).
"As to the claim that it reduces capacity enablement from weeks to potential minutes, to some degree, yes," says Schmitt.
Certainly Ciena, Alcatel-Lucent or Cisco could ship extra line cards into customers and not charge the customer until they are used and that would effectively achieve the same result. "But if the PIC truly has better economics than the discrete solutions from these vendors then Infinera can ship hardware up front and then recognise the profits on the back end," he says.
"You simply can't predict where the best places to put bandwidth will be"
In turn, if customers get free inventory management out of the deal and Infinera equipment can support that arrangement more economically, that is a significant advantage for Infinera.
"This instant bandwidth is unique to Infinera. As I said, anyone could do this deal. But you need a hardware cost structure that can support it or it gets expensive quickly," says Schmitt. "Everyone is working on super-channels but it is clear from the legacy of the way the 10 Gig DTN hardware and software worked that Infinera gets it."
Schmitt believes the term super-channel is abused. He prefers the term virtualised bandwidth - optical capacity that can be allocated the same way server or storage resources are assigned through virtualization.
"The SDN hype is hitting strong in this business but Infinera is really one of the only companies that have a history of a hardware and software architecture that lends itself well to this concept," he says. This is validated with its customer list which is loaded heavily with service providers that are not just talking about SDN but actively doing something, he says.
"It [turning capacity up quickly] is important for SDN as well as more advanced protection arrangements. You simply can't predict where the best places to put bandwidth will be," says Schmitt. "If you can have spare capacity in the network that is lit on demand but not paid for if you don't need it, it is the cheapest approach for avoiding overbuilding a network for corner-case requirements.
"I think the accounting for this product will be interesting, it is likely that we will know in a year how successful this concept was just by a careful examination of the company's financials," he concludes.
ACG Research
Eve Griliches, vice president of optical networking
Infinera delivered this year the DTN-X with 500 Gig super-channels based on PIC technology. Now, a new 500 Gig line card has been added that can operate at 100 Gig and the remaining 400 Gig can be lit in 100 Gig increments using software. This allows customers to purchase 100 Gig at a time, and turn up subsequent bandwidth via software when they require it.
“No other vendor has a software-based solution, and no one else is delivering 500 Gig yet either,” says Griliches.
With this solution, ACG Research says in its research note, operators can start to develop a flexible infrastructure where bandwidth can grow and move around the network instantly. This is useful to address varying demands in bandwidth, triggered by incidents such as natural disasters or sporting events.
Rapid bandwidth enablement has always been important and takes way too long, so this development is key, says Griliches: “Also, it enables Infinera to enter markets which only need one 100 Gig wavelength for now, which they could not do before.”
“No other vendor has a software-based solution, and no one else is delivering 500 Gig yet either”
Looking forward, ACG Research expects this software and hardware-based instant bandwidth utility model will enable Infinera to widen its potential market base and increase its global market share in 2013 and 2014.
Ovum
Ron Kline, principal analyst, and Dana Cooperson, vice president, of the network infrastructure practice
Ovum also thinks Infinera's announcement is significant. It brings essentially the same value proposition Infinera had with 10 Gigabit to the 100 Gigabit market - low operational expenditure (opex) and quick time-to-market. ”Remember 10 Gig in 10 days?” says Kline.
It further fixes an issue for customers in that with the 10x10Gbps, they had to essentially pay for the full 100Gbps up front, and then they could be very efficient with turn-up and opex. Customers made an efficient opex for more capital expenditure (capex) up-front trade. "With instant bandwidth, they don't have to make the upfront capex-versus-opex tradeoff; they can be most efficient with both,” says Cooperson.
Any vendor can shorten capacity enablement times if they can convince the operator to pre-position bandwidth in the network that is ready to be turned on at a moment's notice.
Ron Kline
Kline says operators has different processes for turning up services and in many cases it is these processes and not the equipment directly that is the cause of the additional time for provisioning. “For example the operator may not use the DNA system or may have a very complex OSS/BSS used in the process,” says Kline.
Nevertheless, the capability to have really short provisioning is there, if an operator wants to take advantage. In the TeliaSonera case, Infinera is managing the network so the quick time to market will be there, says Kline.
Cooperson adds that there can be many factors that impede the capacity enablement process, based on Ovum's own research. “But it is clear from talking to Infinera's customers that its system design and approach is a big benefit to those carriers, often the competitive carriers, in competing in the market,” she says. “Multiple carriers told us that with the Infinera system, they were able to win business from competitors.”
Any vendor can shorten capacity enablement times if they can convince the operator to pre-position bandwidth in the network that is ready to be turned on at a moment's notice. However what is unique to Infinera is its system is deployed 500Gbps at a time and all the switching is done electrically by the OTN switch at each node. Others are working on super-channels but none are close to deploying, says Ovum.
“Multiple carriers told us that with the Infinera system, they were able to win business from competitors.”
Dana Cooperson
The ability to turn on bandwidth rapidly is becoming increasingly important. From a wholesale operator perspective it is very important and a key differentiator.
"It's particularly relevant to wholesale applications where large bandwidth chunks are required and the customer is another carrier," says Cooperson. "Whether you view a Google or a Facebook as a carrier or a very large enterprise, it would apply to them as well as a more traditional carrier."