Why is Ethernet Traffic Doubling?

New study looks at why carriers continue to use increasing amounts of Ethernet at the transport layer.

Ethernet use is continuing to grow in carrier transport as new capabilities are being rolled in that make it more like the legacy technologies it is attempting to displace. As Ethernet rises, ATM and SONET/SDH are declining though neither technology is dead yet.

Those are some of the conclusions in a new study from Infonetics Research. It said carriers are reporting that, in both 2006 and in 2007, their Ethernet traffic grew by 90 to 100 percent. In contrast ATM traffic grew by only four percent in 2006 and by 9 percent in 2007.

The outlook for Ethernet in 2008 is also very rosy. Michael Howard, principal analyst and cofounder of Infonetics Research, said carriers expect their Ethernet traffic to increase by 72 percent in 2008. But much of this, he cautioned, is because of slowing growth rates between 2006 and 2007 and from 2007 to 2008, which, in turn boosts volume.

With the rapid rate of growth for Ethernet, there are bound to be challenges for the carriers.

"So far, the carriers are coping fairly well, with crunches, constrictions, and constraints, popping up in various parts of their networks," Howard told InternetNews.com. "One of the growing pressures for 40G is fiber exhaust on some long haul, regional, and metro routes. A lot of 10G wavelengths are being sold and deployed now. We still have seen almost nothing in the way of IPTV and the personalization of TV and other video programming and content--so the worst is yet to come."

While Ethernet use by carriers continues to grow, it's a difficult question as to whether it represents the greatest share of traffic. Howard explained that the difficulty lies in the fact that Ethernet is now also heavily a part of SONET and also a growing part of WDM (wavelength division multiplexing, which is a type of optical fiber). Still, ATM equipment purchases are definitely on the decline.

In the study, Howard noted that service provider networks are in transition, implementing IP network transformation projects. The goal of those efforts is to remove layers from their networks to achieve an IP/MPLS/Ethernet services layer over a fused Ethernet-WDM optical transport. The report expects that carrier efforts will result in a growing IP router and carrier Ethernet switch market.

The Infonetics report also notes that although it will take 15 to 20 years, ATM and SONET/SDH will gradually disappear.

Before ATM and SONET/SDH can be totally displaced, however, the Infonetics report suggests that Ethernet needs circuitlike capabilities to displace and replace ATM and SONET/SDH. A group of technologies now referred to as Connection Oriented or Ethernet transport tunnels may well be the answer.

"The COE term is rather new, but being used frequently among manufacturers and service providers in conversations about PBT(Provider Backbone Transport) /PBB-TE (Provider Backbone Bridging Traffic Engineering)and T-MPLS(transport MPLS)," Howard explained. "It does not apply collectively to Metro Ethernet. The purpose of COE is to give Ethernet the transport connection qualities of SDH and SONET, but in a packet network."

The emergence of COE in carrier plans was one of the most surprising aspects of the study for Howard. The planned adoption of COE was surprising for him since the standards for COE are still in progress.

"It was not a majority of respondent service providers, but a strong minority could say in the fall of 2007 that they planned to deploy in 2008 or that PBT and/or T-MPLS were a critical requirement for equipment purchased in the next 12 months," Howard said.

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