Nortel Buzzboard

Back in my home-sweet-home office after my trip to Ottawa to see first-hand the future technologies Nortel’s R&D guys are working on.  More on that soon in another post.  But first-things-first, today Nortel issued some news that should be of real interest.

Today Nortel unveiled our new 40 Gig optical solution, which also lays the foundation to easily move to 100 Gig.  We’re not the first to announce a 40 Gig solution, but we are the first to have one that is practical to deploy for today’s carriers.  Some of you may be saying “optical, are you kidding?”  But this really is big news about a truly unique Nortel solution, so read on.

Back in the late 1990’s Internet bubble, former US Fed Chairman Allan Greenspan used the now famous phrase “Irrational Exuberance” to describe the ever-escalating stock market. One of the main drivers of that bubble was the huge growth in optical networking, and at the bleeding edge of optical was Nortel.

Nortel was leading the 10 Gig revolution, and was among many already talking about 40 Gig.  But something happened on the way to the 40 Gig party.  Overdeployment of optical networks created a huge oversupply of network capacity globally.  Deployments ground to a halt, as did production for anyone involved in the optical market (including Nortel). 

But that is quickly changing. Today the explosion of YouTube, corporate video-conferencing, IPTV and other bandwidth-hungry applications are creating huge amounts of new traffic.  The Internet Innovation Alliance says that YouTube alone uses as much bandwidth today as the entire Internet in 2000.  Recent reports have predicted the Internet will run out of capacity by 2010 or sooner.

But it turns out just upgrading to 40 Gig isn’t so easy.  Much of today’s fiber - installed at great cost less than a decade ago - can’t support 40 Gig speeds.  Why?  Think of fiber like a freeway.  A small bump on the road at 50 mph isn’t much to worry about.  But hit that same bump at 200 mph and you have major issues.  The same concept goes for fiber, making 40 Gig completely impossible on parts of the network, or making the distance that 40 Gig can travel before needing to “regenerate” the signal unrealistically short.

Nobody has an answer to this issue today…except Nortel.

While in Ottawa yesterday, I talked with one of Nortel’s 40 Gig experts, Jason Duggan, about Nortel’s solution - which he says has about a two year lead on competitor solutions based on customer feedback.  What’s different about Nortel’s 40 Gig solution is that it doesn’t involve sending information faster over the fiber network.  Instead the solution “stuffs” 40 Gig of bandwidth through a signal going at traditional 10 Gig speeds.  Nortel accomplishes this through “Dual Polarization Quadrature Phase Shift Keying modulation with coherent detection”… quite a mouth full huh?

So back to the highway example, instead of having to go 200 mph, the car is carrying four people instead of one, and still going at 50 mph.

What this means is that carriers can use their existing 10 Gig optical infrastructure with our 40 Gig solution.  No network re-engineering, no need to rip up fiber networks and lay new ones, no need to add regeneration equipment every 500 km or less.

So yes - I think it’s time for a little “rational exuberance” over this optical news.  Optical networking will likely never be as big as it was 10 years ago.  But as the video boom continues to drive exponential growth in bandwidth demand, Nortel’s advancements in optical networking are again something to get excited about.