Early last year, some carriers complained that if the price of 40 Gb/s technology didn't come down, they would skip it and go from 10 Gb/s straight to 100 Gb/s. Today, with network traffic rising, carriers increasingly are deploying 40 Gb/s, ushering in what Ovum hailed last month as the commencement of the market's “generalized deployment phase.” As December began, Nortel Networks alone claimed 37 customers for the 40 Gb/s gear it introduced in April.

But with some carriers and vendors already testing 100 Gb/s gear (Ciena, for example, demoed a single 100 Gb/s wavelength just days after Nortel's last customer win news) and with carrier budgets constricted, it may be surprising to some that so many would spend time and money deploying a technology with such a short life expectancy. On the other hand, analysts say industry standards for 100G won't be ready until at least 2010, with big commercial deployments not likely until 2011 or 2012. And some network routes can't wait that long.

“We are starting to see 40G in a lot of different applications, including relief for congested routes, upgrades for undersea and festoon applications as well as router interconnect,” said Ron Kline, research director for Ovum.

In addition, said Mark Lutkowitz, principal with Telecom Pragmatics, “the only reason 40G has become a market is that Cisco released those 40G interfaces on their routers. The AT&Ts of the world had to address that in terms of transport.”

However, the largest carriers still are hoping to leapfrog 40 Gb/s for 100 Gb/s as soon as possible, said Sam Greenholtz, principal with Telecom Pragmatics. While Nortel's customers include Alaska Communications Systems and Canadian carrier Telus, Greenholtz said, “AT&T, Verizon and Level 3 are all looking at jumping over 40G.”

40G LINE CARDS PROJECTED GLOBAL REVENUE