Passive optic LANs: Prospects for your fiber optics business
We are back with our interview with our special guest, Jim Hayes, President of the Fiber Optic Association. The first part was devoted mostly to technical aspects of passive optical LANs, and now we are going to talk about POL business.
Jim Hayes tells about Passive Optical LAN
Alexei: For our readers probably the most interesting aspect is economics of PONs, expenses involved, etc. Motorola claims that capital expenses are cut by 50%, Tellabs’ number for that is even higher, 70%. Can you comment on the numbers?
Jim Hayes: As I said earlier, the numbers are not absolute, of course, and I cannot answer for Motorola and Tellabs. I would say all of this is dependent on the actual installation—how many users and how big a geographic area you cover—and what you compare it to. A POL is a “Level 1 +Level 2” network—it includes the switches and cabling to provide Ethernet. Some people only want to consider cables to cables, but that’s irrelevant, you need to consider it as part of the network. Furthermore, traditional LANs have been priced very high for fiber—a Cat5 port may cost $5 on a switch, a multimode port $500 and a singlemode port $5000! That’s hardly comparable to the cost of FTTH hardware where a typical FTTH subscriber can be connected for what a traditional switch supplier wants for a multimode port! Some cases like Sandia Labs are no-brainers because you need SM to connect various facilities. Others are non-optimal because they are updates in buildings with cabling systems already, but there is another advantage for an OLAN—it takes so little space you can install it before removing all the old copper. Just have a look. And yes, it is good income to recycle! Sandia made $80,000 off recycled cable. The cost of copper will likely be going up and make this recycling even more attractive economically. Besides, fewer electronics means less power. No power or AC in the telecom closet. AC is half the energy consumed in most LANs! That is why electricity expenses are cut about 80%. Even more, the space occupied by the equipment is reduced drastically, sometimes tenfold. One more on POL business. To date, the major markets have been in large LANs, like government agencies, schools and school systems, college campuses, where there are large numbers of users or large geographic areas. We know of several cities considering them for their municipal networks, perhaps in conjunction with a city-owned FTTH system. Now structured cabling standards are adapting to passive OLANs by adding in the splitter so centralized fiber with a splitter becomes a passive OLAN. The alternative is active Ethernet on a centralized fiber architecture using singlemode fiber and P2P (point to point) FTTH hardware. OLANs will be integrated into structured cabling architecture and standards but should over time predominate in larger LANs with at least 100 users, the more the better. That is where they are feasible now, though I can say with fiber optics booming in general the number will go down soon.
Alexei: Do you think that POLs are more interesting for well-developed regions with excellent infrastructure, like most of the US, Western Europe, and cities like Shanghai, Moscow, Singapore?
Jim Hayes: Yes, but only because there is probably a ”dark fiber” network in the cities that allows building citywide networks. I would say that with POL technologies those well-developed regions do not have to be so tightly packed as, say, in Hong Kong. A bank can have several offices, a few miles between them, and still cover it with one relatively cheap and advanced LAN. Besides, such cities are just places where the money goes, swirls, and boils. You want profits, you go to such places.
Alexei: What about installation personnel training and maintenance personnel training?
Jim Hayes: Of course, designers need to understand the new architecture of OLANs, where to place splitters, how to spec singlemode fiber and other related components. If you are familiar with optic fiber, the installation process is simple—tiny cables, prefab cables or prepolished/splice connectors. Installers can learn it in a couple of days. Again, most likely you will need better OTDRs than you do now, because of many connectors and splitters. If you are new fiber optics in general, then you have to learn how to splice, how connectors work, etc. But it is not rocket science.
Alexei: But you still have to pay for new equipment?
Jim Hayes: Right, you cannot reuse copper LAN equipment, of course. But again, if you compare the cost of upgrade, POL is much cheaper.
Alexei: Now about upgrades. According to Tellabs, POLs eliminate future infrastructure upgrades. Sounds too good to be true, no?
Jim Hayes: Well, I would put it more modestly: POLs are as future-proof as you can get today. The same fiber for a gigabit POL can be upgraded to 10G – the standards and products are already here. WDM POLs (wavelength division multiplexing) allows another 100X upgrade – again standards are being developed – and that takes us to 1Tb/s! When LANs go to speeds over terabits per sec, you may need an upgrade. Some time in the future you will definitely have to upgrade. To what? I don’t know, maybe to photon torpedoes or transporter beams, but it is not Godfather, it is Star Trek already (laughing).
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