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200G Transport: A Market Reality Check
As the worldwide communications market migrates to ever higher capacity levels, networks are growing significantly faster at the metro level, driven by demand from data centers and their providers of Internet content and the cloud along with ever-intensifying requirements to bring data closer to end users, particularly for exploding and demanding applications, such as streaming video to mobile devices.

Market estimates project extreme growth of metro traffic. Forecasts by Bell Labs, a division of Alcatel-Lucent, project growth of real-time video traffic from the cloud to mobile smart devices by eight times between 2012 and 2017 and of data center connectivity traffic by more than five times over the same period. For another indicator, Heavy Reading forecasts the metro 100G equipment market will grow at a 72 percent compound rate through 2018. Carriers consequently face pressure to improve their optical network performance in light of these intensifying bandwidth demands and cost crunches threatening their profitability.

At least a few dozen customers have deployed 200G-capable products worldwide (though not necessarily the actual speed since the dominant product is a 100/200 flexible line card usable for either speed). Customers are almost exclusively carriers so far a fact that will soon be changing primarily smaller to mid-size entities, the good majority so far outside the U.S. Most potential customers are still widely seen as "kicking the tires" in this arena.

16QAM modulation providing 200G over 100G lines the primary means by which 200G is implemented will be a growing and significant, though not ubiquitous, market presence for metro and regional routes over the next couple of years. There is likely to be substantial though not overwhelming adoption in the near term, with faster growth among Web 2.0/data centers than carriers as the latter hedge their bets. While the large majority of 200G adoption has been by carriers so far, the market is more optimistic about data center adoption.

The major drawback to 16 QAM is its limited distance reach, exacerbated by issues of protection and fiber rings, multiple modes of fiber and rights of way. While this limitation will likely be transcended over time, it will be binding until something better and broadly credible is introduced, quite possibly for at least the next couple of years.

There is wide disagreement as to whether 200G will become a major presence in the next couple of years in the carrier environment or stay relatively "nichey," limited to relatively small use cases, as on select links on which fiber is exhausted and carriers need to lease.

200G Transport: A Market Reality Check provides a market reality check on the status of 200G adoption. The report briefly provides an overview of this activity, then assesses market trends and circumstances. Finally, this report profiles six key market players.
Sample research data from the report is shown in the excerpts below:
Table of Contents (hri0715_toc.pdf)
The basic reason for implementing 16QAM 200G transport remains to improve economies of capacity creation from a provider perspective in a context of rapidly growing capacity demand. In addition to the primary saving on photonic lines, there are concomitant savings on electric power consumed and real estate used when 200G of bandwidth can be transported much the same way 100G was previously. While 200G will never be a service or service interface, it is an efficiency measure that can dramatically improve capacity economics for carriers and others managing bandwidth provision.
[click on the image above for the full excerpt]
Companies discussed in this report include: Companies profiled in this report include: Alcatel-Lucent (NYSE: ALU); Ciena Corp. (NYSE: CIEN); Cyan Inc. (NYSE: CYNI); Huawei Technologies Co. Ltd.; Infinera Corp. (Nasdaq: INFN); and Verizon Communications Inc. (NYSE: VZ).
Total pages: 13
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