U.S. Ethernet Bandwidth Surpasses Legacy Bandwidth

"Boosted by a 10x surge in the past five years, Ethernet bandwidth has overtaken legacy bandwidth in the U.S. market," said Erin Dunne, director of research services at Vertical Systems Group. "This milestone fittingly coincides with the ten year anniversary of the MEF – an organization that has successfully fostered the deployment of carrier-class Ethernet services throughout the world."

Ethernet has grown in importance since it is has many desirable characteristics: high bandwidth; is very scalable; meets latency requirements; and can be used in a multitude of access, metro and core applications. Service technologies using Ethernet include Private Lines, Frame Relay, ATM, TDM, wireless backhaul and business broadband services. Ethernet can be used as an end-to-end network or as an access technology for MPLS and Internet networks. Overall, Ethernet coverage is growing but is still an issue in some areas.

In the U.S., Ethernet services are offered by telcos like AT&T and Verizon as well as XO, tw telecom, Comcast and Cox. This growth is good news for companies like these who have downward pressure in other business areas like voice.

This should also be a boost for companies like Cisco, Juniper, Adva and Ciena, who make Ethernet equipment.

“The growth in service provider investments in carrier Ethernet equipment continues to outpace that of other telecom equipment, with annual global spending expected to reach $37.5 billion in 2015. The largest investments are in routers, carrier Ethernet switches (CES), and optical gear," notes Michael Howard, co-founder and principal analyst for carrier networks at Infonetics Research. In 2010, carriers spent $26.5 billion on carrier Ethernet equipment as they continued moving from TDM to packet-based networks.

What is the key growth area here? There are still a lot of older mobile backhaul networks out there. Mobile backhaul will continue to be a key area for Ethernet growth as the growing use of smartphones and tablets continues to put pressure on the wireless carriers to increase bandwidth.

Rose Klimovich is a consultant and writer on technology. Formerly she was VP Product Management and Product Marketing for the colocation and interconnection products for Telx, where she led the efforts in creating the Telx strategy and developing and investing in new products and services in areas like colocation, cloud, Ethernet Exchange and Telepresence video.