Cisco Puts T-2 on the Front Burner

The network equipment maker says 40-Gigabit Ethernet has a better chance of launching in the next few years than 100-Gigabit Ethernet does. Cisco Names New CFO

SAN JOSE, Calif. -- Looking ahead to faster networks, Cisco Systems Wednesday said its development road for Ethernet will more than likely take a stop at the 40-Gigabit Ethernet (40-GbE) station.

Sometimes referred to at T-2, 40-GbE/OC-768 is being developed to meet ever-growing demands for bandwidth. The technology uses dense wavelength division multiplexing (DWDM) to carry multiple channels of data on a single optic fiber.

Briefing reporters and investors on its portfolio and its future plans at its headquarters here, the network equipment maker says it is always finding new ways to push packets around the current Internet infrastructure at higher speeds.

"It's always difficult to go to the next step but I don't think we will see 100-Gig Ethernet two years," said Luca Cafiero, Senior Vice President of Cisco's Switching, Voice, and Storage Group. "To be fair, back in 1995, we didn't think we would get to 10-Gig as fast as we did. 40-Gig could be a good compromise."

Currently, Cisco is spending $3.3 billion in R&D and controls 80 percent market share of the routing pie and 60 percent of the switching sector. In the last two months, Cisco has released three products it says could help serve as a building block to the 40- and 100-GbE level.

The company unveiled its Catalyst 2955, a switch for balancing load across VLANs , which the execs referred to as a "paint mixer"; the stackable switch Catalyst 3750; and the refrigerator-sized Catalyst 6500.

However, the company says 40-GbE line rates present significant challenges to network processor designs. The challenges are magnified as silicon-process advances trail growing networking speeds.

"Ethernet is very much a price driven market and until the cost permits, the 10 Gigabit level is where we are at," said Larry Birenbaum, Vice President and General Manager Ethernet Access Group. "One of the barriers for entry is that the new technology has to offer a better cost than what is out there."

One of the uses being discussed for 40-GbE is the convergence angle. With so many homes looking to connect their set-top boxes and media players to stream audio and video from the Internet, Cisco says it is trying to capitalize on the increasing trend of homeowners that purchase routers and switches.

"[Cisco Chief Development Officer] Mario [Mazzola] has a Catalyst 6500 installed at his house," Birenbaum quipped.

In theory, 40-GbE has the capability to offer one fiber to support, simultaneously, an active Internet connection to every household in the U.S.

"We think legal music services and streaming movies are one motivating factor," Cafiero said. "There is also a big push to connect your CD player to the set top box wirelessly."

Cafiero said Cisco is also working on the possibility of using high-speed Ethernet to allow wireless phones to operate over 802.11 networks. Part of that build out is being made possible with Cisco's $500 million plan to by Irvine, Calif.-based Linksys.

As for cheaper competition coming from companies like Dell Computer , Cisco says it is prepared to take on all comers.

"That constant pressure from below helps us work harder to get better," Birenbaum said. "There has always been a threat of commodization. What we do to attack this is offer end-to-end solutions."

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