Trends and Directions in Data Center Interconnect: A Survey of Optical and Packet Mode Networking Practices

This ACG Research report investigates the trends and directions that service providers are taking in the deployment of their data centers and specifically their interconnection. It provides insight into existing data center practices as well as future practices. The survey report connected directly with service providers utilizing data center interconnect equipment or planning to deploy such equipment to interconnect their data centers in the next 12 months. Respondents included Network Service Providers, Cloud Service Providers, Internet Content Providers and Inter-eXchange Providers in the APAC, EMEA, NA and LAC regions. 

“We confirmed our previously held belief that the number of data centers will grow approximately 60% between now and 2019,” says Tim Doiron, principal analyst, Intelligent Network Services. “We determined that the types of products (SFF or multi-slot chassis) and desired product attributes differ based upon the service provider segment. Data center optical reach demonstrates a bimodal distribution with maxima below 30km and above 600km distances. Traffic drivers for DCI bandwidth also differ by service provider segment.”

Contact kgrenier@acgcc.com to purchase the report and 30 minutes of analyst time.

     Tim Doiron

     tdoiron@acgcc.com

     www.acgcc.com

New Entrants into the DCI Small Form Factor Market

Two equipment titans Coriant and Alcatel-Lucent entered the Data Center Interconnect (DCI) small form factor market with targeted packet optical networking products. Coriant added to its 7100 family of products with the 7100 Pico™ Packet Optical Transport Platform and Alcatel-Lucent added to its 1830 Photonic Service Switch (PSS) family of cloud optimized metro products with its 1830 PSS-4, 8, 16 optical transport platforms. Both of these devices integrate cleanly into their respective portfolios and are Software Defined Network (SDN) enabled for dynamic service instantiation.

These products are significant because they validate the need for higher performance in this growing sector of the packet optical market. Bell Labs forecasts an increase of metro traffic by 560 percent by 2017. By 2019 there will be 60 percent more data centers in the world’s metro areas and DCI volumes will increase 400 percent. Why? With cloud-based services, the industry has recognized the need for data center interconnect (DCI). Initially, service providers offering XaaS solutions were connecting customers’ data centers to service providers’ data centers.  New requirements for DCI have grown out of the operators’ needs to deploy very high-capacity, high-speed, low-latency, efficient transport between their own data center sites. In addition, rich data types such as video, multimedia mobile backhaul, cloud and data center traffic are also forcing the need for more intelligent programmability and automation in management of these traffic patterns. However, because of the size and power constraints of the metro data centers to date, platforms need to fit strategically into smaller Point of Demarcation (POD) locations with low power and high cooling requirements. This is where the DCI small form factor market emerges.

Some key specifications and product comparisons for DCI Small FF at-a-glance:

DCI Small FF Requirements	Coriant 7100 Pico	ALU 1830 PSS –4, 8, 16
4 RU Chassis or less	2 RU	PSS-4=(2 RU), PSS-8(3 RU), 16(8 RU)
DWDM w/ Tb/s fiber capacity	88 DWDM @ 10 & 100G	8 CWDM, 32 DWDM (400G – 1.6 Tb/s)
Eth, OTN, SONET	Eth, OTN, SONET	Eth, OTN, SONET
SAN (FICON, etc.)	SAN interfaces	SAN interfaces
Video (DVB, SDI, etc.)	Video interfaces	Video interfaces
40 - 100G+ ntwk interface	40G	10G, 100G, 200G
10GE – 100GE modular I/O	1, 10 , 100 GE (176 GE max)	10 , 40, 100 GE (w/112SDX11 card)
Pwr (AC or DC)	AC/DC (110/220VAC / -48VDC)	AC/DC (110/220VAC / -48VDC)
Open API/SDN mgt	Transend	SDN Enabled

ACG sees a bifurcation of the DCI market between small and multislot form factor devices. The total high-speed DCI market was approximately $400 million in 2013 and is forecasted to grow to $4 billion by 2019. Growth for the DCI small form factor is predicted to be $3 billion by 2019, 97.3 percent CAGR 2014–2019. Growth for the DCI multislot is predicted to be $1 billion by 2019, 27.1 percent CAGR 2014–2019. This market segment is growing because of ADVA, BTI, Ciena, Cisco, Cyan, ECI Telecom, Ekinops, Fujitsu, Huawei, Infinera and ZTE. Who will command the market share? Time will tell but in the meantime ACG is tracking the progress of this exciting market in its new DCI Optical Networking Market Worldwide syndication.

Contact sales@acgcc.com to find out more information or schedule a meeting with Dennis Ward and Paul Parker-Johnson to discuss this research.

Dennis Ward

dward@acgcc.com

acgcc.com

Infinera Puts Agility into Pacnet's Optical Transport Services with Its Open Transport Switch

Infinera’s announcement yesterday that Pacnet has deployed its Open Transport Switch (OTS) embedded intelligence layer into its Pacnet Enabled Network (PEN) for trans-Pacific and intra-Asian optical network services brings an innovative design into production in the fast-moving market for dynamically controlled network services.

Infinera’s OTS brings an innovative design to the table as operators’ efforts to embrace SDN move ahead. Most SDN solutions include an abstraction, or ‘adapter’ layer of software to translate consistently described templates (say, secure VPN or elastic content delivery) into semantics an underlying platform can process. This approach provides agility at the service creation and management level—in an SDN controller tier—and puts the burden of integration with the ‘not SDN-enabled’ infrastructure on the controller.

Infinera has taken an interesting tack in this evolution. Recognizing that operators have a wide range of control environments in play as they move ahead on SDN, OTS puts the ‘agility inside’ the infrastructure and allows it to support dynamic network services in a variety of northbound environments. While its first ‘connection path’ for SDN in Pacnet’s PEN is REST-based, there is no requirement for OTS to be REST-limited in all future scenarios. Underlying data models could be adapted to alternative protocol environments such as NETCONF if an operator requires that model to be used. In this way Infinera enables its DTN-X family to support dynamic controls in a variety of service control environments.

Putting ‘agility inside’ adds a refreshing level of flexibility for designers to take advantage of as they plot their course toward more fluid SDN world. OTS does not take away the value of control plane streamlining or innovations in management applications at higher layers. It simply creates the opportunity to accelerate the path to flexible service deployments operators need for data center interconnect, secure VPN, real-time content delivery, and other high-value services—the point of pursuing agility in the first place.

Will OTS evolve to support multilayer packet and optical operations in Infinera’s portfolio? Will it adapt easily to additional SDN control tiers beyond Pacnet’s REST-based PEN? We expect the odds are ‘yes’ though time will tell. In the meantime we can appreciate the innovation coming to market by introducing agility into the underlying network infrastructure that the OTS solution provides.

For more information about ACG's services, contact sales@acgcc.com.

Paul Parker-Johnson

pparkerjohnson@acgcc.com 

acgcc.com 

Worldwide Optical Market Increases Slightly in 4Q

Demand for rich media and OTT services to the home and mobile devices are market trends that continue to pressure providers to move DCs into the metro and enhance core infrastructures

The Worldwide Optical Networking market rebounded slightly in Q4 2014 to $3.375 billion in revenue, dipping 7.0 percent q-q but increasing 2.7 percent y-y. The year closed with annual revenue of $13.1 billion, 0.9 percent y-y increase. Demand for high-speed optical infrastructure remains steady, driven by increased sales of 100G interfaces in the Metro and LH WDM segments. “The 4Q revenue jump has been observed within the optical market for the last three out of four years. The year-over-year growth indicates a slight increase of spending but not necessarily a bullish market,” stated Dennis Ward, principal optical analyst, ACG.

Regionally, APAC is the top producing region though revenue declined 5.3 percent q-q. North America remained in the 2nd position, increasing 7.8 percent q-q and up 25.4 percent y-y. EMEA remained a strong 3rd at 11.4 percent q-q but showed a dip of 5.2 percent y-y. LAM improved with 6.3 percent q-q and 10.2 percent y-y growth.

The growth rate of 100G optical interfaces remains steady. The trend to support 4G and mobile Internet with its rich services is driving this as well as 400G trials in all regions. But 400G standards are still in flux. Although the Tier 1 communication service providers gear up for 2015, many of the optical equipment providers are finding a real market with the content service providers (CSPs) as they migrate their data centers into the metro closer to their customer bases. Some of these CSPs are looking for simple high- capacity solutions via dark fiber across the metro; others want more sophisticated long-haul solutions into the metro. “We see the demand for DCI bifurcating into two distinct market segments of products, small slot versus multislot solutions,” says Dennis Ward.  

Service provider SDN and NFV in combination with P-OTS/Metro WDM solutions are gaining traction in network infrastructure selection and deployments. P-OTS segment saw a quarterly dip in its revenue contribution but maintained its $.5 billion run rate, decreasing 7.9 percent q-q but increasing an impressive 28.9 percent y-y. The top five worldwide players in 4Q were Huawei, ZTE, Ciena, Infinera and Alcatel-Lucent, respectively.  

Metro WDM maintained its quarterly $1 billion run rate but decreased 0.7 percent q-q and 9.2 percent y-y. Metro traffic is predicted to grow faster than backbone traffic as more regional data centers are located closer to the user community. As much as 70 percent of the traffic is predicted to stay within the metro from which it originated, bolstering east-west traffic between data centers. The increase in DCI supports this trend and will drive the need for additional capacity by the traditional service providers, MSOs, cloud and data center operators.

For more information about ACG's optical services, contact sales@acgcc.com.

Dennis Ward

dward@acgcc.com

acgcc.com