Last month the Linley Group hosted the Data Center Networking seminar in San Jose, California. We took a few moments with Linley analyst, Jag Bolaria, to talk about the future of the optics industry and specifically his view on the war between Optics and Copper technologies.
JM: In the early 2000’s, the general view was that the telecommunications industry had significantly over-invested in fiber optic infrastructure – do you think the investment has caught up with the industry needs of today?
JB: Yes, a lot of money went into the telecom infrastructure and that was followed by a significant cut back in new equipment. In fact, this cut back continued for more than seven years. Since 2000, the traffic mix has shifted dramatically to data from voice—and in the future video will drive further growth in traffic. This new makeup of traffic requires an infrastructure that is designed more for data and video rather than built upon voice technologies. Consequently, in 2009 and 2010 we are at the beginning of an update to the telecom infrastructure—an update that will shift the infrastructure technologies from TDM and SONET/SDH to packet traffic, Carrier Ethernet and OTN.
JM: What areas in fiber optic infrastructure do you foresee organizations investing in as we move into 2010?
JB: The fiber optic infrastructure growth will be driven by OTN technologies, which include data rates of 40Gbps and 100Gbps. Much of this growth will be driven by carriers and a need by the carriers to consolidate multiple transport technologies to OTN and Carrier Ethernet.
JM: When do you predict the war between Optics and Copper will end – or will it?
JB: Instead of a war, we see these as complementary technologies for the most part. Clearly, long haul uses optics today and will continue to use optics. In the Enterprise, distances greater than 100 meters will continue to be optics. At 10Gbps, optics offers a low power solution, which will continue to dominate for several years. Once 10GBase-T can reduce power dissipation to less than 2W, it will offer another alternative for OEMs and end users. This alternative will be particularly attractive for LOM designs. In this type of the larger landscape, we expect both copper and optics to continue shipping volume in millions of units.
JM: How do you see the Optics Components vendor landscape evolving over the next 5 years?
JB: We expect 10Gbps optical port shipments to increase rapidly for the next 3-5 years. This will lead to further consolidation and will favor vertically integrated suppliers for optical modules.
Thanks for your time today, Jag.
