``
`
`The Business Case for
`ROADM Technology
`
`Network Strategy Partners, LLC
`M A N A G E M E N T C O N S U L T A N T S T O T H E N E T W O R K I N G I N D U S T R Y
`www.nspllc.com
`August, 2006
`
`Network Strategy Partners, LLC (NSP) —
`Management Consultants to the networking industry
`— helps service providers, enterprises, and equipment
`vendors around the globe make strategic decisions,
`mitigate risk and affect change through custom
`consulting engagements. NSP’s consulting includes
`business case and ROI analysis, go-to-market strategies,
`development of new service offers, pricing and
`bundling as well as infrastructure consulting. NSP’s
`consultants are respected thought-leaders in the
`networking industry and influence its direction though
`confidential engagements for industry leaders and
`through public appearances, whitepapers, and trade
`magazine articles. Contact NSP at www.nspllc.com.
`
`
`
`Network Strategy Partners, LLC
`M A N A G E M E N T C O N S U L T A N T S T O T H E N E T W O R K I N G I N D U S T R Y
`
`Capella 2024
`JDS Uniphase v. Capella
`IPR2015-00739
`
`1
`
`

`
`
`
`Executive Summary.......................................................................................................1
`Overview of Fixed OADM and ROADM Technology .................................................3
`Fixed OADM Technology ..............................................................................................3
`ROADM Technology .....................................................................................................5
`A TCO Comparison of Fixed OADM and ROADM.....................................................7
`Metro Ring Topology......................................................................................................8
`TCO Comparison .........................................................................................................11
`Linear Topology...........................................................................................................15
`TCO Comparison .........................................................................................................17
`Case Study – A Large Cable Network Operator..........................................................18
`Conclusion ...................................................................................................................20
`
`
`
`
`
`Network Strategy Partners, LLC
`M A N A G E M E N T C O N S U L T A N T S T O T H E N E T W O R K I N G I N D U S T R Y
`
`2
`
`

`
`
`
`1
`
`Executive Summary
`
`Recent developments in the telecom market are leading to rapid growth of traffic in
`metro networks. Among the key applications that are driving this growth are:
`
` •
`
` Residential triple-play services (IPTV, video-on-demand, VoIP, and high-speed
`Internet)
`• Commercial Carrier Ethernet services
`
`As a result of this growth, service providers are deploying DWDM transport networks in
`metro areas. One of the key questions facing service providers is:
`
`Should we deploy a Fixed OADM or a Reconfigurable OADM (ROADM) DWDM network
`architecture in our metro areas?
`
`This paper provides an ROI analysis demonstrating that a Fixed OADM solution could
`be less expensive than a ROADM on day one. However, in many cases over several years
`the Fixed OADM is more expensive then the ROADM. The higher cost associated with the
`Fixed OADM is a result of additional CAPEX and OPEX due to inefficient network
`designs and equipment configurations, inefficient sparing, and increased labor costs. In
`networks with high growth and uncertainty of future demand, the longer-term cost
`savings of the ROADM solution is more pronounced.
`
`Our analysis compares both the capital network equipment costs and labor costs of a
`traditional Fixed OADM network with a Cisco® ONS 15454 ROADM network. In this
`study we use two approaches to make this cost comparison:
`
`1. TCO Model – A total cost of ownership (TCO) model is used that compares two
`hypothetical networks (a ring and linear topology) for both the Fixed OADM and
`ROADM systems.
`
`2. Case Study – A customer that has already deployed the Cisco ONS 15454 ROADM
`and has realized CAPEX and OPEX savings was interviewed and the results of that
`interview are presented.
`
`
`Our conclusions from this analysis are that the deployment of the Cisco ONS 15454
`ROADM system results in both CAPEX and OPEX savings as compared to a traditional
`Fixed OADM. These savings are realized to a greater degree in networks with:
`
` •
`
` Uncertain demand and network changes
`• High growth
`• High capacity
`• Mesh demand characteristics
`
`
`
`Network Strategy Partners, LLC
`M A N A G E M E N T C O N S U L T A N T S T O T H E N E T W O R K I N G I N D U S T R Y
`
`3
`
`

`
`
`
`2
`
`Network equipment CAPEX savings in ROADM networks are primarily due to more
`efficient deployments of OADMs and transponders in the network and the reduction of
`spares.
`
`Labor and OPEX savings are due to the following factors:
`
` •
`
` Bandwidth can be turned up on demand without the need for accurate, long-term
`forecasts.
`• More intelligence, automated discovery, automated signaling, and power conditioning
`functions are used in a ROADM network.
`• Circuit provisioning and activation time is significantly faster in a ROADM network.
`• Maintenance and network care are improved.
`• There is a more efficient deployment of line cards due to any-to-any connectivity.
`• Bandwidth can be deployed much more quickly than with fixed DWDM technology.
`• With a ROADM network, technicians are only needed at origin and destination
`points to install line cards – all other provisioning is automatic. In the fixed system,
`more experienced engineers are needed at each intermediate site (multiple truck rolls)
`to install wavelength add/drop multiplexers to prepare for uncertain future demand
`and to manually readjust tuning for power and signal variants resulting from
`configuration changes.
`• Adding additional wavelength channels in Fixed OADM networks is intrusive and
`service-affecting, and therefore must be done during scheduled maintenance
`windows.
`• Faster provisioning time means faster time to revenue.
`
`In the case study, CAPEX savings were 50% and OPEX savings were 70%. This resulted
`in a high ROI and a payback of less than 12 months for the Cisco ONS 15454 ROADM.
`
`In addition to CAPEX and OPEX savings, the flexibility of the ROADM provides
`strategic competitive advantages including:
`
`• Faster time to revenue due to reduced circuit provisioning times
`• Reduced churn due to reduced provisioning times and greater flexibility in service
`offerings
`• Ability to win the contract in competitive bidding situations due to increased
`flexibility and accelerated service deployment
`
`
`The following sections of this paper present a brief overview of Fixed OADM and
`ROADM technology, a TCO comparison of these technologies, and a case study of a
`large cable service provider that has deployed the Cisco ONS 15454 ROADM
`technology.
`
`
`
`Network Strategy Partners, LLC
`M A N A G E M E N T C O N S U L T A N T S T O T H E N E T W O R K I N G I N D U S T R Y
`
`4
`
`

`
`
`
`3
`
`Overview of Fixed OADM and ROADM Technology
`First- and second-generation DWDM networks were built with Fixed Optical Add/Drop
`Multiplexer (OADM) technology. While these systems have enormous capacity and are
`in wide use worldwide, they are complex systems to design, configure, and install. Fixed
`OADM systems are also extremely complex to change. More recently, Reconfigurable
`OADM (ROADM) technologies have been introduced to the market, allowing service
`providers much greater flexibility in network design and installation and, most
`importantly, have allowed for flexibility in moves, adds, and changes.
`
`
`Fixed OADM Technology
`While there are many different DWDM vendors and system architectures, there are some
`basic components that are used in all Fixed OADM systems. These components are
`depicted in Figure 1. In a Fixed OADM system, multiple optical wavelengths are used to
`create separate optical transport channels. Terminal filters are used at the end points of a
`linear (point-to-point) network or at the hub of a ring to originate or terminate optical
`channels. The terminal filters operate at fixed wavelengths and can only originate or
`terminate optical channels operating at those fixed wavelengths. At any point along the ring,
`channels can be added or dropped by an optical OADM. These OADMs are also fixed to
`specific wavelengths and typically allow add/drop of a fixed number of channels. In our TCO
`model, a fixed OADM system that drops increments of four optical channels is analyzed.
`Electrical-optical transponders are used to convert standard service interfaces to ITU
`DWDM optical signals for transport on the DWDM network. Transponders have many
`service interfaces (Gigabit Ethernet [GbE], 10 GbE, OCn, Fiber Channel, etc.) and come
`in two fundamental data rates: 2.5 Gigabit and 10 Gigabit transponders. Another
`fundamental component of all DWDM systems is the Erbium-Doped Fiber Amplifier
`(EFDA), which is used to amplify the optical signal for medium to long-haul fiber links.
`In Fixed OADM systems, EFDAs need to be manually adjusted so that the amplification
`accounts correctly for the number of channels that are added or dropped at a particular
`site. Manual adjustments need to be made on all EDFAs in the network as new channels
`are added or dropped.
`
`An example of a Fixed OADM network is illustrated in Figure 2. In the Fixed OADM
`network, channels are interconnected using fixed filters/OADMs. Because all channels
`and wavelengths in the network are fixed, it is essential that network planning and
`engineering account for traffic growth and changes as the network evolves. Adding
`capacity and/or making changes to the network is difficult and can cause service outages
`because there is very little flexibility in a Fixed OADM system.
`
`Some of the problems with Fixed OADM systems are:
`
` •
`
`
`
`Inefficient sparing – A large number of spares are required because each filter and
`transponder is unique to a specific set of wavelengths.
`• Fixed channel filters are unique and require specific part numbers – This makes
`inventory management quite difficult.
`• Dynamic traffic management is not supported – Fixed wavelengths require that
`channels and transport interconnectivity be fixed.
`
`
`
`Network Strategy Partners, LLC
`M A N A G E M E N T C O N S U L T A N T S T O T H E N E T W O R K I N G I N D U S T R Y
`
`5
`
`

`
`
`
`4
`
`• Optical span power management is a manual process – As new channels and OADM
`sites are added, amplifiers and dispersion compensation units (DCUs) need to be
`manually readjusted.
`• Channel balancing is a manual process – Engineers are required at all sites in the
`network.
`• Adding additional wavelength channels is intrusive – This must be done during
`maintenance windows and it is service-affecting.
`
`
`While Fixed OADM components are less expensive than ROADM components, the
`model shows that the TCO can be higher as a result of inefficient configurations,
`sparing, and operational expenses.
`
`
`
`Terminal Filter
`4 Channel (100 GHz)
`32 Channel (100 GHz)
`
`Optical Add Drop Multiplexer
`(OADM)
`4 Channel (100 GHz)
`
`Erbium Doped Fiber Amplifier
`(EDFA)
`
`Electrical-Optical Transponder
`(10G & 2.5G Channels)
`
`
`
`Figure 1
`Basic Components of a Fixed OADM Network
`
`
`
`Network Strategy Partners, LLC
`M A N A G E M E N T C O N S U L T A N T S T O T H E N E T W O R K I N G I N D U S T R Y
`
`6
`
`

`
`Legacy DWDM
`• Fixed channel filters
`require specific part
`numbers
`• Current functionality
`does not support
`dynamic traffic
`management
`• Optical span power
`management is a
`manual process
`• Channel balancing is a
`manual process
`• Adding additional
`wavelength channels is
`intrusive!
`• Inefficient sparing
`• Wavelength drop
`locations are
`configuration specific
`
`
`
`5
`
`OAD
`
`λ 1
`
`OAD
`
`λ 2
`
`OAD
`
`λ 3
`
`OAD
`
`λ 4
`
`OAD
`
`λ 5
`
`120 Km
`
`λ 9
`OAD
`
`λ 8
`OAD
`
`λ 7
`OAD
`
`λ 6
`OAD
`
`
`Figure 2
`Fixed OADM Network
`
`ROADM Technology
`Many of the weaknesses of Fixed OADM technology are addressed in the development
`of Reconfigurable Optical Add/Drop Multiplexers (ROADMs). While there are several
`different technology implementations of ROADMs such as Microelectronic Mirrors
`(MEM) and Planar Lightwave Circuit (PLC), they all provide a similar capability.
`ROADMs enable flexible network transport design by allowing add/drop of any channel
`at any ROADM node. ROADMs also automatically adjust the power in the network as
`channels are dropped or inserted in ROADM nodes. Some ROADMs can also provide
`the ability to switch wavelengths from one path to another, but that is beyond the scope
`of this paper.
`
`
`The basic components of the ROADM are depicted in Figure 3 and a ROADM DWDM
`network is represented in Figure 4. The fundamental component of a ROADM DWDM
`system is the Reconfigurable OADM. It typically allows 32-40 channels to be dropped or
`inserted at any node. As demand in the network changes, additional channels can be
`dropped or inserted, creating a flexible provisioning system. The ROADM also uses or
`works with a transponder that is similar in nature to the transponder in the Fixed
`OADM system. One difference in the Cisco ONS 15454 transponders, however, is that
`they are tunable and use pluggable optics (SFPs or XFPs) for client (customer-facing)
`interfaces. This allows for more flexibility in inventory management and more efficient
`sparing. ROADM nodes also use EDFAs for optical amplification. One of the
`differences in ROADM networks is that all EDFAs in the network are automatically
`adjusted to provide the correct transmission power across fiber links. As channels are
`dropped or inserted, power requirements change. In the fixed network this is
`accomplished manually while in the ROADM network power is adjusted automatically.
`The ROADM network also provides per-channel power monitoring for troubleshooting
`at all sites. This allows technicians to monitor power levels via the management tool.
`This capability is not available with a Fixed OADM system.
`
`
`
`
`Network Strategy Partners, LLC
`M A N A G E M E N T C O N S U L T A N T S T O T H E N E T W O R K I N G I N D U S T R Y
`
`7
`
`

`
`6
`
`Re-configurable Optical
`Add Drop Multiplexer (R-OADM)
`32 chs. (100 GHz)
`
`Erbium Doped Fiber Amplifier
`(EDFA)
`
`Electrical-Optical Transponder
`(10G & 2.5G Channels)
`
`
`Figure 3
`Basic Components of a ROADM Network
`
`
`
`λ 1-32
`
`
`λ 1-32
`
`λ 1-32
`
`λ 1-32
`
`120 Km
`
`
`
`λ 1-32
`
`λ 1-32
`
`
`
`λ 1-32
`
`
`
`λ 1-32
`
`λ 1-32
`
`ROADM
`• Provides drop tuning &
`lambda blocking
`• Software selectable
`between add and pass
`path
`• Per channel
`equalization and power
`monitoring
`• Enables dynamic
`allocation of ITU paths
`• Scales from 1 to 32
`lambda services
`• Enables ability to pre-
`deploy ITU interfaces
`without predetermined
`lambda path
`(Source to Destination)
`• Lessens Txpdr-
`ROADM re-cabling
`• Reduces sparing costs
`• Enhanced flexibility!
`
`(Any λ to any drop)
`
`λ 1-32
`
`
`Figure 4
`ROADM Network
`
`Network Strategy Partners, LLC
`M A N A G E M E N T C O N S U L T A N T S T O T H E N E T W O R K I N G I N D U S T R Y
`
`
`
`
`
`
`
`8
`
`

`
`
`
`7
`
`Some of the benefits of the ROADM network are:
`
` •
`
` Provides drop tuning and channel blocking
`• Per-channel equalization and power monitoring
`• Enables dynamic allocation of ITU-wavelength paths
`• Scales from 1 to 32 channel services
`• Enables ability to pre-deploy ITU interfaces without a predetermined channel path
`(source to destination)
`• Reduces transponder-ROADM re-cabling
`• Reduces sparing costs
`• Enhances flexibility
`
`ROADM technology clearly has many benefits. Conventional wisdom is that there is a
`much higher price tag associated with these benefits. The next section of this paper
`shows that the costs of ROADM technology can actually be lower then the costs of
`Fixed OADM technology.
`
` A
`
` TCO Comparison of Fixed OADM and ROADM
`In this section, two hypothetical metro networks are analyzed and the TCO of a Fixed
`OADM system is compared with the TCO of a ROADM system. The first network is a
`ring topology and the second network is a linear topology. Both examples demonstrate
`that when all costs (including spares, engineering, and installation) are considered, the
`cost of the ROADM network is competitive with the Fixed OADM network. In the
`metro ring network the ROADM is significantly less expensive than the Fixed OADM.
`In the linear network the expenses of the ROADM are not significantly different than
`the Fixed OADM expenses.
`
`In both examples (ring and linear) a set of demand matrices are specified for transport
`services over a three-year period and two networks are designed based on that demand:
`
`1. A network using an industry-standard, low-cost Fixed OADM system
`2. A network using the Cisco ONS 15454 ROADM system
`
` A
`
` TCO model is used to compare the costs of the Fixed OADM1 design and the Cisco
`ONS 15454 ROADM design. The costs that are compared in the model are:
`
` Capital equipment costs (OADMs and transponders)
`• Engineering and network design costs
`•
`Installation and test costs
`
`Because chassis and common equipment, amplifiers, and DCUs are considered to be
`roughly the same price for both fixed and reconfigurable systems, these costs were not
`considered in the comparisons2.
`
` •
`
`
`1 The cost of this system is based on a major Fixed OADM vendor with a cost-competitive solution.
`2 In the ring network the Fixed OADM system exhausted all 32 channels and therefore required a
`second ring. In this example the cost of the extra chassis, amplifiers, and dispersion compensation units
`were counted because these costs were costs that were not incurred by the ROADM system which
`satisfied all the demand on 32 channels.
`Network Strategy Partners, LLC
`M A N A G E M E N T C O N S U L T A N T S T O T H E N E T W O R K I N G I N D U S T R Y
`
`
`
`9
`
`

`
`
`
`8
`
`The following sections present the demand matrices and compare the total costs for the
`Fixed OADM and Cisco ONS 15454 ROADM systems.
`
`
`Metro Ring Topology
`In the first example we consider a metro ring topology. In this network there are five
`sites connected by a fiber ring in a metro area. In the following sections we present the
`circuit demand assumptions and the network equipment expenses, labor expenses, and
`TCO associated with both the Fixed OADM design and the Cisco ONS 15454 ROADM
`design.
`
`Circuit Demand Assumptions
`The transport requirements for this hypothetical DWDM network are specified over a
`three-year period. In the first year of operation it is assumed that the DWDM network
`will need to carry traffic from:
`
`1. An existing OC48 SONET network
`2. A new 10 GbE Carrier Ethernet network
`
`The SONET and the Carrier Ethernet transport demand is illustrated in Figure 5. The
`SONET network is an OC48 ring that is overlaid on the DWDM network. To support
`the SONET network, 2.5G channels are required between each node on the ring. The
`Carrier Ethernet network uses Cisco 7600 Series Routers and has hub locations in sites 4
`and 5. The Cisco routers at sites 1-3 are dual-homed to sites 4 and 5 and are
`interconnected with 10 GbE circuits. These circuits are unprotected because SONET
`uses UPSR or BLSR protection and Metro Ethernet uses Layer 2 switching protection.
`
`In years 2-3 it is assumed that there is demand for 2.5G and 10G protected private lines.
`This demand is assumed to be randomly distributed across all five sites.
`
`The complete details of the three-year circuit demand are specified in the demand
`matrices depicted in Figure 6. The upper right-hand half of the matrix specifies the
`number of circuits between two sites. For example, in the matrix that specifies 10G
`protected circuits in year 2, there are two circuits3 between site 1 and site 3 and one
`circuit4 between site 3 and site 4.
`
`
`
`
`3 The number of circuits between site 1 and site 3 can be found in the row of site 1 and the column of
`site 3.
`4 The number of circuits between site 3 and site 4 can be found in the row of site 3 and the column of
`site 4.
`
`
`
`Network Strategy Partners, LLC
`M A N A G E M E N T C O N S U L T A N T S T O T H E N E T W O R K I N G I N D U S T R Y
`
`10
`
`

`
`
`
`9
`
`SONET
`OC48
`
`Cisco
`7600
`
`
`SONET
`OC48
`
`Cisco
`7600
`
`Site 3
`
`Site 4
`
`SONET
`OC48
`
`Cisco
`7600
`
`Site 2
`
`
`
`Site 5
`
`SONET
`OC48
`
`Cisco
`7600
`
`Site 1
`
`SONET
`OC48
`
`Cisco
`7600
`
`2.5G SONET Channel
`
`(Unprotected)
`10G Carrier Ethernet
`Channel (Unprotected)
`
`
`Figure 5
`SONET OC48 and 10 GbE Carrier Ethernet Demand in Year 1
`
`
`
`Network Strategy Partners, LLC
`M A N A G E M E N T C O N S U L T A N T S T O T H E N E T W O R K I N G I N D U S T R Y
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`11
`
`

`
`10
`
`Site 3
`
`SONET 2.5G Circuits in Year 1 (Unprotected)
`
`
`Site 4
`
`Site 5
`
`0
`
`1
`
`N/A
`
`N/A
`
`1
`
`0
`
`0
`
`1
`
`N/A
`
`1
`
`1
`
`0
`
`0
`
`1
`
`2
`
`Site 1
`
`Site 2
`
`N/A
`
`N/A
`
`N/A
`
`N/A
`
`
`
`1
`
`N/A
`
`N/A
`
`N/A
`
`1
`
`Row Total
`
`2
`
`1
`
`1
`
`1
`
`5
`
`
`
`
`
`
`
`
`
`
`
`
`
`Carrier Ethernet 10G Circuits in Year 1 (Unprotected)
`
`Site 1
`
`N/A
`
`N/A
`
`Site 2
`
`0
`
`N/A
`
`Site 3
`
`Site 4
`
`Site 5
`
`Total Circuits
`
`1
`
`1
`
`1
`
`1
`
`0
`
`0
`
`2
`
`2
`
`
`
`
`
`Site 1
`
`Site 2
`
`Site 3
`
`Site 4
`
`Column Total
`
`
`
`
`
`
`
`Site 1
`
`Site 2
`
`
`
`
`
`Site 3
`
`Site 4
`
`Column Total
`
`
`
`
`
`
`
`Site 1
`
`Site 2
`
`Site 3
`
`Site 4
`
`Column Total
`
`
`
`N/A
`
`N/A
`
`
`
`Site 1
`
`N/A
`
`N/A
`
`N/A
`
`N/A
`
`
`
`
`
`
`
`
`
`
`
`N/A
`
`N/A
`
`0
`
`N/A
`
`N/A
`
`2
`
`1
`
`N/A
`
`3
`
`1
`
`1
`
`2
`
`2
`
`1
`
`7
`
`
`
`
`
`
`
`
`
`Private Line 2.5G Protected Circuits in Year 2
`
`Site 2
`
`Site 3
`
`Site 4
`
`Site 5
`
`Total Circuits
`
`1
`
`N/A
`
`N/A
`
`N/A
`
`1
`
`1
`
`0
`
`N/A
`
`N/A
`
`1
`
`
`
`0
`
`0
`
`1
`
`N/A
`
`1
`
`0
`
`0
`
`0
`
`1
`
`1
`
`2
`
`0
`
`1
`
`1
`
`4
`
`
`
`Site 3
`
`Site 4
`
`Site 5
`
`Total Circuits
`
`0
`
`0
`
`N/A
`
`N/A
`
`0
`
`0
`
`1
`
`1
`
`N/A
`
`2
`
`1
`
`0
`
`0
`
`1
`
`2
`
`2
`
`1
`
`1
`
`1
`
`5
`
`Figure 6
`Ring Topology Circuit Demand over Three-Year Period
`Network Strategy Partners, LLC
`M A N A G E M E N T C O N S U L T A N T S T O T H E N E T W O R K I N G I N D U S T R Y
`
`
`
`N/A
`
`N/A
`
`3
`
`1
`
`N/A
`
`1
`
`1
`
`0
`
`2
`
`2
`
`0
`
`7
`
`
`
`
`
`
`
`
`
`Private Line10G Protected Circuits in Year 3
`
`Site 2
`
`Site 3
`
`Site 4
`
`Column Total
`
`
`
`
`
`
`
`Site 1
`
`Site 2
`
`Site 3
`
`Site 4
`
`Column Total
`
`N/A
`
`N/A
`
`
`
`N/A
`
`N/A
`
`1
`
`
`
`
`
`Site 1
`
`Site 2
`
`N/A
`
`N/A
`
`N/A
`
`N/A
`
`
`
`1
`
`N/A
`
`N/A
`
`N/A
`
`1
`
`
`
`
`
`Site 1
`
`Site 2
`
`Site 3
`
`Site 4
`
`Column Total
`
`
`
`
`
`
`
`Site 1
`
`
`
`
`
`Private Line10G Protected Circuits in Year 2
`
`Site 1
`
`Site 2
`
`Site 3
`
`Site 4
`
`Site 5
`
`N/A
`
`N/A
`
`N/A
`
`N/A
`
`
`
`0
`
`N/A
`
`N/A
`
`N/A
`
`0
`
`2
`
`0
`
`N/A
`
`N/A
`
`2
`
`1
`
`1
`
`1
`
`N/A
`
`3
`
`1
`
`0
`
`1
`
`0
`
`2
`
`
`
`
`
`
`
`
`
`
`
`Private Line 2.5G Protected Circuits in Year 3
`
`
`
`
`
`Total Circuits
`
`4
`
`1
`
`2
`
`0
`
`7
`
`Site 1
`
`N/A
`
`N/A
`
`Site 2
`
`1
`
`N/A
`
`Site 3
`
`Site 4
`
`Site 5
`
`Total Circuits
`
`2
`
`1
`
`0
`
`0
`
`0
`
`1
`
`3
`
`2
`
`12
`
`

`
`
`
`11
`
`TCO Comparison
`
`Using the demand assumptions specified above, network designs were developed for
`both a Fixed OADM network and a Cisco ONS 15454 ROADM network. Figure 7
`shows the network equipment expense for the metro ring network over a three-year
`period. The network equipment consists primarily of OADMs, ROADMs, and
`transponders. While Fixed OADM systems are cost-effective for small networks with
`predictable demand, the fixed systems are complex to configure as demand grows and
`are not well suited to random mesh-traffic demands. Therefore, deployment of OADMs
`is inefficient and subsequent capital expenses are incurred as a result of this inefficiency.
`In this example the Cisco ONS 15454 ROADM network was able to serve all the circuits
`specified in the demand matrix on a single 32-channel ring. In contrast, the fixed OADM
`system exhausted all 32 channels in year 1 and, therefore, a second fiber ring was required in
`years 2 and 3. This necessitated a second set of chassis and common equipment at each
`site. The additional Fixed OADM chassis, common equipment, amplifiers, and DCUs at
`each site were added to the equipment expenses because this expense was not incurred in
`the Cisco ROADM design. Additionally another dark fiber on the ring was burned;
`however, this expense was not accounted for in the model. (This is because the cost of
`dark fiber is not easily quantifiable. If dark fiber is abundant it is virtually free, however,
`if it is in short supply the cost could be significant).
`
`Another important factor driving the differences in equipment costs is the high cost of
`spares for the Fixed OADM architecture. The breakdown of network equipment costs
`and spares is illustrated in Figure 8 and Figure 9. The reason for the high cost of spares
`in the Fixed OADM network is that many spare transponders and filters are needed. In
`the fixed OADM network each transponder is tuned to a single wavelength. Therefore,
`for each pair of transponders operating on a single wavelength, a spare is required. In
`contrast, the Cisco ONS 15454 has 10G transponders that are tunable to 82 different
`wavelengths, thus greatly reducing the number of spares required. The Cisco 2.5G
`transponder is tunable to four wavelengths, therefore less spares are required than a
`single wavelength transponder. Also, the fixed OADM system uses fixed 4-channel filters
`to drop and insert wavelengths. One spare for each pair of filters also is required
`because filters are fixed to wavelengths. In contrast, the Cisco ONS 15454 32WSS Card
`(ROADM) is tunable to 32 channels. Therefore, one spare card can serve all the nodes in
`the network. These differences in sparing costs are reflected in the overall equipment
`expenses.
`
`
`
`
`
`Network Strategy Partners, LLC
`M A N A G E M E N T C O N S U L T A N T S T O T H E N E T W O R K I N G I N D U S T R Y
`
`13
`
`

`
`12
`
`Ring Topology Equipment Expense
`
`Cisco ROADM
`Fixed OADM
`
`Year 1
`
`Year 2
`
`Year 3
`
`
`Figure 7
`Ring Topology Equipment over Three-Year Period
`
`
`$900
`$800
`$700
`$600
`$500
`$400
`$300
`$200
`$100
`$-
`
`Equipment Expense (in Thousands of Dollars)
`
`
`
`Cisco ROADM - Breakdown of Network Equipment and Spares
`
`Spares
`Network Equipment
`
`Year 1
`
`Year 2
`
`Year 3
`
`
`Figure 8
`Cisco ROADM – Breakdown of Network Equipment and Spares
`
`$700
`
`$600
`
`$500
`
`$400
`
`$300
`
`$200
`
`$100
`
`$-
`
`Network Equipment & Spares (in Thousands of Dollars)
`
`Network Strategy Partners, LLC
`M A N A G E M E N T C O N S U L T A N T S T O T H E N E T W O R K I N G I N D U S T R Y
`
`
`
`
`
`
`
`
`
`14
`
`

`
`13
`
`Fixed OADM - Breakdown of Network Equipment and Spares
`
`Spares
`Network Equipment
`
`Year 1
`
`Year 2
`
`Year 3
`
`$900
`$800
`$700
`$600
`$500
`$400
`$300
`$200
`$100
`$-
`
`Network Equipment & Spares (in Thousands of
`
`Dollars)
`
`
`Figure 9
`Fixed OADM – Breakdown of Network Equipment and Spares
`
`Cisco ROADM
`Fixed OADM
`
`
`
`Ring Topology Labor Expense
`
`$45
`$40
`$35
`$30
`$25
`$20
`$15
`$10
`$5
`$-
`
`Labor Expense (in Thousands of Dollars)
`
`Year 1
`
`Year 2
`
`Year 3
`
`
`Figure 10
`Ring Topology Labor Expense over Three-Year Period
`
`Network Strategy Partners, LLC
`M A N A G E M E N T C O N S U L T A N T S T O T H E N E T W O R K I N G I N D U S T R Y
`
`
`
`
`
`
`
`
`
`15
`
`

`
`
`
`14
`
`Ring Topology TCO
`
`Cisco ROADM
`Fixed OADM
`
`Year 1
`
`Year 2
`
`Year 3
`
`$900
`$800
`$700
`$600
`$500
`$400
`$300
`$200
`$100
`$-
`
`TCO (in Thousands of Dollars)
`
`Figure 11
`Ring Topology TCO over Three-Year Period
`
`
`In addition to equipment expenses, there are also labor expenses associated with network
`engineering, design, installation, maintenance, and testing. Labor expenses also reflect
`installation and testing of additional wavelengths as demand grows. These expenses are
`presented in Figure 10 and the key assumptions5 used to calculate these expenses are
`presented in Table 1. The Fixed OADM network results in a significantly more complex
`network design, installation, maintenance, and test process. These expenses are also
`reflected in Figure 10.
`
`The combination of the equipment capital expenses and the labor expenses is defined as
`the total cost of ownership (TCO), reflected in Figure 11. Because of the reduced
`network complexity and efficient sparing, the Cisco ONS 15454 ROADM design results
`in a lower overall TCO.
`
`
`
`Fixed
`OADM
`3
`
`16
`
`
`
`Cisco ONS 15454
`ROADM
`1
`
`4
`
`Table 1
`Labor Expense Assumptions
`
`
`Engineering Hours per
`Site, per Wavelength
`Installation Hours per
`Site, per Wavelength
`
`
`
`
`5 The assumptions used to calculate labor expenses are based on field engineering experience with
`optical networks.
`
`
`
`Network Strategy Partners, LLC
`M A N A G E M E N T C O N S U L T A N T S T O T H E N E T W O R K I N G I N D U S T R Y
`
`16
`
`

`
`
`
`15
`
`Linear Topology
`In the second example we consider a metro linear topology (Figure 12). In this network
`there are five sites connected by a linear fiber span in a metro area. In the following
`sections we present the circuit demand assumptions and the network equipment
`expenses, labor expenses, and TCO associated with both the Fixed OADM design and
`the Cisco ONS 15454 ROADM design.
`
`Demand
`The transport requirements for this hypothetical linear DWDM network are specified
`over a three-year period. In the first year of operation it is assumed that the DWDM
`network will need to carry traffic from:
`
`1. An existing linear OC48 SONET network
`2. A new linear 10 GbE Carrier Ethernet network
`
`The SONET and the Carrier Ethernet transport demand is illustrated in Figure 12. The
`SONET network is an OC48 linear network that is overlaid on the DWDM network,
`requiring 2.5G channels between each network node. Each site also has a Cisco 7600
`Series Carrier Ethernet node that interconnects to a hub node at site 1. All connections
`are unprotected because the network is a linear topology.
`
`In years 2-3 it is assumed that there is demand for 2.5G and 10G unprotected private lines.
`This demand is assumed to be randomly distributed across all five sites.
`
`The complete details of the three-year circuit demand is specified in the demand matrices
`depicted in Figure 13. The upper right-hand half of the matrix specifies the number of
`circuits between two sites.
`
`
`
`Site 1
`
`Site 2
`
`Site 3
`
`Site 4
`
`Site 5
`
`
`SONET
`OC48
`
`Cisco
`7600
`
`SONET
`OC48
`
`Cisco
`7600
`
`SONET
`OC48
`
`Cisco
`7600
`
`SONET
`OC48
`
`Cisco
`7600
`
`SONET
`OC48
`
`Cisco
`7600
`
`
`2.5G SONET Channel
`
`10G Carrier Ethernet Channel
`
`
`Figure 12
`SONET OC48 and 10G Carrier Ethernet Demand in Year 1
`
`Network Strategy Partners, LLC
`M A N A G E M E N T C O N S U L T A N T S T O T H E N E T W O R K I N G I N D U S T R Y
`
`
`
`
`
`
`
`17
`
`

`
`
`
`
`
`
`
`Site 1
`
`Site 2
`
`Site 3
`
`Site 4
`
`Column Total
`
`
`
`
`
`
`
`Site 1
`
`Site 2
`
`16
`
`SONET 2.5G Circuits in Year 1 (Unprotected)
`
`Site 1
`
`Site 2
`
`Site 3
`
`Site 4
`
`Site 5
`
`Row Total
`
`N/A
`
`N/A
`
`N/A
`
`N/A
`
`
`
`1
`
`N/A
`
`N/A
`
`N/A
`
`1
`
`0
`
`1
`
`N/A
`
`N/A
`
`1
`
`0
`
`0
`
`1
`
`N/A
`
`1
`
`0
`
`0
`
`0
`
`1
`
`1
`
`1
`
`1
`
`1
`
`1
`
`4
`
`
`
`
`
`
`
`
`
`
`
`
`
`Carrier Ethernet 10G Circuits in Year 1 (Unprotected)
`
`Site 2
`
`1
`
`N/A
`
`Site 3
`
`Site 4
`
`Site 5
`
`Total Circuits
`
`1
`
`0
`
`1
`
`0
`
`1
`
`0
`
`4
`
`0
`
`Site 1
`
`N/A
`
`N/A
`
`N/A
`
`Site 3
`
`Site 4
`
`Column Total
`
`
`
`
`
`
`
`Site 1
`
`Site 2
`
`Site 3
`
`Site 4
`
`Column Total
`
`
`
`N/A
`
`
`
`Site 1
`
`N/A
`
`N/A
`
`N/A
`
`N/A
`
`
`
`
`
`
`
`
`
`
`
`N/A
`
`N/A
`
`1
`
`N/A
`
`N/A
`
`1
`
`0
`
`N/A
`
`1
`
`0
`
`0
`
`1
`
`0
`
`0
`
`4
`
`
`
`
`
`
`
`
`
`Private Line 2.5G Unprotected Circuits in Year 2
`
`Site 2
`
`Site 3
`
`Site 4
`
`Site 5
`
`Total Circuits
`
`0
`
`N/A
`
`N/A
`
`N/A
`
`0
`
`0
`
`0
`
`N/A
`
`N/A
`
`0
`
`0
`
`0
`
`0
`
`N/A
`
`0
`
`
`
`
`
`1
`
`0
`
`0
`
`0
`
`1
`
`1
`
`0
`
`0
`
`0
`
`1
`
`
`
`Site 3
`
`Site 4
`
`Column Total
`
`
`
`
`
`
`
`Site 1
`
`Site 2
`
`Site 3
`
`Site 4
`
`Column Total
`
`N/A
`
`N/A
`
`
`
`N/A
`
`N/A
`
`1
`
`
`
`
`
`Site 1
`
`Site 2
`
`N/A
`
`N/A
`
`N/A
`
`N/A
`
`
`
`1
`
`N/A
`
`N/A
`
`N/A
`
`1
`
`N/A
`
`N/A
`
`2
`
`1
`
`N/A
`
`1
`
`0
`
`0
`
`1
`
`1
`
`0
`
`5
`
`
`
`
`
`
`
`
`
`Private Line10G Unprotected Circuits in Year 3
`
`Site 3
`
`Site 4
`
`Site 5
`
`Total Circuits
`
`0
`
`0
`
`N/A
`
`N/A
`
`0
`
`0
`
`0
`
`1
`
`N/A
`
`1
`
`0
`
`0
`
`0
`
`1
`
`1
`
`1
`
`0
`
`1
`
`1
`
`3
`
`Figure 13
`Linear Topology Circuit Demand over Three-Year Period
`
`
`
`Network Strategy Partners, LLC
`M A N A G E M E N T