Nortel: Don’t wait to start on services

Service providers have to start using incremental technologies to try out services and find out what customers want before they try to roll out long-anticipated offerings such as third-generation (3G) mobile telephony, Nortel Networks Corp. Chief Technology Officer Greg Mumford said Wednesday in a keynote address at Opticon 2002 in San Jose.

In the case of 3G, financial woes and uncertainty about likely demand for high-speed mobile data services are making carriers hesitant to deploy the technology now. In the meantime, they need to explore potential new services via less powerful systems such as General Packet Radio Service (GPRS) and Code-Division Multiple Access (CDMA) 1xRTT to launch some services and get input on what services will meet customer demand, Mumford said.

Those services can kick off a growth cycle in which popular services drive demand for network capacity, network build-outs allow for higher performance services and those new services increase revenue, he said.

“We need to use these to experiment with services and create services,” Mumford said.

Nortel, in Brampton, Ont., is largely finished cutting back units it considered peripheral to its business and is prepared for a transformed carrier equipment industry in which service providers will build capacity to meet customer demand instead of using a “build it and they will come” approach, Mumford told an audience of a few hundred attendees.

Separate tracks at the conference each drew just dozens of participants, testimony to the woes of the optical industry, currently the victim of over-capacity in many service-provider networks.

“In the past year and a half we’ve pretty much taken care of the stuff that we didn’t think was important (for us),” Mumford said.

However, the needs of enterprises and consumers, including mobility, collaboration and personalized services, will make optical packet networks necessary, he added. Carriers need optics and a packet-based infrastructure in the core of their networks to carry all kinds of services on one infrastructure and reduce overall costs, and an intelligent edge network that can provide personalized services for different customers.

Enterprises can cut costs by making data available over networks, such as storage area networks (SANs), rather than from a local copy, Mumford said. User support and computer system costs are a much bigger piece of companies’ IT expenses than LANs, and metropolitan-area networks (MANs) and wide-area networks (WANs) are at the bottom of this inverted pyramid of costs, he said. Networks can be leveraged to cut overall costs as well as enhancing individual users’ capabilities.

“You can really use the communication as a substitute for processing, and by doing that, you can drive down computing system costs,” Mumford said. “After SANs will come servers,” he added.