Metropolitan optical start-up Appian Communications Inc.’s business model started with a reality check.
Seeing Ethernet’s high speed, ease of use and wide availability, founders Mick Scully and Harsh Kapoor in early 1999 envisioned metropolitan carrier networks that would use the LAN technology instead of widely deployed SONET rings. But first they asked carriers what they needed.
Scully recalls talking with a potential customer in lower Manhattan that had dozens of OC-48 SONET rings.
“That was an eye-opening discussion. . . . They were not going to want to build more overlay networks to support a different technology,” Scully says. “It’s not something they can migrate off of easily. It’s entrenched in their business processes.”
Appian took the hint and set out to create a platform that could carry Ethernet over carrier SONET infrastructures. Now, despite a difficult business climate, the company says it has a multimillion-dollar contract with a big carrier and is expanding its product line and capabilities.
The company’s flagship product, Optical Services Activation Platform (OSAP) 4800, lets a service provider’s customers tap into the existing metropolitan network through a familiar Ethernet connection in the box, which typically would be located in a building or corporate campus. When needs grow, rather than having to boost bandwidth by traditional carrier means, it can be added in increments as small as 64Kbps up to gigabit Ethernet. Users migrating from ATM or frame relay can replicate the quality of service those technologies provide, Appian says.
At the same time, OSAP lets the carrier use Ethernet where it chooses and still connect to a variety of legacy technologies on the metropolitan network, such as ATM and frame relay. Enhancements announced May 28 give customers and service providers new ways to use Ethernet and SONET, says Karen Barton, Appian’s vice-president of marketing.
OSAP has a hybrid packet and TDM platform that can handle traditional voice and leased-line traffic, and packet switching. Carriers can encapsulate Ethernet packets in SONET frames, or convert them into frame relay frames or ATM cells and feed that traffic into a conventional device that uses those technologies.
Appian has been focused on helping carriers provide point-to-point links. With the recent announcement, it adds to multipoint services with what it calls virtual Ethernet rings, logical rings that can link sites across a carrier’s existing metropolitan network. Those services will let companies link many sites with Ethernet just as they would with a LAN. With just one OSAP in each city, a carrier also could extend the logical ring over a national or international network.
The company also has expanded its line with OSAP 1600, an access device for smaller customer sites, such as small multi-tenant buildings.
The Telx Group, which operates an interconnection facility in New York, uses two OSAP 4800s on two floors to switch traffic among its customers – carriers that need to link up with other carriers. Those service providers can save money by buying an Ethernet interface into the Telx network rather than a traditional carrier interface such as a DS-3, which may cost 10 times as much, according to Hunter Newby, executive vice-president of strategic planning at Telx.
In addition, OSAP 4800 gives them greater flexibility in how much bandwidth they can buy, which is particularly important for smaller customers.
“When a carrier wants to buy just [2Mbps], it doesn’t have to order a DS-3,” Newby says.
The carrier investment drought since late 2000 has hit Appian’s potential market hard. Originally looking to competitive local exchange carriers, Appian has since concentrated on incumbents.
A long testing process with NTT Communications Corp. paid off earlier this year when Appian announced a contract with the company, which is a spinoff of Japan’s incumbent carrier and one of that country’s largest service providers. The company also has two trials ongoing in the U.S., two in Europe and several in the works in the Asia-Pacific region, Scully says.
Appian’s approval by NTT gives it credibility with other major carriers, according to Michael Howard, principal analyst at Infonetics Research Inc.
“Once you come out of NTT’s labs and become one of their suppliers, you’re pretty good for just about any service provider in any part of the world,” Howard says.
The company gained a head start over competitors by being the first to use the International Telecommunication Union X.86 specification for Ethernet over SONET, and it can provide for an impressive range of Ethernet services over that infrastructure, he says.
The network strategies of companies indicate strong demand for a product such as Appian’s, Howard says. According to a recent Infonetics survey of 80 companies in the U.S. and Canada that have or soon will have an optical connection to a metropolitan network, 85 per cent plan to run Ethernet over it, he says.
Telx’s Newby says he believes service providers will see the benefits of Ethernet, but he sees its adoption growing slowly while SONET keeps going strong.
“Everything in the market was going to take a lot of time, but today, given the economic conditions, it’s going to take even longer,” Newby says.
– IDG News Service