Dark Fiber USA

US long haul networks have been undergoing considerable expansion, and as these long distance carriers complete their networks, build is shifting to metro areas, still hampered by a bandwidth bottleneck. New players are emerging in these markets to compete in delivering bandwidth and applications.

Long Haul Dark Fiber Availability

Availability of dark fiber is generally good and improving as fiber deployment continues at pace in the US. Some operators are keen to sell dark fiber on their networks in order to recoup the massive cost of installation in the short term, often retaining around one third of the total fiber deployed to offer telecommunications services for long-term revenue. Pricing has been declining over the last six months, and it is anticipated that this decline will continue.

Joint Ventures

Joint ventures between players are occurring more and more often, where this increase in cooperation will continue over the next 2-3 years with co-construction projects, capacity and fiber swaps.

Dark Fiber Providers

There is a shift occurring with telecommunications infrastructure providers in the metropolitan space. Those who previously focused exclusively on delivering dark fiber and are now beginning to offer combinations of services, including managed bandwidth services.

CLEC Consolidation

Over the past two years, CLECs have actively moved into the broadband Internet future through mass deployment of low-end broadband services. However, some CLECs have already run out of cash and others are filing for Chapter 11. With further consolidation anticipated, this signals the likely decline in the low-end broadband market and a new era of all-fiber networks.

Dark Fiber Pricing

Dark fiber suppliers, although working from a standard tariff system, still approach dark fiber pricing on a case-by-case basis. As for long haul dark fiber pricing, dark fiber pricing in the metropolitan environments, particularly the Tier I market is declining, although at a slower rate. In most cases, these cities have a limited number of providers, keeping the price of fiber relatively high. Discounts for dark fiber are given on a number of occasions, typically when the customer acquires multiple fiber strands, a long lease and a significant amount of route miles.

Bandwidth Pricing

Bandwidth is cheaper in Tier I cities, where there is a greater choice of operators. This choice becomes progressively limited as the population of the market decreases, and consequentially the price for bandwidth rises. As indicated by the activities of metropolitan network builders, where build is beginning to shift from the Tier I to the Tier II and III markets, the Tier IV markets remain relatively unexplored.

Online Exchanges

Online Exchanges are currently a small group of emerging web based intermediaries facilitating the trade of wholesale telecommunication products and services. Currently there is only a handful of online exchanges actually facilitating dark fiber trading. Market investigation shows that fiber trading accounts for less than 5 percent of online exchange trading, but this is set to grow as utility companies diversify and more players participate in the intensifying telecommunication market.

Rights of Way Issues for Metropolitan Areas

Prices for rights of way in the metro environments are rising, where a telecommunications operator will be expected to pay fees in cities. Cities can also charge for traffic disruption in the densely populated, city center areas, usually on an ongoing yearly basis. In some cases, municipalities are beginning to ask for a percentage of revenues from the operators. Rights of way are not sold on the open market where owners have a great deal of control in transaction values often being the sole source of a right of way corridor.

Construction Costs

In the city core construction costs can become prohibitive, due to the resistance of the city to disruption and the engineering costs required negotiating the intricate existing duct. This has led to some innovative techniques in the market for deploying fiber, such as sewer systems, which are to a certain extent, greatly reducing the installation costs in comparison to trench digging. The laterals off the metro ring to the building are the most costly. In a metro ring high fiber counts are used and the installation cost per fiber is therefore minimal, the laterals on the other hand, containing fewer fibers per cable are relatively more expensive.

Fiber to the Business

It is thought that less than 5 percent of all office buildings have fiber connectivity in the U.S, however research for this report has found that this is changing fast. Carriers in the U.S interviewed suggest that copper is no longer the infrastructure of choice to the building, both in terms of cost and capacity. New companies have emerged in the industry, who install and operate in-building fiber networks, and are often prepared to enter into revenue sharing agreements with building owners.

Fiber to the Home

Currently there is almost no fiber to the home in the U.S. It is widely agreed that fiber networks will have to extend closer to the home, but what is unknown is exactly when and how far the fiber will penetrate. The arguments that exist for fiber to the home are compelling. Over the next five years we anticipate a huge increase in the number of home building projects that select fiber over copper access. For last mile suppliers, the extra investment required for fiber (approximately 20 percent), as opposed to copper installation to the home, is worth making given the rapid time predicted to recoup the costs as bandwidth demand escalates. Residential builders can capitalize the scalability of fiber, to meet this added value to the property, in effect future-proofing the project. However, for existing properties we are likely to see a wait before fiber to the home becomes common place. Telecommunications and cable companies with distribution networks, consisting almost entirely of copper infrastructure are reluctant to give up on their current networks.

Fiber Supply Shortage

A worldwide fiber shortage exists due to the exploding demand for bandwidth capacity. Suppliers cannot keep up with demand, although manufacturing capacity is now being increased. Over the last 12 months both Lucent and Corning have announced massive investments in plant expansion, however it is thought that this may not be enough to meet forecast demand and the shortage is expected to last until at least Q1 2002.

Suppliers claim they can overcome this short-fall with effective management of their fiber inventory, although it may prove tough on new entrants, where incumbent carriers have already established long-term contracts with fiber providers. Buyers report that manufacturers have increased the cost of fiber from between 4 and 18 percent since the shortage began.

Non-Zero Dispersion Shifted Fiber

Non-Zero Dispersion Shifted (NZDS) fiber has become the fiber of choice in the US. This represents a shift from the traditionally deployed standard single mode fiber (SMF). The major builds, if not consisting entirely of NZDS, comprise of a combination of SMF and NZDS fiber.

High Fiber Counts

In the Tier I metropolitan environments nearly all operators are deploying networks with the highest possible fiber counts available.

Metro Optimized Fiber

Fiber optimised for the metro environments must be full spectrum fiber (operating in the entire wavelength range from 1280 nm to 1625 nm), it must have low value Polarisation Mode Dispersion, good core/cladding characteristics for low-cost fusion splicing using standard techniques. Low dispersion in the 1400 nm band for cost-effective 10 Gbps operation and be able to support use of coarse WDM systems to operate across all bands.

Executive Summary

1 INTRODUCTION

2 U.S REGULATION

2.1 U.S Regulatory Structure

2.1.1 Federal

2.1.2 State Regulatory Agencies

2.1.3 Local Government

2.2 Telecommunication Act

2.3 State Commissions (California, Florida & New York)

2.4 Building Access Issues (Smart Building Policy)

2.5 Rights of Way

2.5.1 Pricing

2.5.2 Cost & Rights of Way Issues for Metro Areas

2.6 U.S Statistics Table

3 METROPOLITAN FIBER NETWORKS

3.1 Introduction to Metro Fiber

3.2 Network Topology

3.2.1 The Access Network

3.2.2 Regional Ring Structures

3.2.3 Edge Switches - Key Features

3.3 Future and Demand

3.3.1 Voice

3.3.2 The Internet

3.3.3 ASP's (Application Service Providers)

3.3.4 Internet Exchanges (IPX)

3.3.5 Network Access Points (NAP's)

3.3.6 Wavelength Disk Drivers

3.3.7 Meeting Tomorrow's Needs

3.4 Equipment and Technologies

3.4.1 Silicon Economics

3.4.2 Access Platforms

3.4.3 Metro DWDM

3.4.4 All Optical Networking

3.4.5 Soft Optics

3.4.6 Future Proofing the Network

4 SUBMARINE CABLES

4.1 Background

4.1.1 Terrestrial vs. Submarine - Basic Differences

4.1.2 Issues - Construction and Technology

4.1.3 Technological Advances

4.1.4 Backhual

4.1.5 Submarine Fiber Availability

4.1.6 Summary and Conclusions

4.2 U.S Submarine Cables

4.2.1 360Network

4.2.2 North American Network

4.2.3 Alaska United Fiber Optic Cabling Systems

4.2.4 Arcos - 1

4.2.5 American - 2

4.2.6 Atlantic - 1

4.2.7 China - U.S Cable System

4.2.8 FLAG - Atlantic - 1

4.2.9 Gemini Cable System

4.2.10 Global Crossing - Atlantic - 1

4.2.11 Global Crossing - Atlantic - 2

4.2.12 Mid Atlantic Crossing (MAC)

4.2.13 Global Photon

4.2.14 Japan - U.S Cable Network

4.2.15 Maya (MAYA - 1)

4.2.16 Southern Cross Cable

4.2.17 TAT - 14

4.2.18 TPC - 5

4.2.19 Tyco Submarine System Ltd (TSSL)

4.2.20 SAM - 1

4.2.21 Viatel Global Communications

5 US INFRASTRUCTURE PROVIDERS - PROFILES

5.1 Dark Fiber Providers

5.1.1 360Networks

5.1.2 ACSI Network Technologies

5.1.3 Aerie Networks

5.1.4 Broadwing

5.1.5 C2C Fiber

5.1.6 Caprock Communications

5.1.7 Dedicated Fiber Solutions

5.1.8 Enkido

5.1.9 Evolution Networks

5.1.10 Fiber Technologies

5.1.11 Fiberworks

5.1.12 Florida Fiber Networks

5.1.13 Global Crossing

5.1.14 Global Metro Networks

5.1.15 Level 3 Communications

5.1.16 Looking Glass Networks

5.1.17 Metromedia Fiber Networks

5.1.18 PFNet

5.1.19 Phonoscope

5.1.20 Qwest

5.1.21 WCI Cable

5.1.22 Williams Communications

5.2 Other U.S Fiber Networks

5.2.1 AT&T

5.2.2 BTI Telecom

5.2.3 C3 Networks

5.2.4 Cambrian Communications

5.2.5 KMC Telecom

5.2.6 Lightwave Communications

5.2.7 MCI Worldcom

5.2.8 SDN Communications

5.2.9 Sprint

5.2.10 Time Warner Communications

5.2.11 XO

5.3 Utilities

5.3.1 Utilities Participation in Telecommunications

5.3.2 American Fiber Networks

· AEP Communications

· Allegheny Communications Connect

· CFW Communications

· First Energy

· GPU Telecom Services

· R&B Communications

5.3.3 AVISTA

5.3.4 City Of Los Angeles

5.3.5 Con Edison Communications (CEC)

5.3.6 Dominion Telecom

5.3.7 Enron Broadband Services

5.3.8 Espire Communications

5.3.9 FPL Fibernet

5.3.10 Los Angeles Department of Water & Power

5.3.11 NeesCom

5.3.12 Neon

5.3.13 City of Palo Alto Utilities

5.3.13.1 FTTH Trial

5.3.14 Progress Telecom

5.3.15 Sierra Pacific Communications

5.3.16 Telergy

5.3.17 Touch America

6 FIBER-X PROVIDERS

6.1 Fiber to the Business

6.1.1 Opportunities for Real-Estate

6.1.2 Construction Time & Cost

6.1.3 FCC Forced Access Proceeding

6.2 Fiber to the Business - Company Profiles

6.2.1 Allied Riser Communications

6.2.2 Broadband Office

6.2.3 Cogent Communications

6.2.4 Fibernet Telecom Group Inc

6.2.5 Yipes

6.3 Other Providers of Fiber to the Business

6.3.1 Wired Environments

6.3.2 Cypress Communications

6.3.3 Rudin Management Company

6.4 Fiber to the Home

6.5 Fiber to the Home - Profiles

6.5.1 City of Palo Alto Utilities

6.5.2 FTTH Trail

6.5.3 Fiber to the Home Canada

7 GLOBAL OPERATORS - U.S PRESENCE

7.1 Cable & Wireless

7.2 Teleglobal

7.3 Viatel Global Communication

8 CITIES

8.1 New York

8.1.1 Statistics Table (City Information)

8.1.2 Dark Fiber Providers

· Enkido

· Level3

· Looking Glass Networks

· MMFN

· Telergy

8.1.3 Wavelength Providers

· Con Edison Communications

· Dominion Telecom

· Electric Lightwave

· Enkido

· FiberNet Telecom Group

· Level3

· Lightwave Communications

· MMFN

· NEON Communications

· Telergy

· Time Warner Telecom

· Williams Communications

8.2 San Francisco (And Bay Area)

8.2.1 Statistics Table (City Information)

8.2.2 Dark Fiber Providers

· Enkido

· Global Metro Networks

· Level3

· Looking Glass Networks

· MMFN

8.2.3 Wavelength Providers

· Enkido

· Level3

· Lightwave Communications

· MMFN

· Time Warner Telecom (acquisition of GST)

· Williams Communications

8.3 Los Angeles

8.3.1 Statistics Table (City Information)

8.3.2 Dark Fiber Providers

· City of LA

· Enkido

· Global Metro Networks

· LA Department of Water and Power

· Level3

· MMFN

· Southern California Edison

8.3.3 Wavelength Providers

· Enkido

· FiberNet Telecom Group

· Level3

· Lightwave Communications

· MMFN

· Time Warner Telecom

· Williams Communications

8.4 Miami (Florida Area)

8.4.1 Statistics Table (City Information)

8.4.2 Dark Fiber Providers

· ACSI Network Technologies

· Fiberworks

· Florida Fiber Networks

· FPL Fibernet

· Global Metro Networks

· Level3

· MMFN

· Progress telecom

8.4.3 Wavelength Providers

· EPIK Communications

· FPL Fibernet

· KMC Telecom (not Miami - Florida area only)

· Level3

· MMFN

· Progress telecom

· Williams Communications

9 ON-LINE EXCHANGES

9.1 Online Exchanges Overture

9.1.1 What are Online Exchanges Doing?

9.1.2 Online Exchanges and Dark Fiber

9.1.3 Benefits of an Exchange for Buyers & Sellers

9.1.4 Future Directions of Online Exchanges

9.1.5 Conclusion

9.2 U.S Online Exchanges - Profiles

9.2.1 AIG Telecom

9.2.2 Arbinet - thexchange

9.2.3 Asia Capacity Exchange

9.2.4 Bandwidth.Com

9.2.5 Band-X

9.2.6 Bandwidth Market Ltd

9.2.7 Enron Broadband Services

9.2.8 Fiberloops.Com

9.2.9 Geotele

9.2.10 Iber-X

9.2.11 RateXchange

9.2.12 The Global TeleExchange

10 ALL OPTICAL NETWORK

10.1 The All-Optical Debate

10.1.1 Frequently Asked Questions (FAQ's)

10.1.2 The Velocity of Change

10.1.3 All Optical Intelligent Networking Markets

10.1.