TECHNOLOGY TRENDS: Driven by the Times

As boys, networking

companies were smart. As men, they still are. But they have also

matured. With large stakes in the hot carrier market, networking

companies can no longer just boast of their comfort level with IP.

Today they know that is just a necessary-but-not-sufficient

condition to succeed. They have learnt a thing or two from the real

world sensibility of the carrier market. That is reflected in their

way of doing business; long-term strategies; their talks; and yes,

their technologies.

Take, for example, the broad

concept of technology. Till a couple of years ago, it was synonymous

with product capabilities. Then came Layer 3/Layer 4 switching among

others. Today, the networking vendors do understand that technology

means much more.

All networking companies have

tried to build their strengths in three areas–optical networking,

broadband access (DSL/cable), and unified messaging. These areas

have not only seen acquisitions, even other companies who are still

independent in these areas are hot, with stocks trading at all-time

high.

Optical

Networking

Internet-based multimedia communication services will be

widely available, creating huge demand for bandwidth. Only optical

networking can address that kind of bandwidth needs. The big three

equipment vendors for the new carrier networks (Lucent, Cisco, and

Nortel) talk of IP over Dense Wavelength Division Multiplexing (DWDM). No wonder, the maximum number of acquisition by Cisco and

Nortel Networks have been made in this area. Other start-ups in this

area like Sycamore Networks, Cienna, and Corvis Corp. are also hot

companies. Even in India, most prospective long distance players are

looking at deploying optical networking right from day

one.

Broadband

Access

Interestingly, it is the middle of the carrier network about

which there is a sharp divide among the traditional telecom vendors

and the new datacom equipment suppliers. While DWDM is common choice

for all at the backbone, DSL and cable are fast becoming growth

areas. Many vendors are pushing DSL as it is targeted at the

traditional telcos and some new carriers. Cable, on the other hand,

is restricted to a few markets like the US (also India). India is a

bigger potential for cable than its other Asian neighbours are. This

is another area where most M&As have taken place.

Unified

Messaging

Unified

messaging, is a software-based computer telephony solution and has

been thought of as more of an application for enterprises and telcos

for value-added services. However, with IP rapidly becoming

omnipresent, it is today possible to do virtually everything over

IP. Most networking companies are grabbing up the small application

companies to provide a complete (as opposed to total) solution to

the service providers and enterprises over their converged IP-based

network. Indian companies have a potential to make a mark

here.

Unified messaging is useful both

for the enterprise and the carrier market.

Wireless corporate network is

another area where much activity has been seen. But it is still a

long way to go. The areas to watch out are IN and Web-based

customer/contact management, where some activity has just

begun.

Hot for

2000

In an unwired world, mobile

Internet application has suddenly taken off, despite the 3G wireless

not really moving in the planned direction. Nevertheless, the GSM

world is united under UMTS and the new 3G wireless operators will

soon require solid core wireless networking technology to go with

GPRS. The networking vendors are still not ready to meet the demand,

thanks to the comparatively lesser activity on this front in the US

market. They will either have to catch up fast by acquiring

companies or will also give in to their "slow-moving" competitors

from the traditional telecom equipment domain who have shown that

they are not so slow in embracing IP.