The development has significance in the context of the NBN: its higher user bandwidths are likely to require capacity upgrades to backbone networks. Nortel says it has undertaken extensive modelling of traffic demands likely to be imposed on Australia's long haul domestic and international networks as a result of the NBN and it claims that massive upgrades will be required.
According to Nortel, its 100Gbps equipment "uses unique technology that allows service providers to increase the bandwidth of today's typical 10G infrastructure by ten times without the need to rip and replace major parts of the network...[thus removing] a significant cost barrier for today's service providers with constrained CAPEX budgets."
Commenting on Nortel's announcement, Ovum analyst Ron Kline, said: "Nortel has made tremendous strides with its high-capacity networking capabilities. The company made its 40G capability commercially available in 2Q08 and quickly captured a 25 percent share of the market. Nortel has sold 40G to over 50 customers. It can also tap into the many customers that have deployed the [Optical Multiservice Edge 6500 platform] and [common photonic layer] with 10Gbps that can be upgraded to 40Gbps and now 100Gbps.
"Similar to its 40Gbps approach, Nortel's 100Gbps solution can be deployed over other vendor line systems as an alien wavelength, increasing the applicability to non-Nortel customers."
Nortel's Metro Ethernet division is being acquired by Ciena and Kline added: "Ciena/Nortel can also tap into the opportunity to update Ciena's substantial base of embedded DWDM equipment."
While neither Verizon nor Nortel has said anything about costs, Kline commented: "Our discussion with both indicated [cost of the 100Gbps upgrade] to be less than the cost of ten 10Gbps wavelengths. That is significant because 40Gbps took a number of years before it achieved cost parity with four 10Gs and it is still not really there yet, especially after you factor in the dropping cost of 10Gbps.
Telstra announced in August that it had tested both Nortel's 40Gbps and 100Gbps technology - 100Gbps over 2038kms and 40Gbps over 3370kms. However at that time it had already committed to using Ericsson 40Gbps gear for an upgrade of its Sydney-Melbourne network and Ericsson had said that its equipment would be upgradeable to 100Gbps as soon as the standard had been finalised.
Nortel has implemented 100Gbps transmission on two cards that fit into its Optical Multiservice Edge 6500 platform. According to Nortel "A Nortel 100G line card transmits the full 112Gbps payload within a single ITU standard 50GHz-spaced channel, allowing for a full 88 wavelengths over a single fibre."