AT&T says common interconnection standards will drive new Ethernet growth

AT&T (NYSE: T) may be the largest Ethernet provider in the U.S., but to fulfill the requirements of large multi-national corporation customers (MNCs) that reside outside of its wireline territory, it would like to have a standard method to establish Ethernet interconnection with other providers.

Dan Blemings, director of Ethernet product management for AT&T mobile and business solutions, said in an interview with FierceTelecom that Ethernet interconnection even today is still a challenge.

"We're seeing this transformation in the industry away from TDM and more towards Ethernet," Blemings said. "We have been watching that at AT&T for a while and see that continuing to move to more and more Ethernet over time."

Blemings added that today carriers have a well-established process to interconnect their TDM-based networks because unlike Ethernet, it's a ubiquitous resource.

"One of the things you can do today with TDM that you really can't do with Ethernet is you have ubiquity because TDM has been around for decades," Blemings said. "As our network needs to connect to any other providers around us it's common to connect with TDM, but with Ethernet we have a different problem and we need to figure out how to have our networks standardized so AT&T's implementation of Ethernet works seamlessly with other providers around us."

One of the continual challenges for carriers interconnecting their Ethernet networks is that they have to construct individual External-Network to Network Interconnection (E-NNI) agreements on a case-by-case basis. This is because each provider has its own methods of measuring classes of service (CoS) and tagging Ethernet frames inside the network, for example.

At this point, Blemings said that the company has received necessary network gear and plans to start conducting multi-carrier testing soon. By conducting this multi-carrier testing, Blemings said it will have a better understanding of what to expect when conducting Ethernet interconnection in the networks.

"We know that AT&T has an Ethernet network that handles tagging a certain way and we know that Verizon (NYSE: VZ) and CenturyLink (NYSE: CTL) handle tagging differently than we do," Blemings said. "We connect today for access services for Ethernet so we will have a taste of what to expect as we do more of this testing."

AT&T and other large carriers have a savior in the Metro Ethernet Forum (MEF). Joining Windstream, Verizon, Frontier and Windstream, AT&T is helping the Metro Ethernet shape its Ethernet Interconnect Points (EIP) project to develop common guidelines service providers can use to interconnect their Ethernet networks when pursuing out-of-territory opportunities.

"As I sat down and looked at what AT&T needed to do, I realized that we needed an industry partner and the MEF was the perfect fit," Blemings said. "We have some of the biggest carriers in the U.S. under one roof and we're simulating what our switched Ethernet networks will look like in a real-time environment and rapidly tell each other what works and what does not work and document those things and put them into a standard MEF implementation agreement."

Finding ways to expand Ethernet via interconnection agreements is important for large telcos like AT&T as it continues to see its legacy TDM base continue to decline while next-gen services revenues like Ethernet continue to rise.

During the first quarter, the carrier's Ethernet, VPN and cloud strategic business service revenues continued to be the star in AT&T's wireline business portfolio, growing 14.8 percent year-over-year to $2.6 billion.

That's not to say that AT&T is not enhancing its own wireline and fiber-based footprint. As of the end of the first quarter, the service provider passed over 800,000 buildings with its fiber via the fiber-to-the-building (FTTB) portion of its Project VIP initiative.

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