Vertical Systems cites Ethernet exchanges as new trend to watch

Vertical Systems Group, which is known for its coverage of carrier Ethernet trends, is setting its focus on the emerging Ethernet Exchange market segment.

Defining the market segment as a carrier-neutral marketplace solution to standardize and simplify Ethernet service interconnection among service providers, Vertical's initiative will track drivers and risks, customer segmentation, deployment timing and Ethernet Exchange ports and revenue projections. While Vertical derived its projected Ethernet end-points from Vertical's databases of enterprise network installations and commercial sites, actual projections will be released at a later point.

Establishing External-Network to Network Interconnections (E-NNI) to extend a respective carrier's Ethernet reach has been an ongoing issue when they get a customer requirement that extends outside of the respective network footprint. When service providers got such requests they had to establish a one-off arrangement with a service provider partner to complete the connection in that off-net location.

However, E-NNI arrangements won't be completely replaced by Ethernet exchanges. Instead, the Ethernet exchange--as championed by existing data center providers (Equinix and Telx), peering operators (Neutral Tandem) and Ethernet exchange specialists (CENX)--will be a complementary tool service providers can use along with traditional E-NNI arrangements.

To date, the majority of the carrier arrangements with the Ethernet exchanges, with the exception of Verizon, has been from the competitive carrier community, including traditional CLECs (Covad, RCN Metro and Transtelco), competitive wholesalers (Intellifiber) and more recently cable (Cablevision's business arm Optimum Lightpath). These carriers are leveraging the Ethernet exchange to fill in what Vertical says are "selected gaps in their Ethernet footprints."

Rosemary Cochran, principal at Vertical Systems Group, said the Ethernet exchange idea, while relatively new, could help make the interconnection process perhaps a bit easier for carriers expanding their respective Ethernet footprints through carrier partnerships. "The major driver for Ethernet exchanges has been because doing bilateral interconnect agreements is painful," she said. "Establishing interconnect agreements is something that's being done and has been done because no service provider is everywhere."

For more:
- see the release here

Related articles:
Ethernet exchange: Another tool in the Ethernet service toolkit
Telx jumps into the Ethernet exchange fray
Optimum Lightpath joins CENX's Ethernet exchange
Sandy Brown on his new post as CEO of Ethernet Exchange operator CENX and network interconnection trends

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