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AT&T SDN plans grow; Record Ethernet switch revenue

In telecom news, AT&T's SDN plans gain traction with Domain 2.0, while global Ethernet switch revenue hits record highs.

This week in telecom news, AT&T executive John Donovan addressed AT&T's software-defined networking (SDN) strategy as the carrier plans to transition to a software company. The carrier is beefing up its SDN plans by partnering with more vendors for its Domain 2.0 program. Meanwhile, a report from Infonetics Research found that Ethernet-switch revenue reached record highs for 2014.

Verizon laid out its argument against being reclassified as a common carrier under Title II in a filing with the Federal Communications Commission (FCC). The carrier argued the FCC already has the regulatory control it needs to enforce an open Internet.

Donovan pushes AT&T SDN plan, Domain 2.0

AT&T is ramping up its SDN strategy as it transitions from being a hardware to software company, and in the process, increase the traditional 45% network utilization from to 80% to 90% utilization.  

John Donovan, AT&T senior executive vice president of technology and operations, said at Barclay's 2014 Global Technology Conference that traditional telecom companies are focused on selling software and that carrier and vendor roles will change as a result.

Network reliability will be one thing that will change, Donovan said. He said with AT&T's push into SDN, the carrier's approach to reliability will be "fundamentally different" from the traditional maintenance at the shelf level, card level, system level and route level.

To further push the AT&T SDN strategy, the company added Brocade, Ciena Corp. and Cisco to its list of Domain 2.0 partners. Domain 2.0 is AT&T's plan to transform its network using SDN and network functions virtualization (NFV), which was announced in September 2013. In addition to Brocade, Ciena and Cisco, AT&T has partnerships with seven other vendors, including Alcatel-Lucent, Ericsson and Juniper Networks.

Ethernet switch revenue hits new highs

Ethernet switch revenue for 2014 is expected to hit a new record, according to Infonetics Research.

Fueled by demand in the public and financial services sectors, global Ethernet switch global Ethernet switch revenue grew 4% in the third quarter to $5.6 billion and grew 5% year over year, according to Infonetics' new Ethernet report.

Web-managed and fully managed fixed switches saw double-digit growth. Revenue for unmanaged and chassis switches saw declines, however.  Shipments of 40 GbE switches are doubling year-over-year, which leads the market, especially in the white-box market, while 10 GbE switch shipments fell short of expectations, despite 26% year-over-year growth.

"Looking ahead, we expect growth to accelerate, thanks in part to the introduction of 2.5 G and 25 G Ethernet," said Matthias Machowinski, directing analyst for enterprise networks and video at Infonetics. "These new Ethernet speeds will be a premium offering relative to 1 GE and 10 GE to address bandwidth constraints in data center and campus networks and should provide an additional boost to revenue."

Verizon argues FCC doesn't need Title II regulation

The FCC has the authority to enforce regulations on paid Internet traffic prioritization, blocking and throttling without the need to reclassify broadband Internet under Title II of the Telecommunications Act, Verizon said in a filing.

William Johnson, Verizon's vice president and associate general counsel, argued in the filing against reclassification under Title II, saying the FCC already has regulatory authority under the Telecommunications Act.

"The D.C. Circuit has already confirmed that Section 706 provides the Commission with authority to protect the open Internet by addressing practices that would harm competition or consumers and provided a roadmap for sustainable rules," Johnson wrote.

Johnson claimed the debate over paid prioritization is a red herring, saying there is no record of such deals and that service providers confirmed they have no plans to create paid prioritization deals.

He said the FCC should continue with the current "integrated information service" approach to broadband under Section 706, calling it a lawful approach that would avoid potential lawsuits that could arise under reclassification.

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