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Today, Gigabit Ethernet is the backbone technology of choice for the LAN. And vendors are still innovating, developing faster, cheaper ways to push packets through Gigabit Ethernet switches. Likewise, they are broadening the realm of possibilities with features such as wire-speed QoS (Quality of Service) and traffic classification. This same innovation has contributed to server load-balancing, cache redirection and switching at all layers of the OSI model.

This year we give two awards in the switching space. Fixed-configuration switches, Layer 2 and Layer 3, have reached commodity status; vendors continue to pack in features, but these are largely superfluous--the core functionality you need at the edge can be delivered by the high-density Layer 3 switches shipping. Vendors fight for market share by aggressively slashing prices and adding copycat capabilities. Chassis-based switches, young in comparison with their fixed-configuration brethren, still have a long life of innovation ahead of them. Thus far, capacity and performance have come second to features, and you'll still pay a premium for these big boxes.

Throughout this year, vendors will push hard for "unified services." They'll preach about networks that have a unified code base end to end and networks that can handle voice and data seamlessly, but their goal will be a bigger chunk of your IT and telecom dollars. If unified services are the way to get that bid, then consolidate they will.

Industry consolidation will continue throughout this decade, and despite the need for standards-based technology, the best solutions will be those that are enhanced through proprietary efforts. For you, the consumer, this increases the incentive to pick one technology partner for your end-to-end enterprise connectivity needs.

Some technologies have moved beyond maturity into obsolescence. ATM in the LAN comes to mind. We still get die-hard fans flaming us for our lack of insight, but we argue that ATM has reached the end of its useful life in the LAN. No doubt if you're among the 20 percent of our readers with an installed ATM network, you're shaking your head. Like token ring, ATM is superior to Ethernet in many ways. But also like token ring, ATM has issues. Supporting an ATM network is expensive--training and diagnostic tools cost a mint. ATM innovation efforts have been concentrated in the WAN, and many vendors offer little in the way of new equipment. For a technology that was cutting-edge just five years ago, ATM in the LAN doesn't have a bright future. And sooner or later, you'll be facing the same decisions that token-ring shops face: Do you pull it all out and start over, or do we keep trying to cobble together this aging beast? Don't make the mistake that the true-blue token-ring shops did. Cut your losses now, and make a migration plan.

Last May, we predicted that policy-based networking would bring sweeping changes to network management. In November, we looked at products that delivered a policy-based solution, mostly for single-vendor deployments (see "Policy-Based Network Management"). While these products haven't changed the way you do network management overnight, they have had a profound effect on vendors' strategies to design network-management products. Vendors are using these platforms as springboards for next-generation management products; they're integrating directory services, VPN (virtual private network) and security management, QoS deployment and real-time monitoring.

This year we expect to see an interesting mix of technologies and services. Wireless technology is a hot area for vendors; both broadband-access and local area networking companies are inventing and innovating to create faster, cheaper ways to keep you connected. In our vision, broadband wireless technology will finally replace POTS. The availability of wireless LANs, MANs (metropolitan area networks) and ISPs is growing exponentially thanks to new, large blocks of unlicensed radio spectrum. Likewise, wireless bandwidth and throughput have increased a hundredfold in the past decade, and we've only scratched the surface. The broadband point-to-multipoint services market will flourish in the next two years, creating new opportunities and driving down prices for metropolitan-area connectivity.

Gigabit Ethernet is also experiencing some intriguing twists. Gigabit over copper is starting to appear nationwide in test labs and corporations. For server-room applications, this is an ideal way to add performance without paying a price premium. And just recently, the Ten-Gigabit Ethernet alliance was formed. The standard won't be ready for a few years, but vendors are already talking about the next generation of gigabit switches.