Report: 40/100 GigE Adoption Will Grow

CIR believes that the economic downturn will not delay early adopters of 40/100 GigE as companies such as Google and Amazon have a "desperate need" for 100G connections today. And, although the current economic situation is having an impact on carrier network upgrades, scaling carrier networks to 100 Gbps will now only be accomplished using a 40/100-Gbps variant.

CIR believes that a handful of firms have the opportunity to shape the future of 40/100 GigE. These include Cisco, Juniper, Sun Microsystems, Force10, Nortel at the OEM level; JDSU, Finisar, Avago, Luxtera and Opnext at the transceiver level. At the component level there is Xilinx, Altera, IBM, LSI, Gennum, AMCC, Vitesse and Broadcom.

The adoption of 40G Ethernet will occur first in high end servers and High Performance Computing applications. Within the 40GigE environment, initially as much as 80 percent of the market will be accounted for by the SR4 version of the 40/100 GigE standard. However, the SR4 version is expected to lose share to CR4 over time as 40-Gbps-over-copper becomes more viable. The CIR expects both CR4 and SR4 to quickly lose share once serial 40GigE becomes a reality in 2014.

CIR believes that 100G Ethernet will be adopted in the core of the network, driven by growth in 10GigE server connections and access points. As 100GigE begins to generate revenues in around 2012, CIR expects the LR4 variant to account for maybe half the market, with SR10 taking another 20 percent of the market. However, improvements in copper technology should drive CR10 share of the 100 Gbps space to 25 percent or so by 2016.

The initial solutions for the 40G Ethernet CR and SR variants will rely on existing technology leveraged from InfiniBand which should give vendors a faster time to market and reduced R&D costs. The ability to produce low-cost VCSEL arrays will be especially critical to success in the SR markets. The highest investment in new technology will come from the 100G LR and ER variants which require new 25G technology for the electronics and the optical components. This will include lasers, modulator drivers, PIN diodes, TIAs and SERDES technology.

CIR