Cisco moves to compete in metro networks

Cisco Systems announced new optical networking hardware Wednesday, the giant's latest move to catch up with rivals in the fast-growing market to build networks in metropolitan areas.

Cisco's new product can transport data at high speeds and is aimed at large companies and service providers, particularly those that offer data storage services to businesses, Cisco executives said.

The networking giant's new technology gives the company a product comparable and competitive to previously released technology by Nortel Networks, Ciena, ONI Systems and others in the fast-growing market for metropolitan network equipment, Cisco executives and analysts say.

Industry consulting firm Infonetics Research predicts the market for metropolitan equipment in North America will grow from $6.3 billion in revenue in 2000 to $17.2 billion by 2003, an increase of 175 percent.

"This product exists for the high-end (business) market, largely because of its storage capabilities," Meta Group analyst David Willis said. "Storage is just growing tremendously and will drive optical (networks) growth in the metropolitan area."

Cisco recently released new networking equipment aimed at special-purpose networks used for storing data. Optical networking equipment is new technology that allows telecommunications carriers and service providers to send larger amounts of Net traffic across their networks at faster speeds.

Called the Cisco ONS 15540 Extended Services Platform, the product supports a technology called dense wavelength division multiplexing (DWDM), which increases the amount of information that can be sent through fiber-optic networks. DWDM is a faster alternative to more traditional technology, such as SONET, analysts said.

Burton Group analyst Dave Passmore said a large business with multiple sites could use the technology to link to each other. "You could use it anywhere you have to link from point to point," he said. "Suppose you have two locations in the Bay Area and decided to lease some fiber between the two sites. Normally, you run...a fast SONET connection. But DWDM provides greater speeds."

Cisco is expected to release the product in early May.