Bandwidth Demand for International Circuits Grows by 45%

July 18, 2012 by Leave a Comment

Data from TeleGeography’s Global Bandwidth Research Service reveal that demand for international bandwidth grew 45 percent in 2011, and at a compounded rate of 57 percent annually between 2007 and 2011. Although growth has slowed since 2008, when network capacity increased nearly 70 percent, the pace remains brisk, with aggregate capacity requirements more than doubling every two years.

The rate of growth varies widely by region, and has been fastest on links to less-developed regions. Between 2007 and 2011, international bandwidth usage in the Middle East grew at a compounded rate of 98 percent annually, from 148 Gbps to 2.3 Tbps. Over the same time period, Africa’s international bandwidth usage increased 85 percent annually, to 677 Gbps, and Latin America’s international bandwidth usage grew 71 percent, to 5.6 Tbps.

International Bandwidth Growth Used by Region, 2007-2011

International bandwidth requirements in Asia and Europe grew at a compounded rate of more than 55 percent between 2007 and 2011, while international bandwidth demand in North America and Oceania grew 47 percent. Although international bandwidth usage growth is slower in these mature markets, their capacity requirements are far larger than those of emerging markets. North America’s international bandwidth usage is nearly 10 times greater than that of the entire Middle East, while used capacity connected to Norway is greater than that connected to all of the countries in Africa.

Broadband subscriber growth is the primary driver of bandwidth demand in the Middle East and Africa, where the number of subscribers grew from 9.4 million to 19.4 million between 2007 and 2011, and in Asia, where broadband subscriptions doubled to 250 million over the same period. While broadband subscriber growth has slowed in Latin America, Europe, and North America, bandwidth demand in these regions has been fueled by increases in average broadband access speeds, enabling more frequent use of high-bandwidth applications such as video.

Filed Under: Industry Surveys, International Networks, International Private Leased Circuit - IPLC, Uncategorized, VPLS

Gig-E Prices Continue to Drop as Supply Rises

April 26, 2012 by Leave a Comment

As enterprises around the world replace traditional SDH/SONET private line networks with newer generation point-to-point EoMPLS and port based VPLS services, carriers have rapidly expanded their Ethernet network footprints to keep up with the demand. As a consequence of growing EoMPLS service availability, competition is increasing and prices are declining around the world. However, data from TeleGeography’s Ethernet Pricing Service show that great price disparities persist, both among regions and service providers.

Ethernet services are most readily available, and prices are lowest, in Europe and North America. In Q1 2012, the median monthly price of a GigE EoMPLS pseudowire circuit between Frankfurt and London was $3,448, down 29 percent from Q1 2011, while the median price from New York to Los Angeles was $8,000 per month, 12 percent lower than in the previous year. By contrast, Ethernet circuits connecting to Asian cities remain far more expensive due to more limited service availability, less robust competition, and higher underlying transport costs. The median price of a GigE EoMPLS connection from Hong Kong to London in Q1 2012 was $40,138, down 17 percent from a year earlier, while a circuit from Hong Kong to Tokyo cost $31,096 per month, more than five times the price of a comparable link on the longer London-New York route.

Price differences among service providers can be just as dramatic as price differences among regional markets, with the variance between the high and low prices on some lower-cost routes just as great, or greater, than on more expensive routes. For example, in Q1 2012, the high price of a GigE circuit from Hong Kong to London was $52,500—approximately three times greater than the low price of $16,704. The range of prices on the much less costly London-New York route is far wider: the highest price quoted to TeleGeography, $17,250 per month, was 10 times more than the low price of $1,729.

“Prices of enterprise WAN services often vary far more widely than prices of wholesale carrier services,” said TeleGeography analyst Brianna Boudreau. “While prices will continue to decline as wide area Ethernet services become more standardized and availability grows, large price disparities are likely to persist for years to come.”

TeleGeography’s Ethernet Pricing Service benchmarks the price of international Ethernet service by provider, capacity, service, and route.

 

Filed Under: International Networks, International Private Leased Circuit - IPLC

Perseus Telecom and Reliance Globalcom Launch World’s Fastest Trans-Atlantic Trading Network

April 24, 2012 by Leave a Comment

NEW YORK, April 23, 2012 /PRNewswire/ – Perseus Telecom, a global provider of connectivity, along with Reliance Globalcom, the Global telecommunications services arm of India’s largest integrated telecom operator Reliance Communications, today announced the launch of the world’s fastest available trans-Atlantic network connection, QuanTA, between major global financial exchanges. The launch of QuanTA represents a landmark development in the latency race to zero and creates new opportunities for trading firms on both sides of the Atlantic. (obviously latency will never be zero or close to zero.  But when it comes to trading, milliseconds matter)

The partnership between Perseus Telecom and Reliance Globalcom has resulted in the creation of an innovative high-speed, ultra low-latency network connection across the Atlantic by leveraging an existing system on the FLAG Atlantic-1 (FA-1) North cable, a trans-Atlantic six-fiber pair system between Long Island, New York and Lands End, United Kingdom. Designed with the latest advancements in optical technology, better dispersion compensation methodology, faster processing equipment and shorter cable paths, this ultra low-latency link represents a capital assured, cost-efficient solution for the sub-60ms RTD latency financial market participants require across the Atlantic. 

“Fast-paced trading environments demand even faster connectivity, particularly across the Atlantic where, traditionally, the patchwork grid of cable systems across the ocean had not allowed for a truly low-latency network,” comments Dr. Jock Percy, CEO of Perseus Telecom. “Our ability to create this network in partnership with Reliance Globalcom at relatively low cost and minimal time to market is a testament to our expertise in developing network solutions for the financial industry. We’re incredibly excited at the launch of QuanTA which we believe marks a game-changing development for the global trading community. As high-frequency trading strategies proliferate, ultra low-latency network connectivity becomes even more of a competitive differentiator.”

Commenting on this offering, Mr. Rory Cole, President and COO – Carrier Business, Reliance Globalcom, said, “Being one of the world’s leading carriers with connectivity across the globe, we are happy to announce that Reliance Globalcom now offers the fastest ultra low-latency route on FA-1. With this service, we are now connecting the U.S. and U.K. on the fastest link, addressing the business needs of our customers, especially in the financial sector, to help them gain a significant market advantage.”

The launch of QuanTA provides trading firms with a more secure, low-latency and efficient network connection across the Atlantic. Now, firms tapping into liquidity at exchanges in the U.S. and Europe can do so with guaranteed minimal latency on a highly reliable connection, minimizing potential risk in network outages or latency.

Filed Under: Carriers Offering MPLS, International Networks, International Private Leased Circuit - IPLC, Private Lines, VPLS

What does OC mean? You know…OC-3, OC-12, etc.

April 9, 2012 by Leave a Comment

This is a very brief post, motivated by a consulting engagement that MPLS-Experts is working on right now. This client is building a global private network to service its offices, using eight or ten collocation facilities as the Points-of-Presence. Each collo will be connected with two diverse 1Gbps Layer-1 point-to-point circuits.

So the question came up, what optical circuit do you need for 1 Gig? Not something your average client uses.

OC is short for Optical Carrier, used to specify the speed of fiber optic networks conforming to the SONET standard.

This list shows the speeds for common OC levels.
OC = Speed
OC-1 = 51.85 Mbps
OC-3 = 155.52 Mbps
OC-12 = 622.08 Mbps
OC-24 = 1.244 Gbps
OC-48 = 2.488 Gbps
OC-192 = 9.952 Gbps
OC-255 = 13.21 Gbps

We’ll need a partial OC-24 to provide 1 Gbps on each circuit.

Filed Under: Get MPLS Price Quote, International Networks, International Private Leased Circuit - IPLC, Network FAQs, Private Lines, Quotation Thoughts Tagged With: , , , , , , ,

Level 3 to purchase Global Crossing

June 14, 2011 by Leave a Comment

This is not “new” news (from April, 2011) , but since many clients were not aware of this merger, I feel compelled to post it here:

Level 3 Communications, Inc. (NASDAQ: LVLT) said it agreed to acquire Global Crossing Limited (NASDAQ: GLBC) for about $1.9 billion stock deal to boost its service portfolio.

Including Global Crossing’s net debt of about $1.1 billion as of Dec. 31, 2010, the deal values the company at about $3 billion.

The deal will create a company with pro forma combined 2010 revenues of $6.26 billion and pro forma combined 2010 Adjusted EBITDA of $1.27 billion before synergies and $1.57 billion after expected synergies.

By combining the strengths of each company, the new entity will offer enterprise, government, wholesale, content, and web-based customers a comprehensive portfolio of end-to-end data, video and voice solutions.

“This is a transformational combination that we believe will deliver significant value to the investors, customers and employees of both Level 3 and Global Crossing,” said Jim Crowe, chief executive officer of Level 3. “The complementary fit between the two companies’ networks, service portfolios and customers is compelling. By leveraging the respective strengths and extensive reach of both companies, we are creating a highly efficient and more extensive global platform that is well-positioned to meet the local and international needs of our customers.”

Including the benefit of synergies and the cost of integration, Level 3 expects the transaction to be accretive to its Free Cash Flow per share in 2013.

Through integration of the combined businesses, the transaction is expected to create substantial annualized Adjusted EBITDA synergies of approximately $300 million and cost savings of about $40 million.

Level 3 expects to realize approximately two-thirds of the run rate Adjusted EBITDA synergies within 18 months of closing. The company estimates that the net present value of the potential synergies will be approximately $2.5 billion.

In addition, Level 3 expects to incur about $200 million to $225 million of integration costs associated with this transaction.

Also, the transaction is expected to improve Level 3′s credit profile as well as significantly strengthen the company’s balance sheet.

The combined business will offer an extensive portfolio of transport, IP and data solutions, content delivery, data center, colocation and voice services, delivered globally.

Global Crossing will bring important additions to Level 3′s service portfolio, including managed services, collaboration services and inter-continental virtual private networking capability. The combined service portfolio and distribution channels will allow Level 3 to better address the needs of enterprises, content providers, carriers and governments throughout North America, Latin America and Europe.

Global Crossing’s enterprise service portfolio and proven sales expertise together with the improved cost structure and performance achievable by combining the extensive international, intercity and metro networks will enable opportunities for improved growth by giving enterprises better options to meet their local, national and international communications needs.

Level 3, which got committed financing for $1.75 billion in connection with this acquisition, said ST Telemedia, which owns approximately 60 percent of Global Crossing’s stock, has agreed to vote its shares in favor of the deal.

The transaction is expected to close before the end of this year, subject to customary closing conditions and regulatory approvals.

Bermuda-based Global Crossing is an IP, Ethernet, data center and video solutions provider, offering a full range of data, voice, collaboration, broadcast and media services delivered with superior customer service.

It connects the North America and Europe, and links to Asia and Latin America through submarine fiber-cable networks. This fiber stream supports a wide range of services, including Internet access and other data services, for multinational corporations, government agencies, and other telecom service providers

Global Crossing provides services to enterprises (including approximately 40 percent of the Fortune 500); government departments and agencies; and 700 carriers, mobile operators and ISPs. It delivers converged IP services to more than 700 cities in more than 70 countries, and has 17 world-class data centers in major business centers around the globe.

In 2010, Global Crossing revenue grew to $2.61 billion from $2.54 billion in 2009.

Filed Under: Carriers Offering MPLS, International Networks, International Private Leased Circuit - IPLC, Private Lines

Private Lines – How to interface to your network

June 7, 2011 by Leave a Comment

Surprisingly, there is very little written about interfacing a private line circuit to your network.  MPLS networks are not always the right solution for WAN connectivity.  For point-to-point networks, a private line or international private line could be the most cost effective solution.  But private lines typically do not come with routers and management.  This makes some people nervous about how they will make it work, but it shouldn’t be a real concern.

A Private Line is a TDM circuit, using Time Division Multiplexing to cost-effectively share your circuit with others on a carrier network.  To function, you need a CSU/DSU.

A CSU/DSU (Channel Service Unit/Data Service Unit, but no one calls it that!) is a digital-interface device used to connect a  router to a digital circuit (for example a T1, E1 p DS3 line).

A CSU/DSU operates at the physical layer (layer 1) of the OSI model.

So what does a CSU do? A CSU is acts as a buffer between a LAN and a public carrier’s WAN to ensure signals placed on the public lines are appropriately timed and formed for the network. The DSU manages timing errors and signal regeneration, providing a “modem-like” function , it converts digital data frames from the local area network (LAN) into frames appropriate to a wide-area network (WAN) and vice versa. The CSU receives and transmits signals from and to the WAN line and provides a barrier for electrical interference from either side of the unit. The CSU can also echo loopback signals from the phone company for testing purposes.

The CSU/DSU can be a separate piece of hardware mounted on the wall.  More commonly, it is simply a card that is part of a router.  The WIC (WAN Interface Card) may contain an integrated CSU/DSU that can be inserted into a router slot.

Once your Private Line has timing set up between the far and near ends, you then simply configure your router as you would for any other wide area network.

 

Filed Under: International Networks, International Private Leased Circuit - IPLC, Network FAQs, Private Lines Tagged With: , , , , , , ,