As regular readers know, Carrier Ethernet has been experiencing dramatic growth. And some areas within the broad category of Carrier Ethernet business services are especially hot, as recent research from International Data Corporation reveals.

Three of the biggest growth areas within the general Carrier Ethernet business services category are Ethernet virtual private line services, services offering speeds between 100 Mb/s and 1 Gb/s, and hybrid services that also have an IP-VPN component.  So said Nav Chander, telecom research manager for IDC, in a phone interview this week.

EVPL service growth has been driven, in part, by price declines of as much as 25%, Chander said.

“Everyone is starting to move into that area of business more aggressively as networks have been upgraded,” he explained. “They changed out their network infrastructure so they can implement switched Ethernet services.” Chander pointed to Comcast, CenturyLink and AT&T as three companies that have gotten serious about the EVPL opportunity.

Declining prices also have been an important driver for an increase in carrier Ethernet services at speeds between 100 Mb/s and 1Gb/s, Chander said, noting that the 100 Mb/s - 1 Gb/s range is now the most popular Carrier Ethernet speed category among business customers.

Meanwhile, hybrid networks that combine carrier Ethernet and IP-VPN connectivity also are seeing big gains, IDC’s research shows. The hybrid approach is popular among businesses that want to use IP-VPNs for most of their locations, but are shifting to Ethernet for extra high-bandwidth applications such as data storage, backup, recovery, and database replication.

What Business Customers Want

Business customers are looking for three key capabilities in a service provider, Chander said. These include on-demand bandwidth (or as close to the on-demand nirvana as possible), performance monitoring and service assurance capabilities.

“If you want to move out of a pure commodity game as Ethernet is maturing, this is where you can add more value,” Chander advised service providers. Service providers should be asking themselves if their network can support capabilities such as service assurance and, if not, should be seeking partnerships with companies such as Infovista or IBM to fill in the gap, said Chander. He added that he expects to see some interesting offerings along those lines coming to market in 2012.

On the performance monitoring side, Chander sees a bright future for Carrier Ethernet network interface devices (NIDs), which he sees supporting powerful monitoring capabilities for carrier Ethernet services. “There is a huge opportunity for service providers to capitalize on driving performance application requirements,” Chander said. “Ethernet could grow even faster if monitoring capability is there and you’re delivering a managed service.”

Chander also sees new opportunities emerging in carrier Ethernet services that integrate with data center Ethernet. “The idea of virtualizing data centers will drive interesting trends in Ethernet,” he predicted. The question, he said, is what role the service provider should play between and within data centers and with data center equipment manufacturers. The answer, he said, may be a few years away.

In the meantime, he said service providers should be able to gain some substantial traction if they follow some of the basic rules of good salesmanship. “For Ethernet, they should be looking at the customer needs and connectivity requirements and how they vary by application type, performance requirements and location,” said Chander. “It seems like a simple thing but you would be surprised. Some people are so used to looking at what they have and how they can force fit it.”

IDC’s carrier Ethernet business services findings are summarized in a report titled “U.S. Carrier Ethernet Services 2011-2015 Forecast.” The report was based on a survey of 1,000 enterprises with as few as 50 or as many as 5,000 employees. To learn more about this report, please visit www.idc.com

As regular readers know, Carrier Ethernet has been experiencing dramatic growth. And some areas within the broad category of Carrier Ethernet business services are especially hot, as recent research from International Data Corporation reveals.

Three of the biggest growth areas within the general Carrier Ethernet business services category are Ethernet virtual private line services, services offering speeds between 100 Mb/s and 1 Gb/s, and hybrid services that also have an IP-VPN component.  So said Nav Chander, telecom research manager for IDC, in a phone interview this week.

EVPL service growth has been driven, in part, by price declines of as much as 25%, Chander said.

“Everyone is starting to move into that area of business more aggressively as networks have been upgraded,” he explained. “They changed out their network infrastructure so they can implement switched Ethernet services.” Chander pointed to Comcast, CenturyLink and AT&T as three companies that have gotten serious about the EVPL opportunity.

Declining prices also have been an important driver for an increase in carrier Ethernet services at speeds between 100 Mb/s and 1Gb/s, Chander said, noting that the 100 Mb/s - 1 Gb/s range is now the most popular Carrier Ethernet speed category among business customers.

Meanwhile, hybrid networks that combine carrier Ethernet and IP-VPN connectivity also are seeing big gains, IDC’s research shows. The hybrid approach is popular among businesses that want to use IP-VPNs for most of their locations, but are shifting to Ethernet for extra high-bandwidth applications such as data storage, backup, recovery, and database replication.

What Business Customers Want

Business customers are looking for three key capabilities in a service provider, Chander said. These include on-demand bandwidth (or as close to the on-demand nirvana as possible), performance monitoring and service assurance capabilities.

“If you want to move out of a pure commodity game as Ethernet is maturing, this is where you can add more value,” Chander advised service providers. Service providers should be asking themselves if their network can support capabilities such as service assurance and, if not, should be seeking partnerships with companies such as Infovista or IBM to fill in the gap, said Chander. He added that he expects to see some interesting offerings along those lines coming to market in 2012.

On the performance monitoring side, Chander sees a bright future for Carrier Ethernet network interface devices (NIDs), which he sees supporting powerful monitoring capabilities for carrier Ethernet services. “There is a huge opportunity for service providers to capitalize on driving performance application requirements,” Chander said. “Ethernet could grow even faster if monitoring capability is there and you’re delivering a managed service.”

Chander also sees new opportunities emerging in carrier Ethernet services that integrate with data center Ethernet. “The idea of virtualizing data centers will drive interesting trends in Ethernet,” he predicted. The question, he said, is what role the service provider should play between and within data centers and with data center equipment manufacturers. The answer, he said, may be a few years away.

In the meantime, he said service providers should be able to gain some substantial traction if they follow some of the basic rules of good salesmanship. “For Ethernet, they should be looking at the customer needs and connectivity requirements and how they vary by application type, performance requirements and location,” said Chander. “It seems like a simple thing but you would be surprised. Some people are so used to looking at what they have and how they can force fit it.”

IDC’s carrier Ethernet business services findings are summarized in a report titled “U.S. Carrier Ethernet Services 2011-2015 Forecast.” The report was based on a survey of 1,000 enterprises with as few as 50 or as many as 5,000 employees. To learn more about this report, please visit www.idc.com