Innovation & Leadership: Ciena s FlexSelect Vision

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Elfreda Ursula Tucker
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1 Analyst Day October 10, 2006 Steve Alexander Sr. Vice President, CTO Innovation & Leadership: Ciena s FlexSelect Vision Ciena Proprietary

convergence is occurring from the users perspective Network = Service = Applications = Content = Voice, Video, Music, Transactions,

2 Networks are in transition IP is the world s first global language is the first global network access technology Every device in the world is becoming network addressable More bandwidth at lower costs Data Global Network Voice Video Mobility Storage Real convergence is occurring from the users perspective Network = Service = Applications = Content = Voice, Video, Music, Transactions, Information Differentiation is based on end-user experience: content branding, accessibility & reliability 2006 Ciena Corporation - Proprietary 2

3 Transition creates opportunity Metro/Core service delivery today IP VPNs VoIP Virtual P/Ls METRO CORE METRO IP / MPLS Layer 3 ATM / Layer 2 IP/MPLS $$$ ATM / $$ IP / MPLS Layer 3?? ATM / Layer 2? IP VPNs VoIP Virtual P/Ls Challenges Multiple high-cost network elements to purchase and administer Management and services interworking difficult TDM P/Ls Transmission Layer 1 $ Optical / SONET/ SDH - Transmission Layer 1 TDM P/Ls COST COMPLEXITY 2006 Ciena Corporation - Proprietary 3

4 Some initial solutions - Metro Core - Metro Router Router Routers Router Router WDM WDM WDM Directly connected routers $$$ Complex to manage Slow L3 restoration switch WDM switch MPLS Routers WDM switch WDM switch Directly connected Immature management Slow restoration Not deterministic over SONET/SDH MPLS Routers WDM over SONET/SDH over SONET/SDH Does not scale Still expensive for packet 2006 Ciena Corporation - Proprietary 4

5 FlexSelect : Enables cost-effective transition Layer 3 Layer 2 IP ATM Layer 2/3 Layer 1/2 IP/MPLS Flexibility IP for applications Shared, multi-point connectivity for packet transport Low-cost interfaces Layer 1 Layer 0 SONET SDH DWDM Layer 0/1 Resilient Transport OTN for managed optical lightpaths Service transparency 2006 Ciena Corporation - Proprietary 5

6 OTN extends the ability of optical networks Service & protocol transparency G.709 digital wrapper Any service inside Production-grade management Robust OAM streamlines operations, administration and maintenance Sub-wavelength granularity OTN Mix any services Client Ports ESCON (200Mb/s) GbE (1250Mb/s) FC (2125Mb/s) STM-1 (155Mb/s) Timeslot Interchanger OTU-1 Wrapper ITU G.709 digital wrapper Right-size baby wavelengths 2006 Ciena Corporation - Proprietary 6

7 OTN optimizes data services delivery Lower CAPEX/OPEX and L0/L1/L2 Integration Layer 3 Services PWE3 & P2MP Services P2P Services Layer 1 Services thru Metro OTN + Integrated IP-aware Layer 2 IP/MPLS Core Dynamic OTN / Optical Core IP/MPLS thru Metro OTN + Integrated IP-aware Layer 2 Layer 3 Services PWE3 & P2MP Services P2P Services Layer 1 Services Connectionoriented virtual circuits for deterministic performance Optimize routers and router ports Efficient use of L0/L1/L2 for lower cost Fast provisioning, protection, restoration Simplified management Single OTN for ALL services 2006 Ciena Ciena Confidential Corporation and Proprietary - 7 7

Simple OSS integration No protocol-specific cards & new protocols are just a download away FlexiPort hardware & software Flexible Network

8 FlexSelect targets pain points G.709 OTN unified transport layer Multi-service networking standard. Optimized not only for voice but for ALL services Converged Network lower OPEX Robust management for ALL services Familiar OAMP and FCAPS Simple OSS integration No protocol-specific cards & new protocols are just a download away FlexiPort hardware & software Flexible Network Peace of mind New Services Higher revenues Layer 1 multi-service solution Reconfigure sub-λ and full-λ services Transparent ROADM & eroadm 2006 Ciena Corporation - Proprietary 8

FlexSelect network architecture Business Services VLANs or PWs TDM 10/100 Core Service Edge Metro Multiservice Pseudowires DWDM Line System CN 4200 MC Packet-Aware FlexiShelf Metro Broadband & Triple

9 FlexSelect network architecture Business Services VLANs or PWs TDM 10/100 Core Service Edge Metro Multiservice Pseudowires DWDM Line System CN 4200 MC Packet-Aware FlexiShelf Metro Broadband & Triple Play GbE Optical CNX5/5+ GbE GbE FTTx/DSL Fixed Mobile Convergence IP/MPLS Data Service DN Edge Packet-Aware Transport CNMetro 4200 Network (OTN) access over any media Video Transport Service CoreDirector Edge SONET/SDH Evolving to OTN Packet-Aware CN Metro 4200 MC 2006 Ciena Corporation - Proprietary Managed transport 9 Voice Internet CNX TDM/ATM 10/100 = ROADM = service creation Long-haul transport

10 FlexSelect network architecture Business Services VLANs or PWs TDM 10/100 Core Service Edge Metro Multiservice Pseudowires DWDM Line System CN 4200 MC Packet-Aware FlexiShelf Metro Broadband & Triple Play GbE Optical CNX5/5+ GbE GbE FTTx/DSL Fixed Mobile Convergence IP/MPLS Data Service DN Edge Packet-Aware Transport CNMetro 4200 Network (OTN) access over any media Video Transport Service CoreDirector Edge SONET/SDH Evolving to OTN Packet-Aware CN Metro 4200 MC 2006 Ciena Corporation - Proprietary Managed transport 10 Voice Internet CNX TDM/ATM 10/100 = ROADM = service creation Long-haul transport

access The Universal Standard Ubiquitous Worldwide The choice for NG platforms as an interface Affordable commodity High volumes as a service (Virtual) Private Line,

11 access The Universal Standard Ubiquitous Worldwide The choice for NG platforms as an interface Affordable commodity High volumes as a service (Virtual) Private Line, (Virtual) LAN Differentiate service quality for WAN networking Packet switching & aggregation GE, 10GE framing & transmission 2006 Ciena Corporation - Proprietary 11

12 CN 4200 MC: Optical access to the masses OTN based C/DWDM platform that optimizes CAPEX and OPEX Targets network edge apps e.g., CPE, 10G router interconnect, storage, Private Line, Managed Service Delivery New M3, 3 port line card for lower start-up costs Shared line cards, software and management 4 (2.28RU) 2006 Ciena Corporation - Proprietary 12

13 Deep fiber economics Central Office RT Digital Loop Carrier (DLC) DSLAM (Integrated or Adjunct) < 12 kft, subs Cross Connect < 5 kft, subs CAPEX $ FTTN Cross Connect Remote DSLAM < 0.5 kft, subs Fiber Copper FTTC Host Digital Terminal Optical Network Unit (ONU) Optical Line Terminal (OLT) FTTH Passive Optical Network (PON) 1-32 subs Splitter 0 kft, 1 sub Optical Network Terminal (ONT) $$$$ 2006 Ciena Corporation - Proprietary 13

CNX-5 family eases transition to broadband Flexibility: Three access platforms

Flexibility: Two network locations Remote terminals (RT) SAI cross-connects (FTTN)

Selective service migration High bandwidth -based IP services (including IPTV)

14 CNX-5 family eases transition to broadband Flexibility: Three access platforms CNX-5 & CNX-5 IP for SLC-5 RT Sites CNX-5Plus for universal deployment Flexibility: Two network locations Remote terminals (RT) SAI cross-connects (FTTN) Remote Terminal SAI DSLAM SAI Broadband subscriber Broadband services CNX-5 IP Selective service migration High bandwidth -based IP services (including IPTV) Enables transition from ATM to IP Expands Ciena s markets CNX-5Plus 2006 Ciena Corporation - Proprietary 14

15 FlexSelect network architecture Business Services VLANs or PWs TDM 10/100 Core Service Edge Metro Multiservice Pseudowires DWDM Line System CN 4200 MC Packet-Aware FlexiShelf Metro Broadband & Triple Play GbE Optical CNX5/5+ GbE GbE FTTx/DSL Fixed Mobile Convergence IP/MPLS Data Service DN Edge Packet-Aware Transport CNMetro 4200 Network (OTN) access over any media Video Transport Service CoreDirector Edge SONET/SDH Evolving to OTN Packet-Aware CN Metro 4200 MC 2006 Ciena Corporation - Proprietary Managed transport 15 Voice Internet CNX TDM/ATM 10/100 = ROADM = service creation Long-haul transport

16 Optical transport layers Optical network clients SAN PKT PKT Multilayer network element Alien wavelengths SONET Optical network layers SONET/SDH OTN OTN (OCh) FlexiPort Adaptation to OTN Photonic OTN (OMS&OTS) 2006 Ciena Corporation - Proprietary 16

17 Transport evolution Optical Network Clients SAN PKT PKT Alien Wavelengths SONET SONET/SDH Intelligent Interworking Optical Network Layers OTN OTN (OCh) FlexiPort Adaptation to OTN Photonic OTN (OMS&OTS) 2006 Ciena Corporation - Proprietary 17

18 The importance of FlexiPort technology The traditional approach { OC-3 OC-12 OC-48 Fibre Channel Gb ESCON Video Fast The FlexiPort advantage The Ciena approach Any Service Any Speed Any Port Any Time } } OC-3 OC-12 OC-48 Fibre Channel Gb ESCON Video Fast Network or Client A key construct of FlexSelect A standards-based solution (G.709) A service-oriented solution 2006 Ciena Corporation - Proprietary 18

19 OTN + eroadm: standards-based flexibility Services a, b,..f Services g, h, m Node Local services a, c, h, k Services b, d, e Services f, g, i, m Services j, k, l, m Groom wavelength in 155Mb/s increments Services mapped & managed as virtual wavelengths Full service transparency Reduces wavelength used up to 78% vs. traditional ROADM s 2006 Ciena Corporation - Proprietary 19

ROADM + eroadm = low cost with scalability Hybrid electrical + optical ROADM Adds flexibility & automation to traditionally rigid optical networks Benefits of electrical (OEO) and optical (OOO)

20 ROADM + eroadm = low cost with scalability Hybrid electrical + optical ROADM Adds flexibility & automation to traditionally rigid optical networks Benefits of electrical (OEO) and optical (OOO) switching Electrical switching for low speed <10Gb Optical switching for 10Gb, 40Gb, and above Delivers on-demand high bandwidth services any port to any port 2006 Ciena Corporation - Proprietary 20

21 FlexSelect network architecture Business Services VLANs or PWs TDM 10/100 Core Service Edge Metro Multiservice Pseudowires DWDM Line System CN 4200 MC Packet-Aware FlexiShelf Metro Broadband & Triple Play GbE Optical CNX5/5+ GbE GbE FTTx/DSL Fixed Mobile Convergence IP/MPLS Data Service DN Edge Packet-Aware Transport CNMetro 4200 Network (OTN) access over any media Video Transport Service CoreDirector Edge SONET/SDH Evolving to OTN Packet-Aware CN Metro 4200 MC 2006 Ciena Corporation - Proprietary Managed transport 21 Voice Internet CNX TDM/ATM 10/100 = ROADM = service creation Long-haul transport

22 Advanced services on transport platforms Aggregates TDM traffic to service edge equipment (IP/MPLS Edge routers, VoD servers, etc.) Reduced interface costs Reduced Interface Costs IP Network MPLS Core VoIP SoftSwitch MPLS VoIP MPLS VoIP Gateweay GE/10GE Integr. Packet Switch VoD Server TDM Transport (GFP/VCAT/LCAS) NE Replacement TDM/Packet Services Removed NE STM-N SDH Transport For Example GE/10GE STM-N VLAN GFP GE PHY SONET IP Service GFP SONET Virtual concatenation groups aggregating at CoreDirector 802.1Q VLAN switching, including Q-in-Q support 2006 Ciena Corporation - Proprietary 22

23 Multiservice access & aggregation Private Line Multiservice aggregation TDM Any service over (conversion & convergence) + service over any media (New service flexibility) NG SON/SDH EoS GigE FR/ATM aggregation 1 or 10GbE Native or OTN Metro optical (/OTN) transport Legacy L2 LSP / PWE3 Native VLANs, VCs, Circuits Packet or Circuit Packet Many different traffic types aggregated from access network in various formats: Natively; Dry Martini; Static Pseudowires Multiservice aggregation into pseudowires and TDM/ATM/FR to /Packet conversion/interworking 2006 Ciena Corporation - Proprietary 23

24 Functional consolidation trend Legacy transport Bandwidth-optimized transport Service-optimized transport Services Services Services Aggregation Pt-to-Pt and Pt-to-Mpt (E-LINE and E-LAN) Aggregation Pt-to-Pt (EPL) Hard QoS Aggregation Transport SONET/SDH Pt-to-Pt (EPL & EVPL) Bandwidth shaping, policing and optimization Transport OTN ROADM IP-aware Layer 2 Per service traffic management: Pseudowire origination/termination/ switching Transport OTN ROADM WDM WDM WDM 2006 Ciena Corporation - Proprietary 24

25 Flexible control plane Dynamic Lightpaths Client device Client device Automation & simplification of connection processing UNI NE Domain A I-NNI Global network NE Domain B E-NNI NE I-NNI E-NNI NE E-NNI Client device NE Domain C I-NNI NE UNI UNI Discovery, route computation, routing & signaling Multiple network domains within a global network Common UNI and E-NNI border interfaces Independent characteristics within each domain (I-NNI) 2006 Ciena Corporation - Proprietary 25

26 Flexible intelligence with FlexSelect Distributed Intelligence Discovers the network & topology, & automatically routes circuits on-demand Always knows what is available where -- ALWAYS Enables rapid provisioning & very high availability New connections can be provisioned in seconds 2006 Ciena Corporation - Proprietary 26

27 FlexSelect intelligence saves money Service Database Connection Database ON-Center Inventory Database Put A in B Put B in A Put A in B Confirm A in B A Network A Network is Database Legacy Manual => Errors FlexSelect OS Automatic => Accurate 2006 Ciena Corporation - Proprietary 27

FlexSelect ON-Center a common denominator Integrated

Manages services Manages service levels The glue

service level management ON-Center End-to-end

28 FlexSelect ON-Center a common denominator Integrated cross-ciena management platform Manages networks Manages services Manages service levels The glue that enables end-to-end service management Network & service level management ON-Center End-to-end service mgmt & monitoring 2006 Ciena Corporation - Proprietary 28

29 FlexSelect network architecture Business Services VLANs or PWs TDM 10/100 Core Service Edge Metro Multiservice Pseudowires DWDM Line System CN 4200 MC Packet-Aware FlexiShelf Metro Broadband & Triple Play GbE Optical CNX5/5+ GbE GbE FTTx/DSL Fixed Mobile Convergence IP/MPLS Data Service DN Edge Packet-Aware Transport CNMetro 4200 Network (OTN) access over any media Video Transport Service CoreDirector Edge SONET/SDH Evolving to OTN Packet-Aware CN Metro 4200 MC 2006 Ciena Corporation - Proprietary Managed transport 29 Voice Internet CNX TDM/ATM 10/100 = ROADM = service creation Long-haul transport

30 The trend in optical components $/Performance 2.5G Transponder 2.5G GBIC 2.5G CWDM SFP 2.5G DWDM SFP 10/100/1000BT SFP New innovative products T1 or DS3 Circuit Em SFPs 10G DWDM XFP Everything becomes pluggable & tunable More suppliers, lower costs, more innovation 10G DWDM 40-ch Tunable XFP Time 2006 Ciena Corporation - Proprietary 30

31 High-bandwidth lightpaths Beyond 10 Gbps TDM and have converged at 10Gbps TDM 40G (4x growth) 100G (10x growth) High bandwidth lightpaths are being driven by data (not voice) Economic drivers: Moore s Law Open standards Global economics 100G 40G 10G 2.5G 1G Dominant WDM Line Rate Cross Over SDH Today time 2006 Ciena Corporation - Proprietary 31

32 100G transport options 5 Fibers G (NRZ, Duobinary) 2 ( PAM-4, DQPSK) 4 (QAM-16) Cost / Bit Optical Wavelengths WDM 10 G 40 G EDFA Disp. Map FEC, EDC WDM WDM TDC Capacity & Distance Raman PMDC WDM 100 G? AMF Functionality Time Bits per Symbol 100G parallel 100G serial with advanced modulation format 2006 Ciena Corporation - Proprietary 32

33 A need for speed 10GbE, 40GB, OTU3, 100GbE Confidence: We will fill up the bandwidth just like we fill-up disk space and memory Ciena Corporation - Proprietary 33

34 Summary SONET/SDH SONET/SDH SONET/SDH Too little Too much Networks are in transition Service provider need solutions that can manages change and lowers risk Ciena s FlexSelect architecture offers insurance customers don t always have to be right about traffic volume/mix Just right 2006 Ciena Corporation - Proprietary 34

Service-centric transport infrastructure

Analyst Day October 10, 2006 Vinay Rathore Director of Marketing Service-centric transport infrastructure Ciena Proprietary Key drivers for the optical infrastructure Services Scalability Cost 2006 Ciena