Moving Beyond 100G Optics

Prepared by
Sterling Perrin
Senior Analyst, Heavy Reading
www.heavyreading.com

December 2013
White Paper

Moving Beyond 100G: The Future
of Optics

HEAVY READING | DECEMBER 2013 | WHITE PAPER | MOVING BEYOND 100G: THE FUTURE OF OPTICS 2

This white paper is a special report sponsored by Huawei Technol-
ogies Co. Ltd.

Transport Trends & Architecture Requirements
It is well known that network operators' revenue growth has not kept pace with
traffic growth. With mobile broadband now entering the 4G LTE era and with fixed
networks moving into ultra-broadband speeds of 100 Mbit/s and above, this
mismatch between rapid traffic growth and modest revenue growth is fully
expected to continue.

In order to retain sustainable businesses, operators must dramatically reduce their
cost per bit for transport. Capex reductions alone are not sufficient to close the
gap between traffic growth and revenue growth. Rather, operators must look to
architectural changes that decrease network total cost of ownership (TCO).
Approaches include:

Transporting traffic at the lowest possible OSI layer possible, such as mov-
ing from Layer 2/3 to OTN and WDM layers;
Network element/layer convergence, such as that achieved through
packet-optical transport systems that combine Layers 0, 1 and 2 in a single
element;
Flexible and dynamic networking to improve network utilization, such as
that delivered through new optical hardware innovations and software-
defined networking (SDN).

Heavy Reading covered the first of these architectures in detail in the white paper
entitled "The Benefits of WDM/OTN to the Metro Edge" (July 2013). This white paper
focuses primarily on the benefits of and enablers for the latter two architectures.


Moving From 100G to Beyond 100G
The 100G Era Has Begun
While much of the first decade of this century was focused on building out
broadband access infrastructure, starting around 2010 we saw resurgence in core
network investment to accommodate all of the broadband growth, as well as to
prepare for future networking demands. At the heart of the core network resur-
gence is 100G transport, which began ramping to volume deployments in 2012.
Heavy Reading believes that 100G will become the dominant line rate in core
networks, in terms of capacity shipped, as early as 2014. Meanwhile, 100G
transport is also migrating down to regional and large metro core networks.

Figure1 shows Heavy Reading's global core line-side 100G port shipment forecast.
We believe that 100G line-side ports will increase at a 76 percent CAGR through
2017. The 100G era is in full swing. We note that despite the aggressive CAGR of 76
percent, our 100G line-side shipments forecast could prove too conservative.
Actual growth in 100G ports and revenue has been exceeding our expectations
and our forecast revisions, thus far, have only been upwards.

Key Technologies for Beyond 100G Transport
In moving from 10G per channel to 100G per channel, capacity on a single fiber
pair was improved by 10x while transmission distances at 100G were able to
match those achieved at 10G. In moving beyond 100G, this is no longer the case:
Current 100G performance is close to the Shannon Limit, and new technology
breakthroughs that allow greater capacities without reduced reach (such as
spatial division multiplexing, as one example) are not likely to become commer-
cially available before 2020. In the meantime, we see some key enabling technol-
ogies for enabling Beyond 100G, as described below.
Figure 1: Global Core Line-Side 100G Port Shipments, 2011-2017

Source: Heavy Reading


Higher Order Modulation
Today's 100G systems are based on QPSK modulation, but for higher line rates we
will see the use of different higher-order modulation formats. Suppliers will use
16QAM, 32QAM and even 64QAM to get higher spectral efficiency. For example,
200G transmission using 16QAM modulation provides twice as much capacity as
100G using QPSK modulation, while occupying the same 50GHz channel spacing.
The primary drawback of 16QAM modulation is that it trades distance for higher
bandwidth, and so is not suitable for long-haul and ultra-long-haul applications.

Super Channels
A super channel is an evolution in DWDM in which several optical carriers (or
lasers) are combined to create a composite signal of the desired capacity. A
super channel differs from simply sending multiple wavelengths down a fiber in
two key ways:

The spacing of optical carriers within a super channel can be packed
tighter than the ITU-T WDM grid, thus enabling higher spectral efficiency, a
key driver for using super channels;
Super channels behave as a single unit of bandwidth, are brought into
service in a single operational cycle, and therefore allow service providers
to scale operations without scaling costs.

Greater spectral efficiency is achieved primarily via tighter spacing between sub-
carriers based on coherent detection, and also via various means to squeeze
spectral efficiency such as Nyquist sampling. Some suppliers have also developed
proprietary algorithms to further increase spectral efficiency when needed.

Super channels enable the industry to achieve higher bit rates much sooner than
would be possible with single-channel technology, because optical transmission is
far ahead of electronic processing: Today, while 100G transport is moving into the
mainstream, the state of the art in electronic analog-to-digital conversion is only at
32 GBaud. Terabit-speed processing is more than a decade away.

Photonic Integration
We have seen a moderate use of photonic integration within optical networks up
to now, but Heavy Reading believes that the optical industry will enter a new
phase of photonic integration as it moves beyond 100G and into the era of super
channels. Significantly, the large-scale PIC, by its design, fits nicely into a super
channel model that requires multiple carriers/lasers. To create a 1Tbit/s super
channel composed of 10 channels, for example, a module requires roughly 10x
the number of optical components that a single-channel (non-super channel)
module would require. Therefore, photonic integration becomes essential in
reducing module costs, footprint and power consumption.

While reducing costs, footprint and power, PICs that combine multiple lasers on a
chip also play into the "fluid bandwidth" proposition of super channels. With super
channels, operators will be able to throttle bandwidth up and down, as needed,
by adding and subtracting carriers, as well as by tuning into different modulation
formats that trade off between capacity and reach.


Achieving Flexibility in Next-Gen Transport
Operators must adopt new transport network architectures in order to reduce
TCO, including building flexible and dynamic networks that dramatically improve
network utilization. This section details the hardware and software architectural
components required for dynamic and flexible optical transport networks.
Flexible Modulation
Historically, WDM networks have been built using fixed modulation formats that
occupy a fixed 50GHz amount of spectrum. To increase channel capacity such
as moving from 10G channels to 100G channels new transponders have been
required, resulting in increased capex and a slower time to market.

For Beyond 100G, the industry momentum is toward flexible transponders that can
use multiple modulation formats to best match capacity and reach requirements
of the applications. Benefits of this new flexible modulation include:

Maximizing the efficiency of physical fiber resources as the flexible tran-
sponders can provide the highest possible capacity for any particular link;
Simplifying hardware and reducing hardware spend as one transponder/
muxponder can be used for all capacity requirements;
Simplifying network planning and equipment ordering for faster time to
market.

Figure 2 provides an example of how flexible modulation formats can handle
various capacity and reach requirements for 2Tbit/s super channels.

A key technology for flexible transponders is the digital signal processor that
supports multiple modulation formats. Alcatel-Lucent, Ciena and Huawei are
among the major suppliers that have announced next-gen DSPs supporting both
QPSK and 16QAM modulations. Heavy Reading believes that ASIC advances will
lead to more modulation formats supported in DSP in the future.
Flexible ROADMs
A new generation of flexible ROADMs will play a key role in moving beyond 100G.
For speeds beyond 100G i.e., 400G, 1Tbit/s or anything in between more than
50 GHz of spectrum will be required. Most network operators would like to be able
to accommodate those future speeds on the same networks that are also
transporting 40G and 100G wavelengths.
Figure 2: Flexible Modulation Formats Applied to 2Tbit/s Super Channels
LINE RATE MODULATION SYSTEM CAPACITY TYPICAL SYSTEM REACH
2 Tbit/s 20SC-DP-QPSK 12 Tbit/s ~2,500km
2 Tbit/s 10SC-DP-16QAM 24 Tbit/s ~800km
2 Tbit/s 8SC-DP-32/64QAM 40 Tbit/s ~300km


Flex-spectrum ROADM nodes could support any rate that is based on increments
of n*12.5GHz spacing, such as 37.5GHz, 75GHz, 125GHz, etc. Compared to fixed
50GHz spacing, or n*50GHz spacing in colorless ROADMs, flexible spectrum
ROADM provides a close match between capacity needs and dedicated
spectrum, resulting in more efficient use of spectrum and less wasted bandwidth.
Flexible OTN
Heavy Reading sees a tight coupling of switched OTN and 100G, and many
network operators are upgrading their networks to both technologies in tandem.
The reason for this coupling is that the move to line-side 100G transport is creating
a large mismatch between the line side (100G) and the client side (primarily 10G
and below) that requires traffic grooming in between. Furthermore, market
research shows that the mismatch between client-side rates and line-side rates is
here to stay for the foreseeable future. Operators view OTN as the Layer 1 groom-
ing technology of choice for efficiently packing 100G waves.

Future developments will likely focus on increasing the flexibility/adaptability of
OTN containers for high-order bit rates. There is strong industry interest in expand-
ing the low-order flexibility of ODUflex to wavelength-level rates. The goal is to
build flexible Beyond 100G line rates composed of varying numbers of OTN
channel building blocks that can be combined and removed as dictated by
bandwidth requirements. (See "Relevant Standards Work" section for details on ITU-
T work in this area.) As of the publication of this report, a flexible OTN rate appears
far more likely than any of the fixed Beyond 100 line rates that were originally
considered (including 400G and 1Tbit/s).
Transport SDN
The flexibility innovations discussed above center mostly around hardware. The
telecom industry is in the midst of a software revolution, called software-defined
networking (SDN), aimed at increasing network elasticity/flexibility, reducing TCO
and generating new revenues. While SDN originated in the data center and at
Layer 3, work has begun in bringing the technologies and benefits of SDN to the
transport layers (Layers 0 and 1). This is known as transport SDN, or T-SDN.

The telecom industry is just at the beginning of T-SDN development, but some
potential benefits of bringing SDN to the transport layers include the following:

Automation of planning, commissioning and maintenance (for reduced
operational costs and quicker time to market)
Improved network resource utilization
Greater network monetization through bandwidth on demand and net-
work on demand (or network as a service)
Coordination of transport network resources with IP/MPLS and data center
networks
Faster upgrade cycles for both hardware and software

The combination of business and technology differences separating transport SDN
from higher-layer SDN puts T-SDN on its own path that will use some of the same
technologies, such as ONF OpenFlow, but will incorporate others as well, such as
the IETF's path computation element protocol (PCEP), among others. (See "Rele-
vant Standards Work" section for more details on T-SDN standards efforts.)


Converging Layers 0-2 in Next-Gen Transport
Hardware element/layer convergence is a common means used by operators to
cut both capex and opex expense and reduce their network TCO. For example, in
metro networks during the last five years we have seen a successful convergence
of Sonet/SDH, packet and WDM into a single network element known as packet-
optical transport systems (P-OTS). The introduction of cell-based, protocol-agnostic
switching fabrics has been a key enabler.

Heavy Reading survey data shows a clear trend toward switched OTN, particularly
in the core. However, there is also strong operator interest in being able to switch
both OTN and packet traffic at these core nodes in the future. Rather than adding
two separate fabrics to core switching elements i.e., one OTN fabric and one
packet fabric suppliers are introducing cell-based switching fabrics that can
switch TDM or packets, in any combination, based on the interface mix. While the
early deployments are focused on switched OTN, for many operators the ability to
handle packet switching in the future is a must.

In addition to the integration of optical and packet switching, the integration of
switching and optical transport is a must. In other words, core packet-optical
switching elements must combine multi-terabit switching with DWDM transport
within the same physical system. Such packet-optical integration provides the
following benefits to network operators (all of which are rated as highly important):
capex reductions; opex reductions; increased network capacity; and faster
response times to customer demands. Increased automation yields both opex
reductions and faster response times to customers and requires manage-
ment/control that is coordinated across network layers. Some operators will
prioritize control integration (without requiring physical integration), while others
will insist on both physical and control integration.

Figure 3 shows Heavy Reading's most recent forecast for core packet-optical
switching elements. We estimate global core P-OS revenue was $800 million in
2012 and will increase at a 38.4 percent CAGR to reach $4.1 billion by 2017.

Figure 3: Core Packet-Optical Switching Revenue, 2011-2017 ($M)



In time, there will be a need to scale to tens of terabits of capacity per system.
Supplier roadmaps call for future system capacities of 100 Tbit/s and higher. At 10-
50 Tbit/s in a single chassis, many suppliers believe that multi-chassis configurations
are the best option considering price, performance and time-to-market. Thus, we
will see systems scale to tens of terabits of capacity through clusters. This is also
driving a lot of interest in the rack-to-rack interconnect segment, toward optics,
including interest in silicon photonics.

Figure 4 illustrates the evolution of packet-optical transport from minimal integra-
tion to fully converged switching fabric and line cards.

Another type of convergence taking place is the integration of DWDM optics on
routers, known in the industry as IP over DWDM (IPoDWDM). Some operators are
interested in IPoDWDM for capex savings as it reduces the number of short-reach
interfaces that are required to connect routers with DWDM transport equipment.
However, there are disadvantages to this approach as well, including port density
sacrifices, lack of interoperability and reliance on a single supplier for both routing
and transport. Heavy Reading research shows that IPoDWDM appeals to opera-
tors for specific applications, but that most operators are not ready to base their
full transport networks on this architecture.

Figure 5 provides an illustration of a next-generation transport architecture tying in
with SDN. In this case, the flexible physical layer is enabled by the technology
innovations discussed throughout this paper, including flexible OTN and DWDM
and universal fabrics. A transport controller acts as a mediator between the
physical layers and the orchestration layer, thus enabling SDN control to be
applied to the transport network. Currently, there is significant operator support
behind adding this mediation layer between the physical transport network and
the orchestration layer.
Figure 4: Packet-Optical Switch Fabric Convergence Evolution



Figure 5: Next-Gen Transport Architecture Diagram



Applications & Trial Activity
We are at the earliest stages of Beyond 100G introduction, but leading-edge
operators and suppliers have already completed trials demonstrating Beyond
100G channel rates combined with flexible hardware and software innovations.
We describe some recent activities below:

In October 2013, Ciena and Comcast announced the successful comple-
tion of a live network field trial of 1Tbit/s over a distance of 1,000km on
Comcast's existing long-haul fiber network connecting Ashburn, Va., and
Charlotte, N.C. In the trial, the 1Tbit/s 16QAM super channel carried live
data traffic over a commercial network that was also carrying customer
traffic over 10G, 40G, and 100G wavelengths, thus demonstrating a mix of
flexible spectrum and 50GHz fixed spectrum.
In April 2013, Alcatel-Lucent and Canada's Shaw Communications an-
nounced the completion of a 400G data transmission over an existing
400km optical link connecting Calgary and Edmonton in Alberta. The trial
demonstrated the ability of an existing optical network to carry 17.6 Tbit/s
of traffic roughly double the previous capacity carrier over a 100G co-
herent network.
In January 2013, Huawei announced the successful completion of a
2Tbit/s field trial using Vodafone's live backbone network in Germany. In
one application, Vodafone and Huawei achieved a transmission distance
of 1,500km using polarization-multiplexed 16QAM modulation and 10 su-
per channels. In a second application, the two companies achieved
3,325km transmission distance using polarization-multiplexed QPSK modu-
lation and 20 super channels. Both transmissions used G.652 fibers and ED-
FAs without the use of regeneration. Subsequently, in November 2013,
Huawei completed a field trial with Turk Telecom that demonstrated an
even higher-order modulation format. Using advanced 32QAM modula-
tion, the Huawei WDM system delivered a net spectral efficiency of up to
8 bit/s per Hz, or 40Tbit/s of total capacity, within the C-band.
In December 2013, Huawei and Telefnica Chile announced that the op-
erator will deploy the worlds first OTN-based 400G WDM network this year.
The metro network, which is being deployed in Chiles capital city of San-
tiago, will use dual-polarization 16QAM coherent 400G combined with
coherent 100G transmission.


Relevant Standards Work
The technology innovations described throughout this paper must be coupled
with standardization in order for wide-scale adoption to take place. In this section,
we briefly highlight the major standards activity helping define the future of optics.
Client Side: IEEE Is Standardizing 400GigE
The IEEE 802.3 Industry Connections Higher Speed Ethernet Consensus Group was
formed in August 2012 to build consensus on the next bit rate. Originally, 400GigE
and 1Tbit/s Ethernet were put on the table, but after much debate, the IEEE has
decided in favor of a 400GigE client-side standard. The IEEE launched a "Standard
for Ethernet" study group in April 2013 to explore development of a new 400GigE
standard, currently expected to be completed in 2016 or 2017. The IEEE has given
the ITU-T the direction it needs to move forward on line-side standardization.
OTN: ITU-T Moves Toward a Flexible Line Rate Beyond 100G
The ITU-T Study Group 15 is responsible for defining line-side bit rates and is currently
working on defining the next bit rate beyond 100G. Of particular interest within SG
15 is Question 11, which defines signal structures, interfaces, equipment functions,
and interworking for transport networks. With the IEEE 802.3 having launched its
400GigE standard Study Group, the ITU-T is now moving forward under the expec-
tation of a 400G client-side standard. A completion schedule for a Beyond 100G
standard has not been publicly stated but would come in 2015 at the earliest.

Line-side interfaces must be able to accommodate the coming 400GigE client-
side traffic, but they do not need to be an exact match. Early on in ITU-T discus-
sions, there were three main options contending for future line-side bit rates
beyond 100G, including a fixed 400G line rate, a fixed 1Tbit/s line rate and a
flexible OTU rate. While the specifics (including naming) have not yet been worked
out, the ITU-T membership has decided on the flexible OTU rate as the working
assumption moving forward.

A flexible OTU line rate is composed of multiple lower-rate OTUs that can be
managed as a single higher rate. The lower-rate OTUs would be standardized
building blocks (such as 100G or 200G) upon which higher-rate channels could be
built. For example, four 100G blocks could be combined for a 400G channel, or
eight 100G blocks could be combined for a single 800G channel. Both rates would
be standards-compliant under the flexible option.
Line Side: OIF Works on Next-Generation Optical Interconnects
The OIF Physical and Link Layer group published its Next Generation Interconnect
Framework document in April 2013. This document identifies the hardware
interconnection application spaces where the communications industry might
benefit from interconnection definitions or Implementation Agreements. The
paper identifies key technical challenges for next-generation systems, define
optical and electrical interconnection applications and discuss some of the
interoperability test challenges so that the OIF and other industry bodies will have
a common language as well as understanding of the development projects that
are required for the next-generation data rate systems. This work is relevant to
scaling future optical systems beyond single-chassis configurations, in which 10
Tbit/s and higher uplink capacities will be required for linking systems.


Transport SDN: IETF Works on PCE & the ONF Extends OpenFlow
The ONF launched a new Optical Transport Working Group in March 2013 with the
goal of defining the open programmable control of transport networks, using and
extending the OpenFlow protocol. The scope of work includes both the photonic
network and the optical circuit-switched network (Layer 1 OTN). Just like in packet
networks, OpenFlow in transport networks will require full separation of the control
layer from the network infrastructure.

Basic charter components include: control of optical transport networks incorpo-
rating OpenFlow, definition of Layer 0 photonic and Layer 1 circuit switch abstrac-
tions for OpenFlow and interactions with packet flows, extensions for OpenFlow-
wire and OpenFlow-config protocols, and exploring both direct control and
abstracted/mediated control of optical transport network elements.

If the Optical Transport Working Group keeps to its proposed deliverables sched-
ule, then we could expect standards-based optical transport SDN deployments by
mid to late 2014.

The IETF PCE architecture was specified by the IETF in 2006 in RFC 4655, "A Path
Computation Element (PCE)-Based Architecture" and the specific protocol, PCEP,
was defined by RFC 5440. PCE and the PCEP are positioned by proponents as an
alternative (i.e., non-OpenFlow-based), more evolutionary path to SDN.

Although it uses the PCE protocol (PCEP) and not OpenFlow, PCE does share some
of the key tenets of SDN. Specifically, PCE does the following SDN functions:

PCE moves intelligence from the network elements to the control cloud
(specifically, the path computation intelligence).
It provides a physical separation of the control plane and the data plane
(by moving path computation functions to a separate server).
It provides open control of the network.

PCE differs from OpenFlow in that with PCE, only a portion of intelligence is moved
from the network element to the cloud. Specifically, the path computation
function is placed on a separate server, while all of the other control plane
functions remain on the elements, as they have in the past. One key benefit of the
PCE architecture is that it offers a practical approach to vendor and network
operator interoperability at the transport layers.


Conclusions
As 100G transport ramps into volume deployments, industry work is well underway
in developing technologies and architectures for Beyond 100G. Technology
enablers for Beyond 100G include higher-order modulation formats, tightly spaced
super channels and photonic integration (including III-V semiconductors and
silicon photonics). As Beyond 100G faces a physics-driven trade-off between
capacity and reach, the goal will be to drive the greatest possible efficiency from
the network for any given transmission distance.

Beyond 100G transmission is one component of the overall transport architecture
that will be used to deliver the lowest possible network TCO. Lower TCO will be
enabled by:

New flexible hardware and software
Network layer convergence
Standards support and third-party openness

On the hardware side, there are several enablers for flexibility and transport
elasticity. Flexible modulation that allows operators to "dial up" the right modula-
tion format for the right application requirements, flexible OTN containers that can
be adapted to client-side capacities and flexible-spectrum ROADMs that can fit
Beyond 100G channel rates are three key hardware enablers. On the software
side, transport SDN and open interfaces will bring unprecedented programmabil-
ity and automation to the transport layers.

In summary, the technologies, innovations, architectures and standards activities
described in this paper are the keys to the flexible and dynamic optical transport
networks of tomorrow.

Moving Beyond 100G Optics

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