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Watch what happens to Gigabit Ethernet

Market analysts are predicting an unparalleled adoption rate for Gigabit Ethernet, spurring the creation of a host of new start-ups and a lot of anticipatory greed for speed among investors and networking engineers alike. But as with many technologies that have come before, the only thing that's sure is that Gigabit Ethernet could be a really big deal.

Market analysts are predicting an unparalleled adoption rate for a big brother of Fast Ethernet called Gigabit Ethernet, spurring the creation of a host of new start-ups and a lot of anticipatory greed for speed among investors and networking engineers alike. But as with many technologies that have come before, the only thing that's sure is that Gigabit Ethernet could be a really big deal.

Gigabit Ethernet is a high-speed version of the classic Ethernet technology that stormed LANs (local area networks) throughout the world at speeds up to 10 mbps. The original Ethernet was followed by Fast Ethernet, which can transmit data as fast as 100 mbps, a vast improvement but still not enough for complex packets of information including video and imaging.

Gigabit Ethernet has its roots in this same Ethernet tradition, but has another layer of fiber-optic cabling for enhanced clock speed. That makes it attractive to LAN administrators who want more bandwidth, but do not necessarily want to start from scratch with an entirely new networking technology.

That is one of the reasons why analysts are expecting customers to gobble Gigabit Ethernet products like Cabbage Patch Kids once it hits the street in 1998. Dataquest thinks the Gigabit Ethernet market will balloon to $3 billion by the year 2000. The Dell'Oro Group takes a more conservative view by estimating the market will hit $1.2 billion by 2000. Both these figures are up from practically zero right now.

"What matters is that it's going to be a big market," noted Gordon Stitt, President and CEO of Extreme Networks and member of the steering committee for the Gigabit Ethernet Alliance. "Gigabit Ethernet gives customers the future. It gives them the scalability and expandability to have a nondisruptive migration of their network. I see it fitting as a backbone and a power workgroup and server connection."

That's why both start-ups and seasoned networking players are scrambling to show customers they will be able to help them migrate to Gigabit Ethernet. Cisco Systems recently paid $220 million for embryonic Gigabit Ethernet player Granite Systems, despite the fact that the company does not have any actual products yet. One can safely bet that other major networking players, like Bay Networks and 3Com will also buy up Gigabit Ethernet start-ups.

As always, though, there's a catch. The predictions on Gigabit Ethernet are assuming that the industry will settle on a standard for these technologies, a standard that will ensure that new products can work with existing network interoperability between vendors. The next meeting of the Gigabit Ethernet Alliance steering committee is scheduled for next month. Extreme's Stitt hopes the standard will be "stable" by the end of that meeting, but the final specification won't emerge until 1998.

That's still not stopping vendors from planning rollouts for products in the first half of next year, with initial prices expected to be upwards of $2,000 to $2,500 per port. Vendors are sure to tell prospective customers that he Gigabit Ethernet products out the door before the standard is finalized will adhere to whatever happens to be the current version of the still-evolving specification.

Users are interested in Gigabit Ethernet for high-speed switch-based networks, according to a survey by the Dell'Oro Group.

Gigabit Ethernet's primary high-speed networking competitor is ATM (asynchronous transfer mode), an internetworking technology for backbone networks as well as high-speed server connections. ATM was itself once proclaimed as the technology that would speed along the future for the networking community, much as Gigabit Ethernet appears to today. But it has not been embraced as rapidly as expected, despite wide acceptance in wide area networks and as a backbone pipe for the LAN.

ATM proponents say that the hype surrounding Gigabit Ethernet does not match the reality, predicting that Gigabit Ethernet will be plagued with the same kinds of limitations that Fast Ethernet users face, namely the fact that Gigabit Ethernet vendors don't offer guaranteed up-time as do ATM vendors. Gigabit Ethernet vendors say they will do so after the standard is finalized.

But even vendors who promote ATM are hedging their bets. Fore Systems, for example, is a huge player in the ATM market that will tell anyone who will listen that "all roads lead to ATM." Nevertheless, it recently announced that it has joined the Gigabit Ethernet Alliance and has plans for Gigabit Ethernet products.

Joe Skorupa, director of product marketing for Fore Systems, still says he's skeptical of the market estimates being thrown around. "How do you go from zero to $3 billion in three years?" he asked. "There's nothing that supports that kind of market ramp ever happening."

Skorupa noted that it is unlikely that the technology will meet analysts expectations seeing as how Gigabit Ethernet moves data packets at a rate that exceeds the current capabilities of switches. Personally, he thinks that Gigabit Ethernet will be useful for connecting into a server but not much use for running a backbone.

So, no matter whose predictions one believes, as with any new technology, customers should be wary of early entrants into the Gigabit Ethernet market and keep track of the status of the evolving standard now in the works.