Ethernet Delivers Most of the Bandwidth, Special Access Makes More Money

With the caveat that “bandwidth” is not the same as “lines” or “revenue,” business Ethernet bandwidth passed the volume of legacy TDM bandwidth in 2012, says Vertical Systems Group.

“Propelled by purchases of 1 Gbps and 10+ Gbps services, Carrier Ethernet will contribute more than 75 percent of total global business bandwidth by 2017,” says Rosemary Cochran, Vertical Systems Group principal.

By some estimates, the U.S. special access market (T1 connections, for example) generates $12 billion to $18 billion in annual revenue for service providers, with the overwhelming amount earned by AT&T and Verizon Communications.

As more incumbent and competitive service providers alike expand their respective wide area and metro Ethernet service portfolios, Insight Research argues the market will grow from $4 billion in annual revenues in 2011 to nearly $11.1 billion by 2016.

In other words, as often is the case for IP-based services, bandwidth consumed generates less revenue per bit than legacy services.

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