Cisco Systems Inc. is pushing an ambitious plan to expand service to the in-building broadband market. On Tuesday, the networking giant unveiled its Long-Reach Ethernet (LRE) technology, consisting of a set of devices that promises to deliver high-speed Internet connectivity to multiunit buildings such as hotels, apartment complexes, factories, and hospitals over existing voice-grade lines.
Customers will be able to purchase speeds of either 5Mbps, 10Mbps, or 15Mbps, and Cisco claims that the technology can send data over distances of 3,500 feet, 4,000 feet, or 5,000 feet, respectively. The products are scheduled for an April launch.
The LRE system will offer broadband speeds over any grade of wire, regardless of whether it is structured or unstructured, dedicated to data or responsible for carrying voice traffic.
"Building managers want to use the same infrastructure they already have, and 90 percent of the world is wired for voice, not data, said Shah Talukder, marketing director for Cisco's in-building broadband group. "We're trying to take a 20th-century infrastructure and provision 21st-century services."
Lower installation costs could make LRE an attractive option for buildings that are too old or too large to be wired for high-speed bandwidth. The solution could also be used in dispersed environments, such as college campuses, in which digging trenches for fiber cable is not financially feasible.
Cisco claims that LRE will also extend cost savings to ISPs. "Deployment, installation, site service provisioning, and ongoing maintenance are critical costs for service providers," Talukder said. "LRE helps them save costs in every part of the chain" because the system can be deployed quickly.
LRE will be compatible with ADSL (Asymmetrical DSL), which will allow service providers to deploy LRE to buildings that already have broadband access. At the same time, spectral compatibility with VDSL (Very high bit-rate DSL) gives Cisco a foothold in the growing VDSL market.
The LRE system will be powered by three hardware components: a switch, CPE (customer premises equipment) device, and POTS (plain old telephone service) splitter.
The switches, which are identical to Cisco's current Catalyst 2900 switches, apart from new LRE ports, can be daisy-chained to other switches, and the CPE device can be managed remotely over the Web.
As part of the LRE package, Cisco is also rolling out its optional Building Broadband Service Manager (BBSM) management software, which the company hopes will "let service providers make a business out of LRE," according to Ben Gibson, LRE senior product manager.
BBSM will be targeted mainly at the hospitality industry. The package will allow network managers to customize the services they provide to each guest, establish portals for local content, and integrate each guest's Web charges with standard hotel billing systems.
Many analysts agree that the in-building broadband market is ready to explode. A recent Cahners In-Stat report suggests that sales of broadband equipment and services to MTU (multiple tenant unit) buildings will rise from US$370 million in 2000 to $4.8 billion by 2004.
Accordingly, Cisco officials expect LRE to represent a significant new revenue stream for the company.
"Property and hospitality owners are now realizing that providing high-speed access and varied IP services -- video being one of them -- is really core to their business", Talukder said. He added that hotels and residential buildings have historically been bypassed for broadband wiring by CLECs (competitive local exchange carriers).
Cisco is targeting hotels, apartment buildings, and multitenant commercial buildings for its first wave of deployment. The company is also eyeing overseas markets, where broadband access is scarcer.
"It's a market that will have an upside," agreed Ron Westfall, senior analyst at research firm Current Analysis Inc.
Westfall also remarked that LRE is likely to be installed in smaller buildings, referring to a recent Department of Energy report that claimed that 95 percent of all structures in the United States are no more than three stories high. "This solution will be geared toward lower-end settings. The real growth in this market isn't the tall, shiny buildings in Manhattan, but the two-story buildings in Omaha," Westfall said.
Westfall also noted that Cisco's foray into in-building broadband signals a shift in the company's traditionally conservative strategy.
"Usually Cisco waits for a market to mature before they step in," Westfall said. "But here they're more on the cutting edge. They have to be more aggressive to maintain their revenue projections." At the same time, Westfall predicted success for the LRE product line, largely due to a lack of competition.
Cisco is targeting a $400-per-port price tag. The switch will cost $3,295 for 12 ports, or $6,495 for 24 ports; the CPE device will sell for $280; the POTS splitter will cost $1,395; and the BBSM software manager is tentatively priced at $9,500 for a 100-seat license.
This story, "Cisco unveils multitenant broadband access" was originally published by InfoWorld.