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Business Network Services - U.S.
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Product Assessment: Optimum Lightpath - E-Line, V-Line, E-LAN, VPRS
Report Date: December 14, 2010
Analyst: Washburn, Brian
Service: Business Network and IT Services 
Market: Business Network and IT Services - US  
Class: Ethernet Services (U.S.) Compare
Current Perspective:

Summary
Buying Criteria
Current Perspective
4
Optimum Lightpath's Ethernet services are threatening in the greater New York City metropolitan area, because the enterprise services division of Long Island-based Cablevision Corporation has abundant metro fiber connecting thousands of commercial buildings, and a competitively priced, sophisticated product portfolio. Optimum Lightpath launched its Ethernet-centric services strategy in 2005. In addition to the standard lineup of Ethernet Private Line, Ethernet Virtual Private Line and Ethernet LAN services, which the company markets respectively as E-Line, V-Line and E-LAN, the cable operator also offers a variety of value-added services that ride over its metro Ethernet infrastructure. These include managed Internet access, storage transport, and managed voice and video services that use Ethernet over MPLS for QoS and rapid recovery from failures. The carrier supports logical ring-based services on MPLS through its virtual private ring service (VPRS), which customers can use to displace Ethernet-on-SONET services. Some of Optimum Lightpath's Ethernet services offer 100% dedicated capacity via MPLS pseudowires that support applications such as TDM circuit emulation over Ethernet, useful for voice customers that have not yet made the move to VoIP as well as wireless carriers for mobile voice backhaul. Optimum Lightpath's verticals include healthcare, media/entertainment, education, financial services, municipal governments and wholesale opportunities, which it targets with its Ethernet-centric portfolio of services.

Optimum Lightpath's strong service portfolio is contained to a tri-state footprint centered around New York City. The carrier has a wealth of business opportunities in these markets – as it covers an area with the nation's highest population density – and the company's own fiber optic network extends beyond Cablevision's hybrid fiber/coax footprint, aided by the carrier's 2008 acquisition of New Jersey-based dark fiber owner 4Connections. Additionally, Optimum Lightpath in July 2010 established an interconnection with CENX's carrier-neutral Ethernet exchange in New York City, which lets the company interact with a large community of Ethernet services partners. Still, to reach destinations well outside the greater New York City metro and surrounding areas, Optimum Lightpath must use third-party partners, which the carrier only does on an as-needed basis. Optimum Lightpath's best opportunities are with centralized customers. Enterprises with geographically dispersed branch offices across a larger region, nationwide or internationally might still use Optimum Lightpath, but they will need to rely on multiple carriers to supply the underlying services. The company also does not offer Ethernet access over Cablevision’s extensive HFC networks at this time. Cable peers Cox Business and Time Warner Cable Business Class both offer Ethernet over HFC to tap these more ubiquitous access networks.
Strengths and Weaknesses
Strengths• Optimum Lightpath has more than 4,000 route-miles of fiber networks that span parts of three states (CT, NY and NJ) around the greater New York City metro area. The company's fiber reaches more than 4,000 buildings, and it continues to add more buildings each month. While other carriers resort to Type 2 connectivity and other third-party access options to reach their customers, Optimum Lightpath focuses on ever-greater penetration of its fiber footprint, so it owns all the fiber it runs into commercial buildings.

• Cablevision is an early adopter among cable competitors, both of telecom and Ethernet services. The company formed the first of a series of network interconnection agreements with NYNEX (now part of Verizon) in 1994/95. At the start of 2005, the carrier began to focus on a 'pure metro Ethernet strategy.' In the five years since, Optimum Lightpath has taken its Ethernet strategy to commercial success.

• Optimum Lightpath can add Internet access, voice and video on top of Layer 2 Ethernet access. For example, its managed voice over Ethernet service uses PRI circuit emulation for PBX interconnection. The carrier can also offer mobile backhaul services to the wireless operators using Ethernet circuit emulation. Finally, Optimum Lightpath has developed a Broadcast Video Transport service supporting real-time applications that is based not on SONET, but on Ethernet over MPLS.

• Optimum Lightpath achieved early MEF 9 and MEF 14 certifications for its Ethernet portfolio. In 2010, the carrier joined CENX, connecting to the carrier-neutral Ethernet exchange's New York City facilities. The CENX interconnection lets Optimum Lightpath source Ethernet services from third-party providers, or supply them to other providers, all on a wholesale basis.

• Optimum Lightpath's acquisition of New Jersey-based dark fiber company 4Connections in 2008 extended the carrier's footprint deeper into New Jersey, adding nearly 500 route-miles of fiber in the state. Optimum Lightpath is constrained by its New York City area footprint, and the 4Connections acquisition expanded the company's marketable footprint and potential customer base.
Weaknesses• Optimum Lightpath's Ethernet services are mainly available in one, large tri-state contiguous footprint centered around the greater New York City metropolitan area, which is often described as the most competitive market in the country. Optimum Lightpath does well with centralized customers inside its footprint, but is challenged in selling Ethernet services to geographically distributed enterprises with branch offices and other important facilities located outside its service area.

• Because of its contained footprint, many of Optimum Lightpath’s largest customers tend to be located in a single building, on a single campus, or in a single city or metro area. Larger customers concentrated in one commercial building or campus also tend to be reached by fiber from competitive access providers, which tend to offer simple, low-cost optical Ethernet connectivity. In its service territory there is no shortage of optical transport competitors.

• Compared with the incumbent telcos with which it competes, Optimum Lightpath generates only a fraction of the revenues of its larger competitors. Optimum Lightpath had $255.5 million in revenue in 2009, contributing a small part of Cablevision's $5.431 billion communications-related revenues for the year. Including all of its other lines of business, Cablevision generated $7.773 billion in revenue in 2009.

• Optimum Lightpath has few gaps in its comprehensive transport and networking product portfolio, but one of them is the lack of an Ethernet over hybrid fiber/coax product. Without an Ethernet-over-HFC service, Optimum Lightpath cannot offer end-to-end Layer 2 Ethernet services that span its high-speed optical transport services and its lower-speed HFC reach.


Buying/Selecting Criteria Availability Rating: 3
• Optimum Lightpath operates a 4,000 route-mile optical fiber network that spans parts of three states (CT, NY and NJ) in the greater New York City metro area. The company reaches more than 4,000 buildings with its own fiber, and it continues to add commercial buildings to its fiber. Optimum Lightpath offers its complete portfolio of Ethernet services across this fiber footprint. The carrier focuses on expanding its own fiber reach rather than relying on third-party partners for access.

• Optimum Lightpath's fiber includes extensive data center connectivity in and around the greater New York City area, and the company has launched Data Center Connectivity Services that can combine its Ethernet networking services with customers' choice of data center connectivity. Optimum Lightpath's fiber reaches data centers from Blue Hill Data Services, Cervalis, Continuity Centers, Data Storage, mindSHIFT Technologies and Xand. These connections reach service providers located in the region's major carrier hotels, including providers such as Telx and CENX.

• Because of its extensive reach in the greater New York City metro area, Optimum Lightpath is sought out by telecom and cable providers to extend their access reach. Optimum Lightpath's Ethernet interconnection partners include fellow MSOs Time Warner Cable Business Class and Sidera Networks; carriers AT&T, Savvis and BT; and competitive access provider AboveNet. Optimum Lightpath can meet wholesale partners at carrier hotels, POPs and data centers in its region for Ethernet NNIs.
E-LAN Services Rating: 4
• Optimum Lightpath's E-LAN services support multipoint (any-to-any) connections at the following port speeds: 10, 20, 50, 100, 150, 300 and 1,000 Mbps. In addition to port speeds, customers can purchase CIR bandwidth at the following increments: 1, 2, 5, 10, 20, 50, 100, 150, 300, 400, 500 and 600 Mbps. The service additionally supports Layer 2 multicast traffic and sub-50 ms failover via MPLS Fast Re-Route.

• Optimum Lightpath’s standard E-LAN offer supports up to five sites; support for more than five is available an individual case basis, based on the customer's requirements.

• Optimum Lightpath's E-LAN services are one access option to the carrier's Ethernet Virtual Private Ring Service (VPRS), which builds a logical ring architecture across the carrier's network, complete with dedicated primary and backup capacity and sub-50 ms failover. VPRS is accessible via E-LAN, E-Line and V-Line services, and is offered at interface rates of 500 Mbps with up to five user-to-network interfaces (UNIs), 1 Gbps with up to 10 UNIs and 10 Gbps with up to 20 UNIs. Customers can burst traffic on the standby ring, effectively doubling their top available speeds.

• Optimum Lightpath also offers several value-added services that ride on top of its range of Ethernet services. These include dedicated Internet access at speeds from 5 Mbps to 1 Gbps; Lightpath Internet/Voice Bundles and Lightpath SIP trunks, with Ethernet speeds from 5 Mbps to 1 Gbps including voice bundles from 10,000 to 1 million minutes; and Lightpath Premises Voice (using Cisco gear) and Lightpath Hosted Voice, two fully managed, turnkey services.
E-Line & E-Tree Services Rating: 4
• Optimum Lightpath offers E-Line (Ethernet private line) and V-Line (Ethernet virtual private line) point-to-point services. As with the carrier's E-LAN service, E-Line and V-Line speed options are 10, 20, 50, 100, 150, 300 and 1,000 Mbps. Optimum Lightpath's E-Line bandwidth is dedicated to the customer; its V-Line service supports grooming multiple connections onto a single, higher-speed trunk for hub-and-spoke configurations.

• Optimum Lightpath customers can use the carrier's E-Line and V-Line services for dedicated Internet access, Internet/voice bundles and managed voice services, as described in the E-LAN services section above. E-Line and V-Line are also access options to the carrier's VPRS, as described in the “E-LAN Services” section.

• The carrier also offers Optimum Lightpath Video Services, a point-to-point Ethernet service for real-time, broadcast-quality video transport over the company’s Ethernet/MPLS backbone using the carrier's delay-sensitive class of service. Optimum Lightpath Video Transport supports entertainment, broadcasting, content distribution, and HD videoconferencing at various video formats and speeds of 10, 20, 50, 100 and 300 Mbps, plus an optional 1 Mbps video control channel. Optimum Lightpath offers both unmanaged and managed flavors of the service.

• Data Center Connectivity Services is yet another Ethernet-based service package from Optimum Lightpath, which combines V-Line at rates of 5, 10, 20, 50, 100, 150 and 300 Mbps with the carrier's extensive data center reach. The carrier mainly positions the service for business continuity/disaster recovery applications. Continuity-conscious customers might combine the company's Data Center Connectivity Services with Optimum Lightpath Business Continuity Service, which lets the customer select physical routes that avoid certain bridges, tunnels and facilities.

• Finally, the carrier offers Ethernet wavelengths as part of Optimum Lightpath Optical Transport Services portfolio. The carrier offers 1 Gbps, 10 Gbps, 40 Gbps and sub-rate 10 Gbps metro point-to-point wavelength options for customers on its wavelength division multiplexing (WDM) backbone.
Platform Rating: 4
• Optimum Lightpath calls its infrastructure the “Intelligent Enterprise Network”. The carrier is the owner and operator of its own fiber footprint, from the network core out to the drop in customers' buildings. Optimum Lightpath claims full electronic and physical diversity, with customer fiber able to route to redundant nodes in different head-ends.

• Optimum Lightpath has two primary Ethernet services platforms. The carrier's go-forward primary platform is Cisco’s 7609 router, though it also uses Cisco 12000 series switch/routers and Juniper Networks' MX960 platforms in its networks. Most of Optimum Lightpath's customers are currently still served by the Nokia Siemens Networks (formerly Atrica) A-2000 series CPE and A-4000/A-8000 series switches in the network, plus the Atrica ASPEN Service Platform for network provisioning and management.

• The carrier also has added Tellabs 7100 reconfigurable optical add/drop multiplexers (ROADMs) to its network core. The equipment supports up to 40 Gbps wavelengths, and is capable of supporting 100 Gbps wavelengths once the technology becomes commercially available. Optimum Lightpath upgraded 33 routes with the new platform in 2009, will have 18 more routes upgraded by year-end 2010, and will complete the network-wide rollout by upgrading eight remaining spans in 2011.

• Optimum Lightpath's new network infrastructure supports both MPLS and VPLS. Optimum Lightpath's current generation of Layer 2 Ethernet services employs MPLS for service delivery and traffic control, with some configurations using pseudowires to dedicate bandwidth to customers.
Pricing Rating: 4
• Optimum Lightpath uses flat-rate, simple service pricing where customers find it easy to understand what services they are getting, and making them easy to order. Optimum Lightpath historically published standard pricing prominently on its Website, a direct challenge to competitors that kept their price plans close to the vest. While it no longer discloses list prices, the carrier offers a “Savings Calculator” on its site that estimates how much customers might save if they choose Optimum Lightpath as their service provider.

• Optimum Lightpath offers multi-year contract term discounts.
Reliability Rating: 3
• Optimum Lightpath SLAs include a four-hour mean time to repair and a 99.99% service availability to on-net customers.

• In the event of an outage, Optimum Lightpath's standard credit begins after 30 consecutive minutes of outage. An outage of up to three hours merits a 1/10 day credit; at three hours the credit increases to 1/5 day, and increases incrementally every three hours thereafter, up to a full day's credit for 15-24 hours of outage. The customer receives two days' credit for each additional day of outage.

• Optimum Lightpath offers three CoS tiers for its E-LAN services, but the carrier does not publish a standard SLA for the performance metrics customers should expect from Optimum Lightpath's premium CoS tier.

• Like its major cable provider peers, Optimum Lightpath monitors and provides network management for its customers via its NOC. Unlike its major cable provider peers, Optimum Lightpath has (and specifies basic details about) its online portal, branded Customer Care Online. The portal connects customers to the carrier's billing and service centers. Customers can search buildings for Ethernet access, view their circuit inventory, provision EVCs within V-Line service, enter and track service requests, and check their account balances/billing records via the portal.
VPLS Rating: 2
• Optimum Lightpath's E-LAN service uses VPLS label distribution protocol (LDP). Optimum Lightpath's E-LAN service operates by terminating MPLS traffic to VPLS-LDP.

• Optimum Lightpath's E-LAN service is available throughout the carrier's tri-state footprint.
Metrics Long-haul/International Network
POPs
Not applicable (operates contiguous tri-state regional network).
Long-haul/International Partnerships
Not applicable
Long-haul Platform(s)
Not applicable
Backbone Transport
Not applicable
Network Options (E-Line, EVPL, E-LAN)
Not applicable
Metro/Access Networks
Metros (COs, metro route-miles, lit buildings – as incumbent vs. competitive provider)
More than 4,000 route-miles of fiber lighting more than 4,000 buildings in New York City, Long Island, northern NJ and southwestern CT
Access NNI partnerships (in U.S. and in other countries)
Connection to CENX Ethernet exchange in New York City. Additionally has wholesale NNIs with third-party providers. Extends services out-of-region via NNIs only on a custom basis.
Metro Carrier Platform(s)
Cisco 7609, with Juniper MX960 and Cisco 12000 GSR in the core. Tellabs 7100 in core for high-speed transport services. Other equipment includes Nokia Siemens Networks (formerly Atrica) A-4000/A-8000.
Network Options (point-to-point, hub & spoke, multipoint mesh)
E-Line, V-Line, E-LAN and virtual ring
Ethernet/IP interworking options (e.g., DIA, MPLS IP-VPN)
Offers Internet, IP-VPN, premises-based/network-hosted voice, video transport and additional managed services compatible with Ethernet access.
Point-to-Point Services
Service Names/Types (EPL, EVPL)
E-Line, V-Line (configured point-to-point).
Service Tiers/CoS (if any)
E-Line and all services over VPRS feature fully committed bandwidth via Layer 2 pseudowires (customer can determine CoS for capacity in use). V-Line: 3 CoS tiers.
DIA/MPLS IP VPN interworking
Offers Internet, IP-VPN, premises-based/network-hosted voice, video transport and additional managed services compatible with Ethernet access.
Service Speeds
10, 20, 50, 100, 150, 300 and 1,000 Mbps; 1.25 Gbps, 10 Gbps (LAN-PHY/WAN-PHY), 40 Gbps and sub-rate 10 Gbps via wavelengths.
Monitoring & Customer Management
Optimum Lightpath monitors customer networks via its NOC, provides managed services. Customer Care Online portal connects customers to billing and service centers. Customers can search buildings for Ethernet access, view their circuit inventory, provision EVCs within V-Line, enter and track service requests, and check account balances/billing records.
CPE (Platforms, Management Options)
Includes Nokia Siemens Network (A-2000 series) and a range of Cisco Catalyst CPE (1900, 2600, 3550, 3750, 4500 and 6500 series).
Resiliency Options
Implements MPLS Fast Re-Route for sub-50 ms failover of Ethernet services. VPRS offers bidirectional ring failover capability.
Billing Options
Flat-rate, distance-independent billing.
SLAs (Availability & Performance)
99.99% availability, less than 0.5%-1% packet loss.
Notes
Hub & Spoke Services
Service Names/Types (EP-Tree, EVP-Tree)
V-Line
Service Tiers/CoS
3 CoS Tiers
DIA/MPLS IP VPN interworking
As above.
Service Speeds
10, 20, 50, 100, 150, 300 and 1,000 Mbps. V-Line over VPRS features fully committed bandwidth.
Monitoring & Customer Management
As above.
CPE (Platforms, Management Options)
As above.
Resiliency Options
As above.
Billing Options
As above.
SLAs (Availability & Performance)
As above.
Notes
Mesh Services
Service Names/Types (EP-LAN, EVP-LAN)
E-LAN
Service Tiers/CoS
3 CoS tiers.
VPLS Features
E-LAN service powered by VPLS, but Optimum Lightpath does not offer commercial VPLS directly to customers at this time.
Maximum Recommended Endpoints
Not applicable for VPLS. For E-LAN, Optimum Lightpath recommends up to five sites standard, though the cable provider can connect more sites ICB. For VPRS, supports up to between five and 20 UNIs standard, dependent on customer's virtual ring bandwidth.
DIA/MPLS IP VPN Interworking
As above.
Service Speeds
1, 2, 5, 10, 20, 50, 100,150, 300, 400, 500, 1000 Mbps. E-LAN over VPRS features fully committed bandwidth.
Monitoring & Customer Management
As above.
CPE (platforms, management options)
As above.
Resiliency Options
As above.
Billing Options
As above.
SLAs (Availability & Performance)
As above.
Notes

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