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Cost Implications and Financial Trending 217

rations. Telephone companies sustained their operation by offering
higher-speed access and lower costs at the same time. Carriers will
be able to upgrade network connections more easily and may end up
with excess capacity on their networks in the future. To entice cor-
porate enterprises to use this capacity, carriers are expected to
reduce prices or develop novel value-added services. A very close
friend of mine has become a “designer carrier,” offering specialty
product and bandwidth on a user-by-user basis. Although the bene-
fits of fiberoptic technology have been very clear for 20 years or more,
the medium has been 20 to 40 percent more expensive than coaxial
cable connections. Fiber’s complexity is one reason, but a lack of reli-
able standards also contributes to the sharp price differential.

Sometimes It Is the Fiber

As light beams travel along a fiberoptic cable, they can splinter,
bump into each other, and disrupt the connection. The greater the
wavelength density, the higher the risk of this occurring.This makes
sense, because the more light beams (wavelengths) we use, the more
chance there is of something getting in the way.To solve the problem,
suppliers have delivered amplifiers that regenerate wavelengths as
they travel along a line.Amplifiers can be expensive, costing $50,000
to $100,000 per unit.Therefore, equipment vendors have been devel-
oping new technologies, such as Spatial Mode Transformation
1
(SMT), that boosts the maximum distance between amplifiers.
The type of fiber that carriers have in place also determines how
much amplification is needed. Carriers have largely deployed single-
mode fiber, whereas multimode fiber has become the staple in enter-
prise networks. Most single-mode fiber was not designed to carry
such dense transmissions. Corning’s LEAF single-mode fiber, intro-
duced in February 1998, does not need as much regeneration nor
does it need to consume as much power as traditional single-mode
fiber lines. Consequently, it can support transmissions traveling
more than 31 miles. Most fiber was optimized to approximately a
6.2-mile connection. Corning sold 1 million kilometers of LEAF fiber

1 Spatial Mode Transformation is a product of LaserComm.