August 14, 2000

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ClearData Builds Advanced Optical Net

With investments from Nortel and Williams, ClearData will offer high-speed connections

By Bob Wallace

More on optical networks:

Computer Reseller News Obsessing about optical (6/26/00)

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lthough the details are sketchy, little-known regional Internet service provider ClearData Communications Inc., founded in June 1999, is quietly building an advanced nationwide optical network designed to give users faster, less expensive, and more flexible communication services.

Fueled by investments from project partners Compaq, Lucent Technologies, Nortel Networks, and Williams Communications, ClearData expects to offer services to users in 17 U.S. cities by month's end and 17 more by the end of the year.

Even more are slated to receive service next year. Compaq and Williams have taken 5% and 19.9% minority stakes, respectively, in the ambitious upstart.

The bulk of the equipment ClearData is using is based on dense wavelength division multiplexing (DWDM) technology to optimize bandwidth on the nationwide fiber lines it's leasing from Williams. The new technology lets carriers more heavily load fiber by sending traffic over individual wavelengths, or colors, on a fiber strand, and it can be used to more quickly activate additional links for customers. The links connect hosting centers built and outfitted with servers from Compaq and use traffic load balancers from Nortel, which is also providing professional services. InfoLibria Inc. is supplying caching systems.

ClearData wouldn't release service pricing or details except to say that it will provide high-speed links between the major cities it services. Although several carriers are beginning to install DWDM equipment for metropolitan-area networks, that's not something ClearData plans to do--which is surprising, given its recent $300 million equipment deal with Nortel that would cover DWDM equipment.

"They're being generic and secretive, possibly because they don't want to make commitments they can't live up to," says Ron Westfall, a senior analyst at Current Analysis. To survive, he says, ClearData will have to price its transport services at least 10% to 15% below those of its more established rivals.

Indeed, building a network with the latest and greatest equipment isn't enough to ensure success. "Buying lots of sexy equipment doesn't make you a well-off, next-generation carrier," cautions Joanna Makris, a program manager at the Yankee Group. "To be a winner, you have to take the new technology and apply it to enhance current, or create new, services, be it Web hosting, IP offerings, or content delivery."

That's partly because other new-age carriers--including Qwest Communications International, Level 3 Communications, and Enron Broadband Communications--are also implementing ad-vanced optical gear, Makris says.

Lower pricing, high reliability, and the ease of hooking up new pipes are top priorities at the National Board of Medical Examiners, a medical testing agency in Philadelphia. "Once they make it cheaper for me to run my wide area network, offer 99% service availability, and hand off a high-speed link to my switch, then they've got me hook, line, and sinker," says Steve Lopez, architect of enterprise infrastructure at the Board, which uses dedicated lines to link its sites.

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