Still, on the desktop, we're already seeing dramatic drops in price. A 10/100/1000 internal adapter can run as low as $50. That's a huge percentage premium over Fast Ethernet NICs, which can sell for less than $10. But it's still only $50, and that's almost a throwaway expense. Plus, more and more PC vendors have Gigabit Ethernet chips built onto the motherboard of the PCs they aim at corporations. These PCs often cost less than $1,000. Meanwhile, the technology is becoming a staple on notebook computers, which are typically less price-sensitive than the commodity desktop market. Corporate users in particular expect their notebooks to give them robust communications technology, and Gigabit Ethernet is part of that.
But remember that this switchover is just happening. It will accelerate greatly in the next year and then keep going, as Gigabit Ethernet prices continue to drop and the technology migrates into higher-volume price points of the desktop and notebook markets.
One thing to look for here: a slowdown in the turnover for networking technology. The shift from 10Base-T Ethernet to Fast Ethernet on the desktop took three to four years, and it will probably be three to four years for Gigabit Ethernet to displace Fast Ethernet. But analysts like Yankee Group's Kerravala say Gigabit Ethernet will remain the staple for desktop connectivity for five to eight years. In part, that will be because it might take that long to figure out how to get the next level of Ethernet technology, 10 Gigabit Ethernet, to run over copper. That shift also will have to answer a currently unanswerable question: can computers cope with such speeds?
"What good is it to put a 10-gigabit spigot into your server if the absolute maximum it can consume is 1 gig?" Estrin asks. She notes that the basic PC input/output system hasn't really changed in decades. So today's PCs can't take full advantage of 1 Gbit speeds, though even 500 Mbit is a vast jump over Fast Ethernet. Basic elements of the PC architecture likely must change before 10 Gbit reaches the desktop.
The Gigabit Backbone
This is where Gigabit Ethernet is most prevalent. Gigabit switches in the backbone and on servers helps with all sorts of high-end applications, such as clustering and distributed storage networks.
"Gigabit Ethernet is highly deployed in the backbone," says Meta Group's Chris Kozup. Companies will use Gigabit Ethernet to create more robust networks, Kozup says, and that in turn will spur the use of technologies that have little tolerance for latency (the gap between when a packet is sent and when it arrives at its destination). One such technology is voice over IP. But Kozup says safe failover, hot swapping, and other such "high availability" services will become increasingly important, driving demand for bandwidth.
That will be particularly true as costs come down. The premium for Gigabit Ethernet over Fast Ethernet can be as little as 10% to 20% per port, though the chassis for the faster switches costs more. Those prices will continue to come down throughout 2004.