Evolution Of The Network Router Market

When the University of Utah Health Sciences Center had to choose core routers for a new Gigabit Ethernet network, manageability and performance were its key considerations. After all, its 3,000-plus employees, medical faculty members, and students would depend on the network constantly.

After turning on the new network, "we actually could see what is going through that switch or router, or who is doing what," says Jason Traeden, network engineer at the health center, which encompasses a hospital, medical college, and numerous clinics.

The health center replaced an older 10-Mbps asynchronous transfer mode network at the facilities, selecting two BigIron core routers from Foundry Networks Inc. over products from several other vendors based on comparisons of their performance, management tools, reliability, and support for several specific applications, including multicasting, security, and voice.

The features the center looked for are typical of those most large businesses need on their networks, although in a time of reduced technology spending, most companies these days are upgrading existing routers to obtain the features they need. That trend means that overall router sales are falling, according to vendors and analysts, as customers upgrade existing equipment to get the enhancements they need instead of replacing the equipment outright.

"We had a large ATM enterprise network and wanted to go to a Gigabit Ethernet-style network," primarily to reduce costs, Traeden says. In its nine-month replacement project, the health center took out $1.6 million in ATM equipment and put in routers that cost between $500,000 and $600,000, or about a third of the cost of the ATM network.

After going live earlier this month, "we have a much cleaner, easier-to-manage environment, which has been a nice relief," says Traeden. The center uses the sFlow packet sampling feature of the Foundry routers to collect and send sample packets and packet-flow information to a server where engineers monitor the network and collect statistics.

The health center already used multicasting to distribute videotaped medical lectures and other digital data files around its campus and started using that feature on the Foundry routers right away. But it also made sure the new routers have enough processing power and built-in support for advanced security features and voice-over-IP services that it will eventually need, Traeden says.

Like most high-end routers today, the BigIron products have higher processing power than earlier generations, which translates into more memory for larger routing tables and advanced routing functions and support for functions such as IPv6 and Border Gateway Protocol, Traeden says.

New patient-confidentiality rules required by the federal Health Insurance Portability and Accountability Act will force the center to upgrade network security, so it made sure that its core routers could handle security features such as access lists and active control lists without hurting routing speeds, he says. And, when the Utah state university system that oversees the center decides to implement voice-over IP, the center needs to be ready. "VoIP is coming, so we made sure that the equipment we have supports it," through features such as voice support with quality-of-service and bandwidth management, he says.

Those enhancements, security, and voice support are at the top of most customers' lists, according to market leader Cisco Systems. But the majority of customers today are adding specific functions to their routers with add-on hardware and software modules for security functions such as firewalls, intrusion detection, and security accounting, plus other functions such as voice support, VPNs, and fault protection, says Rob Redford, VP of marketing for Cisco's router group.

Among the high-end routers in its 7000-series family, Cisco has a new route-switch processor and an interface processor for the 7600 and new interface cards for the 7300. Cisco hasn't launched any new product lines recently, but "we continue to offer our existing customer base new capabilities," Redford says.

Juniper Networks makes high-end routers for service-provider and large company networks, and both environments demand performance characteristics such as speed, capacity, and resiliency, says Kevin Dillon, director of marketing at the vendor. Features such as security, traffic prioritization, quality of service, and support for multiple IP services such as VPNs, voice over IP, and IPv6, support, and a choice of interfaces, including multiple varieties of ATM and Ethernet, also are essential, he says.

Juniper's routers for business networks include its T640 and T320, plus its M20, M40E and M160 routers, and all feature a modular software architecture so that processes including routing protocols, management, and command line interfaces, don't interfere with each other. In addition, routing and forwarding functions are separate, so forwarding is performed entirely by ASICs at wire speed without affecting routing functions.

The trend is for core routers to perform higher-level functions, moving beyond simple network routing to handle more complex tasks that depend on traffic characteristics such as transport, session, presentation, and even application, says Chad Elford, product line manager of Nortel Networks' Passport 8000 and 1000 series routers.

With higher-level traffic awareness, "the network is knowledgeable about your request and your user profile and delivers you to the most appropriate site based on those parameters," Elford says. In the last year, Nortel revamped its entire 8000 and 1000 series high-end Passport routers to include what it calls "application optimization," including processing capacity for functions such as security, content delivery, and awareness. The extra processing headroom is needed because "nobody wants to implement applications such as security if they degrade performance," Elford says.

The trend of upgrading existing routers to achieve desired functions or services ensures that routers will remain a central part of corporate networks, although it's hurting sales of new routers.

Revenue from router sales worldwide dropped 6% in the second quarter of 2002, to $1.5 billion, with Avici Systems, Cisco, Juniper, and Redback Networks leading in sales, according to Dell'Oro Group's latest report. High-end router revenue dropped during the quarter, although units shipped remained steady, because increasingly cost-conscious customers shifted from expensive high-speed ports (10 Gbps and 2.5 Gbps) to lower-speed, lower-priced ports (155 Mbps and 10/100 Mbps Ethernet), according to Dell'Oro.

Because most of the new features are add-ons, router vendors "will not get people to replace existing equipment; they're going to wait for extraordinary advances," although demand for routed circuits at common T1 speeds is still strong, says Dell'Oro Group founder Tam Dell'Oro.

The market evolution means Cisco's dominance could slip, since the trend of adding features such as voice, security, and IP services to routers means new vendors are moving into core router markets, says Jon Cordova, directing analyst for access networks at market research firm Infonetics Research. Cisco has about 85% of the total router market, but its share could slip to 60% or 70% as the trend continues, Cordova says.

As a hint of future capabilities in store for corporate networks, the high-speed Abilene research network that serves the Internet2 community uses 12 Cisco 12000 series routers, and researchers are installing 11 Juniper T640 routers chosen as the network's next-generation core routing platform. The T640s have 640 Gbps in combined input and output capacity and interfaces for traffic speeds ranging from 622 Mbps to 10 Gbps. In the Abilene network, they will aggregate connector and peer traffic and deliver backbone services, says Chris Heermann, senior network engineer for Abilene.

Abilene's routing requirements included the ability to handle large individual data flows and provide advanced high-speed services such as IPv6, Heermann says.

Compared with the commerical Internet, Abilene's operators needed multicasting support, dedicated and real-time measurement capabilities at each PoP, native IPv6 support at 10-Gbps line rates, as well as IPv4 and advanced restoration services, Heerman says.

The aim of the project is to demonstrate how larger, more scalable networks can operate in a research setting, leading to broader use of stable, high-speed networks supporting a variety of real-time services such as voice and video, as well as high-speed data applications.

"By pushing the envelope and looking beyond what is being done today," he says, "we hope to facilitate advances in technology that will be used in tomorrow's commercial Internet."