cross connects and their pound of flesh

If they've based their model on extracting profit proportional
to technology speed then they've misunderstood Moore's law


Before 100G, you'd need ten cross connects to move 100G. Now you'd need only one. That's a big drop in revenue.

I don't buy this. They sold you one cable before, they sell you cable now.
  Little difference then we moved customers from a T1 to T3 back in the
90's. If Colo's can't understand more then 20+ yrs of evolution its hardly
right to blame it on the market.

Mimir Networks

Actually, back in the T1/T3 days, colos frequently asked what you ran on the cable and then charged you based on the capacity of the circuit - even when it was the same exact cable. Of course, none of us would ever ask for T1 xconn then run ethernet over it.

Colo providers are absolutely worried about drops in xconn revenue. Look at some large colo providers who are public and split out their numbers. You’ll see that the percentage of their profit from xconns is usually more than double the percentage of their revenue from xconns. Put another way, if xconn revenue drops by 10%, their profit drops by over 20%. How many public companies can shrug off a 20% drop in EPS? I submit: Not very many.

This is not surprising. When you build your business on the ignorance of your customers, you are in a world of hurt once your customers learn even a little bit more.

If you look at companies that have foundered due to failure to innovate, most of the time it's because they were too focused on what made them money then, not what was going to make them money 5 years from then.
And networks don't track very well to Moore's law...

Gotta watch out for specifying T1 when you want Ethernet- they could just give you 4 wires on pins 1,2,4,5 :slight_smile:

I see the problem as misunderstanding what "physical" actually means: 4-wire twisted pair is different from 8-wire, is different from coax, is different from SMF etc. what gets run over it is nobody's business but the person controlling the end points.

David Barak

You assume things like "nobody's business" has something to do with "extracting money".

David said:* Gotta watch out for specifying T1 when you want Ethernet- they
could just give you 4 wires on pins 1,2,4,5 :)*

I think Patrick was thinking back in the days when Ethernet was just two
pairs. You could get away with a lot on 10BaseT, I've even used dry telco
pairs between buildings when I was in a tight spot. Nice clean T1 pairs
through at DSX panel was quite common before we had fancy things like fiber
meet-me-rooms. SIX started with midnight cable runs in the drop ceiling.