ATM Viability

Word of ATM's pending death was greatly exaggerated. Any number of analysts predicted that the use of Asynchronous Transfer Mode would die out somewhere within the last two years, but for several reasons, this legacy still has a stronghold in the network edge, and may be gaining in public networks. Why is this, and where will things stand in the future? Linda Dailey Paulson has the story.

By Linda Paulson | Posted Feb 6, 2002
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ATM is a networking technology with a strong installed base. People know what it is and how it works. It's a known quantity. There's reluctance to discard it, and with good reason. New services are being offered via ATM networks, including voice, DSL, Internet access, video; the advent of Multi-Protocol Label Switching (MLPS) is also providing more opportunities and challenges.

Word of ATM's pending death was greatly exaggerated.

"Eighteen months to two years ago we thought ATM would die out or down," says Christin Flynn, analyst for The Yankee Group. "It really hasn't." She says there has been a surge of growth in ATM as what she calls a "back haul technology," precipitated by the growth of frame relay. "There's a lot of it and we're still seeing healthy growth."

According to Flynn, ATM switching had a 50 percent growth between 1999 and 2000 with the market for multiservice WAN switches at $4.3 billion in 2000. Traditionally, the firm has examined ATM only, but frame relay through multiservice WAN was added to the survey with the growth in these services. Multiswitch vendors include Alcatel, Cisco, Ericsson, Lucent, Marconi, Nortel and WaveSmith Networks.

She expects that market to have a compound annual growth rate of more than 20 percent during the next five years, reaching more than $10.6 billion in 2005.

"ATM is still today the only way to handle mixed services traffic cost-effectively where quality of service is paramount," says Marlis Humphrey, chairman of the Board of Directors of The ATM Forum.

Although sales were sluggish in 2001, there will be growth in the market attributable to the backlog of carriers that had been waiting for either MLPS or a higher-capacity switch fabric and density, and to these carriers resuming their purchase of high-density core devices, Flynn says. Growth can also be attributed to increased frame relay services and traffic.

"There's a big push for ATM in the public network," says Rick Townsend, president of The ATM Forum and a distinguished member of the technical staff at Lucent Technologies. "The exciting stuff is happening in the public network with carriers and service providers. It begins to feed back into the metro area networks."

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