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Dark Fiber is Shining Bright - What is Driving its Resurgence?

  • March 2016
  • -
  • Frost & Sullivan
  • -
  • 14 pages

Summary

Table of Contents

Dark Fiber is Shining Bright What is Driving its Resurgence?

Dark Fiber means exactly what the name suggests—fiber that is dark or unlit. Dark fiber is an alternative to commercial network services; and a preferred choice among organizations that require flexibility in network configurations, a large amount of dedicated bandwidth, extremely low latency, and, most importantly, full control over their network. With dark fiber, enterprises can connect network routers directly (without using any network protocol), to achieve extremely low latency; or they can choose to run a variety of network protocols on it.

Nevertheless, dark fiber is not without caveats. Dark fiber is expensive and costs can run into millions of dollars. In addition to the cost of leasing fiber and deploying optics, dark fiber customers need to have a strong network management team in place to run and manage the network. The benefits of dark fiber have to be strong enough for the customer to go the dark fiber route. Market demand for dark fiber has been increasing since 2014, gaining sufficient momentum that a host of new dark fiber providers have entered market.

These new “pure play” providers deploy fiber networks in specific metro or regional areas; but, unlike Network Service Providers (NSPs), they generally do not make the same investment in networking equipment to manage the network, or operating and billing systems to manage customer accounts. They merely lease the physical plant to customers. Several vertical customer segments—including mobile network operators (MNO) for small cell backhaul, education and government vertical clients to fulfill bandwidth demand, financial services clients for low latency trading networks—are driving demand.

In this analysis, we take a close look at the key trends driving demand for dark fiber; analyze the changing pricing and contracting trends; and review the competitive landscape.

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