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- THE FRIDAY LETTER -

(emailed weekly, from Gilder Publishing,
for friends and subscribers)

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| http://www.gilder.com/ | Issue 330.0/February 29, 2008

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HEADLINES:

- The Week / EZchip on the Critical Path of Fiberspeed Connectivity (video)
- Friday Feature / Metcalfe: Terabit Ethernet Requires Network Overhaul
- Friday Blogger Bonus / Zetabyte Heights
- Readings /

THE 12TH ANNUAL GILDER/FORBES TELECOSM CONFERENCE
Hosted by George Gilder and Steve Forbes | May 28 – May 29
The Sagamore Resort | Lake George, New York

TELECOSM 2008: THE EXAFLOOD

Register online today: www.TelecosmConference.com

The Week / EZchip on the Critical Path of Fiberspeed Connectivity (video)

EZchip CEO Eli Fruchter speaking on the “Critical Path of Fiberspeed Connectivity” at Gilder/Forbes Telecosm 2007 in October: I wanted to start by telling you what we do, because not all of you own LanOptics shares…We build chips. We are a fabless company. We build network processors that go into network equipment; mainly switched and routers. The big companies that build switches and routers are using our chips…

Now, I want to say a few things about our NP-2 chip in light of yesterday’s session on multicore processing….

View the Complete Video:
http://www.discovery.org/v/44
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ANNOUNCEMENT: Hear Bob Metcalfe and George Gilder debate the future of venture capital ― energy vs. info, at the 12^th Annual Gilder/Forbes Telecosm Conference: TELCOSM 2008, hosted by George Gilder and Steve Forbes, May 28 – May 29 at The Sagamore Resort in Lake George, New York.

Register online today at www.TelecosmConference.com.
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Friday Feature / Metcalfe: Terabit Ethernet Requires Network Overhaul

Ed Gubbins, Telephony Online (2/26/08): SAN DIEGO--Terabit Ethernet networks are coming, said Bob Metcalfe, a partner at Polaris Ventures who is credited with having invented Ethernet more than 35 years ago. But it’s not clear exactly when, he said. And it’s less clear what network architectures will be needed to enable them.

Addressing the OFC NFOEC show today, Metcalfe said terabit-per-second Ethernet networks might be deployed by 2015, adding, “I’m not sure.”

Network traffic is certainly escalating dramatically, he pointed out. This week futurist George Gilder predicted the Internet would carry a zetabyte of traffic annually by 2015. That’s a one followed by 21 zeroes.

To stay ahead of that increasing demand, carriers will eventually need to introduce dramatic and fundamental changes in the way optical networks are currently built, Metcalfe said.

“To get to terabit Ethernet, we’ll have to break out of a lot of constraints,” he said, including 1550-nanometer lasers and 15-GHz spacing between them. New modulation schemes will be needed for the coming network, he said, as well as “new fiber, new lasers, new everything.”

The need to replace existing technologies will create “chaos,” Metcalfe said, but also opportunity for equipment vendors. Future demand might be met by deploying fiber with vacuum cores, for example, or carbon fibers rather than silicon fibers. Carriers might deploy more all-optical gear or even more free-space optical gear, he said.

But a key technology in accommodating future traffic growth is one that emerged in the previous decade: dense wavelength division multiplexing. And it is far more complex than Ethernet….

Read the Complete Article:
http://telephonyonline.com/ethernet/news/metcalfe-terabit-ethernet-0226/
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Friday Blogger Bonus / Zetabyte Heights

Sean Buckley, Telecommagazine.com (2/28/08): It seems fitting at this week’s FTTH Council Europe event in Paris, France—an event where the focus is on delivering tens and potentially hundreds of megabits of bandwidth to the home—that the growth of the Internet is a major discussion point.

Bret Swanson, a senior fellow at Seattle’s Discovery Institute, spoke at Wednesday’s opening keynote, "Estimating the Exaflood: The Impact of Video and Rich Media on the Internet." Citing the lesser-known French economist Jean-Baptiste Say’s theory of “supply creates its own demand,” Swanson said the growth of new Internet applications is on a similar path.

In his 1803 Treatise on Political Economy, Say theorized two basic macro and micro ideas about economies.

On a macro level, he theorized economies were not built on innovative new supplies of goods. From a micro sense, Say believed entrepreneurs supplying new products had the ability to anticipate the demands of the consumer.

“My view is that Jean-Baptiste Say would be a great believer in FTTH and the enormous increases in bandwidth we’re about to see across the globe with FTTH,” Swanson said.

“One of the key questions some people have about FTTH is [whether there is] enough demand for all of this new bandwidth you want to supply….

Read on:
http://www.telecommagazine.com/newsglobe/article.asp?HH_ID=AR_3997

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The next logical step in the evolution of the Gilder Technology Report (published by Gilder Publishing, LLC in association with Forbes Inc., 1996-2007), the Gilder Telecosm Forum is the web’s premier technology investment discussion forum.

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Readings /

FTTH 2008: Internet set to reach Zetabyte heights by 2015
http://www.telecommagazine.com/newsglobe/article.asp?HH_ID=AR_3997

How Cloud & Utility Computing Are Different
http://gigaom.com/2008/02/28/how-cloud-utility-computing-are-different/

Finisar Moves Into ROADMs
http://www.heavyreading.com/document.asp?doc_id=146860

Infinera unveils photonic roadmap
http://fibresystems.org/cws/article/news/33049

Reasons to Feel Happy and Angry
http://blogs.forbes.com/digitalrules/2008/02/reasons-to-feel.html

Nortel Aims for Ethernet Profits
http://www.heavyreading.com/document.asp?doc_id=147133
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Friday Letter Editor: Mary Collins George / mcollins@gilder.com

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