Network Magazine

The Second Coming of Free Space Optics -- New technology called Free Space Optics may be the answer to bandwidth bottlenecks.(Technology Information)

Just when you thought the local broadband access market was limited to Digital Subscriber Line (DSL), cable modems, and wireless, along comes a new contender. Not so new, actually: Free Space Optics (FSO) has been around since the late 1980s, but at the time, it failed to deliver on distance and performance claims. Now it's beginning to make a comeback among local Internet access providers.

Why this newfound interest? "According to various statistics, almost 90 percent of all office buildings in the United States have no fiber connection to access the service provider's network," says Bettina Tratz-Ryan, a senior analyst at Gartner Dataquest ( "Furthermore, fiber buildout to these buildings is very expensive."

FSO uses lasers, or light pulses, to send packetized data in the terahertz (THz) spectrum range. Air, not fiber, is the transport medium. This means that urban businesses needing fast data and Internet access have a significantly lower-cost option. To link a building with fiber costs between $100,000 and $200,000 and often involves a provisioning delay of four to 12 months. By contrast, AirFiber (, a major FSO vendor, says it can get a link up and running within two to three days at one-third to one-tenth the cost of fiber (about $20,000 per building).

FSO is not only cost-effective and easy to deploy but also fast. Currently it supports connections from OC-3 (155Mbits/ sec) to OC-12 (622Mbits/sec), though some vendors are advertising Gigabit Ethernet speeds now. With these cost/performance benefits, you can see how FSO beats local access alternatives hands down; neither DSL nor cable modems can match its bandwidth or provisioning. Nor can other wireless technologies such as Local Multipoint Distribution Service (LMDS) and Microwave Multipoint Distribution Service (MMDS).

Still, the technology is not for everyone. A major reason companies might not adopt FSO is its confinement to urban areas. FSO deployments must be located relatively close to big hubs, which means only customers in major cities will be eligible-at least initially. Businesses in more remote locations are out of luck, unless a provider sets up hubs in their area, which seems like a distant reality right now (see Figure 1, page 56).

Despite these drawbacks, however, FSO is poised to become a major player in the local broadband access market, particularly among small and medium-size businesses, which typically lack fiber connections. On the conservative end, The Yankee Group ( estimates the market will grow to either hundreds of millions of dollars or the very low billions by 2005. The Strategis Group ( pegs growth at about $2 billion by 2005. This number seems to be the general consensus, though several vendors will tell you it's significantly higher. All agree, however, that FSO is only a year or two away from mass market implementation.

This article will take a closer look at FSO technology, its pros and cons, and the various products and service providers that support it.


FSO is largely unproven for last-mile access today, though carriers who passed on it several years ago are now taking a second look. The technology has proven itself in other applications, particularly those requiring a tactical, point-to-point link. In "network assist" applications, for example, FSO adds additional capacity and reach to an existing network such as LMDS, usually for backhauling traffic. …

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