The future of long haul Ethernet got a boost Monday as XO Communications Inc. announced that the company will offer inter-city Ethernet connections to the 63 metropolitan areas it serves. The company owns and operates its own fiber networks to these markets.

John Mullan, director of data networking at Reston, Virginia-based XO, said the service is a Layer 2 (OSI model) offering. "We have been offering Ethernet in the metro space, and this extends our reach to long distance, between cities."

Ron Kaplan, analyst with International Data Corp. (IDC) in Framingham, Massachusetts, said long haul Ethernet is still an untested technology. "There are just a few companies getting ready to launch this kind of service. It does have the potential to lower costs. You could theoretically do away with your Frame Relay or ATM hardware, for example."

Mullan says these are the kinds of savings XO hopes will entice customers. "Right now," he explained, "if you want to create a virtual LAN over the long haul, you will typically need ATM or Frame Relay gear on both ends, outside your Ethernet switches. We eliminate the need for all that gear."

Christine Hartman, research director at Probe Research in Austin, Texas, says eliminating the need for ATM (Asynchronous Transfer Mode) would be an advantage. "People use ATM for this kind of networking," said Hartman, "but they also consider it too expensive."

Greg Wortman, vice president of marketing for Coriolis Networks in Boxborough, Mass., agrees that long distance Ethernet is starting to look more attractive. "Enterprise users see Ethernet as the first viable alternative to ATM and Frame Relay," said Wortman.

Coriolis makes optical transmission systems, and Wortman says Ethernet could give this market a boost. "Many of us in the industry thought 2001 would be the year for Ethernet services to take off. Economic and other factors have obviously introduced a lag here."

Kaplan said the biggest question here is how well it works. "This announcement from XO is significant," he said, "but it is so new, there is no track record yet."