XO Communications 2010 Annual Report Download - page 12

Our metropolitan fiber networks are connected by our own switching, routing and optical equipment. The
metropolitan networks are connected to wavelengths of transmission capacity on our inter-city fiber optic
network. By using our own switching and routing equipment, we maximize the capacity and enhance the
performance of our inter-city network as needed to meet our customers’ current and future telecommunications
needs.
Inter-city Network. We have designed and built an advanced and reliable inter-city fiber optic
transmission network using XOH fiber and long-haul dense wave division multiplexing transmission
equipment. There are at least two physically diverse fiber paths connecting most of our markets to their
adjacent markets. This allows us to reroute traffic around inter-city fiber cuts to ensure end-to-end connectivity
to our customers. Metropolitan fiber rings are diversely routed to the XOH POP. This ensures that we can
reroute customer traffic around network impairments.
Our inter-city fiber network primarily is comprised of a twenty-year IRU for 18 fiber optic strands
pursuant to arrangements with Level 3 Communications, Inc. (‘‘Level 3’’). This fiber network traverses over
16,000 miles and connects more than 60 cities in the United States and Canada, including most of the major
metropolitan markets served by our metropolitan fiber networks. In addition, we have inter-city fiber IRUs
from Abovenet Communications, Inc. (‘‘Abovenet’’) and Qwest Communications Corporation (‘‘QCC’’) for
routes totaling another 3,000 route miles.
We have lit 8 of our 18 fiber optic strands on selected intercity routes with 400G, 800G, 1.6Tbps and in
2010 a 3.2Tbps DWDM capable systems. We believe that lighting our inter-city fiber network is strategically
beneficial to us. Using our own inter-city fiber optic network and associated transmission and switching
equipment provides a lower cost basis for running our network and a higher level of service for our
customers.
IP Network. Our IP network consists of a 10 Gbps Ethernet-based high-capacity backbone that runs
along the same routes as our inter-city fiber optic and transmission network. This Nx10G IP/MPLS backbone
connects to ten IP core nodes in the US, three IP core nodes in Europe and one IP core node in Hong Kong,
as well as 70 IP POPs located in 38 US markets and provides connectivity to one XOH-operated hosting data
center. The European and Asian core nodes connect to XO’s North American backbone via third party leased
facilities. These IP backbone nodes and POPs provide inter-city IP transport between the XOH metropolitan
fiber networks and the connectivity to other ISPs which are commonly referred to as peering. Peering with
other ISPs is done in each of our fourteen IP core nodes. The IP POPs house customer termination and
aggregating routers, as well as VoIP media gateways for XOH’s softswitch platform.
Our IP/MPLS network architecture, constructed with our own 10 Gbps wavelengths, provides the highest
level of restoration available to IP networks today. Redundant routes and capacity are identified and reserved
so that in the event of a failure, the network will automatically restore traffic in the shortest time possible
without the need for manual intervention. In 2009, we began a program to upgrade the pairs of Provider
Edge (PE) routers in our metro IP POPs that aggregate traffic from smaller customer-aggregating routers, as
well as provide cost-effective customer terminations at 1 Gigabit Ethernet (GE) and 10GE. The modern
Ethernet-based PE routers have the potential to support 40Gbps and 100Gbps trunks and customer
terminations in the future. In 2010 we completed the installation of the new metro PE routers in each
XO market and have rolled all IP services onto this new platform.
Wireless Network. We hold 91 licenses in the Local Multipoint Distribution System (‘‘LMDS’’)
wireless spectrum (28-31 GHz range) and ten 39 GHz licenses. These licenses cover 75 basic trading areas
(‘‘BTA’’), which are typically cities or metropolitan areas located throughout the United States. For every
license, the license holder must make both a license renewal filing and a demonstration of ‘‘substantial
service’’ at the Federal Communications Commission (‘‘FCC’’). Our licenses are renewable for additional ten
year terms. The renewal dates for 90 of our LMDS licenses are in 2018 and one LMDS license has a renewal
date in 2016. On December 22, 2010, the FCC renewed all ten 39 GHz licenses until 2020. In order to secure
renewal of our LMDS and 39 GHz licenses, we must generally be in compliance with all relevant FCC rules
and demonstrate that we are providing ‘‘substantial service’’ in our licensed areas. As of December 31, 2010,
substantial service demonstrations for 43 of our LMDS licensed markets have been approved by the FCC. The
remaining 48 LMDS substantial service demonstrations and the ten 39 GHz substantial service demonstrations
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