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David, Thanks for the pointers to the IEEE policy. I have been reviewing it
and find the following particularly relevant to the thread below. I have
underlined key parts for easier reference. What
else can we discuss? IEEE wants you to have the maximum
flexibility to discuss topics relevant to developing a standard while also
adhering to certain rules designed to minimize risk. It is impossible to
identify all the topics that you can discuss,
but here are some that you cannot discuss:
• prices at which products or
services implementing the standard should be sold (“price”
includes discounts, terms, and other conditions of sale); • profits or profit margins; • individual companies’ market
shares or sales territories; • allocation of customers, markets,
production levels, or territories; or restricting the customers to whom, or
territories in which, a company may sell or resell products; • using standards or certification
programs to exclude suppliers or competitors from the marketplace for any
reason other than cost-performance or technical considerations; • conditioning the implementation of
a standard on the implementer’s use of products or services from a particular
supplier [such as requiring use of a particular manufacturer’s components or
requiring implementers to use a particular service provider(s) for compliance
certification]; • bidding (or terms of bids) or
refraining from bidding to sell any product or service; • any matter which restricts any
company’s independence in setting prices, establishing production and sales
levels, choosing the markets in which it operates, or the manner in which it
selects its customers and suppliers. The first bullet gets at the heart of the matter. It is what everyone keys
on when the discussions of price are thwarted. It states we cannot discuss what
prices should be. I think we can all agree that to do so would be
anti-competitive. But it says nothing about discussions of prices as they actually
are in the market today or have been in the past. To muzzle such discussions
is overstepping the bounds and scope of the policy, for there is no anti-trust reason
why prices that are in public domain, such as can be found posted on public web
sites, cannot be brought forward. Such activity is not price fixing, it is
price reporting. In the case of setting new standards we are naturally talking about documents
that affect the future. This is the context under which the IEEE policy is
written and should be interpreted and applied. When the policy says: Discussion of the cost of inputs
necessary to create a compliant implementation of a standard are treated
differently from discussions of prices at which compliant implementations can
or should be sold. There is no useful or appropriate reason to discuss selling
prices of implementations – each implementer of the standard should use its own
independent business judgment to make that decision. In contrast, there is a
legitimate reason to discuss costs of inputs used in implementation. … With regard to the costs of inputs
used in implementing a standard, the only permitted discussion is the degree to
which such costs may differ. Examples of permissible discussion topics would
include differences in comparative component costs, operating costs, licensing
costs, or the aggregate of such costs. The importance of this restriction on
discussion is reinforced by the understanding that participants in the
development of a standard often come from multiple stages of the supply
chain (e.g., the input cost of a component to a system manufacturer is
the output price of a component supplier). Thus, in standards development
technical activities, participants may discuss the relative costs (in
terms, for example, of percentage increases or decreases) of different proposed
technical approaches in comparison with the relative technical performance
increases or decreases of those proposals. It is obviously referring to the setting of new standards. This is
conveyed by the use of the word “proposed” and more fundamentally by the entire
context of the policy for guiding standards development. While it is not
referring to discussions of cost for implementations already standardized and
in the market, the above restrictions are needlessly being applied that way. There
is no anti-trust implication to discussions of publicly available information,
even if it is with regard to price. How can there be? It’s already fully
available to all participants. Such restrictions would imply that discussions
of current prices somehow set agreements on future prices of
yet-to-be-standardized implementations. That is a non-sequitur. If we are talking about input costs on items affecting the setting of
future standards, the guidelines are clear that we must use relative costs, not
absolute costs. It also recognizes the supply chain issue, that one link’s cost is the previous
link’s price. But it places no restriction on the point in the supply chain at
which relative costs can be compared. Therefore imposition of restrictions on
discussions of relative costs at the top of the supply chain or any other
specific part of the supply chain is outside of this policy. While I do not relish raising these issues, I feel compelled to do so because
after reading the actual policy it is clear to me that our practices in 802.3 are
unnecessarily restrictive both to the letter and spirit of the IEEE policy. Regards, Paul -----Original Message----- Hi Jonathan, While I note that Dan has already stated that comparing cost at the end
user is not permitted, and discussion did not go into that area, I wanted to
reiterate that such discussion are not permitted. I also wanted to respond to
your request to me to comment. As I have often stated at meetings, I would encourage everybody to read
the IEEE policy document 'Promoting Competition and Innovation: What You Need
to Know about the IEEE Standards Association’s Antitrust and Competition
Policy' <http://standards.ieee.org/develop/policies/antitrust.pdf>. I
personally think it provides a good explanation of why these rules are in
place, due to the Antitrust and competition laws throughout the world, and the
consequences if they are not followed. This policy states that we cannot discuss, among other items, 'prices
at which products or services implementing the standard should be sold (“price”
includes discounts, terms, and other conditions of sale)'. This is enforced in
subclause 5.3.10.3 'Discussion of relative cost/benefit analyses' of the
IEEE-SA Standards Board Operations Manual and stated in the 'Guidelines for
IEEE-SA Meetings' slide shown at every meeting. By way of an introduction to why these rules are in place, and the
consequences to all of us if they are not followed, I offer the following
extract from the introduction to the above policy document. Clause 2 of this
document addresses 'Cost Discussions' in further detail. Participants may also
wish to consult 'What You Need to Know About IEEE Standards and the Law'
<http://standards.ieee.org/develop/policies/stdslaw.pdf>. ---- Promoting Competition and Innovation: What You Need to Know about the
IEEE Standards Association’s Antitrust and Competition Policy Antitrust and competition laws throughout the world rest on the premise
that competition in the provision of products and services is the best way to
ensure that consumers and other users receive maximum innovation and quality at
the lowest possible prices. But sometimes effective competition requires a
measure of cooperation among competing firms. Standards development is one of those areas. Standards development
serves one part of the IEEE’s mission – advancement of global prosperity by
fostering technological innovation – but it can do so only if the standards
development is conducted consistent with the antitrust and competition laws
that regulate the nature and extent of cooperation in which competitors can
legitimately engage. The IEEE-SA is an international membership organization that provides a
standards program serving the global needs of industry, government, and the
public. A violation (or claims of violation) of competition laws will
jeopardize what all participants are working so hard to build; will impede the
IEEE mission; and may expose participants and their employers to the risk of
imprisonment and other criminal penalties, civil remedies, and significant
litigation costs. Even if a competition-law case or investigation is ultimately
dropped, that will often happen only after the parties have spent considerable
resources in responding to information requests and defending against the
claims. The IEEE-SA wants to help all of its participants avoid competition-law
problems. Many IEEE-SA participants receive antitrust/competition-law
compliance training from their employers, and IEEE-SA participants should
always consult with their own or their company counsel when they have
competition-law-related questions. This brochure is not intended to replace
that competition-law training, advice, or other competition-law-related
resources that participants may have available to them; rather, this brochure
is intended to highlight the competition-law risks that are most pertinent to
standards development and to explain the IEEE-SA’s policies with respect to
competition law matters. <http://standards.ieee.org/develop/policies/antitrust.pdf> ---- Best regards, David ________________________________________ From: Sent: 16 November 2011 20:04 To: Subject: Re: [802.3_100GNGOPTX] Emerging new reach space Hi Robert, I am not sure its even appropriate to comment about prices-of-resale.
Its a topic better left understood without discussion within the IEEE. We all
have a general idea of the challenges we face in assessing relative cost. In my opinion, you do it by looking at fundamental architectural
components and their specifications. You do it by looking at cost from a
form/fit/function perspective and leave out things like market pricing, demand
or volume. You choose *cost* comparisons with components that have equivalent
markets/volumes and then your comparison can have merit without getting into
the esoteric aspects of the market. Dan From: Robert Lingle <rlingle@xxxxxxxxxxxxx> Reply-To: Robert Lingle <rlingle@xxxxxxxxxxxxx> Date: Wed, 16 Nov 2011 22:52:26 +0000 To: 100G Group < Subject: Re: [802.3_100GNGOPTX] Emerging new reach space Jonathon, I agree with your former sentiment about it being against IEEE
guidelines, so we must not do it. I am sure Paul agrees. However I don’t agree with the latter sentiment. I think Paul is
pointing out a real quandary in our task. I think we can point out cases where
the adoption of components has been substantially impacted by the
prices-of-resale, over a lengthy period of time. I am not sure how long we
would have to wait for the long term? It seems to be a genuine difficulty in carrying out the analysis we all
want to see. I don’t have a solution. Warm regards, Robert From: Sent: Wednesday, November 16, 2011 5:15 PM To: Subject: Re: [802.3_100GNGOPTX] Emerging new reach space Hi Paul, I cannot support comparing cost at the end user, because
(in my opinion) that is quite clearly a price, and would be contrary to IEEE
guidelines. I would like David Law to weigh in on this. In an efficient market economy, the cost of manufacture (not the cost
of distribution) of a product, or group of products, is the best indicator for
long term cost to the end user. I think that’s what we (802.3) want to
get some indicator of when striving for ‘low cost’ solutions. Best wishes Jonathan From: Sent: Tuesday, November 15, 2011 8:30 PM To: Subject: Re: [802.3_100GNGOPTX] Emerging new reach space I also like Jack’s perspective foundation. And I have to agree
that a common small port form factor would be valuable. Regarding the PMD cost comparisons, I also agree that picking a common
cost basis could eliminate translation problems that come with use of different
bases. For PMD relative costs I am fine with choosing either 10GE SR or
LR because I don’t quite appreciate Chris’ concerns over the danger in using LR
as the basis. But if there is a problem, it seems like it could be
avoided by eliminating the bit/sec factor and instead using simple cost. However, there is still the issue of picking the point in the supply
chain at which the baseline cost is chosen. It could be at the level of
the transceiver manufacturer, or up one level to the switch manufacturer, or
off on another branch to distributors, or up one level again to the end
user. There can be substantial differences in these costs, which is what
likely gives rise to the “order of magnitude” perception disparity that Chris
mentioned. While we are forbidden to talk about it, it is the 500 pound
gorilla in the room. In some cases it tips the scales lightly and in
other cases it leans its full weight. Yet this weight is what is creating
a 100GE market acceptance barrier in data center deployments. While there is clear cost reduction potential in reducing the multimode
lane count based just on the improvement in media cost, the benefit of defining
a new single-mode solution may depend largely on the gorilla, for if we go to a
parallel solution the media will only get more costly. So for me the
biggest cost question is whether defining a new single-mode solution moves the
gorilla from leaning heavily to leaning lightly. While I’d like to agree to use cost at the transceiver maker level as
the basis, it cannot address this big question. If used it will likely
result in highly distorted perceptions and projections because it ignores the
order-of-magnitude problem. The only point in the supply chain where
transceiver costs and cabling costs come together is at the end user
level. This dilemma is hitting me squarely as I try to further my work on
the “Kolesar_Kalculator”. I continue to wonder what good this tool
will do if the PMD cost and cable cost are in two different silos without a
common basis to bring them together, for it is the combination of the two that
defines the total channel cost that we must optimize. I need to find a
way to appease the gorilla. If only Fay Wray were here… ________________________________________ From: Chris Cole [mailto:chris.cole@xxxxxxxxxxx] Sent: Tuesday, November 15, 2011 7:33 PM To: Subject: Re: [802.3_100GNGOPTX] Emerging new reach space Hello Jack, Nice historical perspective on the new reach space. Do I interpret your email as proposing to call the new 150m to 1000m
standard 100GE-MR4? ☺ One of the problems in using today’s 100GE-LR4 cost as a comparison
metric for new optics is that there is at least an order of magnitude variation
in the perception of what that cost is. Given such a wide disparity in
perception, 25% can either be impressive or inadequate. What I had proposed as reference baselines for making comparisons is
10GE-SR (VCSEL based TX), 10GE-LR (DFB laser based TX) and 10GE-ER (EML based
TX) bit/sec cost. This not only allows us to make objective relative
comparisons but also to decide if the technology is suitable for wide spread
adoption by using rules of thumb like 10x the bandwidth (i.e. 100G) at 4x
the cost (i.e. 40% of 10GE-nR cost) at similar high volumes. Using these reference baselines, in order for the new reach space
optics to be compelling, they must have a cost structure that is referenced to
a fraction of 10GE-SR (VCSEL based) cost, NOT referenced to a fraction of
10GE-LR (DFB laser based) cost. Otherwise, the argument can be made that
100GE-LR4 will get to a fraction of 10GE-LR cost, at similar volumes, so why
propose something new. Chris From: Sent: Tuesday, November 15, 2011 3:06 PM To: Subject: [802.3_100GNGOPTX] Emerging new reach space Following last week's meetings, I think the following is relevant to
frame our discussions of satisfying data center needs for low-cost low-power
interconnections over reaches in the roughly 150-1000m range. This is a
"30,000ft view,"without getting overly specific. Throughout GbE, 10GbE, 100GbE and into our discussions of 100GbE
NextGenOptics, there have been 3 distinct spaces, with solutions optimized for
each: Copper, MMF, and SMF. With increasing data rates, both copper and MMF
specs focused on maintaining minimal cost, and their reach lengths decreased.
E.g. MMF reach was up to 550m in GbE, then 300m in 10GbE (even shorter reach
defined outside of IEEE), then 100-150m in 100GbE. MMF reach for 100GbE
NextGenOptics will be even shorter unless electronics like EQ or FEC are
included. Concurrently, MMF solutions have become attractive over
copper at shorter and shorter distances. Both copper and MMF spaces have
"literally" shrunk. In contrast, SMF solutions have maintained a 10km
reach (not worrying about the initial 5km spec in GbE, or 40km solutions). To
maintain the 10km reach, SMF solutions evolved from FP lasers, to DFB lasers,
to WDM with cooled DFB lasers. The 10km solutions increasingly resemble
longer-haul telecom solutions.! There is an increasing cost disparity between MMF and SMF solutions.
This is an observation, not a questioning of the reasons behind these trends.
The increasing cost disparity between MMF and SMF solutions is accompanied by
rapidly-growing data center needs for links longer than MMF can accommodate, at
costs less than 10km SMF can accommodate. This has the appearance of the
emergence of a new "reach space," which warrants its own optimized
solution. The emergence of the new reach space is the crux of this discussion. Last week, a straw poll showed heavy support for "a PMD supporting
a 500m reach at 25% the cost of 100GBASE-LR4" (heavily favored over
targets of 75% or 50% the cost of 100GBASE-LR4). By heavily favoring the most
aggressive low-cost target, this vote further supports the need for an
"optimized solution" for this reach space. By "optimized
solution" I mean one which is free from constraints, e.g. interoperability
with other solutions. Though interoperability is desirable, an interoperable
solution is unlikely to achieve the cost target. In the 3 reach spaces
discussed so far, there is NO interoperability between copper/MMF, MMF/SMF, or
copper/SMF. Copper, MMF and SMF are optimized solutions. It will likely take an
optimized solution to satisfy this "mid-reach" space at the desired
costs. To repeat: This has the appearance of the emergence of a new
"reach space," which warrants its own optimized solution. Since the
reach target lies between "short reach" and "long reach,"
"mi! d reach" is a reasonable term Without discussing specific technical solutions, it is noteworthy that
all 4 technical presentations last week for this "mid-reach" space
involved parallel SMF, which would not interoperate with either 100GBASE-LR4,
MMF, or copper. They would be optimized solutions, and interest in their
further work received the highest support in straw polls. Given the
high-density environment of datacenters, a solution for the mid-reach space
would have most impact if its operating power was sufficiently low to be
implemented in a form factor compatible with MMF and copper sockets. Cheers, Jack |