With a trio of startups close to introducing gear and rumors running rampant about a next-generation offering from an incumbent player, the core IP-routing market is beginning to attract a good deal of attention.

Caspian Networks, Hyperchip and Pluris are all expected to deliver high-speed IP routers later this year that improve on current router design by enabling service providers to expand capacity by interconnecting switching fabrics. Though the company has made no public announcements, competitors and industry experts say Juniper Networks is also close to revealing a new core router that offers improved scalability.

As far as the leader in the category is concerned, however, all of the activity amounts to much ado about nothing. Mike Volpi, senior vice president of the Internet switching group at Cisco Systems, says that it could be months or even years before the market can support a new breed of routers.

"We are investing extremely heavily in future and current routers," says Volpi. "Multi-chassis is interesting, and we are putting R&D dollars there as well. That said, today's market doesn't really require [a new breed of scalable routers]"

Speaking a day after Cisco's recent earnings announcement, Volpi said that the service-provider arena was still too unpredictable to make guesses about the time frame for a recovery. For the next 12 to 18 months, however, he doesn't see a need for more firepower in the core.

"Customers [service providers] have plenty of capacity in their existing infrastructures," he said. "The direction will be more efficient use of existing levels of bandwidth."

Volpi added that the limited success of Avici Systems, which introduced a scalable, multi-chassis router more than a year ago, is another indication of the lack of demand for larger core routers. Although he also included Pluris as another router maker that has failed to find traction, Pluris has yet to commercially release its router.

Volpi's take on the core-routing needs of larger service providers is in stark contrast to those of challengers in the space. Caspian Networks has been the most vocal about an imminent need for a higher order of backbone routers. Caspian founder and CTO Lawrence Roberts, based on his own measurements of Internet traffic growth, says that carriers maybe able to put off major infrastructure upgrades for the rest of this year. However, he says pent-up demand will force them to install new gear by the start of next year at the latest.

Roberts also says that many carriers are holding off from making major purchases in anticipation of the availability of next-generation routers.

"We know that's true of a lot of carriers we're talking to," says Roberts.

Roberts and other experts say the current crop of routers are plagued by several problems, the most pressing being the inability to scale gracefully. Standalone routers, such as those from Cisco and Juniper, can only be expanded by piecing together multiple system. This process is inefficient because it chews up valuable interface ports that must be used as links between multiple routers. In addition, the systems remain separate, adding to the complexity of network management.

Multi-chassis routers, on the other hand, are designed to scale from the gigabit to the terabit range. In addition to not requiring carriers to sacrifice data ports, these new routers can be managed, regardless of how many units are interconnected, as a single system.

The major advantage of a scalable router is that it will let service providers extend the usefulness and life of their backbone infrastructures. Carriers have been growing out their IP networks at such a rapid rate over the past few years that core routers typically have a shelf life of about 18 months.

It could be even less time before service providers are required to replace core routers or at least deploy them at the edge of the network, says Roberts. Although he says that Caspian's new router could remain in the network indefinitely, he estimates that about seven years is a reasonable time frame.

Hyperchip officials also believe that a seven-year life-cycle is achievable. Carriers are desperate to reduce operational and capital costs, says Paul Charron, director of product management at Hyperchip.

"This legacy approach to IP expansion is no longer acceptable," he says.

Roberts adds that existing routers are guilty of more inefficiencies than simply their inability to scale. Although Caspian isn't proposing any major changes to IP, BGP or any other standard protocol, Roberts says a more-efficient communications mechanism between routers would enable them to carry much higher levels of traffic without compromising performance. Carriers do not like to exceed more than 40 percent utilization on existing routers. Roberts says Caspian's forthcoming technology could safely push utilization rates past 60 percent.

While the industry would welcome the scenario that Roberts and others present, Volpi is much less optimistic about an imminent recovery of the backbone IP market.

"Capex at large carriers is still dropping, and the number of companies that are still in business is still dropping," said Volpi. "We are confident that at some point the industry will settle down. Affixing a time frame to when that will happen is difficult."