Frame Relay Holds Its Own Over ATM

Two banks on opposite coasts and competing in different financial markets share one view as they overhaul their networks: ATM is not yet up to snuff.

San Francisco-based California Federal Bank (Cal Fed) and Sumitomo Bank Capital Markets in New York are each engaged in LAN and WAN projects that rely heavily on frame relay.

Cal Fed, which is replacing a point-to-point systems network architecture (SNA) network with frame relay, is considering ATM, but only in the distant future.

"We are looking at ATM for the future, but the major carriers are not ready for prime time" with the required infrastructure -- namely, written procedures, documentation, and ongoing testing to compete with frame relay, said Thomas Nanomantube, Cal Fed's senior vice president of information and technology services.

Sumitomo has a frame relay network from Concert Communications that connects its New York office to branches in London, Hong Kong, and Tokyo. Someday, that network will migrate to ATM, but not soon.

"Public ATM networks are still in their infancy and remind me of where frame relay was five years ago," said Rob McKenna, vice president of global network engineering at Sumitomo. "There is no quality of service, and you don't know what the response time and reliability is. Big carriers have the services, but they are more like pilots."

Voice calls have become so inexpensive that it is not economical to put in an ATM network just so voice can be combined with data, he said. And the standards for handling voice over ATM are not set, he added.

"Ideally, once ATM matures and they get some compression and work out something to [support] voice more cost effectively, then we will see a seamless LAN to ATM to WAN and back," McKenna said.

Cal Fed is migrating from SNA to frame relay to increase communication links to branch offices and to ease the acquisition of Glendale Federal Bank. Two Glendale data centers are being consolidated into Cal Fed's data center in Sacramento at a $30 million annual savings, Nanomantube said.

The network upgrade will increase response time to branches, lay the infrastructure for handling more acquisitions, make it possible to roll out Internet services for customers, and create a foundation for an intranet.

Within some 400 branches, Cal Fed is replacing token ring LANs with Ethernet networks running off Cisco 10/100 Catalyst 2924 switches. WAN connections will be through Cisco 2524 routers. MCI is supplying 56-kilobit-per-second frame relay links to the branches and T1 or T3 lines into data centers.

"The network was not meeting our business requirements because of response delays to the branches," said Nanomantube. "We wanted to [Web-enable] the branches and allow them to do that without impacting response times."

In addition, the network connects its headquarters in San Francisco to loan and mortgage offices in Maryland and Texas. The network will have 400 routers and 600 switches in the branch offices, and 20 additional routers and about 100 switches in other offices around the country.

Most of the bank's traffic is from typical financial transactions such as credit verifications. ATM machines are on the LANs, but have their own WAN connections. Nanomantube said ATM traffic will be wrapped in Synchronous Data Link Control protocol and shipped across the WAN in IP packets. Legacy SNA traffic will run under Novell's Internetwork Packet Exchange protocol in an IP packet on the frame relay network.

Nanomantube is on a tight schedule. In any given week, 20 to 30 branches are being cut over; all 400 are supposed to be completed by early next year.

Cal Fed will roll out Internet banking services next year. That may include processing of auto loans and consumer mortgages. The Web site today is used for informational purposes only. "We have got the frame relay network now and can move [ahead]," Nanomantube said.

In New York, Sumitomo's overhaul will build the network infrastructure for the next three to five years and let network managers tailor bandwidth to the most important application and business needs, said McKenna.

Sumitomo is installing 3Com SuperStack II Switch 1100s as well as 3300s and 3500s that connect to 3Com CoreBuilder 5000s. The bank has 18 of the 5000s, but is replacing some of them with 30 of the less expensive stackable switches, McKenna said.

The switches also replace costly Cisco 7000 routers, which will be moved to the network edge to handle frame relay connections. The 7000 is an old router, and newer models would have cost twice as much as the stackable switches, McKenna said.

Still, he will use new smaller Cisco routers -- probably 4500s -- for the frame relay WAN connections because they are more robust than 3Com's, he said.

"We are looking at ordering CoreBuilder 9000s later this year for more port density," he said. "We will probably get two of those and put them in the first quarter of 1999."

McKenna said the stackable switches are 802.1pq-compliant and will lay the foundation for intelligent network and quality-of-service guarantees. "We will be able to tailor our traffic flow to applications that are most important to the business, and, ultimately, flagging priority traffic," he said.