Optical networking, as embodied by dense wavelength division multiplex
ing (DWDM) and optical amplification, has revolutionized long-distance
transport and has resulted in capacity expansion, cost reduction, and
operations simplification. Extension to more wavelengths, emergence o
f reconfigurable wavelength add/drop and other optical network element
s (NEs), as well as cost reduction of optical amplifiers and laser dev
ices, are pushing the revolution into the local and metropolitan netwo
rks. Traffic generated in any format, such as SONET/SDH, asynchronous
transfer mode (ATM), and plesiochronous digital hierarchy (PDH), with
bit rates ranging from 45 Mb/s to 10 Gb/s, can be economically transpo
rted and routed optically without resorting to time division multiplex
ing (TDM). In this paper, we describe the latest advances in optical N
Es and applications in the public and private networks. In addition, w
e discuss how optical networking creates flexibility in sharing existi
ng fiber inventory between service providers. We present an example of
how optical networking is capable of meeting the emerging demand for
high-capacity clear-channel end-user services, a demand that TDM syste
ms cannot meet. Finally, we discuss future directions and optical laye
r restoration as a prime target of network evolution.