mercial long-haul transport systems in the years of the first Internet revolution. The capacity increased from 2.5 Gbit/s (typical capacity of a high-performance SONET/SDH transport system in 1990) to 2.4 Tbit/s (the capacity of a 10 Gbit/s, 128 channels wavelength division multiplexing [WDM] long-haul system, the most advanced commercial long-haul system in 2002). Perhaps, there is no other example in the history of the engineering of a key tech- nical performance of a widely used product that increased three orders of magnitude in 10 years. This evolution was possible due to a huge research and development effort that brought to the market, in a very short time, an impressive number of new technologies, from sin- gle-mode semiconductor lasers to optical amplifiers and from optical modulators to low- loss WDM passive elements. All this effort required a great injection of money into the telecommunication market, as shown in Figure 2.2, where the evolution of the capital expenditure of the U.S. carriers is reported in the considered period [6]. Two important points of discontinuity can be observed in the figure, corresponding to specific events in the market. U.S. carriers CAPEX (B$) Pre-liberalization Post-liberalization- pre-bubble Bubble Recovery Post- period recovery FIGURE 2.2 Evolution of the capital expenditure of U.S. carriers in billion dollars. (After Iannone, E., Personal Elaboration of Ovum "Capex Conundrum" report, Ovum, s.l., 2003.) Telecommunication Networks The first is related to the U.S. market, in particular to the telecommunication act of 1996, which opened the access market to competition, introducing the concept of access unbun- dling and abolishing the monopoly of the RBOCs [7,8]. The second discontinuity, located around 1997, is related to the effort to develop the net- work under the pressure of the first Internet revolution. Looking at Figures 2.1 and 2.2, a comment immediately emerges. The traffic increased from 1991 to 2002 by a factor of about 10, while the carrier revenues increase w