line (May 2001), http://www. telecommagazine.com/issues/200105/tcs/tenHottest.html Nykolak, Gerald, Paul F. Szajowski, A. Cashion, Herman M. Presby, G. .E. Tourgee, and James J. Auborn, "40-Gb/s DWDM Free-Space Optical Transmission Link over 4.4 km." Free-Space Laser Communication Technologies XII, Proceedings of SPIE 3932 (May 2000): 16-20. Rockwell, David and G. Stephen Mecherle, "Optical Wireless: Low- Cost Broadband Optical Access." Lightwave Special Edition- Optical Carrier Solutions (June 2001): 14-18. CHAPTER Practical Design and Economic Parameters Chapter 10 This chapter briefly explores the kind of parametric economic analysis needed to assess the financial situation of a greenfield carrier offering metro optical services. Established carriers need to take the issues dis- cussed in this chapter into account and consider the entire embedded envi- ronment of networks and operations, inclusive of existing systems, rings, central offices (COs), customers, and SO on. Recent history shows that the bottom line is most critical for carriers of all sorts. We recently developed a spreadsheet model comprised of about 500,000 cells that supports the business case for 34 types of high-end broadband services (for example, 10-Mbps transparent LAN service [TLS], 100-Mbps TLS, and Gigabit Ethernet [GbE] TLS; access at 10, 100, and 1,000 Mbps; two-point private line at 10, 100, and 1,000 Mbps; access and private line at OC-x; Internet access with TLS or private line at OC-x; and so on) in 25 cities over a period of 5 years. This leads to a $1.2 billion cumulative rev- enue over the 5-year horizon ($650 million in year 5). An operation with solid 40 to 50 percent gross margins, 20 to 25 percent net margins, and earnings before interest, taxes, depreciation, and amortization (EBITDA) positive in two and a half years was demonstrated and launched. Quite a large number of factors need to be taken into account in a heavy-duty financial analysis. A subset of the input variables to such a model is shown in the following section