Summary 739 (O/E) conversions, particularly at the higher bit rates, it makes sense to minimize the number of these converters in the network. The first step in this direction was the development of ultra-long-haul systems, which provided longer reach between regenerators. The second step was to handle as much of the traffic passing through a node in the optical domain as possible. An all-optical OADM or OXC performs this function. Having optical passthrough instead of electrical processing can lead to an order of magnitude savings in the cost, given that the cost of O/E conversions dominates the cost of the node itself. There are associated savings in power and floor space as well, given that the O/E devices consume most of the power and occupy most of the floor space in WDM equipment. Even further cost savings can be realized by passing signals through in bands of wavelengths, instead of individual wavelengths. These networks are called all-optical or transparent networks. The next step in the evolution of the optical layer was to add agility. An agile network provides the ability to set up and take down lightpaths as needed and allows carriers to provision and deploy services rapidly. This can be realized with optical crossconnects and reconfigurable optical add/drop multiplexers. Although an all-optical network provides significant advantages, it also has its limitations. Certain functions, such as wavelength conversion, regeneration, and traffic grooming at fine granularities (for example, at STS-1 or 51 Mb/s) will need