AONs rely on electrically powered network equipment to distribute the signal, such as a switch or router. Normally, signals need optical-electrical-optical transformation in the AON. Each signal leaving the central office is directed only to the customer for whom it is intended.
Incoming signals from the customers avoid colliding at the intersection because the powered equipment there provides buffering. Active ethernet (a type of ethernet in the first mile) is a common AON, which uses optical ethernet switches to distribute the signal, incorporating the customers' premises and the central office into a large switched ethernet network.
Such networks are identical to ethernet computer networks used in businesses and academic institutions, except that their purpose is to connect homes and buildings to a central office rather than to connect computers and printers within a location. Each switching cabinet can handle up to 1,000 customers, although 400–500 is more typical.
This neighbourhood equipment performs layer 2 switching or layer 3 switching and routing, offloading full layer 3 routing to the carrier's central office. The IEEE 802.3ah standard enables service providers to deliver up to 100Mbit/s, full-duplex, over one single-mode optical fibre FTTP, depending on the provider. Speeds of 1Gbit/s are becoming commercially available.
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