Optical systems and technologies have been radically changing the telecommunication networks for past 15 years; today wavelength division multiplexing (WDM) technology, optical amplifiers, and simple optical switching elements like optical add-drop multiplexers (OADMs) are used in the backbone networks of all operators worldwide. Optical systems nowadays provide the basis for cost-effective transmission of large amounts of bandwidth over the Internet, and will enable its future growth and the spreading of new applications and services. This paper summarizes the main trends in optical networking and investigates potential future application areas. Optical system technology has become so pervasive in network design that it needs to be considered in the context of provisioning new applications and services. Therefore, the analysis is not limited to the aspects of physical transmission, but also takes into account recent developments in integrated network design as well as network control and management. The following sections describe the key functionalities of future optical network architectures, and the key findings of the theoretical analysis are supported by the results of a field trial of advanced transmission technology