AbstractThe steadily rising demand for multimedia and data services, the falling cost and omnipresence of Ethernet and the maturity of passive optical networks (PON) technology, promise to radically change the landscape in the local loop. The heart of a gigabit PON system (recently standardized by FSAN/ITU) is the medium access controller (MAC), which arbitrates access to the upstream link among users with fluctuating traffic demands and effects the multiplexing and concentration policy. At the same time, it has to safeguard the service quality and enforce the parameters agreed in the service level agreements (SLAs) between the users and the service provider. In this paper, a MAC protocol designed to serve any mix of services according to their quality of service (QoS) needs, employing four priority levels along with a high number of logically separate data queues is presented. The architecture and implementation in hardware of a MAC algorithm capable of allocating bandwidth down to a resolution of a byte with QoS differentiation is the focus of this paper. It employs the bandwidth arbitration tools of the FSAN/ITU G.984.3 standard and maps SLA parameters to GPON service parameters to create an efficient, fair and flexible residential access system. Copyright © 2005 John Wiley & Sons, Ltd.