Optical labeling of IP packet bursts with both a wavelength label and a label in FSK or DPSK modulation format (orthogonal to the Intensity Modulation format of the payload data) has been analysed regarding implementation complexity and transmission performance. In comparison to the IM/DPSK format, the IM/FSK signal format is easier to implement in the edge and core routers, and is more robust against laser linewidth, but requires careful fibre dispersion compensation. The IM/DPSK format also requires accurate optimisation of the laser transmitter extinction ratio