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We evaluate the impact of variable-code-rate transceivers on cost, capacity and survivability of wavelength-routed optical networks. The transmission rate and reach trade-off is quantified for two hypothetical coded modulation schemes (aggressive and conservative) in a wavelength routing network with 50-GHz-spaced channels. The aggressive scenario assumes the 64-QAM modulation format, a small gap to capacity, and a small excess bandwidth. The conservative scenario considers the 16-QAM modulation format, and a larger capacity gap and excess bandwidth. The performance of the conservative and aggressive technologies is evaluated in three representative networks. Transparent reaches are calculated by means of an existing analytical method which assumes the AWGN hypothesis for the nonlinear noise. It is shown that variable-code-rate transceivers enable the concept of soft protection, in which the protection lightpath operates at a data rate which is lower than the corresponding working lightpath, in a way to avoid regeneration. This is specially attractive in the transport of IP traffic, where capacity reduction (in average up to 25%) may be tolerable during a repair time. It is also shown that variable-code-rate transceivers have the potential to offer significant savings in terms of transceiver usage and wavelength occupation, when compared to current fixed-rate transceivers operating at 100, 200 or 400 Gb/s. Finally, practical variable-code-rate transceivers may achieve a discrete set of N code rates, yielding a quantized capacity-versus-reach curve. The system impact of N is evaluated for several network scenarios.