The functional design of the NEPTUNE system must be driven by science requirements. For example, the locations of the 30 seafloor nodes in Figure 1 wil be determined by science needs. Through an assessment of present and projected future ocean instrumentation and experiments, system parameters such as the peak and average data rate, power level, and allowed data latency and jitter have been defined. Aggregate system capacity of 10 Gb/s and delivered power at the 2 kW level per site is sufficient to meet science goals. The system must also distribute accurate (1 s) time information to seafloor instruments.