Thursday, September 2, 2010

Zhone Has Stimulus Financed Win with Shawnee Tel in Illinois 09/02/2010 San Francisco - Zhone Technologies, Inc. (NASDAQ: ZHNE), the Oakland, CA based telecom equipment maker focused multi service access platforms, this morning announced that broadband stimulus award winner Shawnee Telephone Company has selected its multi-service access node (MSANs) for support of the Southern Illinois Sustainable Broadband Transformation project. 

"This is one of many stimulus contracts for Zhone and validates that our MSAN solutions and intelligent end terminals are designed for low-touch and no-touch provisioning from central office locations which is a critical advantage for serving rural areas,” said Brian Caskey, chief marketing officer for Zhone. “By providing access – starting at the desktop – Shawnee has shown extreme foresight and commitment to ensuring real long-term educational opportunities, growth and economic promise to the area.”

Sahwnee Tel's project, building new fiber-to-the-home (FTTH) infrasturcture, was awarded $7.35 million in grants and loans from the U.S. Department of Agriculture’s Rural Utility Servcie (RUS) in the first award group for Round2 of the overall $7.2 billion federal program issued by Presdient Obama on July 2.  Additionally, the project will receive and $1 million in matching funds from the Illinois Department of Commerce and Economic Opportunity as part of state broadband initiative of Governor Pat Quinn (D-IL).

The summary of Shawnee's application submitted to RUS states the effort "stands to benefit approximatley 3,100 people" along with "438 businesses and 35 other community insitutiuons" in a region of the Ohio Valley with both the "lowest per-househoild income" and "highest unemployment in Illinois." 

Deployment of the Zhone MSAN platform will allow Shawnee to utilize a mix of broadband technologies including Gigabit Passive Optical Network (GPON) and ADSL2+ to deliver high-speed access to low density rural locations.  Zhone's press release issued this morning states the project is "slated to begin this month," and generating "direct employment for nearly 100 people in an area."

“Zhone’s single-platform, multi-service approach to broadband access provisioning provides both the flexibility and service scalability required for the success and ongoing growth of this project,” said Mike Grisham, controller for Shawnee Telephone Company. “Zhone is consistently responsive in helping us meet the unique challenges in rural service provisioning, both in upfront equipment value and by significantly lower ownership costs over the long term.”

As we reported frequently last year, Zhone was the leading U.S. telecom equipment manufacturer that argued for federal broadband stimulus funds to be expended only on American made gear. RUS legacy telecom funding programs have required such domestic content for decades, as seen in the agency's annually issued and certified List of Materials. Zhone, other manufacturers, and the Communications Workers of America lost that battle to the lobbying might of a coalition of manufacturers.  Alcatel Lucent and Cisco Systems were in the lead of that successful effort to block the strict construction and implemention the Buy American provisions within the broadband programs of the Recovery Act.

Full disclosure: The parent corporation of this publication petitioned the 2 federal agencies managing the broadband stimulus program to give competitively favorable ranking points to applicants under Round2 of the program if they stipulate the use in stimulus funded projects of RUS certified equipment from the List of Materials.  Our efforts, like those of Zhone strongly voiced in funding Round1, came to no avail.
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