Friday, March 25, 2011

Zhone Sees Success in Launch of FiberCell Backhaul-FTTx Solution

Solution Aimed at Dynamic Independent Carrier Backhaul Market 03/25/2011 San Francisco- ZhoneTechnologies, Inc. (NASDAQ: ZHNE), is reporting success in its launch of its Zhone FiberCell portfolio at this week’s CTIA Wireless 2011. The FiberCell portfolio is a carrier-class mobile backhaul solution which integrates with the company’s multi-service MXK platform to help service providers manage higher traffic loads on their existing network infrastructure.
Zhone’s Manish Matta, Senior Marketing Director told us from CTIA the venue “was an ideal launch platform for Zhone FiberCell Mobile Backhaul solution as service providers we have been in discussions with acknowledge the true benefits of leveraging their deployed MXK OLT to fulfill their backhaul needs.” 

“Backhaul is a major bottleneck today,” said Matta “and the Zhone dual step approach via Ethernet and Fiber to provide the needed backhaul capacity and bandwidth provides network flexibility, higher performance and superior investment protection.”

The Zhone FiberCell portfolio offers alternative backhaul options that give operators the flexibility to choose between copper and fiber, including Ethernet in the First Mile (EFM), Gigabit Passive Optical Network (GPON) and Active Ethernet (AE).  By leveraging the operator's existing and new infrastructure, Zhone FiberCell offers a cost-effective and high-performance solution for optimal backhaul capability. 

The FiberCell launch marks Zhone’s entry into the market for wireless backhaul solutions that integrate with FTTx infrastructure to allow providers to scale network capacity as they anticipate a fast evolution to next generation 3G and 4G networks and services. 

The company pointed us to the recent statement of Michael Howard, principal analyst at Infonetics Research, saying "With the moves to fiber by mobile backhaul transport providers, Zhone's new FiberCell products will make their MXK customers and other service providers take note. FTTx solutions such as this can help protect operators' network investments long-term."

"Packet backhaul is absolutely a necessity in today's world of smart devices and increased bandwidth demands," explained Brian Caskey, chief marketing officer of Zhone. "The mobile operators investing in backhaul services rely on IP-based platforms like Zhone FiberCell to offer added flexibility, deliver higher speeds, share resources, ensure seamless management and provide cost-effective scalability. 

Timing is critical in mobile backhaul and Zhone FiberCell is designed to provide seamless service."In the initial phase of the product launch, the Zhone FiberCell portfolio will feature three new products, including:

      Zhone FiberCell MXK Uplink Cards providing integrated timing over packet support, including IEEE 1588 v2 and the ability to accept standard-based timing over Ethernet (SyncE) and external sources including GPS Clock input via the MXK.

           Two Zhone Network Interface Device (zNID) Optical Network Terminals (ONT) (zNID-GE-9480 and zNID-GPON-9480) providing 9 Gigabit Ethernet (GE) LAN, 8 T1/E1, and IEEE 1588 Timing Recovery.

In addition, Zhone customers benefit from the Zhone's advanced management capabilities viaZhone Management System (ZMS) upgrades and Zhone EZ Touch Provisioning.

Our Take: The Rising Tide of Independent Carrier Backhaul
Zhone launched its FiberCell suite this week into a market with continuing buzz from manufacturers AdTran (NASDAQ: ADTN), Alcatel-Lucent (NYSE: ALU), and Calix Networks (NASDAQ: CALX). All have have had products out for a while.

The bigger buzz at CTIA – the $39 billion proposed takeover by AT&T Inc. (NYSE: T) of T-Mobile USA – will have a lot to do with how healthy that market is for multiple backhaul solutions. That is especially true in the small and more rural markets that Calix and Zhone are highly competitive in. Independent cable operators and telcos predominate in that sub-sector.

The proposed acquisition will have an impact, even though the national footprints of AT&T and T-Mobile often leave out these lower density areas. A new wireless mega-operator holding upwards of 80% of the market will produce a significant net consolidation of backhaul circuits. That will,  at least temporarily, put a damper on continued supercharged growth.

Will the rising tide in demand for 3G and 4G mobile services be great enough to lift all boats for  rural carriers and for the gear makers like Zhone that sell into them?

This demand, together with the impacts of the stimulus money now rolling out, the Obama National Wireless Initiative, and new tranches of federal CAPEX subsidies are today creating a new rural broadband ecosystem. Zhone’s new FiberCell suite will live in this space. 
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