Calix Inc. (NYSE: CALX) is building a small, powerful IP DSLAM as part of its overall strategy to double down in the Tier 2 carrier access market, sources familiar with the matter say. The product, called the C5, was designed by Calix and is being built by Flex (Nasdaq: FLEX) in China, sources say. Software design and development for the product is being handled, in part, by a 50-man team at Wipro Ltd. in Chennai, India, according to one source.

It's not clear when the product will hit the market, but Calix hasn't put down the fact that it is building something in the space. "We're not in any position to talk about products that we have planned for the future," says the company's VP of marketing, Kevin Walsh.

Having an IP DSLAM for remote cabinets is right in line with how carrier deployments are going, especially since VOIP technologies and video services are changing the game for carriers in the last mile. "The future is in small-scale IP DSLAMs, not in large-scale digital loop carriers," says Kermit Ross, principal at Millennium Marketing.

An all-IP system will also help Calix in international markets, where fewer carriers have to worry about salvaging ATM- or Sonet-based networks, says Scott Clavenna, chief analyst at Heavy Reading.

More than one source has told Light Reading the box is comparable to the Alcatel (NYSE: ALA; Paris: CGEP:PA) 7330 in functionality and purpose, but it's remarkably less French. The device'll be used to help Tier 2 ILECs pursue a fiber-to-the-node strategy where the existing copper infrastructure is still used, fiber optic links are deployed outside the plant, and DSL bandwidth to each home is increased to provide faster Internet access and allow for the delivery of video content.

Calix has been a busy place of late, making an acquisition and adding products to its arsenal. (See Calix to Buy OSI.)

But it's worth noting that Nortel hasn't talked up Calix much since the two were paired together to win business at Sprint Corp. (NYSE: S), raising the question of whether that company will serve as a distributor for this new device.

Calix says its Nortel relationship is not in any danger following that company's joint venture with Huawei Technologies Co. Ltd. . (See Nortel & Huawei: Broadband Buddies.) "Even since the Huawei JV was announced, we've closed new business together," says Calix's Walsh.

And by "closed," we assume he means booked...

— Phil Harvey, News Editor, Light Reading