Calix: At Home in Britain

LONDON -- NextGen12 -- As part of its bid to boost its international presence, a strategy outlined a year ago and enhanced by the recent move to acquire Ericsson AB (Nasdaq: ERIC)'s fiber access broadband division, Calix Inc. (NYSE: CALX) is looking to help build and run high-speed broadband networks in Asia/Pacific and Europe. (See Russo 'Tickled Pink' by Ericsson, Calix Deal; Calix Acquires Ericsson's Fiber Access Bix; and Calix Goes Global.)

The latest example of Calix spreading its wings, albeit in a small way, is at a new housing development in the north of England (Derwenthorpe, Yorkshire), where the vendor not only is supplying its Ethernet Service Access Platform to enable point-to-point fiber connections to more than 540 homes but also is managing the network too, for at least a few years. (See Calix Lands Small Deal in UK.)

On the customer side, the network runs two fibers into each home, one to carry TV, video and audio services, the other for broadband and VoIP. A building on the edge of the project houses the Calix equipment and takes video services feeds through satellite connections. That facility is linked into a local metro fiber network run by CityFibre , which in turn hooks into the Level 3 Communications Inc. (NYSE: LVLT) U.K. backbone to connect to a London Internet exchange (Telehouse East).

Residents on the housing estate, which is in the process of being built (about 20 homes are ready currently), are offered entertainment services and broadband connections running at up to 50 Mbit/s symmetrical, though 100 Mbit/s connections are also available on demand. As alternative fixed line services are not available, the housing trust behind the project has insisted that broadband prices are set at below standard U.K. service tariffs for equivalent services.

As it's a relatively small project, the vendor didn't face competition from access equipment rivals: according to Calix staff here in London, rival bids were from local companies without the same level of experience in FTTH deployments that Calix was able to offer.

So what's in it for Calix? Well, this isn't a project that's going to shift the revenues needle. But it's another showcase for the company in Europe, where there are numerous local projects in multiple markets, with more likely to be developed as private and particularly public investors back digital projects (See Why 9.2 Is the Magic Number.)

And it's not the company's only engagement in the U.K. It is supplying its GPON access platform to the hauntingly-named Cybermoor Networks project in north-west England, is supplying equipment to a multi-village broadband project in south-west England and, through Occam (which it acquired in early 2011), a city FTTH project in the Glasgow, Scotland. (See Calix Completes Occam Buy and Did Calix Get a Bargain on Occam?.)

Calix's challenge now, especially with Ericsson's GPON assets due to come on board, is to strike multiple deals with major telcos, large alternative network operators and municipalities in Europe and Asia/Pacific that will move the needle on the company's top line.

— Ray Le Maistre, International Managing Editor, Light Reading

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