Nortel JV Buys WDM-PON Specialist

Already one of the hot topics of the summer, WDM-PON's temperature just hit a new high with the news that Nortel Networks Ltd. has just acquired its way into the emerging high-speed access space. (See Ericsson Joins Cost-Cutting WDM-PON Team, Ignis Opens in China, WDM PON: Sooner Rather Than Later?, Tellabs Lays Out WDM-PON Plan, ADC Does WDM-PON, and Verizon's Going Strong on GPON.)

Having walked away from the fixed broadband market a few years ago, and having failed in its bid to broker a broadband relationship with Huawei Technologies Co. Ltd. , Nortel now has its foot back in the high-speed fixed access door courtesy of the acquisition, by its joint venture LG-Ericsson Co. Ltd. , of a leading passive optical network (PON) system specialist, Novera Optics Inc. (See Nortel, LG Seal Deal, Nortel CEO: We Blew It on DSL, and Nortel, Huawei Kill JV.)

LG-Nortel is paying an initial $16 million, plus a potential extra $10 million if certain business targets are met during the next 18 months, for the WDM PON specialist that already has its leading edge access gear deployed at Korean incumbent KT Corp. . (See KT Extends Novera.)

Novera's CEO John Barton noted that his company's WDM-PON platform, which, by delivering one wavelength to each end user, enables up to 1 Gbit/s of symmetrical access for as many as 16 customers per linecard, "is a natural complement to Nortel's and LG-Nortel's carrier Ethernet solutions. Nortel's strong technology base and extensive distribution channels will ensure that service providers around the world can use our WDM-PON technology to more easily deliver high-speed FTTx services to their own customers." (See Novera's Got a New PON Spin.)

And Jae Ryung Lee, LG-Nortel's CEO, noted: "Novera's technology will be indispensable for our carrier customers because it will simplify delivery of carrier-class Ethernet FTTx services to their own customers."

The acquisition also creates a new, if indirect, relationship between Nortel and ADC (Nasdaq: ADCT), as the latter resells Novera's technology in Europe and the Americas. (See ADC, Novera Team.)

— Ray Le Maistre, International News Editor, Light Reading