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Gigabit

Nortel, Calix Get Access at Sprint

LAS VEGAS -- Telecom '05 -- Sprint Corp. (NYSE: FON) finally has declared a winner in the next-generation access race, but the final bout wasn't as much a knockout as it was a split decision.

Nortel Networks Ltd. (NYSE/Toronto: NT) was certified as the primary supplier for the company's local telecom division, a gaggle of telephone networks that cover about 7.5 million access lines in an 18-state footprint. As first reported by Light Reading, Nortel will be reselling the C7 platform from Calix Networks Inc.. (See Sources: Sprint Readies Triple-Play Pick, Calix, Entrisphere Sprint Forward, and Tellabs Trips at Sprint.)

A Sprint spokesman tells Light Reading that the Calix C7 is the "next logical step in broadband access for the company," largely because of its ability to support fiber and/or copper access lines from a single device.

But Sprint says it will choose a secondary supplier, as it always has with DWDM, Sonet transport, and its other recent network upgrades. So the other finalists in this particular access contest -- Entrisphere Inc. and Tellabs Inc. (Nasdaq: TLAB; Frankfurt: BTLA) –-- may have some chance to save face.

Entrisphere, which partnered with Lucent Technologies Inc. (NYSE: LU) to compete at Sprint, had no comment for this story.

Tellabs says its products are competitive and it is still working with Sprint to see how the company wants to migrate its deployed base to a fiber-to-the-premises or fiber-to-the-curb network.

As for the fact that Nortel/Calix was Sprint's first choice, a Tellabs spokeswoman says the company "cannot predict at this point what this relationship will mean to Tellabs."

The deal with Nortel is a two-year commitment, but it's only a certification, not a definite purchase of any gear. Nortel and Calix still have to actually approach each of Sprint's local telecom networks and affilitates to make their sales pitch. That's why there was no announced contract amount or volume commitment on Sprint's part.

"It's a bad time to win Sprint when they're spinning off the wireline group," says an equipment vendor source close to Sprint.

That sentiment probably arises because Sprint's local telecom divison hasn't made known the migration path for its access network, nor the future services planned on its new gear. Those details will following Sprint Nextel's spinoff of its local telecom division, Sprint's spokesman says.

Even without a knockout, a win at Sprint proves that Calix wasn't fighting out of its weight class. Sprint is Calix's largest single customer to date, but the vendor says it has "nearly 190" customers and is shipping DSL ports at a rate of 150,000 to 200,000 per quarter, according to Kevin Walsh, Calix's VP of marketing.

— Phil Harvey, News Editor, Light Reading

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