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Talk Links Internet Photonics & Ericsson

Internet Photonics Inc. has an unannounced partnership with LM Ericsson (Nasdaq: ERICY), according to industry sources.

Neither company will comment, but people familiar with the matter say the deal's been in the works for awhile and already has resulted in at least one major contract award.

If it pans out, an Ericsson partnership could be instrumental in building an international presence for Internet Photonics' products, which include the LightStack GSLAM, a system that lets MSOs create an Ethernet link on Sonet/SDH nets for high-speed voice/video/data services; and the LightStack MXA, which puts access traffic from corporate networks onto CWDM wavelengths.

The startup says it has ten U.S. customers, including MSO Cablevision Systems Corp. (NYSE: CVC) (see Internet Photonics Touts VOD). But it's intent on making its mark worldwide as well. In June, for instance, Internet Photonics' VP of marketing Gary Southwell said the MXA is particularly aimed at allowing carriers in Europe and the Asia/Pacific region to economically extend their point-to-point services into greenfield networks (see Internet Photonics Broadens Targets ).

Internet Photonics already has partnerships, but nothing of the ilk of its presumed deal with Ericsson. It has an agreement with ADC Telecommunications Inc. (Nasdaq: ADCT) to offer integration and installation services to Internet Photonics customers (see Internet Photonics Leans on ADC). It's also got several technology licensing agreements, including ones with AT&T Corp. (NYSE: T) and Path 1 Network Technologies Inc.; and it has an agreement to resell Aurora Networks Inc. But it's lacked partnerships that would link big players' resale rights to its gear, and it has not had a large international sponsor for big contracts.

Ericsson could also use the help of Internet Photonics' equipment, particularly as it seeks to strengthen its position in metro networking, building on a strategy launched late last year that's also aimed at reducing the vendor's losses in other areas (see Ericsson Launches Ethernet DSL Push and Ericsson Replaces CEO).

The secrecy's not surprising. Internet Photonics has already put itself in competition with other big players worldwide, including Nortel Networks Corp. (NYSE/Toronto: NT) and ADVA AG Optical Networking (Frankfurt: ADV). Until a firm agreement's in place, it's not likely to want to further target itself in international competition. Also, in the past, Internet Photonics been cagey about some of its news, such as its scoring of a $10 million line of credit last May (see Internet Photonics Earns $10M Credit).

It's not known when an official announcement may surface, but sources indicate it could happen within several weeks.

— Mary Jander, Senior Editor, Light Reading

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