BellSouth Chooses Cisco (and Lucent)

ATLANTA -- Supercomm 2003 -- Lucent Technologies Inc. (NYSE: LU) and Cisco Systems Inc. (Nasdaq: CSCO) both announced BellSouth Corp. (NYSE: BLS) as a customer of their next-generation Sonet add/drop multiplexers (ADMs) this week, a nice feather in both of their caps, assuming anyone still wears feathered caps (see BellSouth Picks Lucent DMX and BellSouth Picks Cisco for Upgrade).

Both companies should celebrate, but Cisco is far and away the big winner because it claimed its first RBOC customer for its optical networking products, unseated a Sonet powerhouse, and came away with a four-year marketing agreement with the carrier.

First the Sonet ADM news: BellSouth says it has already deployed 70 systems and has ordered another 125, but it won't give any breakdown on the division of labor between Cisco and Lucent. "I don't think we've made any decision on primary and secondary [suppliers]," says Alan Blackburn, BellSouth's science and technology research director.

BellSouth is calling the decision to upgrade its Sonet infrastructure its largest Sonet decision in 10 years. The products involved are Lucent's Metropolis DMX Access Multiplexer and Cisco's ONS 15454 system. Blackburn says the initial deployments will focus on OC192 interoffice transport relief, but BellSouth will eventually put more of the systems in the access network and at some customer premises locations.

Elsewhere in its network, BellSouth uses Cisco's 10000 and 12000 series routers at the edge, but it uses Juniper's M160 and T640 at the network's core.

BellSouth won't give specifics as to what's being upgraded and when, but its executives did note in passing that the company owns 21,000 Sonet rings, so the potential for both Cisco and Lucent is huge. The loser appears to be Fujitsu Network Communications Inc. (FNC), whose top executive, Ron Martin, went to work for Cisco last year (see Fujitsu's Martin Joins Cisco).

"Fujitsu lost to Cisco in what we believe was a close race for the secondary vendor slot. Fujitsu had been an incumbent Sonet vendor to BellSouth," wrote Merrill Lynch & Co. Inc. analyst Simon Leopold in a research bulletin on Monday.

BellSouth's decision "is a testament to the fact that Cisco would listen," says Blackburn. "They have stepped up to the plate and... the 454 has come a long way."

Interestingly, the highway that BellSouth's new data services will travel is good old reliable Sonet transmission. And the platforms enabling the journey are products that are both more than five years old. "It's really boring," says Doug Green, founder of the Bradam Group, a telecom consultancy, who was blearily wandering the Supercomm show floor.

Indeed, while Ethernet services and platforms are more hip and happening -- as discussed extensively at yesterday's Light Reading Live! seminar -- big carriers are actually buying next-generation Sonet transport (see Carriers Converge on Ethernet). Says BellSouth's Blackburn: "Based on what I've seen there's no compelling, fully-feature rich MSPP [multiservice provisioning platform] that does a full complement of Ethernet services and capabilities, including QOS. They have a ways to go and they'll get there eventually."

Now about that marketing agreement...

Under the Cisco-BellSouth agreement, Cisco will be able to sell networked, managed services to small businesses and vertical markets (such as healthcare). The pairing will not only help Cisco move more routers and customer premises equipment, but will also get it into more enterprise customers that it had previously been able to win.

Burger King, which recently bought a soup-to-nuts multipurpose network from BellSouth, wasn't a Cisco customer until the carrier brought in its routers and other gear, according to Mark Kaish, VP for data marketing and product management at BellSouth.

The Cisco arrangement, as well as BellSouth's storage and hosted services alliance with IBM Corp. (NYSE: IBM), signal a new way of doing business for RBOCs, as was touched on during the Tuesday keynote by BellSouth CEO and chairman Duane Ackerman, in between his long, boring, torturous, horrible (you get the idea) diatribes about the evils of the U.S. regulatory environment.

The telecom industry still tends to be "inwardly focused and somewhat proprietary," says Ackerman, but good partnerships would allow lots of companies to get more done. "A combination of two or three carriers, a systems integrator, and a financial institution could deploy, say, voice-over-IP, in a way that's faster and over a greater scale than before."

— Phil Harvey, Senior Editor, Light Reading

green 12/4/2012 | 11:58:18 PM
re: BellSouth Chooses Cisco (and Lucent) Says BellSouth's Blackburn: "Based on what I've seen there's no compelling, fully-feature rich MSPP [multiservice provisioning platform] that does a full complement of Ethernet services and capabilities, including QOS. They have a ways to go and they'll get there eventually."

Mr Blackburn, I think you should take a look at RPR vendors like Luminous Networks. Luminous networks offers a full set of ethernet services including QOS.
grapsfan 12/4/2012 | 11:58:09 PM
re: BellSouth Chooses Cisco (and Lucent) Green, you might be right about Luminous's technology meeting what Blackburn says they don't have yet...but honestly, there's so much more than just box performance for a company like that to win an RBOC contract:

- overcoming the politics and gaining an inside "champion" for you as a credible vendor
- convincing every group within the RBOC, most of whom can't agree on what to order for lunch, that your disruptive technology is a good thing
- getting integrated with Telcordia, the test systems, and every other hurdle that they ask for
- proving price points beyond a reasonable doubt, and then proving them again, and again
- being able to wait for months and months while testing, trials, and first office applications go on and on and on

The key word is Blackburn's statement is "compelling", and I don't think most vendors (especially startups) understand what that entails.
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