Orckit Raises Funds for Transport

Orckit Communications Ltd. (Nasdaq: ORCT) will use a recent $10.6 million infusion to bring its Carrier Ethernet gear further into the carrier world.

The Israeli company wants to add traits like high availability that are more associated with Sonet/SDH gear, Eylon Sorek, director of marketing, tells Light Reading.

Orckit being public, it raised the roughly $10.6 million by selling shares and warrants; Orckit filed its registration statement at the end of March.

Orckit-Corrigent, as the company likes to call its Ethernet systems operation, has seen some success with the CM-4140 system that launched in 2008. The company recently signed a Tier 1 service provider in India, and it also claims KDDI Corp. as a customer. (See Orckit Wins in India.)

Now, one of the company's biggest customers -- officials aren't saying which one -- is requesting that the CM-4000 family include features such as high availability and better reliability -- characteristics associated with older Synchronous Optical Network (Sonet) and Synchronous Digital Hierarchy (SDH) equipment.

Sorek uses the word "transport" to summarize these features, and transport, in that sense, "is a potential growth engine we see for this customer and other customers."

The requests make sense, given that one of Orckit's calling cards is the Ethernet-based transport of TDM traffic, using circuit emulation as the delivery vehicle.

"When you start to take MPLS and packet technology and introduce it to the guys in the transport department, they have their own experience about what is 'management' and what is 'high availability' and what is 'reliability,' " Sorek says. "When you want MPLS as a transport layer, you need to work with those people, and you need to shape the product for, say, high availability."

The CM-4000 line does have redundancy and other reliability-minded features, but they're not at the level expected in a TDM network, according to Sorek.

Two of Orckit's founders are betting their own money on this R&D phase. Chairman Izhak Tamir and CEO Eric Paneth agreed to purchase 100,000 and 75,000 stock-and-warrants units, respectively, in the offering.

— Craig Matsumoto, West Coast Editor, Light Reading