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Ethernet equipment

Zhone Zooms Into Ethernet First Mile

LONDON -- Light Reading's Ethernet Expo: Europe 2006 -- Zhone Technologies Inc. (Nasdaq: ZHNE) burst into the Ethernet over copper market today with the launch of its EtherXtend family of products at Light Reading's European Ethernet Expo, which opened its doors in London this morning. (See Zhone Launches EFM Gear.)

Surprisingly, the company says its new product family is not based on technology from its acquisition of access product vendor Paradyne. (See Zhone to Buy Paradyne for $184M.)

Instead, the products are based on existing technology already deployed in Zhone's broadband loop carrier (BLC), the Multi-Access Line Concentrator (MALC), but developed to conform to Ethernet in the First Mile over Copper (EFM) standards. (See Insider Examines EFM and Ethernet in Access Networks.)

Eric Knapp, product manager for all of Zhone's Ethernet lines -- including the legacy Paradyne products and IP DSLAM products that came from Paradyne's 2004 acquisition of Net to Net Technologies -- says the products provision Ethernet services over copper SHDSL or T1/E1 circuits. The technology is available in standalone product form or as line cards that can be deployed in Zhone's BLC.

Zhone, which just announced its first quarter financials, is entering an already competitive Ethernet-over-copper market with well-established players such as Actelis Networks Inc. , ADVA Optical Networking , ANDA Networks Inc. , Ceterus Networks Inc. , Hatteras Networks Inc. , MRV Communications Inc. (Nasdaq: MRVC), Overture Networks Inc. , and RAD Data Communications Ltd. already touting for carrier business. (See ADVA Snaps Up Covaro, Zhone Reports Q1, and Who Makes What: Access Equipment.)

Knapp admits that Zhone is playing catch-up. So what do analysts think about the vendor making its mark in an already crowded market?

Heavy Reading senior analyst Stan Hubbard says there's plenty of room for another player because of the amount of growth ahead, but he believes Zhone will need to find a larger partner to make its mark globally. "The trend in this sector now is for the EFM specialists to partner with a larger supplier that can provide a healthy sales channel, and that's something Zhone will need to look at too."

Ventelo , which is using the technology to provide Ethernet access services to its enterprise customers, but it has yet to announce any OEM deals.

Perhaps a partnership could begin here. The company was showing off the technology here at the Ethernet Expo, and Knapp had a healthy audience to pitch to -- more than 400 European telecom executives, the majority from service providers, filed through the door in the first few hours of the two-day event.

— Ray Le Maistre, International News Editor, Light Reading

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