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Optical/IP

Mayan Ruins?

Mayan Networks Inc. may be going the same way as its namesake civilization.

The startup, which is developing a next-generation Sonet switch for metro area networks, is the latest in a line of startups feeling the effects of an ongoing optical networking shakeout. Today, the company announced to employees that it would be downsizing its workforce in an effort to cut costs and asked for volunteers to take the lead in falling on their swords for the company.

One source anonymously sent Light Reading an email purportedly issued internally by Andrew White, VP of corporate resources at Mayan:

    In order to conserve our cash to be able to complete future development we must reduce our expenses now and focus only those resources we need on the essential work that has to be done. Consequently, we have determined that we must reduce our workforce commensurate with those needs and the capital we have available.

    As we consider the necessary steps to be taken, we want to offer our employees the opportunity to volunteer for separation before we proceed with any involuntary reduction in our workforce. Some individuals who have key skills that we have identified as essential for the achievement of our goals will not be eligible for this separation package.


Mayan raised its initial $8 million round of funding in November 1999. Since that time it has grown to nearly 200 employees and has added over $90 million of funding to its coffers but still hasn’t been able to announce a customer.

Mayan's problems could stem in part from the fact that it had been targeting competitive local exchange carriers (CLECs) as customers. Shorter sales cycles and greater interest in partnering with startup equipment companies originally made these service providers good customers for startups, says Dennis Barsema who was CEO of Redback Networks Inc. (Nasdaq: RBAK) until last July and has recently emerged as CEO of component startup Onetta Inc.

But now, with the capital markets drying up, numbers of CLECs are running out of money and shutting down operations. AduroNet Ltd., Digital Broadband Communications, and FiberStreet are just a few of the most recent casualties (see AduroNet Goes Bustand Digital Broadband Fades Away).

Equipment startups are often the hardest hit by these closings. For example, Zaffire Inc., a metro DWDM player, announced a $20 million contract with FiberStreet a month before the company closed its doors (see Zaffire Gets Zapped). Ironically, Mayan and Zaffire, which both appear to be struggling, are co-sponsoring a seminar on the future of optical networking in the metro area network. It's set to begin on March 6.

And since the company is competing in an already crowded market, a reduction in potential customers is not a good sign. Especially, when some of its competitors are large players like Cisco Systems Inc. (Nasdaq: CSCO), through its Cerent acquisition; Redback, via its Siara deal; Lucent Technologies Inc. (NYSE: LU), through its Chromatis buyout; Fujitsu Ltd. (KLS: FUJI.KL); and now Ciena Corp. (Nasdaq: CIEN), through its acquisition of Cyras.

The scene is also crowded with other startups that haven’t been bought yet, like Astral Point Communications Inc., Geyser Networks Inc., and Ocular Networks Inc.

Mayan did not return phone calls by press time. But in previous interviews Dan Gatti, the company’s CEO, has acknowledged that the onslaught of CLEC closings was having an impact on the company (see Zaffire Gets Zapped).

-- Marguerite Reardon, senior editor, Light Reading, http://www.lightreading.com

opti fool 12/4/2012 | 8:33:59 PM
re: Mayan Ruins? Can we get a tally of CLECs that have flopped/sought bankruptcy protection so far in the US and Europe? I think there are at least 8 firms.



T-bone 12/4/2012 | 8:49:09 PM
re: Mayan Ruins? Customers have been slow to move to VPNs. Here's an excerpt from Total Telecom:

VPN specialist Aduronet goes under
By Ray Le Maistre, Total Telecom

09 February 2001

"The management team was solid gold - this is a great shame," Camille Mendler, Yankee Group Europe's director of convergent communications service, told Total Telecom. "But you don't fail to get second-round funding just because of cynicism and market conditions. You need to be able to explain clearly what your business proposals are, and one of Aduronet's problems was explaining their position in the market. They were focusing on value-added services and were not an infrastructure play, but they found themselves caught between a rock and a hard place. You need a certain amount of infrastructure for economies of scale," she added.

"The target was right - virtual private networks for corporate customers," continued Mendler. "But it was noted in the industry that it was difficult for Aduronet to articulate its message about how it could empower corporates with these value-added services - that's a difficult message to get across."
clowell 12/4/2012 | 8:49:14 PM
re: Mayan Ruins? Does anyone have any real idea as to why Aduronet actually folded? Poor sales team, weaker than expected demand, poor pricing schemes, over spent on random items? It seems as if the business plan was solid -- new network, cheap bandwidth, great cost advantage, what went wrong?
FiberFan 12/4/2012 | 8:49:37 PM
re: Mayan Ruins? R-007,
My take on Alidian and Astral Point is as follows.

Astral point is a very interesting play. They have a god-like box but seem to have signed a couple of big fish- notably Time Warner telecom. I have a few good friends at TWT and they said thet they really aren't deploying much so I'm curious as if it's a delivery problem or, if TWT just isn't ordering much. I really thought that Astral Point was gonna pop a few more notable ones but it just hasn't happened. I think that's very curious.
Alidian's prospects on the other hand are more muddled. Their only recent press announcements show that they "interoperate" with other gear in lab tests. Although success in lab's is very important, you usually would hope that it's in a potential customer's lab and followed by a puchase agreement. They have no customers on the hook (that we know of) coupled with the fact that within the metro space, their product set (next gen SONET) is really competitive (Cisco, Redback and Astral point among others). It seems as thouh they are between stages two and three. Time to execute.
Of course these are my opinions but I can say that I watch this "space" very closely.
Hope this insight helps.
FiberFan
allidia 12/4/2012 | 8:49:44 PM
re: Mayan Ruins? I read a message board for Lightpath indicating that Lightchip is also on the verge of IPO. Anyone???
allidia 12/4/2012 | 8:49:44 PM
re: Mayan Ruins? anybody know the status on this IPO. I know they have ATG and Comcast as customers and I hear they are buying quite a bit of components?
sonet_rules 12/4/2012 | 8:49:51 PM
re: Mayan Ruins? Yes, that's true. More of them are leaving.....
reader007 12/4/2012 | 8:50:01 PM
re: Mayan Ruins? where do you think Alidian or astral point fits here.

Do you think they will survive this storm.
guy_incognito 12/4/2012 | 8:50:03 PM
re: Mayan Ruins? Yup, I've heard that too.

--------
I heard Equipe picked up an Astral Point architect. Anyone heard same?
FiberFan 12/4/2012 | 8:50:04 PM
re: Mayan Ruins? fk, You make some very valid, on the nails head points.
I think there have been three types of startups recently:
1. Just plain bad- Someone thought they had a better idea (25Mb ATM for example).
2. Really good (or great) ideas that are incubated pretty well but they don't have the right personnel to execute. Their goal is to be purchased, cash out and start again.
3. Great ideas that are combined with a team that can execute. They build their teams form the ground up- idea, leadership, engineering, funding, marketing, sales and service.
At this stage in the game, only "3"s will survive. I would look at all of these hot startups to see a couple of things- Execution (sales, next round funding, etc) and committment (building their infrastructure to support the execution).
All we need to do is watch. The shake out has started.

Comments?

FiberFan
Freddytecho 12/4/2012 | 8:50:05 PM
re: Mayan Ruins? They don't even have BITS interface
DWDM_Man 12/4/2012 | 8:50:16 PM
re: Mayan Ruins? Wellesly:

Yeah - I have heard some HORRENDOUS stuff about these guys. At least some of us have the decency not to air their dirty laundry. These guys ran afoul in their reporting many times. I think they're setting themselves up for another fall.

>> In case you did not know, Lightreading reporters have something common with the National Inquirer newspaper, you will sometimes see words like "Wankers" in some of their articles. This is because there used to be a publication by the name of Data Communication that had reporters of British origin. They quit and now run LightReading. They do not have any interest other then destroying American Companies. I am surprised that some of the advertisers have not questioned their motives.
toolsoup 12/4/2012 | 8:50:16 PM
re: Mayan Ruins? The truth and nothing but the truth.
You should try it.
Silvio 12/4/2012 | 8:50:17 PM
re: Mayan Ruins?
Actually, it's:

"You can't HANDLE the truth!"

But why let accuracy stop you now?

toolsoup 12/4/2012 | 8:50:17 PM
re: Mayan Ruins? I guess we know where you work now!!!
And where that rumor started!!!!!

As my friend Jack says

"You CAN'T handle the truth".
toolsoup 12/4/2012 | 8:50:18 PM
re: Mayan Ruins? The truth will set u free :-)
Silvio 12/4/2012 | 8:50:18 PM
re: Mayan Ruins?
Fly Free Bird, FLY!

http://www.lightreading.com/bo...
fk 12/4/2012 | 8:50:19 PM
re: Mayan Ruins? Where is here? A competing startup. I don't think there's any point in getting more specific than that, because, quite frankly, given the level of rancor and (most specious) personal attacks, I don't want to see my company's good name dragged through the mud. Everyone comes here with an axe to grind, and I have no desire to see people with competing interests and lesser ethics do a hatchet job on us. There seems to be plenty of that going around. The macro-economic conditions in which we find ourselves have deteriorated to the point that a (much needed) shakeout is starting to happen. A bunch of companies are going to go out of business, and a lot of good people's dreams of profiting from the grand optical opportunity are going to be dashed. That's going to make for some very unhappy people.

As far as companies going out of business goes, there are lots of reasons for startups to fail. Failure to execute is only one. Architecting the wrong solution, aiming too low, being too late to the market, growing the company too quickly, failing to grasp changing market conditions until it's too late. Think about Ironbridge, who reportedly finally had the engineering part well in hand, but who failed to seek financing when it could be had (relatively) easily. Do you think they are sorry they didn't secure their next round last summer? A bunch of other startups can be expected to fail not because they are building the wrong box or aren't getting it built and debugged on time, but because they've added more headcount than is sensible and their burn rate is going to harm them in this market of very difficult, low valuation high dilution funding. You need more than a crack engineering team to build a company. You need a management team at the top of its game. You need a marketing department that knows how to position, how to get the message out, how to differentiate. You need a sales team that has the right contacts and experience to deal with the kind of customers that sign the kind of contracts that lead to the IPOs that we all wet dream about.
The shakeout is among us, and some well known names are going to fail. I'm sure glad I'm not at an early stage startup now. Way too risky, and I am not averse to risk. But would you rather join an early stage startup in the current funding environment or a startup that has a product that works, is in trials with major customers, and has the funding necessary to weather the current storm in the bank already?
lightreading 12/4/2012 | 8:50:22 PM
re: Mayan Ruins? companies been out there with product for a while, and not much to show for it. I heard they've been on the block for a while as well. Cisco's looked at them, but no bites so far. the box very limited DWDM capabilities, and nothing to brag about as far as port density goes. a multi-service box that truly falls in the middle (read: it does not excel in any one area).

more power to em if they can close a deal with MFN, but I'd give it 50 to 1 odds they don't.
reader007 12/4/2012 | 8:50:23 PM
re: Mayan Ruins? Alidian seem to have a good technology. The only thing is it's propritory.

Any comments on its future!!!
I believe they are already selling.
Renot 12/4/2012 | 8:50:23 PM
re: Mayan Ruins?
Wasn't sure what 'realdeal' was referring to, so on a hunch (asics) I checked the thread with that rumor. Sure enough, "hitman1's" agenda is unvieled:

http://www.lightreading.com/bo...

http://www.lightreading.com/bo...

http://www.lightreading.com/bo...

;-)

Renot 12/4/2012 | 8:50:24 PM
re: Mayan Ruins?
hitman1 - that was truly pathetic.
wellesly 12/4/2012 | 8:50:26 PM
re: Mayan Ruins? In case you did not know, Lightreading reporters have something common with the National Inquirer newspaper, you will sometimes see words like "Wankers" in some of their articles. This is because there used to be a publication by the name of Data Communication that had reporters of British origin. They quit and now run LightReading. They do not have any interest other then destroying American Companies. I am surprised that some of the advertisers have not questioned their motives.
Jimi 12/4/2012 | 8:50:27 PM
re: Mayan Ruins? Dude,

Alidian has been dead for months. I had a good friend in engineering there. Alidian's problems are DEEP. Everyone and their mother is at MFN. So don't get too excited about it. Which is no FiberStreet.....

You're an idiot.
Rony 12/4/2012 | 8:50:27 PM
re: Mayan Ruins? It's enough that you slam well-intentioned companies in your articles.

I am now convinced you are all posting messages anonymously on this cheezy article talk message board. It's obvious. I've worked in this industry for years. No one I've talked with would defend Lightreading period, and no one I know would do it with as much conviction.

If Mayan Networks were to do something positive, I wonder if LR would print it with the passionate tone of this article. Light reading sees blood and goes for the juggular. (But only if it's a certain company's blood)

I think it's interesting that a few advertisers get slammed too. Wonder if Mayan has decided to cut its ad budget...might this be the reason for the negative reporting?
twistedcopper 12/4/2012 | 8:50:28 PM
re: Mayan Ruins? fk-
where is "here"?
-twisted
vinny_t 12/4/2012 | 8:50:28 PM
re: Mayan Ruins? Nah...I heard it was the kid from the stockroom.
fk 12/4/2012 | 8:50:29 PM
re: Mayan Ruins? MFN may not have anything to gain from the release, but Alidian sure does. Typically, when a trial is successful,, the customer will allow a press release by the vendor mentioning the customer and the success. But the lack of such an announcement is not in and of itself indicative of problems for Alidian. The fact is, sales cycles for the really big guys are on the order of 12 months, so the mere fact that they haven't announced a customer may simply mean that they are concentrating on the really worthwhile accounts.

We're seeing that sort of dynamic here. We're getting all sorts of traction with great customers, but have nothing to announce as yet...
joey_baggadonuts 12/4/2012 | 8:50:30 PM
re: Mayan Ruins? I heard Equipe picked up an Astral Point architect. Anyone heard same?
realdeal 12/4/2012 | 8:50:31 PM
re: Mayan Ruins? Maybe you should spend more time working on those useless asic's. Or maybe your ex director of product marketing who went to Astralpoint could shed some light (no pun intended) on why you announced product more than a year ago and have not announced a single sale. Hitman1- you should start looking for a new job soon - like 1/2 of you hardware team who was recently seen interviewing in Marlboro with the old 3com guys...
allidia 12/4/2012 | 8:50:33 PM
re: Mayan Ruins? You don't get it do you. The box works and it works with others. What does MFN have to gain from that release? Is MFN in the business of product testing? I think not and I like most would read alot further into that announcement.
BTW - I don't work at Allidian I just like the name.
joey_baggadonuts 12/4/2012 | 8:50:33 PM
re: Mayan Ruins? What ever they're doing at the top it seems to be working cause they're still recruiting (successfully) like crazy.
light_on_dude 12/4/2012 | 8:50:34 PM
re: Mayan Ruins? Complete the story Allidia....MFN did a trial of allidian gear...thats it. no comment , no commitment to buy gear, nothing. I don't know why you folks at allidian find this to be a victory? They tried your gear, they said it was ok, but not good enough to buy?? How the heck is that a victory? how would you ever explain that to Wallstreet as a victory? I could understand if this was alpha or beta product, but aren't you supposed to be shipping?
jimandgeri 12/4/2012 | 8:50:34 PM
re: Mayan Ruins? Mayan management does not need to look very far for the reasons for their problems.

Upper management, both engineering and marketting, have repeatedly buried their heads in the sand by refusing to acknowledge the absolute necessity of providing standard management interfaces, TL1 and SNMP based GUI, for their prospective customers.

Another major defect in MAYAN's product, lack of reliability (redundancy, protection switching, etc.) is the direct result of managements refusal to follow the advice of their very talented telecommunications engineers.

It is a terrible shame both investors and many fine MAYAN employees must suffer for this general ineptitude.
adithyan 12/4/2012 | 8:50:35 PM
re: Mayan Ruins? Allidian was displayed in the Qwest/MCI
labs, but they were not at all displaying
the characterstics of a solid metro box
I hear
trinity 12/4/2012 | 8:50:35 PM
re: Mayan Ruins? there goes the theory that LR advertisers are shielded from negative mentions in LR articles.

maybe Mayan should think about upgrading their ad.
toolsoup 12/4/2012 | 8:50:36 PM
re: Mayan Ruins? Blind spots, I guess. For example Equipe, who has done nothing, except replace their heads of marketing, sales and finance in the last couple of months. But LR hasn't even metioned that little nugget. Why Not?

Sounds to me like they have had a bit o trouble @ the top of the org chart.

What is going on over there?
allidia 12/4/2012 | 8:50:36 PM
re: Mayan Ruins? Allidian just completed a trial with MFN which is no Fiberstreet. They and Astral Point (TWT contract) appear the most solid of the Metro companies.
noone 12/4/2012 | 8:50:37 PM
re: Mayan Ruins? Since we are sort of on the subject, what does anyone say about Alidian Networks? They too are a startup in the Metro arena. Are they to suffer the same fate?
rocket101 12/4/2012 | 8:50:37 PM
re: Mayan Ruins? What about Kestrel Solutions? Any info.?
adithyan 12/4/2012 | 8:50:37 PM
re: Mayan Ruins? I would not consider Astralpoint as a bigdog.
But the company sure is not dying. Comapny's
major customer TWT is not going to disapper overnight (considering what happened with Zaffire).

I don't know if it is the advertisements, but
I feel that LR is not very keen on publicizing
the company's acheivements. I see AP being
mentioned whenever there is a bad news in the
metro optical space.

I would suppose, that is the way to go when
it comes to journalism about a highly
competitive market, where journalists themselves
try to grab a pie off of

another boring post 12/4/2012 | 8:50:39 PM
re: Mayan Ruins? Where is your evidence? As far as I can see, this is completely false, and I read this site every day.

Nortel doesn't get written about by LR? Are you kidding? Type "Nortel" into the search engine. See how many stories you get. Literally hundreds.

I'm all for criticism, and keeping people honest. But these blanket statements are just pointless.


another boring post 12/4/2012 | 8:50:40 PM
re: Mayan Ruins? it's part of a trend, no?

Metro systems companies in trouble.
optinuts 12/4/2012 | 8:50:40 PM
re: Mayan Ruins? LR does have several blind spots. Certainly, companies that advertise with them don't get negative mentions all the time. Also, these companies also get cited for their products all the time.

those companies they have reported negative news on, get mentioned all the time. its a sort of self fulfilling prophecy. you need to justify your negative reporting.

a number of companies rarely get mentioned, including big players like nortel. given they are the biggest optical vendor, i would expect they would be mentioned a little more, since anything they do has to have a big impact on the network.
fiberfrk 12/4/2012 | 8:50:40 PM
re: Mayan Ruins? No, I don't get IT!
It just seems like beating a dead horse. LR mentions Zaffire all the time.
This article is a great example. What does Zaffire have to do with Mayan Networks?

ps: I don't work for Zaffire, nor do I know anybody that does.
fk 12/4/2012 | 8:50:41 PM
re: Mayan Ruins? RPR is a future technology. I believe it will gain acceptance as a less expensive, packet oriented alternative to SONET. It's anybody's guess how quickly RPR boxes will be employed, however, and given the uncertain state of the economy, it's dangerous to bet the company that deployment will happen in time to provide the impetus for an IPO before funding runs out. A company that can provide a solution that leverages the existing SONET infrastructure now with a migration path to RPR while preserving its engineering investment in providing differentiated services is well positioned regardless of when RPR is deployed.
DWDM_Man 12/4/2012 | 8:50:42 PM
re: Mayan Ruins? Don't really know why Zaffire is targeted for collateral damage so often - it remains a great example that distratcing personal vendettas play a much more significant role in LR's reporting than focused journalism.

I don't think it is Maggie Reardon with an axe to grind - my hunch is that she takes directives from someone else. I think it is either LightReading leadership or an "Invisible Hand" behind them.

...in any event, there's currently no sign that it will abate any time soon.
another boring post 12/4/2012 | 8:50:42 PM
re: Mayan Ruins? DWDM_Man (and Zaffire employee?)

Here, in reverse chronological order is a list of the screw ups at Zafire in the last twelve months.

* announced customer, goes bust
* fires VP marketing
* fires 20 percent of sales team
* fires CEO
* changes product strategy (not once -- TWICE!)

I don't work for Zaffire. Neither does the lightreading reporter, obviously. So stating these facts is not a personal vendetta, is it?

Do you get it now??? It's called reporting.



mirrorman 12/4/2012 | 8:50:42 PM
re: Mayan Ruins? Where do you think RPR will fit in?
fk 12/4/2012 | 8:50:45 PM
re: Mayan Ruins? How do you figure that DWDM is more efficient than next-generation SONET? In what commodity is it more efficient?

It seems to me that on the edge, there isn't enough aggregation going on to justify the expense, size and power of a DWDM box. At the metro core, sure, but not at the access level. A next-gen SONET access box can be small, relatively low power, densely packed (three or four to a rack), and offer dozens of customer interfaces for a lot less cost than a comparable DWDM system. For DWDM to be cost effective, you need a very substantial degree of aggregation (many hundreds of gigabits); whom do you see in the near term providing such bandwidth demands from your neighborhood CO? Even though its obvious that only businesses could possibly afford the sorts of raw bandwidth that would make a metro-access DWDM box useful, there are still very, very few businesses (if any) willing to pay for those levels of bandwidth, even at steep discounts to the current tariff levels. I think that ultimately the access side is better served by new services than oceans of dumb bandwidth at the edge. Bandwidth is on the path of commoditization. High value differentiated services provide a chance to charge for value, an opportunity to increase margins that will be seen as very attractive by service providers. Commoditization makes cost king; differentiation makes value king. I know where I'd prefer to get MY revenue stream.
firepig 12/4/2012 | 8:50:48 PM
re: Mayan Ruins? Thanks, from your points, the long-haul gaints have already extended their hands to metro-access. Do you think there is still a space for start-up which has not been acquired right now to make its live?
Also, like you mentioned, most the players you brought out are SONET fans, yeah, SONET is the thing on haul and there is no reason to blow them away from meto. Do you think whether there is any other solution from access? ( like you mentioned GE)

Thanks again
firepig 12/4/2012 | 8:50:48 PM
re: Mayan Ruins? Your comments sound interesting. One question: people say metro-access is hot. Is the market Mayan addressed to or they might pick up a old tech.
Thanks
fiberfrk 12/4/2012 | 8:50:49 PM
re: Mayan Ruins? Why is Zaffire mentioned in every Light Reading
article?
allidia 12/4/2012 | 8:50:50 PM
re: Mayan Ruins? 95% of startups will fail. 5% will not only make it but will prosper at enormous valuations. Unfortunately, Mayan and Ironbridge don't seem to have made the cut. So Ms. Darkreading why don't you tell me who will make it as you seem to knock every startup that is named.
Lightlight 12/4/2012 | 8:50:53 PM
re: Mayan Ruins? "No man is an island entire of itself. Every man is a part of the main, a piece of the whole. Every man's death diminishes me as I am involved in mankind. Therefore, never ask for whom the bell tolls, it tolls for thee..."

John Dunn
birdieking 12/4/2012 | 8:50:53 PM
re: Mayan Ruins? Marge fires another torpedo into the side of a listing ship!
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