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 Shorter sales cycles and greater interest in partnering with startup equipment companies originally made these service providers good customers for startups, says Dennis Barsema who was CEO of Redback Networks Inc. (Nasdaq: RBAK) until last July and has recently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

<<   <   Page 2 / 6   >   >>
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.
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.
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.

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

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.
<<   <   Page 2 / 6   >   >>
Sign In