Stealthy startup Xebeo Communications Inc. is about to become a little less stealthy. The company has signed an agreement with IBM Corp. (NYSE: IBM), Light Reading has learned, through which IBM will manufacture custom application-specific integrated circuits (ASICs) for Xebeo. Xebeo (pronounced: za-BAY-o) is building a packet-switching and service-provisioning box for carriers using Ethernet as a replacement for ATM, Sonet, and Frame Relay.

A deal with IBM, one of the premiere developers of ASICs, is a good place to start. Rather than just moving bits, Xebeo's box falls under the category of switches that have substantial packet processing capabilities and can perform a “deep read” of packets as they enter the switch. The ASICs and other electronics in such switches classify, queue, shape, and police the flow of data in order to allow carriers to charge for IP services (see The Service-Aware Switch).

Xebeo's box sits where long-haul fibers meet metropolitan area networks and will aggregate as many as 3,200 gigabit Ethernet connections, or the Sonet equivalent thereof. Not many more details are known about Xebeo's technology, but it sounds as though it would compete with equipment made by Cisco Systems Inc. (Nasdaq: CSCO), Juniper Networks Inc. (Nasdaq: JNPR), Foundry Networks Inc. (Nasdaq: FDRY), Extreme Networks Inc. (Nasdaq: EXTR), and Nortel Networks Corp. (NYSE/Toronto: NT).

Six former Bell Labs engineers -- Rohit Dube, Kerry Fendick, Kanwar Jit Singh, Lampros Kalampoukas, Donpaul C. Stephens, and Bernhard Suter -- founded the company in the spring of 2000. Its board members include Crescendo Ventures' Jeff Hinck and Morgenthaler Ventures' Greg Blonder.

Though it recently added Ewald Anderl as its software director and Barbara Coulter as its operations boss, Xebeo's executive staff is far from complete (see Ewald Anderl Joins Xebeo and Xebeo Names Operations VP). Donpaul Stephens is currently acting as the company's CEO, but Xebeo is looking for someone else to take the job permanently.

Xebeo has raised $17.65 million to date from four investors: Crescendo, Morgenthaler, Windward Ventures, and Millennium Ventures. (Michael Centrella runs Millennium Ventures. His consultancy, Centrella Technology Partners, cites Xebeo as one of its clients.)

- Phil Harvey, Senior Editor, Light Reading
http://www.lightreading.com