Optical/IP Networks

Xtera Xhibits Energis Deal

Xtera Communications Inc. today quietly announced that Energis plc (OTC: ENGSY) has picked the optical networking provider to be its supplier of long-haul DWDM equipment. (See Energis Selects Xtera.)

If this has a familiar ring to it, it's because Light Reading in June reported the Energis deal was happening, as a follow-on to Xtera's other customer, (See Energis Deal Energizes Xtera.)

Xtera says in its press release that the Energis network will use Raman DWDM technology to "create a national multi-service network providing high capacity optical bandwidth to fifty locations throughout the United Kingdom...

"Once completed, Energis’ new optical backbone will comprise more than 60 network elements, will span about 4,000 km and will exploit the full 100nm of bandwidth of the all-Raman Nu-Wave system."

Xtera did not return calls asking about the network, but sources say the DWDM network will be used to shuttle video, primarily for the BBC. Energis is working with Siemens Business Services to provide business process outsourcing (BPO) services to the BBC as part of a £2 billion (US$3.7 billion) technology services deal Siemens signed with the broadcaster last year (See Energis Deal Energizes Xtera). The 10-year deal will have Siemens running the BBC's global IT infrastructure and media services business. Energis has been managing the BBC’s television and radio distribution network since 1993, and the deal with Siemens puts it in charge of most of the network's communications needs.

The deal shows that there is still life left in the DWDM market, and also indicates that Xtera could yet pull off quite a comeback. Xtera, which has garnered more than $100 million in funding, was cut back and restructured dramatically over the years, and its regrouping even included a deal to purchase the assets of former metro networking supplier Metro-Optix. (See Xtera's $110M Surprise, Xtera Scores Surprise $30M, Xtera Nabs Metro-Optix Assets, Xtera's Long-Haul Regeneration.)

Observers say the odds appear to be rising for a turnaround for the venture-funded startup, as the DWDM market picks up pace.

"This win illustrates two things: First, the demand for low-cost, flexible connectivity has created room for a few new entrants, such as Xtera and Infinera; and second, video is the real catalyst for new long-haul builds," says Scott Clavenna, Chief Analyst with Heavy Reading.

Clavenna points out that Xtera is offering up an all-optical solution, while competitor Infinera Inc. is also getting customers with an optical-electrical-optical (OEO) product. "The bottom line is that operators need high-performance networks and aggressive pricing from vendors," he says.

— R. Scott Raynovich, US Editor, Light Reading

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