OPTICON KEYNOTE: CISCO'S CARL RUSSO ON THE OPTICAL INTENET
Scaling the Internet remains the number one challenge of service providers, said Carl Russo, Group VP of Optical Networking for Cisco Systems.  Speaking at this week's Opticon conference in Burlingame, California, Russo observed that the new traffic patterns of the Internet would dictate how network architectures evolve.  The new rule of thumb is that 80% of traffic leaves the enterprise and hits a regional aggregation center, web hosting facility or POP.  This makes metropolitan optical networking a tremendous market opportunity.  In this space, Cisco already claims to be gaining significant traction with hot sales of its ONS 15454 (Cerent) box.  Cisco also recently acquired Qeyton Systems, a developer of a low-cost, scalable metro DWDM platform, and it continues to offer its own Dynamic Packet Transport architecture for linking routers in certain types of fiber ring networks.  In the long-haul market segment, Russo expects that traditional SONET rings will give way to mesh architectures, with MPLS used to set-up and tear down wavelength circuits in the core.  Expect at least four or five major optical product announcements from Cisco in the coming months, as it fills out its optical portfolio and broadens its strategy.  Although he sees optical component vendors as a primary source of innovation for the industry, Russo said Cisco has no plans to acquire optical component companies, choosing to define its role as a systems company.  As for 10 Gbps Ethernet for metro optical networks, Russo hinted that Cisco has internal programs underway, but left open the possibility of Cisco acquiring more companies in the optical space.  Despite industry rumors, Russo said Cisco is quite pleased with its acquisitions of Pirelli and Monterrey Systems.  Pirelli provided an OC48/OC192 DWDM platform that was needed to compete for end-to-end networks for greenfield customers, such as Cogent Communications.  It also provided Cisco with an optical patent portfolio and a strong design team in Milan.  The Monterrey wavelength router is also on track – the box is currently in several top-tier carrier trials.
August 1, 2000

INTEL TO ACQUIRE TRILLIUM FOR ITS SS7/IP/ATM/WIRELESS SOURCE CODE
Intel agreed to acquire privately held Trillium Digital Systems for about $300 million in cash and stock.  Trillium is a leading provider of communications software source code for protocols including SS7, IP, ATM, Wireless and ISDN.  Intel said Trillium's software architecture would become an integral part of the Intel Internet Exchange (IX) architecture, which will now include off-the-shelf software as well as silicon.  Intel’s communications silicon portfolio includes its IXP family of network processors; embedded versions of the Pentium II, Pentium III and Intel Celeron application services processors; and companion chips.  The new Trillium subsidiary is also expected to continue developing and supporting portable software solutions for the communications industry at large.  http://www.intel.com   http://www.trillium.com
Intel, August 1, 2000

• Last month, Conexant announced plans to acquire NetPlane Systems (formerly Harris&Jeffries), a developer of core networking software, including MPLS, ATM, Frame Relay, SS7, for $140 million in stock.
  
• In March, Virata Systems acquired Inverness Systems, which also develops software source code for ATM, IP and MPLS, for about $105 million in stock (March 22 prices).

CISCO SYSTEMS ACQUIRES IPMOBILE FOR 3G WIRELESS SERVICES
Cisco Systems will acquire IPmobile Inc., a start-up developing software for 3G wireless networks, for approximately $425 million in stock.  IPmobile is working on IP Radio Access Networks (IP-RANs) that will connect wireless base stations to the Internet in 3G networks. RANs control and manage the radio networks between the user devices and the base stations, while providing access to data and voice services.  The company has 81 employees and is based in Richardson, Texas.  http://www.cisco.com  http://www.ipmobile.com
Cisco Systems, August 1, 2000

• IPmobile's Airscape technology is being developed to integrate IP routing and QoS layers with the radio physical layer intelligence.  The company says its air intelligent technology has wide applicability for current cellular/PCS and fixed wireless markets, and for next generation IP-based wireless/mobility networks.   Its goal is to enable carrier to deliver Wireless Service Level Agreements (SLAs).
  
• IPmobile was founded in mid-1999 by Pulin Patel, who formerly worked in product management for Nortel Networks’ CDMA Wireless Solutions group, and Rashad Ali, who also previously worked for Nortel Networks and for Ericsson.  The company is led by Russell Davis, who previously held positions at Alcatel and DSC Communications as vice president and general manager. 

TERAYON ACQUIRES MAINSAIL NETWORKS FOR ITS INTEGRATED ACCESS
Terayon Communication Systems will acquire Mainsail Networks, a start-up developing integrated access solutions for broadband networks, for about $163 million (3.2 million TERN shares).  Terayon said the acquisition represents its expansion into the access infrastructure and optical transport markets.  http://www.terayon.com/news/newsrelease/2000newsrelease/080100.shtml
http://www.mainsailnet.com
Terayon, August 1, 2000

• MainSail offers an Integrated Multiple Access Platform designed for concentration and interworking of multiple protocols, including TDM, IP, Frame Relay and ATM over various interfaces, including IDSL, SDSL, HDSL, HDSL2, G.lite, ADSL, T1, T3, OC-3c, OC-12c and OC-48c.  The platform is based on a 2.4Gbps non-blocking ATM switch providing multiple classes of service, connection admission control, traffic policing and shaping.  MainSail is based in Fremont, California.  
  
• The company was formed in 1997 by Boris Zats, formerly Vice President of Software Development for Premisys.

TRANSWITCH TO ACQUIRE ALACRITY FOR ITS CELL-BASED SWITCHING SILICON
TranSwitch Corporation will acquire Alacrity Communications, a start-up developing VLSI switching devices for telecommunications, for approximately $11 million in stock.  Alacrity has designed a cell-based, 6.4 Gbps switch engine that simultaneously switches asynchronous packet data (LAN/WAN) and isochronous real time data (voice/video multimedia).  Alacrity is based in Milpitas, California.   http://www.alacritycom.com
TranSwitch, August 1, 2000

• Alacrity was founded in 1997 by Dr. Zheng Liu (formerly Cisco/Stratacom) and funded by private investors led by K.S. Chay, a founding principle behind Creative Technologies.

VERIZON BEGINS VODSL TRIAL WITH LUCENT AND COPPERCOM
Verizon Communications launched a technical trial of Voice over DSL (VoDSL) involving its employees in the Dallas area.  The trial uses Lucent Technologies' Stinger DSLAMs in combination with CopperCom's integrated access devices and central office voice gateways.  Verizon said it plans to offer VoDSL commercially later this year.  http://www.verizon.com
Verizon Communications, August 1, 2000

• Verizon was formed through the recent merger of Bell Atlantic and GTE

EXCELIGHT SPINS-OFF FROM SUMITOMO, TARGETS OPTICAL COMPONENTS
Sumitomo Electric Industries has spun off its electro-optic products group into a new company called ExceLight Communications.  The company offers high-performance active and passive optical components and subsystems for public and private networking.  Its portfolio includes 1480-nm pump lasers for fiber amplifiers, high-performance DWDM signal lasers, photodiodes, and state-of-the-art data links for SONET/SDH, ATM, and Gigabit Ethernet applications.  A range of passive products includes wavelength-division multiplexes, optical add/drop modules, couplers, splitters, filters, and fiber Bragg gratings.  ExceLight Communications will be led by Mr. Yuji Hamasaki and based in Durham, North Carolina.  http://www.excelight.com/
ExceLight Communications, August 1, 2000

AGILENT AND REDSWITCH TO DEVELOP INFINIBAND CHIPS
Agilent Technologies announced plans to work with RedSwitch, a start-up formed by a design group from HAL Computer Systems (a Fujitsu subsidiary), on a new series of ICs for InfiniBand applications.  InfiniBand is an interconnect or I/O architecture that connects servers with remote storage and networking devices and other servers.  Agilent's InfiniBand products are expected early next year.  Agilent also made an undisclosed equity investment in RedSwitch.  The start-up company is based in Milpitas, California. http://www.agilent.com   http://www.redswitch.com/
Agilent Technologies, August 1, 2000

KYMATA INTRODUCES VARIABLE OPTICAL ATTENUATION EVALUATION SYSTEM FOR DWDM
Kymata introduced a Variable Optical Attenuation Evaluation System for DWDM. The multi-channel variable optical attenuator and software allow complex optical wavelength systems to be rapidly prototyped and controlled, thereby reducing system time to market.  http://www.kymata.com
Kymata, August 1, 2000