Zhone planning new WDM transport gear

Late in this year’s first quarter or early in the second, Zhone Technologies plans to introduce new optical transport gear based on its next-generation Single Line Multiservice (SLMS) architecture.

The new products will include dense wavelength multiplexing (DWDM) and coarse wavelength-division multiplexing (CWDM) technology. DWDM is often used in high-capacity and long-haul networks to pack up to 40 wavelengths on a single fiber. CWDM generally does less than half as much at a much lower price.

“[The new gear] is targeted really for up to about 10 Gb/s transport,” Mory Ejabat, Zhone’s chief executive officer, said during the company’s fourth-quarter earnings call late Thursday.

Zhone already sells CWDM and DWDM transport gear, which it obtained by acquiring equipment vendor Sorrento Networks in 2004. But it has not yet combined those technologies with its SLMS architecture, which allows a migration from legacy circuit-switched networks to more efficient packet-based ones.

Last year, Zhone made use of another acquisition, Paradyne, to add Ethernet-over-copper technology to its SLMS broadband loop carrier.

The mention of new WDM transport gear is the second time this month Zhone’s CEO has offered a glimpse of imminent new products. Two weeks ago, Ejabat promised new products based on gigabit passive optical networking and pseudowires.

Zhone expects to achieve positive cash flow and positive earnings before interest, taxes, depreciation and amortization on a quarterly basis before this year is over. But the company is unlikely to make any more acquisitions in the foreseeable future.

“Having built our business to its current level, we no longer plan to rely on acquisitions to grow further,” Ejabat said. “Instead we plan to grow as our current customer base [and others] migrates to next-generation technologies.”