RUS designation helps Taqua land Class 5 switch sale

Taqua today announced that rural local exchange carrier Pine Telephone System would deploy its OCX next-generation Class 5 switch at its Halfway, Ore., central office. The OCX eventually will replace a legacy Nortel DMS-10 switch. Pine Telephone plans to eventually add a second OCX switch to its Granite, Ore., central office.

Pine Telephone will progressively migrate traffic from the DMS-10 to the OCX and then cap the legacy switch. The carrier hopes to complete the migration by the end of next year, and anticipates the OCX will be installed by the end of this year. The switch is scheduled for delivery in two weeks. Wayne Lowe, Pine Telephone’s central office supervisor, said the migration likely will begin by shifting toll traffic to the OCX, but the carrier also is considering running trunks between the two switches for local traffic.

Lowe said Pine Telephone would not have been able to purchase the OCX without the Rural Utilities Service (RUS) designation that Taqua received in September. The RUS designation makes Pine Telephone eligible to receive low-interest government loans to finance the purchase.

“We depend on RUS loans for anything like this,” Lowe said. “So that was a big deal to us for Taqua to get their RUS approval. The RUS designation was a huge factor in us being able to do this now,” Lowe said.

He added that Pine Telephone would have been faced with “having to sink a lot of money” into its DMS-10 to upgrade it to CALEA compliance and GR-303 functionality, features that are provided by the OCX.

“We regarded that as a giant step sideways,” Lowe said. “It made a lot of sense from a technical standpoint to move forward into a next-generation platform, and also from an economic perspective, because we were looking at quite an expenditure to upgrade the DMS-10.”

Currently, Taqua’s OCX is the only next-generation switch to receive a RUS designation. The company expects to do about $20 million in RUS business next year, and is hopeful that amount will double in 2004. According to Taqua, the average age of legacy switches employed by RLECs is 17 years, with some as old as 40 years, and the company believes those switches will need to be capped or replaced soon, with all of them needing to be replaced in the next decade.