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Ciena Targets the 3G Mobile Operator Market in Europe

Positions strength in improving operators’ backhaul aggregation and transmission needs for 3G evolution

Ciena® Corporation (NASDAQ: CIEN), the network specialist, today announced its strategy for the 3G market in Europe to help mobile operators overcome capacity, efficiency and operational expenditure challenges when deploying 3G Radio Access Networks (RANs). With market leading network aggregation and transmission platforms (the DN and CN series products), Ciena uniquely enables mobile operators to implement the most economical, reliable and future-ready access networks.

The evolution of 3G is placing considerable strain on the operational expenditure of mobile operators. The main challenge today and onwards is for operators to economically create increased capacity without compromising existing voice and new data-oriented revenue streams. This capacity demand is being driven by increased introduction of sophisticated new bandwidth-hungry services being offered to customers, thus resulting in operational challenges in the RAN.

Due to the initial rate of adoption of 3G, many mobile operators chose to take a leased-line or managed services approach to aggregation and transmission when building their RAN infrastructure. However, market expectation is for network coverage that equals or exceeds 2G coverage with more extensive service deployment. This expectation, coupled with increased consumer and business uptake of 3G services, means that mobile operators are considering taking more ownership and control of the RAN to ensure ongoing competitiveness. In this scenario, Ciena enables the creation of a RAN that is able to accommodate significantly higher bandwidth and handle the support of all types of backhaul traffic, including TDM, ATM, Ethernet and IP/MPLS, thereby achieving the most cost-effective competitive position.

The 3G evolution enables mobile operators to penetrate new markets such as corporate data and entertainment, and to be successful in this environment they must compete with traditional landline carriers and services. Therefore, mobile operators must take advantage of low-cost infrastructure solutions wherever possible.

Ciena works with 3G operators who decide either to insource their RAN or to continue their leased-line arrangements with fixed operators. In either case, Ciena’s solutions significantly improve the network efficiencies and cost in the 3G RAN. Ultimately, insourcing will enable greater control over the costs of backhaul and the quality of the new mobile subscriber services. Whichever approach taken, Ciena helps 3G operators to flexibly and reliably meet their network aggregation and transmission needs.

By working with Ciena in this manner, 3G operators may expect to achieve significant margin improvements and overall improvement in their return on investment. Ciena enables mobile operators to increase margins by supporting long term ARPU growth based on new services such as media rich applications, VPN access and gaming. These applications will drive significant bandwidth demand in the RAN, which needs to be supported cost effectively. Operators that choose the insource route will also benefit from increased management and control by gaining direct control of the transport from the base station interface to the switching centre interface. Some operating networks could also benefit from a significant increase in service availability through use of Ciena’s advanced technology.

Gary Smith, CEO and president at Ciena, said: “Ciena is one of the world’s leaders in transmission and aggregation equipment to many large telecoms carriers around the globe. The decision to target the 3G market is a natural evolution for us, as it is an extension of our specialization in fixed networks. Regardless of the choice to insource or outsource, Ciena has a significant part to play by bringing to the market a solution that is ideally suited to this emerging need. We look forward to expanding our involvement with 3G operators to help provide significant cost savings as they take advantage of new data services and reap the benefits from their 3G license investment.”

“Wireless backhaul has emerged as an important growth market for multiservice switching vendors,” said Phil Marshall, director of Wireless Mobile Technologies, The Yankee Group. “To take advantage of the wireless backhaul opportunity vendors must deliver solutions that not only facilitate advanced voice, data and entertainment services, but also help mobile operators drive down operational costs. Backhaul solutions such as that offered by Ciena help mobile operators achieve new revenues, lower OPEX and reduce customer churn.”

About Ciena’s Products
Ciena’s DN 7000 series sits in the radio access network and aggregates 2, 2.5 and 3G traffic with TDM, ATM, Ethernet and IP/MPLS capabilities. The DN series future-proofs the backhaul for the evolution of the 3G standards progression toward IP and the next-generation of profitable services that these technologies enable. For 3G multiservice RAN backhaul, the DN 7000 series features and competitive differentiators allow Ciena to offer mobile operators the ability to deploy the most economical, reliable and future-ready packet aggregation networks.

Ciena’s DN 7000 series is the only next-generation multiservice edge switching product family that has been deployed in multiple Tier 1 operator accounts. The legacy multiservice switches sold by the incumbent vendors are based on 1990s technology with minimal or no incremental technical enhancements. The Ciena next-generation design with compact footprints and reduced power consumption provides proven reductions in upfront capital expenditures as well significant reductions in ongoing operational expenditures.

The DN 7000 series was designed from the ground up to simultaneously address the needs of both Layer 2 and Layer 3 networks with the highest levels of scalability and reliability. The DN 7000 series has industry-leading scale in terms of protected capacity and densities of ports, virtual circuits and pseudowires. This product family also provides the highest performance and most flexible new features in terms of Ethernet and IP/MPLS to support the evolution and migration of traditional packet protocols. This is accomplished with any-service, any-port layer 2/3 processing which allows operators to invest in hardware once and modify their network as needed by software-only configuration changes.

In addition, Ciena has long been an innovator and leader in the optical transmission market space, both in metro access and long-haul transmission networks. Ciena’s extended solution set including next-generation transmission products provide mobile operators mobile operators the right portfolio of products to insource their 3G radio access network in the most cost-effective manner.