Alcatel-Lucent Increases ISAM Portfolio Reach with FTTB Product Line

| Mar 7, 2008 | Broadband Infrastructure | Competitive Intelligence Report

| Analyst: Erik Keith

Current Perspective: Positive
Vendor Importance: High
Market Impact: Very High

Event Summary

March 5, 2008 – Alcatel-Lucent announced an expansion of its Intelligent Services Access Manager (ISAM) portfolio of digital subscriber line (DSL) and fiber access products. The ISAM’s new fiber to the building (FTTB) solution set complement this product family’s existing central office (CO) and cabinet solutions. The ISAM FTTB portfolio, which consists of four new products, allows operators to deliver up to 100 Mbps over copper in multi-dwelling unit (MDU) environments, in which it can be difficult to introduce fiber.

Analytical Summary

• Current Perspective: Positive on Alcatel-Lucent’s expansion of its ISAM portfolio to include the FTTB-specific 735x product line, because with this new set of remote/distributed DSLAMs (and the 7352 FTTB ONT), Alcatel-Lucent is providing operators with a solution set that is designed specifically for “deep fiber” network build-outs in conjunction with short-run copper loops (e.g., VDSL2 over in-building copper) to provide fiber-quality connections to end users, primarily in high-density urban environments. This if of particularly high importance in the European market, hence the product line’s debut at CeBIT 2008.

• Vendor Importance: High to Alcatel-Lucent, because the company needed to expand its ISAM portfolio with the 735x FTTB solution set in order to address the increasingly important hybrid fiber-copper (“HFCu”) market, i.e., where operators are utilizing GPON and/or GigE network uplinks and VDSL2 subscriber connections to meet the burgeoning need for bandwidth and consumer multi-play service bundles in areas where full FTTH network build-outs are too expensive (active or passive) and ADSLx-based connections are insufficient.

• Market Impact: Very high on the overall wireline broadband access market, because of Alcatel-Lucent’s established, dominant position in this sector, as well as the fact that the new 735x series leverages existing ISAM components, feature sets and management solutions, making it easy for existing customers to deploy and leverage accordingly. But even for operators that are not current Alcatel-Lucent customers, the appeal of the new FTTB solution set will be strong given the advanced service delivery capabilities of the 735x series, not to mention Alcatel-Lucent’s extensive product set and competitive price/performance proposition in this market.

Recommended Competitor Actions

• Nokia Siemens Networks, as the primary supplier for one of the largest fiber-to-the-node (FTTN) DSLAM network build-outs in Europe (i.e., T-Home’s nationwide, “50 Mbps in 50 Cities” ongoing service turn-up), can highlight its integral role in helping T-Home – formerly known as T-Com – continue this massive access network transformation/upgrade leveraging Nokia Siemens’ hiX series IP DSLAMs, which leverage the N x GigE network uplink + VDSL2 subscriber interface proposition.

• Ericsson can also point out that not only was it one of the first vendors to offer GPON uplinks within its EDA 1200 IP DSLAM portfolio, but that Ericsson has also expanded its fiber access proposition dramatically in October 2007, with the debut of the EMN120 platform (see “BBWF Europe 2007: Ericsson Expands Ethernet Access and Aggregation Proposition with EMN120, from October 11, 2007). Ericsson can also point to its increasing presence in the T-Home network for customer validation of its EDA 1200 series.

• ECI Telecom can highlight its own FTTB product line debut a week ago (see “FTTH Council Europe 2008: ECI Expands its Fiber Access Portfolio with FTTB ONUs” from February 29, 2008), highlighted by the G-PoweRAM 48V, which leverages GPON uplinks and supports 48 VDSL2 subscriber interfaces, and supports a service delivery/value proposition that is quite similar to the Alcatel-Lucent 7352 FTTB ONT. Like NSN and Ericsson, ECI can also highlight its substantial presence in the T-Home network, as well as its more recent wins with operators in Norway and France.

• Huawei and ZTE, which have both made strong in-roads into the European broadband access market over the past several years, need to highlight their own respective next-generation wireline access differentiators, e.g., where they can match or beat their chief rivals from a product and or service delivery standpoint. For example, ZTE asserts a very strong position in terms of power consumption vis-à-vis its European competitors; this claim needs to be justified with a direct, benchmarked comparison.

• All other contenders that are targeting the high-potential European FTTB market – including, for example, Allied Telesis, Iskratel, Keymile, PacketFront, Teledata, UTStarcom and Zhone – as well as the other ETSI-spec markets where FTTB solutions will be deployed extensively, also need to match or beat the FTTB proposition of Alcatel-Lucent et al., in order to have any chance of competing in this sector moving forward.

Recommended Competitor Actions

• Current Alcatel-Lucent customers that are interested in deploying any of the company’s new FTTB solutions need to arrange trial deployments of the specific platforms to evaluate their live-network service support capabilities and related performance metrics. Since the 735x FTTB solution set leverages existing ISAM technology (including the critically important access management system, the 5520), deployment of ISAM FTTB solutions is a relatively seamless, congruent fit with existing ISAM network elements.

• Operators that are evaluating FTTB solutions need to compare/contrast the Alcatel-Lucent proposition against solutions such as ECI Telecom’s G-PowerRAM 48V, Ericsson’s EDA 1200 series, Huawei’s VDSL2 remote DSLAMs, Nokia Siemens’s hiX GPON MDU and FTTB DSLAMs and ZTE’s GPON, active Ethernet and FSAP remote DSLAMs, as well as other vendors that offer similar platforms. Beyond the usual port density/scalability per rack unit, bandwidth/throughput and related performance metrics, other factors such as power consumption and thermal efficiency are increasingly important.

CLIENTS ONLY

Current Perspective

Competitive Positives and Concerns

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