NXTcomm08

Zhone Leads a New (and Novel) Charge on Metro-Scale WiFi

| Jun 11, 2008 | Wireless Infrastructure | Show Update

| Analyst: Peter Jarich

Current Perspective: Positive Vendor Importance: Moderate Market Impact: Moderate

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Event Summary

June 10, 2008 – Zhone announced SkyZhone, a metro-scale WiFi solution. Available with 2.4 GHz and 4.9 GHz radios (standalone or combined), the new offer leverages an 802.11n architecture with MIMO, integrated DSL backhaul and line powering. Currently deployed or in trials with more than 10 networks, the solution is fully integrated into Zhone’s multi-service broadband access platform and network management system, ZMS.

Analytical Summary

• Current Perspective: Positive on Infinera’s announcement of its new line system for the DTN platform; dubbed tPositive on Zhone’s new SkyZhone metro-scale WiFi solution. Municipal WiFi is unlikely to drive Zhone’s financial success and the high-profile collapse of WiFi initiatives at Earthlink and MetroFi may have tainted the market’s perceptions – making it difficult to sell the new solution. Yet, Zhone’s solution attacks the market in a new way – based on a novel WiFi architecture and a focus on telcos – playing to its strengths and setting the stage for operators to see the larger value of outdoor WiFi.

• Vendor Importance: Moderate to Zhone because municipal WiFi is not the company’s primary line of business. Ultimately, the new SkyZhone solution will serve as a complement to Zhone’s broadband access kit; a way to extend broadband access for the company’s telco customers and potentially snag new customers interested in WiFi as an adjunct to fixed-line broadband.

• Market Impact: Moderate on the metro-scale WiFi market. As a new player in muni WiFi, Zhone does not yet have the product or deployment credibility to threaten the likes of Tropos, BelAir, Strix, etc. That said, the company’s knowledge of (and channels into) the telco space could help it make quick market inroads and its focus on a combination of new technologies (MIMO, line powering, DSL transport) could force competitor innovations – particularly if they resonate with operators and lead to deals.

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Current Perspective

Competitive Positives and Concerns

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