Update

The Fiber to the Home Council (Washington, DC) and the Telecommunications Industry Association (TIA—Arlington, VA) announced an updated list of "U.S. Optical Fiber Communities," with the total rising to 128 communities in 32 states. Prepared by Render, Vanderslice & Associates and TeleChoice, the list tracks communities nationwide that are delivering broadband services to customers through fiber to the home (FTTH) solutions. The 36 communities added to the list indicate that FTTH deployments continue to be driven by municipalities, CLECs, and new residential developments. List analysis also shows a significant increase in FTTH subscribers, with average subscriber take rates exceeding 40% overall and more than 75% in some communities.

3M (Austin, TX) announced plans to discontinue the production and sale of its optical components and specialty fibers; the company intends to phase out its West Haven, CT, facility by the end of this month. 3M's participation in the optical-fiber industry will continue through a number of other product areas, including products based on the company's proprietary GGP singlemode and multimode fiber.

Optical transport equipment supplier Tellabs (Naperville, IL) and access equipment provider AFC (Petaluma, CA) entered into a definitive agreement by which Tellabs will acquire AFC. Under terms of the transaction, which was approved by both companies' boards of directors, AFC stockholders will receive 1.55 shares of Tellabs common stock and $7 cash per AFC share. Based on Tellabs' closing price on May 19, that represents $21.24 in value per AFC share, or a total value of $1.9 billion. Upon the transaction's completion, Tellabs stockholders will own about 75% of the company and AFC stockholders will own 25%. AFC chairman and CEO John Schofield will become chief operating officer and a director of Tellabs. The Tellabs board will be expanded to 12 members to include three AFC directors, including Schofield. The combined company will employ about 4,100 people, including nearly 1,000 in international locations. It will have research and development centers in Illinois, California, Florida, Texas, Virginia, Denmark, and Finland. The transaction is subject to certain closing conditions, including regulatory approval and approval by Tellabs' and AFC's stockholders. It is expected to close in the second half of this year.

Lightpath (Jericho, NY), the business telecommunications services division of Cablevision Systems, completed transition of its core network from SONET to a DWDM architecture. This new network infrastructure will enable Lightpath to offer more scalable and cost-effective IP-based and broadband services to businesses in the tri-state metropolitan area, including New York City, Long Island, Westchester county, southern Connecticut, and northern New Jersey. The second phase of the upgrade, which is already underway, will be the deployment of an MPLS overlay on the DWDM core. The result will be a converged ubiquitous IP network deployed over a high-density optical core.

MetroPhotonics (Ottawa, Ontario), a developer of photonic ICs, received a CDN$7.7 million investment from Technology Partnerships Canada, a Canadian government agency that provides funding support to Canadian companies for research and development and pre-commercialization. MetroPhotonics' lead product, the SurePath Monitor, is shipping to customers on a controlled availability basis, with full commercial availability expected soon upon completion of Telcordia qualifications.

Princeton Lightwave (PLI—Cranbury, NJ) purchased the optical-channel-monitor (OCM) product line from OFS (Norcross, GA). PLI has hired all current OFS employees connected with the design and manufacture of OCMs.

The executive management of the Optical Fiber Communication Conference and Exposition (OFC) and the National Fiber Optic Engineers Conference (NFOEC) announced plans to combine the two events into one comprehensive conference and trade-show exposition March 6-11, 2005 in Anaheim, CA. Telcordia Technologies has turned over assets and management of its NFOEC event to OFC. The standalone NFOEC meeting originally planned for September has been cancelled and will take place in combination with OFC next year. The OFC event is managed by the Optical Society of America (OSA—Washington, DC) and co-sponsored by OSA, IEEE/Communications Society, and IEEE/Lasers and Electro-Optics Society.

Cogent Communications (Washington, DC), a facilities-based provider of high-speed Internet access and IP connectivity, filed a registration statement with the Securities and Exchange Commission (SEC) for the proposed public offering of $75 million of its common stock. In connection with the offering, subject to stockholder approval, Cogent's outstanding preferred stock will be converted into 500.2 million shares of common stock and Cogent will effect a 1-for-20 reverse stock split of its 514.3 million shares of outstanding common stock, including the common stock issued upon conversion of the preferred stock. That will result in 25.7 million shares of common stock outstanding prior to the offering. The public offering will be made through an underwriting syndicate led by Jefferies & Co. CIBC World Markets and Friedman Billings Ramsey will act as co-managers.

Xanoptix (Merrimack, NH) announced the closing of $15.2 million of its Series C convertible preferred securities. This latest round was led by the company's primary investors: William Blair Capital Partners, Euclid SR Partners, Envest Ventures, and Optical Partners. The funds will be used to further develop Xanoptix's hybrid IC technology and expand its XTM series optical-interconnect product line.

StrataLight Communications (Campbell, CA) selected iolon (San Jose, CA) for the continued supply of widely tunable lasers for StrataLight's OTS-4000 optical-terminal subsystem. Iolon began delivering widely tunable lasers to StrataLight in December 2001; the current supply agreement extends through mid-2005.

Pulte Homes and PAXIO (Anaheim, CA) have partnered to deliver fiber to the home (FTTH) to five new northern California communities. PAXIO, a technology and service provider, will install and operate FTTH networks at the Pulte Homes communities of Mariani Square (San Jose), Elevation 22 (Emeryville), Danbury Place (Sunnyvale), City Limits (Oakland), and Bentley Park (San Jose).

RBN (San Francisco) completed a $9.5-million funding round from existing investors Allen & Buckeridge, Macquarie Technology Fund, Paecal Ventures, and Redfern Photonics. The company has raised a total of $45 million since its inception in February 1999. As part of this round, RBN secured an AusIndustry Start Grant worth up to $4.5 million from the Australian government to help fund the development of its next product line at its R&D headquarters in Sydney, Australia.

Five Colleges Inc., through its limited liability company Five College Net, awarded a contract to Adesta (Omaha, NB) to design and build a fiber-optic-cable communications network. Five Colleges Inc. is a consortium of higher education institutions located in rural western Massachusetts. The network forms a 29-mi ring connecting member colleges Amherst, Hampshire, Mount Holyoke, Smith, and the University of Massachusetts Amherst as well as a 12-mi leg into a primary carrier hotel in Springfield, MA.

Zhone Technologies (Oakland) will acquire Sorrento Networks (San Diego), which makes metro-optical transport and access products, particularly DWDM and CWDM systems. The transaction is currently expected to close in the summer.

Bharti Infotel (New Dehli), provider of access, long-distance, data, and corporate services in India, is working with Cisco Systems (San Jose, CA) on a technology for advanced services and solutions for its enterprise and corporate customers. Bharti has deployed a Cisco IP-based MPLS backbone based on the Cisco 12000, 10000, 7300, and 7200 routers and Catalyst 4500 switches.

Fabrinet (San Francisco), an engineering and electromechanical manufacturing services company, announced the planned expansion of its operations in Thailand, with the investment of $25 million in additional manufacturing facilities, equipment, and training. A portion of the funds was used in the acquisition of Fabrinet's new 115,000-sq-ft factory outside of Bangkok, Thailand, completed in early April. Additional funds will be used to facilitate the new factory, which will be available to customers this month. Construction also will begin later this year to expand the new factory space into a 340,000-sq-ft campus, increasing the company's aggregate footprint to about 575,000 sq ft.

Luminous Networks (Cupertino, CA), provider of multiservice provisioning platforms (MSPPs), reports that ChongQing city in western China successfully deployed a Luminous transport network to provide telecommunications transmission along a major highway in the region.

NTT-ME, a subsidiary of Nippon Telegraph and Telephone East (Tokyo), deployed the E-Series from Force10 Networks (Milpitas, CA) in a 10-Gigabit Ethernet core upgrade to provide advanced services to its broadband subscribers. The Force10 E600 equipment will enable NTT-ME to extend its WAKWAK broadband service to subscribers across Japan. Introduced in 1999, WAKWAK delivers broadband connectivity and advanced applications to home and small office/home office users. NTT-ME will use its new equipment to expand its WAKWAK service to include such applications as IP telephony, streaming media, and telenetworking.

Keybridge Communications, a systems integration reseller of Luminous equipment in China, has installed the Luminous PacketWave system to provide services for freeway customers. China will link up the road network in its western region by introducing advanced road construction technology over the next two decades. By 2010, China is expected to complete construction of nine artery roads in the west and build about 150,000 km of roads linking each village.

UTStarcom (Alameda, CA) announced a new contract valued at about $21.5 million with Chunghwa Telecom of Taiwan. Chunghwa will employ UTStarcom's NetRing multiservice optical transport products to deliver high-density, high-speed broadband services, including voice, data, and video, to subscribers throughout Taiwan. Under the contract, UTStarcom will provide the optical equipment and Siemens (Munich) will handle installation, maintenance, and third-party services.

MobileOne (M1—Singapore), a mobile wireless service provider in the Asia-Pacific region, is deploying LightPointe (San Diego) FlightSpectrum free-space optics (FSO) systems in lieu of traditional wireless microwave radio or land-based wired infrastructure such as copper or fiber-optic cable. The connectivity is necessary to provide network coverage for voice and data traffic for M1's growing base of subscribers. LightPointe was selected in a tender with participation of several FSO system vendors.

Cablecom, the largest cable TV operator in Switzerland, selected Transmode Systems (Stockholm) to provide WDM transmission equipment. Transmode is supplying its System 1100, which Cablecom will use for various applications ranging from its internal IT infrastructure needs to connectivity to enterprise and wholesale customers as well as in its cable TV network.

Bookham Technology plc (Oxfordshire, UK) has entered into an agreement under which it will acquire Onetta (Sunnyvale, CA), provider of optical-amplifier modules and subsystems. Under the agreement, Bookham will purchase the entire issued-share capital of Onetta in consideration for the issue of 27.6 million Bookham ordinary shares to the Onetta shareholders which, at market close when the deal was announced back on May 21, had a value of $23.3 million. As part of the agreement, the Onetta shareholders have agreed to discharge liabilities of the company of about $6 million. In this year's first quarter, Onetta generated $3.3 million in revenues and reported a loss of $2.1 million. The value of the net assets being acquired at the end of the quarter was $7.5 million. Completion of the acquisition was expected last month.

Tyco Telecommunications (Morristown, NJ), provider of international wholesale capacity, managed services, and equipment space on the Tyco Global Network (TGN), signed a contract for a 10-Gbit/sec transatlantic wavelength with TeliaSonera International Carrier, the leading carrier of IP traffic in the Nordic and Baltic Sea regions. The carrier is fully owned by the TeliaSonera Group. Under the agreement, Tyco Telecommunications will provide the high-bandwidth circuit on TGN to support TeliaSonera's increasing volume of voice, data, and Internet traffic between Europe and the United States. The 10-Gbit/sec circuit connects TeliaSonera's facility in London with its point of presence (PoP) in New York City and is interconnected with the carrier's other international circuits and PoPs. Tyco Telecommunications has provisioned the bandwidth on its TGN transatlantic cable, which connects New York City and Wall, NJ, with London.

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