Ciena lands contract in Bell Atlantic revamping Initial value of up to $15 million for Linthicum firm


March 31, 1998|By Mark Ribbing | Mark Ribbing,SUN STAFF

Ciena Corp. of Linthicum was among five firms that won contracts yesterday to supply equipment to Bell Atlantic in the five-year, $1.5 billion upgrade of the phone company's communications network.

The initial value of Ciena's share of the Bell Atlantic project is estimated at $12 million to $15 million.

Lucent Technologies Inc., Fujitsu Network Communications Inc., Tellabs Inc. and DSC Communications Corp. also will supply equipment for the upgrade.

Bell Atlantic Corp. said in January that it planned the fiber-optics upgrade to its communications network. Lucent said yesterday that its share of the agreement will be worth about $500 million.

Bell Atlantic said the upgrade will give the giant phone company a state-of-the-art network that will enable it to keep up with dramatic increases in communications traffic.

Michael P. Daigle, a director of network planning at Bell Atlantic, said the installation of new fiber lines and capacity-boosting equipment will result in "a bigger, faster, more reliable network." The network construction will take place on business and residential lines throughout New York-based Bell Atlantic's local phone service territory, which stretches from Maine to Virginia.

"This is a major deal," said Randy Carlson, a telecommunications analyst at the Yankee Group in Boston. "It signals the end of an entire generation of equipment in the local market."

Bell Atlantic is shifting away from traditional copper lines and toward a durable, high-speed fiber technology called a synchronous optical network, or SONET.

Ciena, meanwhile, will supply Bell Atlantic with its signature product, a technology that expands a single fiber-optic channel to several, increasing network capacity.

Bell Atlantic's demand for this equipment is valued at between $25 million and $30 million. Ciena will initially get about half of that piece of the pie. Lucent, Ciena's larger rival, also will provide capacity-boosting equipment to Bell Atlantic and will get the other half.

That division of labor sets up a competition between Lucent and Ciena for a bigger share of Bell Atlantic's business. Either of the companies could end up with a larger share of that business, depending on how their products perform.

Bell Atlantic and Ciena officials said they have agreed on all major issues, but not signed a final contract. They were optimistic the deal will close soon. "I don't see any showstoppers," Daigle said.

Ciena spokesman Denny Bilter said the deployment of his company's equipment will begin in the second half of this year.

Pub Date: 3/31/98

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