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Broadband Access
Meriton Sees Merits of OSP
Forecasts 25 Percent Annual Growth in Market
by Iain Morris
Launched in 2000, just prior to the optical sector meltdown, Meriton
ran into some choppy waters not long after it made its maiden voyage
into the market. But while some of the other optical-switching
vendors have failed to go the distance, Meriton has not only
been able to weather the storm but is now seeing a sunnier
forecast ahead.
Talking to Telecommunications® at the Broadband World
Forum in Paris this week, Mike Pascoe, the company’s CEO,
says he expects to be cash-flow positive sometime next year,
when revenue is forecast to exceed US$50 million. He is already
talking bullishly of going public in the not-too-distant future.
According to Pascoe, Meriton has survived and prospered by
combining innovation with cautiousness. During the difficult
times, the company kept its corporate head down and
focused on R&D while some competitors were plugging their
products and haemorrhaging cash. Meriton has grown in the
intervening years to a medium-sized organisation of 160
people, 100 of whom are engineers at the forefront of that
innovation.
The company’s flagship product is the 7200 optical switching
platform (OSP) – a state-of-the-art solution that, according to
Pascoe, allows for a ‘mesh network environment rather than a
ring deployment’. The upshot is greater resilience and
reduced costs, and Pascoe claims that’s a message that is
starting to catch on at the highest level. In April, the vendor
was selected by Korea Telecom to install its architecture in the
carrier’s next-generation network, and through a strategic
partnership with Fujitsu it is also providing the OSP to BT for
use in the 21CN – the next-generation all-IP network being
rolled out in the UK.
Pascoe says that at the Tier 1 level it’s a harder market to
crack in North America, where the biggest carriers are still
predominantly served by legacy technology supplied by the
heavyweights in the vendor community. The company is
attempting to make up for that shortfall with its
reconfigurable optical add/drop multiplexer (ROADM) – an
evolution of the OADM originally developed by Nortel back in
the 1990s. Pascoe says there’s a important differentiator:
with Meriton’s ROADM, reconfiguration can be done from a
distance, rather than on-site, allowing for greater flexibility
and slashing opex.
At the current time, Pascoe says the revenue split between
the ROADM and the 7200 is about 50/50 – a ratio that
translates geographically as well, with half of the company’s
revenues coming from business outside North America.
Could it be argued that Meriton is serving too slim a niche for
sustained, long-term prosperity – a market that could quickly
fall through with a demand lag for broadband Ethernet
services?
“We see that carriers are increasingly moving to high-speed
deployments in metro access environments,” says Pascoe,
who believes the contracts with Korea Telecom and BT are just
the tip of a much bigger iceberg. “It’s a multibillion-dollar
niche that is growing at 25 percent a year.”
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