Nortel and HP team on high-speed optical links

Nortel Networks Corp. and Hewlett-Packard Co. Wednesday announced that they intend to work together to develop high-speed interfaces linking HP servers with Nortel optical networking gear.

The products will be targeted at content service providers experiencing bandwidth bottlenecks in Internet data centers.

The two companies will investigate joint commercial development of a 10G bit/sec Ethernet network interface card for HP’s Superdome and HP 9000 servers. Last month, at NetWorld+Interop 2000 in Atlanta, Nortel and HP demonstrated integration of computing platforms and dense wave division multiplexing optical network technology over 10G bit/sec Ethernet.

The 10G bit/sec Ethernet product will be designed to eliminate the congestion caused by multiple router hops within traditional Internet data centers, Nortel says.

Nortel, citing data from International Data Corp., said the Internet data center infrastructure market is expected to be a $18 billion business by 2003. Nortel also says service providers will build approximately 740 Internet data centers over the next 3 years, again citing research from IDC.

Nortel and HP also are sizing up other technologies as potential bottleneck breakers for Internet data centers. Some of these technologies include optically enabled storage and content networks, and centralized service management based on the combination of HP’s OpenView and Nortel’s Preside management platforms.

Separately, Nortel and electronics distributor ANTEC Corp. Wednesday announced an agreement to realign their cable businesses to create a new company providing broadband cable access products to homes and businesses.

The new company, called Arris Inc., will combine ANTEC with Nortel’s interest in Arris Interactive, which develops broadband cable access technology and products. Arris will acquire Nortel’s 81.25% stake in Arris Interactive for 33 million shares of common stock in the new company, and $325 million in cash.

Nortel will have a 46.5% stake in Arris. ANTEC will become a subsidiary of the new company. The realignment will effectively end a 5-year distribution arrangement between Nortel and ANTEC, and terminates existing noncompete and exclusive joint marketing agreements between the companies.

Nortel will work with the new company, however, to offer broadband cable products for “first” or “last” mile access to the Internet.

“This is our access vehicle for the cable industry,” says Steve Pusey, vice president of Nortel and chairman of Arris Interactive.

Nortel says the deal allows it to focus on “end-to-end” offerings for broadband cable networks, such as its market leading optical networking products, and Succession packetized voice, routing and content networking, and Preside service management products.