Cable & Wireless Begins U.S. Overhaul
Employees and customers got the pink slip this week as the U.K.-based carrier followed through on a promise to cut jobs, cancel contracts because of an under-performing U.S. economy. (more)

Probe of Tyco ex-CEO Widens
A devastating week for L. Dennis Kozlowski, ex-CEO of the Exeter, N.H., conglomerate, and accused artful (tax) dodger, just got worse. Prosecutors are now investigating whether Kozlowski improperly used company funds and interest-free loans to buy his $18 million Manhattan apartment and furnish it with paintings, sources told The Wall Street Journal. The newspaper also reported that the SEC is opening its own probe. (more)

AT&T Realigns Credit for Comcast Deal
With its credit rating suffering amid a glut of telecom supply, Ma Bell renegotiates an $8 billion bank facility in order to keep its cable/broadband merger with Comcast on track. (more)

Lucent Completes Agere Systems Spinoff
Lucent Technologies on Monday said it has completed its spinoff of Agere Systems. Lucent completed the spinoff on June 1, 2002, by distributing 37 million shares of Agere Class A common stock and 908.1 million shares of Agere Class B common stock to the holders of Lucent common stock as of the close of business on May 3, 2002, the record date. Lucent had spun off Agere in March 2001 with an initial public offering, but the telecom giant still owned about 58% of Agere stock. A full spinoff of Agere had to be postponed last fall, because Lucent could not meet bank-mandated financial agreements.

Lucent Closes $100M Plant Sale
The optical gear maker transfers its North Andover, Mass., factory to Solectron, a Milpitas, Calif., manufacturer. (more)

Cisco Sweet On Network Convergence
Expanded portfolio of products and services aims to further the adoption of broadband and IP telephony for service providers and business customers. (more)

Venture Capital News

A busy week in the private capital market!

Mahi Networks Catches $75M
Emerging optical networking equipment supplier Mahi Networks said it has closed $75 million in new funding to support the market introduction and rollout of its flagship product, the Mi7 Optical Transport Switch. The funding brings the total capital raised by the company to over $185 million since it was founded in September 1999.

Led by St. Paul Venture Capital, a syndicate of 12 leading private equity firms contributed to Mahi's Series D financing round. Participants included Rho Ventures, Oak Investment Partners, Jerusalem Venture Partners, Wasserstein Ventures, Investor Growth Capital, as well as existing investors Berkeley International Capital, Mitsui & Co., Anschutz Investment Company, Van Wagoner Capital Management and others.

Mahi Networks' Mi7 Optical Transport Switch is a Telcordia GR-253 compliant, packet-aware platform designed to aggregate, switch and groom large SONET interoffice facilities and immediately to provide the means to support Gigabit Ethernet and MPLS-based services.

Picolight Lands $27M
Boulder, Colo.-based Picolight Inc., which develops high-speed optoelectronic components and subsystems for the enterprise and optical metro/access networks, said it has raised $27 million in its latest funding round. St. Paul Venture Capital joined with Bank America (BA) Venture Partners, Charles River Ventures and Pequot Capital, who participated in previous rounds, to complete the new funding.

The new financing will enable Picolight to continue the volume manufacturing ramp of each of its three product lines: Magnus 850-nanometer (nm) parallel optics products, Accelar 850 nm serial optical products, and Extensus 1310 nm products.

Inphi Raises $24M
Inphi Corp., a Westlake Village, Calif.-based indium phosphide IC developer, said it has received an additional $24 million in its second round of equity funding. This round brings the total investment to date to $36 million and represents a strong vote of confidence in Inphi's 10- and 40-gigabit per second (Gbps) integrated circuit solutions for optical networks, officials said.

The lead investor for the Series B funding is Walden International, and other participants in the round include Menlo Park, California-based Dali-Hook Partners and previous investors Tallwood Venture Capital and Mayfield, both of which participated in the Series A round in December 2000. The company has introduced several products along its technology roadmap, including multiplexers and demultiplexers, modulator drivers, and transimpedance amplifiers.

CorActive Activates $10.5M
CorActive, a Quebec-based manufacturer of specialty optical fibers, announced it has secured $10.5 million (C$16 million) in private financing in a round managed by Yorkton Securities Inc. The lead investor was Fidelity Management & Research Company, on behalf of funds and accounts managed by it and also included Novacap and existing shareholders namely Innovatech Quebec et Chaudiere-Appalaches and Investissement Desjardins.

The financing will mainly be used to increase the production capacity of the company through the purchase of new equipment and the hiring of experts in research, manufacturing and sales.

SilverBack Gets Greenbacks
The Billerica, Mass., maker of IT monitoring software raises $9M in fourth-round VC to target new customers and markets. (more)

Product News

Atrica Unveils Ethernet-Optimized DWDM System
Optical Ethernet equipment provider Atrica Inc. announced a major new hardware platform release for its A-8800 Optical Ethernet Metro Core Switch that lets carriers dramatically simplify their Metro network operations, significantly reduce their capital and operational expenditures, and scale their networks effectively to support emerging Ethernet-based services, officials said.

Release 2.0 of Atrica's A-8800 Optical Ethernet Metro Core Switch delivers a comprehensive new set of Ethernet-optimized optical capabilities, making Atrica the first vendor to deliver a fully-integrated Ethernet/DWDM (Dense Wave Division Multiplexing) system and the only vendor to offer true Optical Ethernet combining standard Ethernet, integrated optical switching and traffic engineering and management.

Orchestream, Riverstone Partner on OSS
Orchestream, a provider of software platforms for automating the configuration, activation and assurance of next generation services on broadband networks, said it has partnered with Riverstone Networks to deliver an integrated operational support system (OSS) application solution for provisioning and managing metro services. The RapidOS Metro Service Center unveiled today by Riverstone, capitalizes on Orchestream's multi-vendor service activation and automated configuration support capabilities.

By integrating critical OSS applications into one solution, RapidOS Metro Service Center eliminates the process of selecting, installing and integrating OSS applications, giving service providers immediate access to the benefits of offering metro Ethernet services. The RapidOS Metro Service Center combines service creation, service level agreement monitoring, service fault management and billing, using the best-of-breed applications from Orchestream, MicroMuse, XACCT and InfoVista. Enterprise customers can access their own network services through a self-service Web portal, allowing them to securely monitor and control which services they have, track performance and review billing.

Lumentis Unveils 10 Gbps Transponder
Lumentis AB, a provider of metro DWDM systems that maximize network utilization, reveals its development of a single board, single-slot 10 Gbps Transponder. With a size of 220x230 mm, the new 10 Gbps Transponder is a compact, plug-in unit that provides 10Gb/s SONET/SDH and 10 Gigabit Ethernet traffic to be transported in the Lumentis metro networks, officials said.

Coupled with a Mentis 3000 unamplified metro platform, the Lumentis 10Gbps Transponder removes the need for intermediate termination or additional de-multiplexing while carrying traffic to and from long haul networks to the metro environment. This translates into immediate and long-term cost savings for the carrier building a simpler, cost-effective metro network. The Lumentis 10 Gbps Transponder will be available in 2002's fourth quarter.

Other News

Level 3 Chooses Laurel Networks' Edge Router
Laurel Networks Inc., which provides high-performance service edge routers, said broadband network services provider Level 3 Communications has selected the Laurel Networks ST200 Service Edge Router for its MPLS-based Ethernet private line, ATM and Frame Relay service in the U.S. and Europe. The ST200 was designed from the ground up to create profitable data services at the edge of an IP/MPLS backbone network. With a distributed, edge-optimized architecture combining Internet class routing, full port-by-port multi-service capabilities and a sophisticated service management infrastructure, the ST200 delivers services with unmatched performance, scalability and flexibility to support current and future service provider requirements, officials said.

Atrica and FlexLight Networks Partner on Metro/Last Mile Ethernet
Atrica Inc., a provider of Optical Ethernet equipment, said it is teaming with FlexLight Networks, a new company delivering a Gigabit Passive Optical Networking (GPON) solution for the last mile. Under the terms of the agreement, the two companies will participate in joint reference-selling of their products, and have already successfully completed the initial tests to ensure interoperability between Atrica's Optical Ethernet System and FlexLight's GPON solution.

Atrica's Optical Ethernet System combines standard 10Gigabit Ethernet with optical switching and traffic engineering and management capabilities to give carriers up to ten times better price/performance as compared to other Metro networking solutions including SONET and next-generation SONET, company officials said.