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Optical Access for Business Services Choosing the Right Technology Optical Access for Business Services Choosing the Right Technology

Market Trends in Business Services Business Fiber Trend % of Commercial Buildings with 20+ Market Trends in Business Services Business Fiber Trend % of Commercial Buildings with 20+ Employees Fiber penetration has doubled in last 5 years to U. S. Commercial Buildings with 20+ employees VSG 2010 • Carriers have developed a “think fiber first” mindset – Service quality/reliability – Growth potential/scalability • Investment is accelerating in fiber access – Fiber penetration has more than doubled in last 5 years – Solutions must be fiber-ready ® Adtran, Inc. 2008 All rights reserved 2

Drivers for Optical Access Smart Phones, Video, new apps are stressing backhaul infrastructure Fiber Drivers for Optical Access Smart Phones, Video, new apps are stressing backhaul infrastructure Fiber access offers improved scalability and reliability Fiber plant constraints addressed with WDM or PON Pseudowire emerging as legitimate TDM transition option ® Adtran, Inc. 2008 All rights reserved 3

Key Attributes for Optical Access Low Cost, Highly Scalable Bandwidth – Ethernet, TDM Time Key Attributes for Optical Access Low Cost, Highly Scalable Bandwidth – Ethernet, TDM Time to Market for Service Ubiquity – Ethernet, TDM, Copper Service Convergence – Path to all-packet architecture SLA Management – Co. S support e. g. Real-time vs. Best-Effort Resiliency – 99. 99+% service availability Hardened solutions for outside plant deployment – Robust operating range, metallic interface protection ® Adtran, Inc. 2008 All rights reserved 4

SONET / SDH Point-to-Point Ring ® Adtran, Inc. 2008 All rights reserved Notes: • SONET / SDH Point-to-Point Ring ® Adtran, Inc. 2008 All rights reserved Notes: • Dedicated bandwidth per service interface • Deterministic transport performance • ‘Single’ Class of Service - guaranteed • Very mature OA&M capabilities • Ideally suited for TDM transport • DS 1/E 1 VT 1. 5/ VC-2 • DS 3/E 3 STS-1/ VC-3/4 • Adapted for packet based transport • 10/100 Mbps GFP VT/VC • GE/ 10 GE GFP STS/VT/VC • Modular, ‘carrier grade’ architecture 5

Ethernet over Fiber Point-to-Point Ring ® Adtran, Inc. 2008 All rights reserved Notes: • Ethernet over Fiber Point-to-Point Ring ® Adtran, Inc. 2008 All rights reserved Notes: • Possibility for shared bandwidth per service interface or trunk • Engineered transport performance • Multiple Classes of Service • Emerging OA&M capabilities • Ideally suited for packet based transport • Adapted for TDM based transport • DS 1/E 1 PWE 3/CES • DS 3/E 3 PWE 3/CES • Modular architecture • Emerging ‘carrier grade’ architecture 6

GPON Point-to-Multipoint Notes: • Shared bandwidth per service interface • Engineered transport performance • GPON Point-to-Multipoint Notes: • Shared bandwidth per service interface • Engineered transport performance • Multiple Classes of Service • Emerging OA&M capabilities • Ideally suited for low bandwidth, best effort packet based transport • Adapted for TDM based transport • DS 1/E 1 PWE 3/ CES • DS 3/E 3 PWE 3/ CES • Typically fixed access architecture • Emerging ‘carrier grade’ architecture ® Adtran, Inc. 2008 All rights reserved 7

Technology Comparison Technology SONET/ SDH Ethernet over Fiber GPON Availability • Ability for network Technology Comparison Technology SONET/ SDH Ethernet over Fiber GPON Availability • Ability for network to survive failures Highest High Medium Reliability • Ability to detect and react to local faults Highest High Medium Packet Efficiency • How efficiently Ethernet is carried Medium Highest TDM Efficiency • How efficiently DS 1/E 1, DS 3/E 3 is carried Highest Medium* Performance • Tools to monitor error rates • Capabilities in testing/ reporting High Medium** Cost per bit • Overall cost to transport service High Medium Low * Pseudowire solutions available for DS 1/E 1 ** Ethernet OAM standards are maturing ® Adtran, Inc. 2008 All rights reserved 8

Higher Lower Cost per bit Technology Tradeoffs for Today’s Solutions SONET/ SDH Ethernet over Higher Lower Cost per bit Technology Tradeoffs for Today’s Solutions SONET/ SDH Ethernet over Fiber GPON Lower Higher Performance ® Adtran, Inc. 2008 All rights reserved 9

OPTI 6100 Family of Systems LMX chassis 24 Line Card Slots Rack mount 336 OPTI 6100 Family of Systems LMX chassis 24 Line Card Slots Rack mount 336 DS 1, 48 DS 3, OC-12 Ethernet OC-48 Network interfaces (OMM) – OC-3 – TM, UPSR, 1310 nm IR and LR, w, w/o XC, ADM, 1550 LR – OC-12 – TM, UPSR, 1310 nm IR and LR, w, w/o XC, ADM, 1550 LR – OC-48 – Linear, UPSR – SFP based Low-speed (tributary) interfaces MX chassis 12 Line Card Slots Wall or Rack mount 84 DS 1, 12 DS 3, Ethernet OC-3, OC-12, OC-48 SMX chassis – – – – DS 1 (28 ports, M 13, or VT 1. 5 mapped) DS 3 (3 port) OC-3 (1 port, 2 fiber, SFP) OC-12 (1 port, SFP) Ethernet (10/100) (3 ports)(8 ports w, w/o tagging) Transmux (1 port and 3 port) Gig. E (copper, SM, MM, SFP) 4 Line Card Slots Wall or rack mount 28 DS 1, 6 DS 3, Ethernet OC-3, OC-12, OC-48 Tilt-down Wall Enclosures for MX and SMX application ® Adtran, Inc. 2008 All rights reserved 10

Advanced Ethernet Modules vs. Individual VLANs in shared VCAT Group VLAN 1 Individual VCAT Advanced Ethernet Modules vs. Individual VLANs in shared VCAT Group VLAN 1 Individual VCAT Groups Shared VCG Customers VLAN 1 OPTI-6100 Customers Gig. E or 10/100 Router HO/LO VCAT OPTI-6100 VLAN 1 OPTI-6100 VLAN 2 VLAN trunk OC-12/48 SONET Ring VLAN 3 Gig. E Applications • EVPL service with VLAN separation of customer traffic • ELAN service with VLAN separation of customer traffic ® Adtran, Inc. 2008 All rights reserved 11

Ethernet over Fiber Components TA 5000 8 -port Gigabit Ethernet Access Module – 8 Ethernet over Fiber Components TA 5000 8 -port Gigabit Ethernet Access Module – 8 Gig. E SFP cages – Link Aggregation – Link OAM Net. Vanta 8044 M – – – 4 -10/1000 Base. T WAN or LAN 4 - Gig. E SFP WAN or LAN 2 - Expansion Slots 1 and 2. 5 G ERPS Ring support with optical bypass option. Clock Sync over Packet Ready e. g. G. 8261/62 Sync. E Dual fed DC options (+/-24 V, -48 V DC) Carrier Ethernet – MEF 9, 14, 18 – Eth OAM CFM and PM – TACASC+ and RADIUS Authentication, Authorization 8 -port Gig. E Access Module ® Adtran, Inc. 2008 All rights reserved Net. Vanta 8044 M Modular NTE 12

Leverage Fiber Assets with CWDM DS 1 TA 5000 MSAP 2 x. GE or Leverage Fiber Assets with CWDM DS 1 TA 5000 MSAP 2 x. GE or 2 x 10 GE Central Office/ Exchange TA 5000 MSAP Carrier Ethernet Network 8 port Eo. Fiber AM Net. Vanta 8044 M 8 port PW Service Module CWDM Gig. E NV 8044 M Modular NTE 8 x. DS 1 & Clock Sync 10/1000 Cell Site ® Adtran, Inc. 2008 All rights reserved 8 x. DS 1 & Clock Sync 10/1000 Cell Site 13

Total Access GPON Solution Total Access 5000 OLT – GPON 2 -Port Optical Line Total Access GPON Solution Total Access 5000 OLT – GPON 2 -Port Optical Line Terminal – 21 OLTs/42 PONs per Total Access 5000 1, 344 SUBs Total Access 5000 – 2. 488 Gbps downstream, 1. 244 Gbps upstream – Completely GEM based Voice support via SIP GPON Optical Network Terminals – SFU—Support for triple-play delivery 2 POTS, 1 Ethernet port 2 POTS, 2 Ethernet ports Voice, HS data, IPTV ® Adtran, Inc. 2008 All rights reserved TA 35 X GPON OLT 14

Total Access 372 SBU Total Access 372 – SBU ONT – 8 POTS, 2 Total Access 372 SBU Total Access 372 – SBU ONT – 8 POTS, 2 Ethernet, 4 DS 1 Loop and Ground start 10/1000 Bt Ethernet – TLS Support – MEF Compliant (future) DS 1 PWE – GR 950 Compliant Enclosure – GPON and Active Versions 372 - SC APC GPON 372 E - SFP Active Ethernet ® Adtran, Inc. 2008 All rights reserved 15

Conclusions Fiber the preferred access media for business services Choices available, each with its Conclusions Fiber the preferred access media for business services Choices available, each with its own set of strengths and weaknesses – SONET/ SDH The most mature Ideally suited to TDM services Comparatively expensive – Ethernet over Fiber Suitable for packet based services over a wide range of speeds Moderate cost Excellent scalability – GPON Ideally suited to services up to 100 Mbps Can be engineered for business services Lowest cost Choice of technology is dependant upon service needs and cost objectives ® Adtran, Inc. 2008 All rights reserved 16