TE SubCom, a TE Connectivity Ltd. company and an industry pioneer in submarine network technology, and Ciena, a leading network strategy and technology company, have agreed to an alliance that furthers the advancement of open submarine cable networking solutions. Customers seeking a single point of contact for both wet plant and dry plant will have the option to combine TE SubCom’s advanced wet plant designs and marine installation with Ciena’s industry-leading 6500 Packet-Optical Platform, powered by WaveLogic™ coherent optics, to create a powerful and flexible next-generation undersea cable system.
The combination of Ciena’s leadership and innovation in high-speed optics, underpinned by its OPn network philosophy including GeoMesh submarine solutions, and TE SubCom’s leading position in wet plant cable solutions will accelerate the transition toward software-defined submarine networks that offer ultimate capacity and reach, maximum resilience, greater programmability, and lower operating costs. Introduced in 2015, TE SubCom’s Open Cables business model continues to enable a greater degree of choice, allowing customers the flexibility to select their preferred submarine transceiver equipment vendor. Since its launch, TE SubCom has seen an increasing number of cable operators take advantage of its Open Cables approach and elect to utilize Ciena equipment.
Recognizing the benefits of this enhanced customer choice, TE SubCom’s Open Cables model will now also provide customers the option of buying a combined solution using fully-qualified Ciena equipment on TE SubCom-designed wet plant. Customers can purchase this solution from TE SubCom, benefitting from a single point of contact and guaranteeing the performance of an end-to-end, turnkey lit system, or, alternatively, customers can contract independently with TE SubCom for wet plant and Ciena for transmission equipment.
“Having manufactured our own submarine line termination equipment for decades, we are well aware which technologies are required to efficiently utilize our wet plant system. Ciena produces innovative, flexible and responsive technology that will provide for a fully optimized undersea cable network,” said Aaron Stucki, president of TE SubCom. “The Open Cables model has enabled us to offer our customers options that have never before been available in the undersea cable industry. That model is now further enhanced through this agreement with Ciena, as cable operators wishing to deploy Ciena’s equipment on TE SubCom networks will be able to do so efficiently, with the full support of our engineering team and our commitment to on-time delivery of an end-to-end solution.”
“As customers increasingly choose to consume network technology in different ways to address evolving network requirements for today’s web-scale world, this alliance with TE SubCom helps us continue meeting their needs for open, programmable, multi-vendor networks to create powerful and flexible next-generation undersea systems,” said Gary Smith, president and CEO of Ciena.
“Collaborating with TE SubCom will provide Ciena greater reach into submarine network operators and give customers a more diverse range of options for network configuration.”.
Source: TE SubCom-Ciena Joint Press Release
ANALYSIS: A few years ago, when independent terminal equipment manufacturers entered the submarine sector and decimated the system upgrade market which had always been a fall-back for the traditional turnkey submarine system suppliers, TE SubCom was already struggling to regain its position as joint market leader with Alcatel Submarine Networks after its disastrous venture into becoming a carriers' carrier as well as a supplier to carriers with the TyCom Global Network.
At that time, rumors abounded of an imminent and logical takeover of TE SubCom by Ciena. Both parties denied that they had any interest in a merger. Ciena was enjoying a leading position in the market for upgrading existing submarine cable systems beyond their original design capacity and some spoke of the end of the need to put any more new submarine cables in the ocean on key routes.
But this upgrade market did, in fact, prove to be finite and Ciena re-positioned itself as a prime provider to the burgeoning demand from cable operators for more choice in sourcing system elements, an end to "turnkey hegemony", and progress towards truly "Open Systems". Ciena's core strategy in this re-positioning was to promote Software-Defined Networks (SDN).
TE SubCom, on the other hand, caught a lucky break when the parent of ASN, Alcatel-Lucent, got into liquidity problems, tried and failed to sell off ASN, and was then itself acquired by Nokia. The future for ASN remains uncertain which makes customers more wary of making long-term commitments to purchase from a system supplier that may not be around in a few years and TE SubCom's market share rebounded. Nevertheless, the Company had already been waving a white flag with regard to competing with Ciena and Infinera in the terminal equipment segment and, from the beginning of 2016, began actively promoting the concept of "Open Systems".
It is difficult to imagine that this "alliance" between TE SubCom and Ciena is the end-game. SubCom has been reduced to a manufacturer of wet plant and provider of cable ships, while Ciena's growth is limited to terminal equipment. There is probably more advantage in a merger for TE SubCom than there is for Ciena, but who ever can resist the thought of becoming the owner of a fleet of eye-catching, brand-awareness-raising, ocean-going vessels that are literally building a physical global telecommunications network and are thereby changing the lives of billions of people for the better and forever?
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Julian Rawle, Author
Thought leadership articles and commentary on developments related to the subsea fibre optic cable industry can be found here.