News Release

Cisco Captures Number One Market Share in OC-48 Optical Transport Segment

Cisco Achieves Fastest Growth in Industry with Nearly 500 Percent Growth and 9 Point Gain in Overall SONET Market Share
Mar 05, 2001

SAN JOSE, Calif. - March 5, 2001 - Cisco Systems, Inc. (NASDAQ: CSCO), the worldwide leader in networking for the Internet, has captured the number one position in the North American market for Optical Carrier (OC) 48 long-haul SONET transport, according to a newly released report by RHK, Inc., a leading industry research firm. The report entitled, "SONET Transport & DCS Long-Haul SONET Market Forecast" states information that is current as of January, 2001.

Additionally, Cisco's market share for the total long-haul Synchronous Optical Networking (SONET) equipment market soared nearly 500 percent from 2.3 percent 1999 to 11.3 percent in 2000, by far the largest market share gain of any supplier in the report. The report projects North American spending on long-haul SONET equipment to increase from $5 billion in 2000 to $7 billion by 2003.

According to the report, Cisco achieved a 29.2 percent market share for OC-48 in 2000, passing such traditional SONET/SDH vendors as Nortel Networks, NEC, Lucent, Alcatel and Fujitsu, based on estimates of North American manufacturing revenues. Cisco's OC-48 transport interfaces are hosted on the industry leading ONS 15454 optical transport platform.

"In 2000, Cisco became the number one player in the OC-48 SONET equipment market," said Brian Van Steen, Analyst, Optical Networking, of RHK Inc." This was the result of the market's demand for Long-Haul SONET transport equipment. Cisco sold the most OC-48 equipment in only its first full year of selling the ONS 15454."

OC-48 is an optical transport protocol that makes it possible to carry up to 2.5 gigabits per second over fiber optical cable using SONET technology. According to the RHK report, in the year 2000, more OC-48 SONET units were deployed than any other line rate.

Traditional SONET systems were designed for voice only networks, and were typically large, single bit-rate and single service platforms. For example, a traditional OC-48 SONET multiplexer, requiring a seven- foot equipment rack, only supports OC-48 transmission speeds, and aggregates only voice traffic. In contrast, the multi-service Cisco ONS 15454 Optical Transport Platform is designed to support any SONET bit rate, and can aggregate and switch both voice and data traffic, all in a single platform about the size of a 19 inch television.

"These numbers affirm Cisco's market share leadership in delivering IP+Optical solutions," said Terry Brown, Cisco's Vice President and General Manager of the Optical Transport Business Unit. "With over 500 customers and tens of thousands of systems in the field, Cisco is now at a top position in the optical transport market. The unprecedented customer acceptance of the ONS 15454 has completely changed the playing field for optical networking: scalability to OC-192 and beyond, Ethernet/IP and ATM services on demand with packet and cell switching, integrated DWDM, and the lowest life cycle cost in the industry. The combination of supercharged SONET/SDH, integrated optical networking, and unprecedented multi-services capability in a single platform has brought dramatic economic benefits to service providers worldwide."