On Monday, the telecommunications equipment maker introduced the Multiservice Provider Edge (MPE) 9000, known internally as "Neptune." The new edge router is designed to help carriers shift traffic from their old ATM (asynchronous transfer mode)-based networks to ones built using a technology called MPLS ().
Today, most carriers use different networks to transport voice traffic and Internet traffic. MPLS will allow them to carry both types of traffic over the same network.
Nortel is a major supplier of the older, more traditional voice-switching gear. And while it offers a few products that help carriers deliver some services over a converged network, it has been missing a scalable router that can take in different types of traffic and put it onto the MPLS infrastructure.
Before the MPE 9000 was announced, Nortel tried to position its older products, like the Passport ATM switch and the Shasta IP Service switch, for this purpose. But neither product had been specifically designed to handle MPLS, and neither product supported the scalability necessary, said Mark Bieberich, an analyst at The Yankee Group.
"The Passport and Shasta were designed for different purposes," he said. "At a certain level, the economics don't work for these older products, and a new one, built from the ground up, is needed."
As more carriers move toward an MPLS network, the market for products that can help them bridge the gap between the old network and the new one is heating up. Nortel's primary competitor in thismarket is Cisco Systems. Cisco has repositioned its GSR 12000 router, which had originally been designed as a core router for the Internet, as its answer to MPLS convergence. It also targets certain accounts with its 7600 and 10000 routers.
Other equipment makers are also trying to cash in on convergence. Juniper Networks, the No. 2 IP-routing player, offers customers its IP routers, including the M320, M160 and M40e.
Companies without much of an IP story have been scrambling to find one. Last year, Alcatel bought TiMetra Networks to get its foot in the door. And Tellabs, also a maker of traditional telephone switching gear, bought a start-up called Vivace Networks.
A couple start-ups still remain independent, includingand .
There had been speculation that Nortel might try to buy a start-up to fill its gap. But the company decided to build the product on its own.
"This is a big deal for Nortel," Bieberich said. "This is the first time in a long time that they have engineered a product like this from the ground up."
Carriers have already begun testing the product. Equant has the box in its labs right now, and Infonet Services will begin trials soon. The company expects the product to be more widely available by the fourth quarter of 2004.
Nortel's product announcement comes on the heels of theof several key executives, including its chief executive, Frank Dunn. The company fired Dunn, along with its chief financial officer and controller, after into the company's accounting practices revealed that discrepancies ran deeper than expected.