CEC-IDN And CIENA Sign Memorandum of Understanding

Business Wire, Feb 20, 2002

Business Editors/Hi-Tech Writers

HONG KONG--(BUSINESS WIRE)--Feb. 20, 2002

Agreement Covers Collaborative Manufacturing, and Joint Research and

Development to Tailor CIENA's ON-Center NMS Software

to the China Market

CIENA(R) Corporation (Nasdaq:CIEN), a global leader in intelligent optical networking systems and software, and CEC-IDN Telecom Limited ("CEC-IDN"), a provider of optical networking solutions to Chinese operators, today announced that they have signed a memorandum of understanding for collaboration on manufacturing, and research and development activities in China.

CIENA and CEC-IDN intend to collaborate on the joint manufacture of CIENA's CoreDirector(TM) and MetroDirector K2(TM) products in the People's Republic of China (PRC). This manufacturing collaboration will first involve the MetroDirector K2 and will be carried out in a sequence of phases that ensure the highest standards of product quality and availability.

CIENA and CEC-IDN also plan to jointly establish a software research and development center in Shanghai for the development of a single, integrated and localized Network Management System ("NMS") for the CIENA/CEC-IDN solution.

The Center will focus on tailoring CIENA's ON-Center(TM) NMS software to meet the unique requirements of the PRC market, including the development of a Chinese-language graphical user interface (GUI) and the integration of CEC-IDN's existing access products.

"This agreement underscores our long-term commitment to the China market," said Gary Smith, CIENA's president and chief executive officer. "We continue to view Asia, and China in particular, as a key region for future growth. Together with CEC-IDN, we expect to bring China's telecom operators the ability to migrate their networks from legacy systems to next-generation optical networks, ultimately reducing capital expenditures and generating additional streams of revenue."

The memorandum of understanding follows a successful six-month collaboration between the two companies that had entered into distribution and technical co-operation agreements in 2001. CEC-IDN has deployed CIENA's industry-leading CoreDirector and MetroDirector K2 products, and has placed several additional purchase orders with the Maryland-based company.

CIENA's CoreDirector is an intelligent optical switch utilized in the core of long-haul and metropolitan networks. It is designed to rapidly deliver a wide range of differentiable end-to-end optical capacity while minimizing capital and operational expenses. It enables the ability to groom circuits, thereby offering carriers the flexible capacity that today's networks require.

MetroDirector K2 is a next-generation Multi-Service Transport Platform (MSTP) designed for service providers seeking increased availability of usable, cost-effective bandwidth. The MetroDirector K2 platform has an innovative architecture that helps service providers transcend metro area gridlock, while extracting increased revenues and performance from their existing infrastructure.

"CEC-IDN is thrilled to expand our relationship with CIENA, the leader in next-generation optical networking solutions," said Mr. Shan Chang, chairman of CEC-IDN. "China's local markets are growing rapidly, and a fast, flexible and high-capacity telecommunications infrastructure needs to be established to manage the increased demands. CIENA provides the groundbreaking technology required to further build out China's telecommunications networks. We're confident that CIENA's next-generation systems will be an integral component of our successful network deployments."

"This memorandum of understanding is a great endorsement of our mutually rewarding relationship with CEC-IDN," said Claude Achcar, managing director of CIENA's Asia region. "CEC-IDN is a valued CIENA partner that carries a great deal of respect in China."

CIENA's product family spans the critical areas of next generation intelligent optical networking. With the products that form CIENA's revolutionary LightWorks(TM) architecture, service providers can build a network that reaches from the core of the network to the access edge.

CIENA is the only next-generation provider to offer carriers a complete range of products in long-distance optical transport, metropolitan optical transport, intelligent optical switching and network management.

CEC-IDN was founded by China Electronics Corporation (CEC), the largest electronic enterprise in China, and IDN Telecom, Inc., a privately held broadband and metro access solution company with headquarters in Fremont, Calif. CEC was established in 1989 under the jurisdiction of China's State Central Enterprises Working Committee with a mandate to vitalize and develop China's information industry.

ABOUT CIENA

CIENA Corporation's market-leading optical networking systems form the core for the new era of networks and services worldwide. CIENA's LightWorks(TM) architecture enables next-generation optical services and changes the fundamental economics of service-provider networks by simplifying the network and reducing the cost to operate it. Additional information about CIENA can be found at www.ciena.com.