Bandwidth Brokers: Texas Startup Targets Skyrocketing Bandwidth Demands of New "Bandwidth Brokers," Major Telecom Carriers - Company Business and Marketing

EDGE, On & About AT&T, Oct 19, 1998

A new "Telecom Corridor" startup is developing products that will let carriers take full advantage of emerging optical networking technologies - particularly the Dense Wavelength Division Multiplexing (DWDM) technology which is dramatically increasing the capacity of fiber networks. Monterey Networks, Inc., will enable service providers to create data-optimized optical networks by performing a "traffic cop" function for their high-capacity fiber-optic backbones.

Formed in mid-1997 by Silicon Valley technology veterans, Monterey Networks is chartered to help the new breed of "bandwidth brokers" (fiber-rich network service providers) and established telecommunications carriers deal with skyrocketing capacity demands, especially as heavy loads of data move onto networks once dedicated exclusively to voice traffic.

The company has named as its president and CEO the 15-year Alcatel Network Systems veteran Joe Bass, who most recently was vice president and general manager of Alcatel's Optical Networks Business Unit (Richardson, Tex.). Bass brings to Monterey Networks an extensive background in high-capacity transport products and services and expertise in both established and emerging interexchange carrier markets.

$10 Million Raised in First-Round Financing In May 1998 Monterey Networks raised $10 million in first-round venture funding from Communications Ventures (whose partners have backed PairGain Technologies, Tellabs, Ciena and Advanced Fibre Communications), JAFCO America Ventures (Advanced Fibre, Ciena), Sequoia Capital (Cisco, Stratacom, Yahoo!) and Sevin Rosen Funds (Ciena, Compaq, Lotus). Members of the board of directors are Jon Bayless (chairman), partner at Sevin Rosen; Todd Brooks, managing principal at JAFCO America; Roland Van der Meer, partner at Communications Ventures; Joe Bass; and H. Michael Zadikian, Monterey co-founder and vice president of marketing.

Scheduled for delivery in late 1999, Monterey's products will enable the service provider infrastructure to support the exponential growth in bandwidth demand created by widespread adoption of the Internet as a communication mechanism for both data and voice.

"Leading router and switch vendors are already moving to connect their products directly to optical fiber networks, eliminating SONET infrastructure in the core network," said CEO Bass. "But this introduces provisioning, restoration and management problems when wavelengths are switched between major backbone segments. Monterey's products will allow carriers to leverage their next-generation multi-gigabit routers, DWDM systems and ATM switches to create new services over high-capacity, high-reliability fiber networks."

Telecom Corridor Chosen Over Silicon Valley According to Zadikian, the company initially intended to set up shop in California's Silicon Valley but chose to settle in Richardson's "Telecom Corridor" because of the area's wealth of service providers, equipment suppliers and component vendors focused on telecommunications markets. Monterey, which currently has 35 employees, expects to grow its staff to more than 75 in the next six months, chiefly through the addition of engineering personnel.

The Monterey Networks founding team includes Zadikian; Ali Saleh, chief systems architect; Zareh Baghdasarian, vice president of engineering; and Vahid Parsi, senior systems architect.

Zadikian was formerly vice president of marketing at Sourcecom, in Westlake Village, Calif., where he launched the first credit-card-size router, based on emerging DSL (digital subscriber line) technology; he had previously spent four years at Cisco Systems, leading the marketing effort for the company's Interworks Business Unit. Saleh was co-founder and chief architect at Sourcecom, and had previously held lead engineering positions with Quotron/Citicorp and Informer. Baghdasarian was vice president of engineering at Sourcecom; earlier he had served as general manager of Ameritec's Signaling Group and directed a multi-discipline engineering department for Tekelec. Parsi came to Monterey from ACT Networks, where he was principal member of the technical staff; he had previously worked on communication chips at Advanced Micro Devices. FMI: 972-301-1000 or http://www.montereynets.com.