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Posted by Stephen Hardy

As we reported yesterday, Tellabs has decided to walk away from Verizon's GPON program. As the story indicates, the company isn't providing many details about its thinking, other than "we did not find the deal economical."

However, I have to give Tellabs credit for having the sense to walk away from a high-profile program when the numbers just didn't add up. Yeah, sticking around would mean the company could still say it was a part of the country's biggest FTTH deployment. But being the #3 supplier for a GPON rollout that's still in its nascent stages couldn't have offered much hope of return on R&D; investment. The situation reminds me of those stories you hear about titled families in Europe living almost like paupers in the ancestral castle; at some point, the sacrifices necessary to keep up appearances become irrational.

In an industry that is known for wrapping products in dollars just to keep them moving out the door, Tellabs' ability to say, "Enough!" provides an example that others ought to ponder.

Of course, the smartest move is to avoid getting involved in programs like this in the first place. But, hey, one step at a time.

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Blogger Juan David said...
I agree with your comment. One thing to add: the centralization on one company was avoiding the international market, which could be their logical next step. See how the stocks raised after the news.
Thursday, April 3, 2008 5:14:00 PM EDT  

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The Lightwave editorial staff uses The Lightwave Blog to share their thoughts on optical communications and whatever else might be the current topic of conversation from cubicle to cubicle. Feel free to add your own opinions.

Stephen Hardy is editorial director and associate publisher of Lightwave, which makes him responsible for the editorial aspects of the Lightwave franchise. A technology journalist since 1982, he once had his job duties described as "gets paid to tick off advertisers ".

Meghan Fuller is senior editor of Lightwave. She has degrees from Franklin & Marshall College in Lancaster, PA, and the University of Delaware and is a card-carrying member of Red Sox Nation.