CIENA Unveils LightWorks Toolkit for New Optical Services.

Business/Technology Editors

LINTHICUM, Md.--(BUSINESS WIRE)--Jan. 25, 2000

Optical Networking Leader Enables New Optical Services for the

Broadband Internet; CIENA-Built Networks To Deliver Any-Time,

Any-Size, Any-Priority Optical Capacity

CIENA Corporation (Nasdaq: CIEN) today introduced the LightWorks Toolkit(TM) for Optical Services, a series of new optics-, silicon- and software-based service enablers from CIENA. With the Internet driving fast and unpredictable changes in network demands, these tools will allow CIENA's carrier customers to deliver the next generation of any-time, any-size, any-priority optical services based on user-signaled needs - previously impossible to offer due to the inherent limitations of SONET/SDH.

CIENA's LightWorks Toolkit will transition carriers from static provisioning to real-time, on-demand bandwidth delivery; from bandwidths limited by traditional SONET hierarchy to optical bandwidths of any size; and from a single wavelength quality of service to a range of service qualities that can be dynamically configured and monitored. These service-enabling tools, including Wavelength Binding(TM), Flexible Concatenation(TM) and VSR Optics(TM), are scheduled to be integrated into CIENA's intelligent optical networking solutions this year, removing the roadblocks to a rich, responsive broadband Internet.

&uot;In today's SONET networks, ordering and provisioning a basic data circuit from New York to Los Angeles takes months. Given that level of pain with even a simple circuit, talking about value-added services is almost a waste of time,&uot; said George Peabody, managing director of telecommunications research at the Aberdeen Group. &uot;Customers want bandwidth in Internet increments on Internet time, provisioned within seconds, and with a Web tool to reconfigure the service themselves in real time, or with the bandwidth allocated transparently by a router based on traffic type and a service level agreement. The first carrier to do that is going to scare the heck out of the competition. CIENA's service enablers are the class of tools carriers need to get the job done.&uot;

&uot;Last year CIENA introduced its LightWorks architecture,&uot; Peabody continued. &uot;CIENA's new software tools let a carrier build the network to that architecture, moving from infrastructure theory to service delivery. CIENA's focus on services provisioning supports the carrier business agenda: increased revenue at higher margins.&uot;

&uot;We've roughly doubled our installed base in the last year because the LightWorks(TM) architecture has resonated with carriers, and we've worked closely with them to analyze the true drivers behind the optical Internet,&uot; said Gary Smith, CIENA's chief operating officer. &uot;The landscape has evolved from being driven primarily by competition to being dominated by growth in Internet traffic and new applications. Today, demand is less predictable and customers require more levels of service quality.&uot;

&uot;Carriers are telling us that their customers are demanding more customization than ever, but at the same time, carriers must increase returns on their bandwidth investments. The way to accomplish both is to turn network intelligence into a higher level of optical services,&uot; Smith continued. &uot;To maximize revenues and minimize opportunity and operations costs, carriers must be able to deliver flexible, real-time, user-signaled optical services. CIENA is committed to being the company delivering on this vision.&uot;

Delivering on the Vision

Throughout the year, CIENA will be introducing new tools implemented in the company's optical networking platforms to make service-centric networks possible. These technologies will help service providers fulfill their need for any-time optical capacity of any size and any priority. Key technologies announced today include:

Wavelength Binding

With unprecedented traffic growth and changing traffic demands, Internet-centric carriers are looking for ways to better match the changes in IP router traffic demands with the provisioned capacities available within their networks. To meet this need, CIENA has developed Wavelength Binding. Wavelength Binding leverages intellectual property in both hardware and software to enable a device of any speed to be connected to a network operating at a lower speed by building &uot;virtual channels&uot; of multiple wavelengths bound together in a single, very high capacity bitstream. The result is that CIENA's carrier customers will be able to deliver 40Gbps, for example, without changing their transport infrastructure. Wavelength Binding is scheduled to be integrated into CIENA solutions by the end of the third calendar quarter 2000.

Flexible Concatenation

In legacy networks, bandwidth demand is arbitrarily shoehorned into SONET/SDH-sized transport containers (OC-3/STM-1, OC-12/STM-4, etc.). CIENA is using a combination of silicon and software to redefine how carriers access bandwidth within each bitstream. Flexible Concatenation will allow carriers to access all time slots within the SONET/SDH frame - even when fractionally filled. That means carriers can create true OC-&uot;N&uot; services in which &uot;N&uot; can be any number between 1 and 768. When an end user needs OC-&uot;7&uot; for instance, carriers will deliver true OC-7 service instead of the traditional SONET-restricted OC-12 - maximizing bandwidth and delivering more customized service. Flexible Concatenation is scheduled to be integrated into CIENA solutions by the end of the second calendar quarter 2000.

VSR Optics

For increased profitability, carriers must continually drop their cost per bit. However, to stay competitive, carriers must continue to increase the value of their services. VSR (Very Short Reach) Optics enable dramatically lower-cost, high-capacity connections between Internet and optical networking systems. CIENA will initially apply this data rate-scalable technology to 10Gbps router-to-router and router-to-network connections. VSR Optics leverage VCSEL (Vertical Cavity Surface Emitting Laser) technology and Gigabit Ethernet standards to make variable-rate optical services not only possible, but highly economical - a valuable service for unpredictable bandwidth demands. VSR Optics technology is scheduled to be integrated into CIENA systems by the end of the third calendar quarter 2000.

&uot;The optical marketplace may be hot but its focus on counting wavelengths is wrong. Service delivery is what the next generation of optical products must provide,&uot; Aberdeen's Peabody said. &uot;Carriers need suppliers who understand their operations and need to offer substantive services quickly. CIENA has set specific deliverables that should really mean something to the carrier.&uot;

ABOUT CIENA

CIENA's market-leading intelligent optical networking solutions 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 http://www.ciena.com.

NOTE TO INVESTORS

Forward-looking statements in this release, including, but not limited to, the cost savings, deployment timing and network management benefits of the Company's products, are based on information available to the Company as of the date hereof. The Company's actual results could differ materially from those stated or implied in such forward-looking statements, due to risks and uncertainties associated with the Company's business, which include the risk factors disclosed in the Company's Report on Form 10K filed with the Securities and Exchange Commission on December 10, 1999.