|Q4 2011 CC excerpts:|
On the new product front, customer interest in our new DTN-X, since its launch, has been very strong, which we believe is in recognition of the unique advantage Infinera's integrated platform brings to market, the only platform operating integrated DWDM and OTN switching functionality without compromise. As a reminder, this platform is fundamentally 3 products in one: A DWDM transmission system that will support the world's first 500 Gig super-channels based upon 100 Gig of FlexCoherent channels, upgradable in the future to 1 terabit super channels, unleashing highly efficient DWDM transmission capacity at the lowest operational cost; an integrated OTN switching system that will scale from 5 terabits in its first release to 100 terabits in the future and will enable operators to efficiently tame these large pipes, through the grooming of traffic down to 1 Gig granularity; and third, a system that is designed to MPLS switching in the future, which will further enable convergence of the network for improved efficiency, reducing the number of interconnections between layers while preserving network investment.
Infinera pioneered the integration of OTN switching and DWDM with the DTN in 2005. Leveraging this unique learning for more than a decade of development in 7 years of field operation, the DTN-X integrates 3 technology-building blocks to deliver value and differentiate itself from the competition: 500 Gig platonic integrated circuits with FlexCoherent DSPs; custom switching ASICs and a multi-terabit nonblocking switch fabric; and intelligent GMPLS control plane software that scales to thousands of nodes.
The DTN-X design has been optimized to meet the needs of Tier 1 carriers and addresses their need to prepare for extremely, high capacity in dynamic networks, opening up a large and new market for Infinera. Competitors are following Infinera's architectural lead, announcing integrated solutions. However, unlike the DTN-X, design for this integration from day 1, competitors are taking existing systems and adding DWDM or switching after the fact. This approach results in a compromise between the switching and transmission capacity of these systems. This does not occur with the DTN-X. We believe that DTN-X will be the only platform on the market that will allow all components, including the optical functions based on our pic technology, to be consistent with Moore's Law, delivering best-of-breed switching integrated with best-of-breed DWDM, without compromise.
The DTN-X is on track with lab trials in Q1 and volume production starting in Q2. We have begun to scale the production capability, and the 500 Gig PICs have been released to manufacturing. On the trial front, we have scheduled 4 DTN-X lab trials in our current quarter. All 4 of these trials are with Tier 1 carriers, reflecting a mix of both new prospects and current customers, with 2 located in North America and 2 located in Europe.
In addition to these trials, we've had numerous demonstrations of the full DTN-X system. While we are pleased with the early interest by the carriers areas in our DTN-X platform, it is important to note that Tier 1s often have extensive qualification testing and that a lab trial is only one of several steps toward revenue. In the quarters ahead, we will be -- report to you on additional trials and DTN-X wins.