Press Release

Oakland, CA — August 10, 2011 — Zhone Technologies, Inc. (NASDAQ: ZHNE), a global leader in FTTx network access solutions, today announced that its industry-leading MXK™ multi-service access node (MSAN) will be used by SRT Communications (SRT) in combination with Microsoft® Mediaroom® to deliver new IPTV and video services via ADSL2+ and fiber-to-the-home (FTTH) networks.

As the largest telephone cooperative in North Dakota, SRT serves 48,000 customers, including consumers, businesses and governmental agencies, and has remained a regional leader in deploying enhanced telecommunications services for the past 60 years. SRT currently provides broadband and dial-up Internet services, wireless service and cable TV as well as traditional telephone, leased line, voicemail and long-distance voice services. After a year-long trial with Zhone, SRT chose to fully utilize the MXK for its new Microsoft Mediaroom-based video offering (SRTVision) to achieve its expansion plans to reach the 5,800 unserved subscribers in its coverage area. SRT is also one of Zhone’s first customers, having deployed the MALC™ MSAN solution almost a decade ago when SRT was seeking an extendable and cost-effective solution to deliver broadband services to its customers.

“Zhone has proven to be a valuable partner in our growth strategy over the years, providing the technology solutions and support needed to design flexible access networks for our multi-play service needs,” noted Shawn Grosz, Director of Network Technology, SRT Communications. “Zhone’s support of the Microsoft Mediaroom platform, their overall responsiveness during the trial phase and the ability of the MXK system to effectively support our unique mix of multicast and unicast network traffic needs will help improve our ability to deliver IPTV services effectively to our customers. With the migration flexibility of the existing MALC installed base, we were able to ensure that the new network build utilizing the MXK system will be completed cost-effectively.”

Zhone’s consistent leadership and solution efficiencies have not only enabled SRT to expand the reach of its services, but rapidly upgrade all of its offerings when needed to maintain a competitive edge. Microsoft Mediaroom-powered TV services are being offered by over 40 network operators, delivering services to more than seven million consumer households equaling more than 15 million set top boxes deployed throughout the Americas, EMEA and APAC. The Mediaroom platform enables SRT to deliver a consistent premium entertainment experience across multiple screens and networks.

“This deployment of Microsoft Mediaroom using Zhone’s MXK is a testament to the unique flexibility we have in supporting a variety of Gigabit Passive Optical Network (GPON) and Active Ethernet (AE) service models,” noted Brian Caskey, chief marketing officer at Zhone. “Specifically, Zhone’s MXK platform, in combination with other solutions from the Zhone FiberHome™ portfolio, is providing a critical foundation for customers such as SRT that are not only aggressively driving broadband expansion across North America, but ensuring that such network investments are maximized for multiscreen delivery services.”

Zhone has deployed more than 2,000 of its fully redundant, carrier-grade all-IP MXK platforms with more than 150 service providers in over 40 countries. Featuring industry-leading density, scalability and switching capacity, the MXK is the industry’s first terabit access concentrator and provides non-blocking capacity of up to 3,600 100 Mbps GPON subscribers or 360 1G Active Ethernet subscribers.

Press Release

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