Ciena to buy Nortel unit for $521 million

Ciena has agreed to acquire Nortel's Metro Ethernet Networks business for approximately $521 million in cash and stock. The two companies earlier this week confirmed they were in an advanced stage of negotiations for the sale.  Ciena will pay $390 million in cash and 10 million shares of Ciena stock for Nortel's MEN business. Hottest tech M&A deals of 2009 The MEN business includes Nortel's optical networking and Carrier Ethernet assets.

Ciena's stock closed yesterday at $13.05. The product and technology assets to be acquired include Nortel's long-haul optical transport portfolio, including the 40G/100Gbps systems; metro optical Ethernet switching and transport solutions; Ethernet transport, aggregation and switching technology; multiservice SONET/SDH product families; and network management software products. The assets to be acquired generated approximately $1.36 billion in revenue for Nortel in 2008 and $556 million in the first six months of 2009. Nortel says it has deployed 430,000 optical nodes to more than 1,000 customers in 65 countries, making Nortel – along with Ciena – one of the leading optical transport and switching vendors worldwide. "We believe this transaction will position us for faster growth by giving us greater geographic reach, broader customer relationships and a deeper portfolio of solutions," said Gary Smith, Ciena's CEO and president, in a statement. "We believe we are best positioned to leverage these assets, thereby creating a significant challenger to traditional network vendors." Ciena says it expects to offer employment to at least 2,000 Nortel employees, which represents more than 85% of Nortel's optical networking and Carrier Ethernet workforce. The agreement also includes all patents and intellectual property that are predominantly used in the businesses, and provides for the transition of substantially all of Nortel's Optical Networking and Carrier Ethernet customer contracts. As of July 31, Ciena employed 2,110. Nortel's bankruptcy: A long time coming "Today's announcement is a positive step forward for the future of Nortel's Optical Networking and Carrier Ethernet customers and employees," said Philippe Morin, Nortel MEN president, in a statement. "The sale of these businesses to a strong and stable buyer enables the innovation of one of the foremost leaders in the optical industry to continue to thrive." The transaction is subject to a "stalking horse" competitive bidding process and requires the approval of the United States Bankruptcy Court for the District of Delaware and the Ontario Superior Court of Justice Ciena expects hearings before those courts to approve bidding procedures, break-up fee and expense reimbursement will be held within the next several weeks, followed by a bid period and a potential auction, with final sale hearings to be held thereafter. Nortel is liquidating assets after having failed to restructure the company under Chapter 11 bankruptcy as a viable telecom competitor.

The transaction is also subject to customary closing conditions, including receipt of necessary regulatory approvals. To date, Nortel has sold its CDMA and LTE wireless assets to Ericsson for just more than $1 billion and its Enterprise Solutions business to Avaya for just less than $1 billion. It's also looking to sell its GSM wireless business. 

NEC upgrades to HYDRAstor grid storage system

NEC Corp. today unveiled several upgrades to its flagship HYDRAstor grid-storage system , adding write-once, read many (WORM) capabilities and the ability to encrypt data in transit. NEC officials said that the upgraded software will increase performance by 67%, while boosting security by improving HYDRAstor's ability to archive mission-critical data. "Over 70% of even high I/O data from source applications such as databases have not been touched after 6 months. The upgraded system also provides deduplication capabilities for more third party backup applications.

A lot can be off loaded onto more efficient platforms," said Gideon Senderov, director of product management for NEC's IT Products Group. The new RepliGrid in-flight data encryption capability protects data as it's being transmitted between HYDRAstor grids and data centers, he added. The new HYDRAlock WORM capability allows administrators to lock out any changes to documents or other records, maintaining a chain of custody for regulatory purposes, Senderov said. NEC also announced that it will allow users to license additional physical capacity that can be activated without adding additional components. A new quota management system allows administrators to set limits to the maximum effective capacity allocated for each file system and its associated application. For example, can now license as little as 12TB of capacity in a 24TB configuration and then pay a fee to activate additional capacity as needed.

The quota management system also offers threshold notifications as well as the ability to set aside a capacity reserve for other applications, such as critical archive data. The upgraded system can deliver up to 1.8TB per hour per accelerator node and up to 90TB per hour for the largest supported configuration of 55 accelerator nodes and 110 storage nodes, according to the company. Previously, the HYDRAstors grid architecture had a default capacity of 256 petabytes for all applications. "We are really looking forward to taking advantage of the new in-flight encryption and quota management functions," said Scott Ashton, a LAN/WAN specialist at TLC Engineering for Architecture Inc., an Orlando, Fla.-based engineering firm. "We've really seen the return on our initial investment as we've been able to take advantage of each new upgrade with HYDRAstor since our early adopter installation in 2007." NEC said that the performance boost comes from software enhancements and more efficient inter-node data transfer and communication protocols. Accelerator nodes are the controller blades with the CPU processing power and storage nodes are the system blades with disk storage capacity. NEC today also introduced lower-capacity, or "entry-level" models of HYDRAstor offering raw storage capacities of 12TB (or over 150 TB effective capacity); 24TB (or over 300 TB effective capacity) and 36 TB (or over 450 TB effective capacity). "A highly resilient storage solution primed for archiving, that self-evolves with the ability to intermix several generations of technology, offers global deduplication, great scalability, and automates provisioning, migration, workload balancing and system management will be the key features of a storage solution that the market will demand," said Dave Russell, a vice president at researcher Gartner Inc. The new application-aware deduplication feature allows newly-supported third-party backup applications such as IBM's Tivoli Storage Manager and EMC's NetWorker, as well as previously previously supported Simpana from CommVault and NetBackup from Symantec, to take advantage of the data reducing feature.

With the exception of WORM capability, the customers can install the latest HYDRAstor upgrades for free. The WORM upgrade costs $14,000 per accelerator node.

Mobile WAN operators raise 'openness' bar

It was a productive week for mobile WANs, with AT&T, Verizon Wireless, T-Mobile and Sprint all making announcements that broke new ground for the licensed operators. One reason for the demand is that, theoretically, you could bypass paying for a separate voice plan for using AT&T's legacy circuit-switched GSM network. Especially noteworthy: * AT&T caved to pressure to allow VoIP traffic on its 3G data network from the iPhone, something customers have been demanding. Note, though, that VoIP traffic over the 3G data network will consume kilobytes on your data plan if you don't have an unlimited domestic plan.

Top 10 must-have iPhone business apps * Verizon Wireless said it has partnered with former nemesis Google to develop two open source Android devices this year and associated applications. And if you're traveling out of the country, usage rates can be astronomical, so you're better off using VoIP over Wi-Fi (already supported) in those locations anyway. Note that the devices will support the Google Voice application that AT&T recently shunned for its iPhone amid much public fanfare. T-Mobile and Sprint also each announced intentions to launch Android phones made by Samsung, leaving AT&T as the only carrier without publicly announced plans to offer an Android device. * T-Mobile introduced an enterprise version of its UMA-based service, which allows Wi-Fi calling over its GSM network. Even Google CEO Eric Schmidt expressed surprise "that Verizon Wireless would emerge as the 'open' leader" among the mobile operators, though he said the two companies have been in cahoots on the Android project for 18 months. The Research in Motion BlackBerry-centric service is integrated with your corporate PBX features and dial plan, so users can pick up or make a call from either their desk phones or their BlackBerries.

Verizon Wireless offers such a managed service, too, says Rob Arnold, senior analyst at Current Analysis, but without the Wi-Fi calling capabilities. T-Mobile's Wi-Fi Calling with MobileOffice involves T-Mobile installing and managing a BlackBerry Mobile Voice System (MVS) server on your premises. Note that you could also buy, install and manage an MVS server yourself. The difference is that the service offers unlimited Wi-Fi calling over T-Mobile's GSM core network for free to enterprise customers with 100+ T-Mobile lines or for $9.99 per month per line for companies with fewer than 100 lines.

Three indicted for Comcast hack last year

Three hackers have been indicted for redirecting the Comcast.net Web site to a page of their own making in 2008. When Comcast customers visited the Comcast.net site during the attack on May 28, 2008, they were redirected to a Web site that displayed a message attributing the attack to members of the Kryogeniks hacker gang. At that time, about 5 million people connected to the Web site each day, the U.S. Department of Justice said in a statement. Because the site redirected to that page, customers were unable to access their Comcast e-mail accounts through the Comcast.net site.

Instead of the Comcast page, customers saw the message: "KRYOGENIKS Defiant and EBB RoXed COMCAST sHouTz to VIRUS Warlock elul21 coll1er seven." Immediately after Comcast was able to address the hack, the ISP (Internet service provider) and Network Solutions, the registrar, said they didn't know how the hackers managed to get the passwords necessary to switch the DNS servers and redirect the site. The suit said that one of the defendants, Christopher Allen Lewis, made two phone calls through which he got the information that he and his friends used to access Comcast's DNS information. The indictment sheds only a bit of light on how they did it. Another of the defendants, Michael Paul Nebel, allegedly logged onto a specific Comcast e-mail account that allowed him to communicate with Comcast's DNS registrar. During the attack, one of the defendants, Lewis, called a Comcast employee at his home and asked if the company's domains were working properly, the indictment alleges. Lewis was then able to sign onto Comcast's account at the registrar and point the Comcast.net Web site to the page he and the others made, according to the filing.

Comcast claims that it lost US$128,578 due to the attacks. The men are charged with one count each of conspiracy to intentionally damage a protected computer system. James Robert Black Jr. is the third defendant named in the indictment. The charges were filed in the U.S. District Court for the Eastern District of Pennsylvania on Thursday. If convicted they each face a five-year prison sentence and a $250,000 fine.

Google Voice Frees Your Voicemail, and Your Number

Until yesterday, signing up for a Google Voice account required you to pick a new phone number - not a pleasant option for those who have kept the same digits for years. When you sign up for Google Voice - which is still not widely available to the public (you need to get an invite or request one) - you can either choose Google one-stop phone number or keep your own for a more pared-down experience. Now Google has enabled users to keep their existing phone numbers and get (most of) the features Google Voice offers, including Google's excellent voicemail service. Keeping your old digits gives you: Online, searchable voicemail Free automated voicemail transcription Custom voicemail greetings for different callers Email and SMS notifications Low-priced international calling Going for the full-throttle Google experience gives you all of the above plus: One number that reaches you on all your phones SMS via email Call screening Listen In Call recording Conference calling Call blocking If you already have a Google Voice number, you can add the voicemail option to any mobile phone associated with the account.

Happily, Google circumvented this problem earlier this month. Some of the awesome benefits are explained in Google's YouTube explanation: Since voicemails are transcribed and placed online, even made publicly available for sharing purposes, there has been some danger of said voicemails appearing in search results. These new features are both freeing and limiting: you can keep your number but sacrifice some of the goodies that make Google Voice a powerful contender in the telephony business. Follow Brennon on Twitter: @neonmadman Full number portability is likely coming in the future, after, of course, Google deals with AT&T, Apple, and the FCC. But some have high hopes that eventually the opposition will grow to accept and embrace Google Voice.

Beware BlackBerry Browser Bug Until Carriers Offer Updates

BlackBerry smartphone users who frequently surf the Web via handheld will want to keep checking with their wireless carriers for BlackBerry Handheld Software updates in the coming weeks. The BlackBerry Browser dialog box informs the BlackBerry device user when there is a mismatch between the site domain name and the domain name indicated in the associated certificate, but does not properly illustrate that the mismatch is due to the presence of some hidden characters (for example, null characters) in the site domain name." The flaw relates to the BlackBerry software's certificate-handling functionality. That's because a new bug found in most current versions of Research In Motion's (RIM) device software, which makes it easier for malicious parties to execute "phishing" attacks on unsuspecting smartphone users, has been addressed via handheld software updates from RIM. From RIM's online security advisory: "This advisory relates to a BlackBerry Browser dialog box that provides information about web site domain names and their associated certificates.

A hacker could potentially recreate, or "spoof," a site commonly visited by BlackBerry users, such as RIM's BlackBerry.com, by purposely adding "null characters" to the site certificate's Common Name (CN) field. CVSS is a vendor agnostic, open standard for the security industry meant to depict the seriousness of vulnerabilities, according to RIM. The BlackBerry-maker recommends that all BlackBerry users running handheld OS 4.5 or higher check in with their wireless carriers to see if device software updates are available. The recently discovered flaw keeps the BlackBerry Browser from correctly identifying mismatched site certificates due to an inability to render said null characters. (See screenshot below for an example of how the BlackBerry Browser box should look when it encounters site certificate issues due to the presence of null characters in site CN fields.) The flaw was rated 6.8 (Medium Risk) on a Common Vulnerability Scoring System (CVSS) scale of one to ten, with one representing little or no risk and ten representing very serious risk. The problem: I just did a quick search of both AT&T and Verizon's BlackBerry download pages, but in a number of cases I could only locate earlier software versions than those recommended by RIM. Here's a list that specifies which software should be updated and to which new versions. If you encounter a BlackBerry Browser dialogue box like the ones shown in this post, you should choose to close the connection rather than subject yourself to potential phishing-related risk, according to RIM. More information on BlackBerry security can be located on the company's website. Current Software Version * BlackBerry Device Software v4.5.0.x to v4.5.0.173 or later * BlackBerry Device Software v4.6.0.x to v4.6.0.303 or later * BlackBerry Device Software v4.6.1.x to v4.6.1.309 or later * BlackBerry Device Software v4.7.0.x to v4.7.0.179 or later * BlackBerry Device Software v4.7.1.x to v4.7.1.57 or later Until you're able to sit down and update your device-or while you wait for your carrier to issue an update-RIM says to use caution when clicking unknown links in SMS text or e-mail messages, even if they're from what appears to be a trusted source.

Defunct airport fast-pass program may be revived

Tens of thousands of subscribers to a registered air traveler program, who were left feeling scammed when the company offering the service abruptly went out of business, may soon get a break. Subscribers to the Clear service, some of whom had signed up for two years or more of service just before VIP went out of business, will be offered a chance to continue their subscriptions after the deal goes through. A new investment group based in California has signed a letter of intent with Morgan Stanley, the defunct company's largest debt holder, according to the New York Times . Under a proposed plan, the investment firm will be allowed to buy the assets of Verified Identity Pass Inc. (VIP) and restart the Clear fast-lane security service, the Times reported, quoting the owner of the Emeryville, Calif.-based investment banking firm, Henry Inc. If an individual chooses not to, any personal data on that individual that had been collected by VIP for Clear, will be permanently destroyed, the Times said quoting the investment banker.

VIP was one of seven companies approved by the Transportation Security Administration (TSA) to operate a registered traveler program, which lets air travelers get through airport security checks faster. The news is likely to provide some comfort to thousands of customers of VIP who were left in the lurch when the company in June abruptly announced it could no longer offer the Clear service because it had run out of cash. It offered the service at 21 major airports, including New York's John F. Kennedy International Airport, La Guardia, Boston's Logan International and Atlanta's Hartsfield-Jackson airports. To sign up for VIP's Clear service, customers had to submit to background checks and provide identifying information, including Social Security and credit card numbers, home address, date and place of birth, phone numbers and driver's license number. More than 200,000 customers had signed up for the service when the company went out of business.

They also had to provide fingerprints, iris scans and digital images of their faces. The company made matters worse by hinting that it would sell the data it had collected to fulfill its debt obligations. VIP's decsion to shut the service raised concerns about the fate of the data that had been collected by the company. Many participants were left feeling scammed when VIP announced that it couldn't refund their subscriptions because it had run out of money. The motion was in response to a lawsuit brought by concerned customers.

Days after the company's closure, the chairman of the House Committee on Homeland Security asked the TSA to ensure that all information collected by VIP was properly protected and destroyed . In August, a federal judge in New York issued an injunction prohibiting VIP from selling, transferring or disclosing to any third-party the data it collected while operating the Clear service. The injunction, however, was later lifted on a technicality. For the moment, the purchase does little to alleviate the major complaint in the lawsuit, which is that VIP's customers didn't get a refund from their subscriptions. "That is something that they are entitled to regardless of whether or not other companies" purchase VIP, he said. Todd Schneider, an attorney with Schneider, Wallace, Cottrell, Brayton, Konecky LLP, a San Francisco law firm representing one of the parties in the lawsuit, today said he was unclear on the ramifications of the reported purchase of VIPs assets by the investment banking firm. A hearing in the case has been scheduled for Oct. 16, where Schneider plans to again ask the judge to bar VIP from selling its data assets to any third party.

News of the proposed purchase comes as the House Committee on Homeland Security is scheduled to hold a hearing today on the future of the registered air traveler program.