For beleaguered optical and networking players such as Ciena, Juniper, Qwest and Sycamore, the Gig-BE contracts awarded by the Department of Defense could not have come at a better company. The total contracts are worth around $877 million.
bq. At the high end, Lehman Brothers estimates that this crop of winning vendors could pull down as much as $510 million in revenues from the GIG-BE opportunity in the next two years. (LightReading)
The contracts are being referred to as Global Information Grid-Bandwidth Expansion or GIG-BE. With spending on long haul networks having come to a crawl, these companies have been desperately looking for a lifeline to right themselves. The news of the contracts broke last week. Readers of this weblog already knew of these contracts, when I first wrote about them in September 2003.
bq. The new Defense Department network will enable warfighters and analysts to access and post intelligence information more quickly and easily than they do today. The worldwide network uses 10 gigabit/sec or faster connections. At the beginning, it will serve DOD users at 100 locations around the world. (FCW.com)
Here is the break down of the contracts:
bq. Ciena will provide optical transport system equipment. Sprint will provide digital cross connect equipment, and Juniper will deploy IP routers. Qwest, with partner Cisco Systems Inc., will provide multiservice provisioning platform technology. (FCW.com)
The results of the contract are already impacting some stocks. Sycamore Networks is on its way up, according to Dow Jones News Wires, and so is Ciena. Losers in this contract, Lucent and Corvis are kind of blah!