1. CENX Reinvents Itself as a Software Company

    CEN Feature (Feb 19 2013)

    1. CENX Reinvents Itself as a Software Company

      CENX, the company that pioneered the concept of the Carrier Ethernet exchange, has reinvented itself as a software company, with a new CEO at the helm.

      CENX is experiencing “a natural evolution from interconnect service provider to now being an interconnect solutions provider,” said Ed Ogonek, the company’s new president and CEO, answering questions from reporters at the Metro Ethernet Forum’s quarterly meeting in San Diego on January 29.

      The purpose of the CENX Carrier Ethernet exchange was to serve as a physical connection point between Carrier Ethernet service providers, but CENX soon learned that interconnectivity had many other dimensions – including ordering and monitoring. Last year the company announced it had developed software to enable flow-through ordering and monitoring between Carrier Ethernet service providers – initially as a means of enhancing the company’s Carrier Ethernet exchange business. Ogonek likened the software to a Rosetta stone, enabling one carrier’s operations support system to communicate with another carrier’s OSS.

      “There are two parts to a Carrier Ethernet exchange,” said Nan Chen, CENX co-founder and former president, who is now executive vice chairman. These include physical connection and the logical interconnect – and of these, he said, “the logical systems integration part is much more of a value add.”

      As for the exchange business, Chen said, “Our focus has shifted entirely to supplying . . . software and the demand is much greater than we even initially imagined. Down the road, when the carriers have adequate systems to manage their Ethernet, they may need a hardware platform to exchange traffic and that model might be in demand, but right now CENX means software – Ethernet Lifecycle Management software.”

      Ogonek comes to CENX after 28 years in the technology business. His career included stints at Alcatel, Newbridge Networks and British Telecom. Most recently he was president and CEO of mobile data software provider Bridgewater Systems – and he believes that experience will help him in heading up CENX.

      “It’s a business model I understand very well,” said Ogonek, adding that he sees an opportunity to put business infrastructure in place to help the company gain greater scale.

      Carrier Ethernet service providers can purchase their own Carrier Ethernet interconnect software or purchase it as a cloud-based service from CENX. Chen said the company is “actively implementing” its software with a large North American operator.

      Ogonek replaces former CENX CEO Herb Hribar who has taken a position with Irish service provider Eircom, a company he helped with an IPO in 2004.

      “This change at CENX coincided well with the completion of our transition from an exchange-focused company to an Ethernet software and services company,” said Chen. “Thus in our recruitment of Ed, we were able to focus on attracting a candidate steeped in providing software and services to carriers, which is precisely the expertise Ed brings CENX.”

      The monitoring capability of the CENX software could be a critical component in enabling service providers to offer service level agreements for connections that rely on more than one operator’s network. Moving forward, Ogonek suggested that the company might be able to monitor the customer connection all the way to the end user device.

      CENX is not the only Carrier Ethernet exchange operator to shift focus. In a discussion about wholesale Carrier Ethernet opportunities at the MEF meeting, Vertical Systems analyst Erin Dunne noted that some other Carrier Ethernet exchange operators have transformed themselves into cloud exchanges.

      The Carrier Ethernet exchange business has proven to be a difficult one because many service providers prefer to connect with one another through their own private network-to-network interfaces, Dunne said.

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