CENX Opens 3 Carrier Ethernet Exchanges

In an effort to solve the growing problem of carrier Ethernet interconnection, startup company CENX announced Tuesday the opening of its first three Carrier Ethernet Exchanges in Los Angeles, New York City and Chicago.

The exchanges are fully operational and supporting carrier interconnections, but no service provider customers were named.

CENX solves what founder and CEO Nan Chen calls the “NxN problem,” of interconnection. To interconnect 60 carriers using non-standardized methods, for example, requires 7,000 network-to-network interfaces, he said, explaining CENX instead offers carriers the ability to connect to one CENX hub location.

“Connection is the easy part,” Chen conceded, noting that service alignment and management are the other two problems that CENX solves for carriers. “That’s why interconnection is going slow,” he said, explaining that mapping classes of service and SLAs between two carriers can take six to nine months and cost up to $1 million. He said CENX handles service alignment and mapping for carriers to reduce the time to revenue from months to days.

According to Infonetics Research, the ability for service providers to quickly and economically interconnect with their peers could add as much as $4.7 billion to the global Ethernet revenue forecast in 2013, reaching nearly $39 billion. The worldwide Ethernet services market was $22 billion in 2008, the research firm said.

CENX founder Chen is well known in the industry for his role as president of the Metro Ethernet Forum, an industry organization that also is focused on solving the interconnection problem through its E-NNI (External network-to-network interconnection) specification, which is expected to be approved by February 2010.

In addition, the MEF Ethernet Exchange Committee, which includes Verizon Communications Inc, AT&T Inc., Level 3 Communications Inc., Orange Business Services, Tata Communications Ltd., Cablevision Systems Corp. and Cox Communications Inc., worked for about a year to provide a framework to solve the business and technical issues around interconnection. The committee concluded that the resolution would be best provided by independent companies rather than the MEF.

Chen said he launched CENX about a year ago as a result of that discussion. Chen, who previously worked for Strix Systems and Atrica, is joined in the privately funded venture by co-founder Ron Gavillet, who serves as executive vice president of external affairs. Gavillet previously was with Neutral Tandem, a company formed in 2004 to facilitate the interchange of transit and switched access traffic among wireless, CLEC, IXC and next-gen service providers. Chris Swenson, CENX’s vice president of finance, also is a Neutral Tandem alumnus. CENX’s CTO, Chris Purdy, came from Nakina, and its chief technical advisor, Bill Bjorkman, presently serves as co-chair of the MEF technical committee and co-editor for MEF's forthcoming E-NNI specification. Rounding out the management team are Eric Gillenwater, vice president of worldwide sales, who previously worked for Telstra USA, and Mark Fishburn, vice president of marketing, who is a previous MEF chairman and marketing exec for Spirent.