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Technology Stocks : SONS
SONS 7.830+2.8%Nov 28 4:00 PM EST

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From: Home-Run6/9/2005 2:20:08 PM
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JUNE 09, 2005

Source: Sonus Has BellSouth Deal

CHICAGO – Supercomm 2005 – BellSouth Corp. (NYSE: BLS - message
board) is ramping up for a residential VOIP service launch within
the next 12 months and has selected Sonus Networks Inc. (Nasdaq:
SONS - message board) as its softswitch supplier, according to an
industry source with inside knowledge of negotiations.

The source, who requested anonymity, says Sonus landed the deal
ahead of Siemens Communications Group. Sonus says there is no news
to report at BellSouth, noting that the RBOC is already a customer.

But Sonus's initial engagement at BellSouth was four years ago, when
the RBOC announced it would use Sonus technology to offload dialup
Internet traffic from its circuit-switched network to reduce the
traffic loads building in its Class 5 switches.

Now, following last year's launch of hosted business VOIP services
using a gateway bolt-on system from Lucent Technologies Inc. (NYSE:
LU - message board), the carrier is believed to be gearing up for a
broader VOIP service launch, and might even resell services from a
specialist VOIP service provider such as 8x8 Inc. (Nasdaq: EGHT -
message board) to launch a service quickly while it deploys the
Sonus gear.

BellSouth, which named Sonus as the Charity Sponsor of its Classic
annual golf tournament in March this year, had not returned calls
seeking comment as this article was published.

The deal would give Sonus a very strong position with the major U.S.
operators. Qwest Communications International Inc. (NYSE: Q -
message board) is a long-time customer; Verizon Communications Inc.
(NYSE: VZ - message board) is a customer; and AT&T Corp.'s (NYSE: T -
message board) extensive use of Sonus technology could give the
softswitch vendor a big chance of extending into SBC Communications
Inc. (NYSE: SBC - message board) once the two operators merge (see
Sonus Details Verizon Deal, Q2 Results and SBC/AT&T: Possible
Winners & Losers).

Sonus, which this week expanded on the IMS strategy outlined in a
recent in-depth interview given by CTO Mike Hluchyj, has already
been on the right side of the news this week (see Sonus Supports IMS
and Mike Hluchyj, CTO, Sonus Networks). Its stock rose 6 percent
yesterday to close at $4.64 as the Securities and Exchange
Commission (SEC) ended its formal investigation into the company
following its accounting issues during the past year or so (see
Sonus Cleared by SEC, Stock Jumps).

Also this week, Sonus announced a micro version of its softswitch
and named a Japanese cable company as a new customer (see Sonus
Shrinks Its Softswitch and Japan's Jupiter Wants Sonus).

— Ray Le Maistre, International News Editor, Light Reading
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