Residential Legacy Service Migration Wednesday, April 14, 2010

® Adtran, Inc All rights reserved Total Access 5000 Services Migration Landscape

3 ® Adtran, Inc All rights reserved Competitive Landscape  Tellabs 8800 Series –Supports ATM to Ethernet IWK  2-Port Channelized OC3/STM-1 IMA  168 T1 or 126 E1 channels  Maximum of 42 IMA Bundles –Supports Frame Relay, PPP/MLPPP to Ethernet Migration –Supports Frame Relay over MLPPP –Supports BCP for MLPPP –Supports L2 switching / L3 routing  8830, 6 Slot system  8840, 15 Slot system  8860, 19 Slot system

4 ® Adtran, Inc All rights reserved Competitive Landscape  Cisco 7600 Series –Varying Slot / Chassis Configurations –Leased Line Services  Channelized T1/E1  Channelized T3  Channelized OC3/STM-1 –ATM Interworking Support  OC3/STM-1  OC12/STM-4  OC48/STM-16 –10G, GigE, Fast Ethernet

5 ® Adtran, Inc All rights reserved Competitive Landscape  Zhone MALC –Full MSAP –Supporting ADSL2+, VDSL2 –ATM Migration, EFM –FTTH (GPON and Active E)  Calix C7 Series –MSAP –Supporting A/V DSL –Supporting ATM Migration –FTTH (GPON and Active E)  Occam BLC 6000 –Supports FTTH (GPON and Active E) –Supports PPP/MLPPP

® Adtran, Inc All rights reserved ATM Aggregation and Interworking Total Access 5000 Residential Services Migration

7 ® Adtran, Inc All rights reserved Goals  Maximize product lifecycle of existing ATM DSLAMs –Leverage already installed base –Maximize return on investment  Provide ubiquitous migration strategy to Next-Generation IP/Ethernet core –Same for all vendors –Low impact to existing network  Edge aggregation and interworking –Minimize impact on existing inter-office transport –Allow higher speed service offerings

8 ® Adtran, Inc All rights reserved Tier I Business Case Scenario One Upgrade from DS3 to OC3 IOF costs $39K per OC3 Request for 6 OC3s generates the deployment of a new switch/router Scenario Two Eliminates new ATM Switch/Router Interworks traffic locally, minimizing IOF costs Quantifiable Savings $569K per Central Office $56.9M per 100 Central Offices Frees up multiple DS3 ATM ports and DS3 IOF facility Scenario 1: Upgrade of 6 ASAMs in a CO using the current strategy of ATM/SONET upgrades 6 IOF OC3s to ATM Switch (New Ring) ATM Switch Cost ERX Router EF&I of ATM and Router IOF for ATM to Router and Router to LCR Total Cost$1,353,707 Scenario 2: Upgrade of 6 ASAMs in a CO using the ADTRAN TA5000 for ATM/Ethernet Interworking TA5000 equipped for 7 OC3s EF&I of TA IOF GE to Router and GE card at Router EF&I of Router 1 IOF OC3 to ATM Switch ATM Switch 4-Port OC3 Card IOF for Router to LCR Total Cost$784,366 Total Savings for Scenario 2 $569,341

9 ® Adtran, Inc All rights reserved Residential Services  ATM Aggregation and Interworking –MultiNode ATMoE Support (Planned) –Key Features Will support Multi-Shelf application VPI / VCI to S / C – Tag translation IPoA Management OC3, DS3, and IMA ATM Aggregation DS1 / DS3 / OC3 ATM 1G – 10G Redundant Router Total Access 5000 DSL Growth Alcatel ASAM Total Access 3000 ATM OC-3 or DS3 –DSL Growth from Node 1 and 2 with MultiNode ATMoE –ATMoE for DSL growth –VP Switching –Support for 3 rd Party GigE Aggregation to ATM Network IFC ATM GigE Node Expansion GigE TA1148A

10 ® Adtran, Inc All rights reserved ATM Aggregation and Interwork Modules  ATM Aggregation –ATM DS3 4-Port: Up to 84 DS3s –ATM OC3 4-Port: Up to 84 OC3s –Optionally Redundant  ATM DS1 Aggregation –32-Port DS1 IMA, G1  Up to 640 DS1s per system –3p Channelized DS3 IMA, G2  Up to 1680 DS1s per system –Optionally Redundant  ATM E1 Aggregation (Planned) –32-Port E1 IMA, G1 –Up to 544 DS1s per system –Planned 1H 2011 –Optionally Redundant  ATM Uplinks –ATM DS3 and OC-3/STM-1 Single Port –Optionally redundant

11 ® Adtran, Inc All rights reserved Question and Answers