Mi7 designed to take cost out of traditional central offices, interoperate with SONET gear for new services.ATLANTA - Start-up Mahi Networks this week finally will unwrap the metropolitan core aggregation system it has been developing since being founded four years ago.Mahi will unveil Mi7 at the Optical Fiber Communication Conference. Mi7 is targeted at incumbent local exchange carriers (ILEC), interexchange carriers (IXC) and national competitive local exchange carriers (CLEC) that need to optimize an embedded base of SONET rings and multivendor transport equipment for metropolitan Ethernet and other data services.Mahi touts Mi7 as a "packet aware" broadband cross-connect that can eliminate many stand-alone patch panels, add\/drop multiplexers and Layer 2 Ethernet switches in carriers' central offices. The result is that a $7 million investment in Mi7 over five years will reap $30 million is operational cost reduction over that same time period, Mahi says.Mi7 integrates SONET add\/drop multiplexing, 3\/3 and 3\/1 digital cross-connect capabilities, and Layer 2 Ethernet transport and switching into a single bay chassis. The system is designed to aggregate and groom traffic in STS-1 and VT 1.5 increments across multivendor SONET rings, and oversubscribe Ethernet bandwidth to provide high-performance transport services, the company says.The Mi7 backplane scales from 40G to 320G bit\/sec. Transport capabilities range from OC-3 to OC-192 and Gigabit Ethernet. It also offers pluggable interfaces and laser options, such as very short-reach and long-reach optics, which let Mi7 support applications such as intraoffice equipment connection and SONET ring aggregation.Mahi says the potential market for Mi7 is $1.5 billion to $3 billion - about one to four Mi7s in 3,000 of the 50,000 central offices in the U.S. The system costs $140 million to build over three years.PROFILE: MAHI NETWORKSFounded:1999Headquarters:Petaluma, Calif.Funding:$185 million from St. Paul Venture Capital, Oak Investment Partners, Rho Ventures, Investor Growth Capital and others.Management:Christopher Rust, president, CEO and founder; Kevin Pope, executive vice president of engineering and founder.Employees:165Products: Mi7 Metro Core Aggregation System; Dx7 Electrical Tributary Expansion Shelf; Mission7 element management system; NetOASys network optimization analysis system.Customers:ILECs, IXCs and nationwide CLECs.Fast fact:Last summer, while other start-ups struggled to attract capital to stay alive during the depths of the telecom depression, Mahi landed an astounding $75 million in new funding."Carriers are going to have to improve their interoffice facility transport in order to accommodate new services," says Michael Kennedy, an analyst at Network Strategy Partners. "Mahi is focused on getting the cost out of the standard [public switched telephone network]. It's a tough challenge but it seems like they have the answer. The incumbent vendors are milking what they've got; Mahi's at least a half-generation ahead."The challenge for Mahi is to win at least a major carrier account that can drive volume for its product, Kennedy says. Mahi officials say they have 10 systems installed in five lab trials with two ILECs, two IXCs and a national CLEC. The company also has service and support agreements with established vendors ADC, Fujitsu and NEC, which could go a long way toward convincing a carrier to do business with it.Mahi's Mi7 will compete against Lucent's LambdaUnite, Cisco's ONS 15600, Ciena's CoreDirector and Tellabs' Titan 6500. The system costs about $1 million and complies with Network Equipment Building Standards and Operations Systems Modifications for the Integration of Network Elements.