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Zhone Shows Break-Away Lead in Multi-Service Access Platform Shipments Throughout the Americas

Newest Data from Infonetics Reseach Shows Zhone's North American DSL Port Shipments Lead Second Major Supplier by Over 100 Percent

Oakland, CA — August 21, 2007 — Zhone Technologies, Inc. (NASDAQ: ZHNE), a global provider of advanced communications equipment and a leader in VoIP, IPTV, and Ethernet over copper and fiber access lines, today cited shipment results from the esteemed industry analysis firm, Infonetics Research. The newest Infonetics data shows that Zhone took a break-away lead in second-quarter port shipments in the fast-growth Multi-Service Access Platform (MSAP) category in both North America and Central and Latin America (CALA). Results show Zhone leading in DSL port shipments by more than 100 percent over the number two major suppliers in both North America and CALA. Zhone also led in DSO port shipments in the MSAP category throughout the CALA region.

"Carriers are actively looking for ways to offer new services over their existing last-mile assets while at the same time simplifying provisioning and management," said Jeff Heynen directing analyst of broadband and IPTV for Infonetics Research. "As triple play becomes the baseline service suite, the MSAP product category is widely acknowledged as the platform of choice over single-purpose systems."

"We're seeing tremendous operator interest in the service flexibility and cost advantages of our MALC platform," said Steven Glapa, VP of marketing for Zhone. "Zhone will continue to extend MSAP innovation into new modes of access—for example, our recent introduction of standards-based GPON—to leverage the MALC's powerful operational advantage and create greater value for our customers."

In use by hundreds of operators worldwide in both established and emerging markets, Zhone's MALC MSAP enables providers to quickly deploy a comprehensive suite of communications services over copper or fiber via one powerful converged platform. In addition to high-speed data and POTs voice, Zhone's MALC enables simplified provisioning of premium Voice over IP, IPTV, and fast-growth Ethernet in the First Mile (EFM) services.

About Zhone Technologies — Access for a Converging World

Zhone Technologies, Inc. (NASDAQ: ZHNE) is a provider of advanced communications equipment to more than 600 operators worldwide. The company's broad line of access and transport networking solutions enables the full range of multi-play services, including residential and business broadband, VoIP, IPTV, and Ethernet. Zhone's converged access platform improves network agility and reduces costs, allowing operators to rapidly deploy premium services on their existing copper and fiber infrastructure while providing a seamless migration path to an efficient, all-IP network. www.zhone.com

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Zhone, the Zhone logo, and all Zhone product names are trademarks of Zhone Technologies, Inc. Other brand and product names are trademarks of their respective holders. Specifications, products, and/or product names are all subject to change without notice.

Forward-Looking Statements
This press release contains forward-looking statements that are subject to the safe harbors created under the Securities Act of 1933 and the Securities Exchange Act of 1934. Forward-looking statements include statements that refer to continued MSAP innovation and Zhone’s plans, objectives and strategies for future operations. Readers are cautioned that actual results could differ materially from those expressed in or contemplated by the forward-looking statements. Factors that could cause actual results to differ include, but are not limited to, the ability to anticipate or adapt to rapidly changing technology and to offer products that meet changing customer demands and industry standards. In addition, please refer to the risk factors contained in Zhone’s SEC filings available at www.sec.gov, including without limitation, Zhone’s annual report on Form 10-K for the year ended December 31, 2006 and Zhone’s quarterly reports on Form 10-Q for the quarter ended March 31, 2007 and June 30, 2007. Readers are cautioned not to place undue reliance on any forward-looking statements, which speak only as of the date on which they are made. Zhone undertakes no obligation to update or revise any forward-looking statements for any reason.