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Zhone Ranks 15 in Quality Leadership Top 100 Manufacturers Survey

US Manufacturing Base Enables High Quality Standards, Customer Responsiveness and Clean Tech Production

Oakland, CA — March 17, 2008 — Zhone Technologies, Inc. (NASDAQ: ZHNE), a global leader in multi-service access equipment for VoIP, IPTV and Ethernet over copper and fiber access lines, today announced that it ranked 15 out of more than 800 manufacturers surveyed for Quality Magazine's Quality Leadership 100. Manufacturers were assessed based on warranty costs as a percentage of sales, rejected parts per million shipped and the contribution of quality to profitability and shareholder value. The selection criteria also included the number of quality programs in place, registration to standards, employee training, and the percentage of employees dedicated to quality responsibilities

Based in the United States, Zhone recently concentrated manufacturing in its plant in Largo, Florida. The 125 thousand square foot facility produces zero toxic emissions, no circuit board waste water and is CFC-free.

"In addition to improved quality and clean-tech practices, our US manufacturing base enables a high level of product customization and responsiveness to customers," said Ed Thompson, vice president of manufacturing for Zhone. "Zhone ships thousands of different model numbers to customers all over the world. With an outsourced manufacturing model it would be very difficult to fulfill demand for that kind of product diversity without overshooting inventories or sacrificing customer service."

The assembly line uses just-in-time manufacturing processes originally devised by Toyota. The system is integrated through feedback loops and signaling systems to prevent individual anomalies or line occurrences that can impact the quality of the final product. Zhone recently doubled output capacity on its MALC line to accommodate customer demand.

For more information about Quality Magazines, Quality Leadership 100 visit http://www.qualitymag.com .

About Zhone Technologies — Access for a Converging World

Zhone Technologies, Inc. (NASDAQ: ZHNE) is a provider of advanced access network equipment to more than 600 operators worldwide. The company offers the industry's broadest portfolio of fully-integrated access solutions, enabling the full range of multi-play services, including residential and business broadband, VoIP, IPTV, and Ethernet. Zhone's converged multi-service 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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