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Zhone Wins Major Equipment Contract with Lebanese Incumbent - OGERO for Metro Wi-Fi, VDSL2, ADSL2+ and EFM Network Access

Zhone Named as Preferred Access Provider by Government Owned Operator to Expand IP Network Services Nation-Wide

Oakland, CA — August 25, 2009 — Zhone Technologies, Inc. (NASDAQ: ZHNE), a global leader in network access solutions, announced today that OGERO (Organisme de Gestion et d'Exploitation de l'ex Radio Orient), the incumbent telecommunications operator of the government of Lebanon has named Zhone as its preferred IP access equipment provider. OGERO selected Zhone equipment to support several major projects which include public Wi-Fi access throughout the capital city of Beirut, and ADSL2+, EFM and VDSL2 deployments nation-wide. As the national incumbent in Lebanon, OGERO has already successfully rolled out services to over 75 percent of the country's DSL subscriber base using Zhone's MALC multi-service access platforms (MSAPs) and 8800 IP DSLAMs.

"For our newest network expansion, we are very happy to use Zhone's equipment offering a thoroughly integrated solution for everything from high-reliability Wi-Fi to VDSL2, ADSL2+ and EFM," said Dr. Toufic Chebaro, Director of Information Technology for OGERO. "Accessing multiple services on one consolidated platform eliminates redundancies and makes it easier to manage and scale so we can time the introduction of new services to the needs of our customers."

Dr. Chebaro underscored that selecting Zhone's metro Wi-Fi solution enables OGERO to leverage their existing copper infrastructure and Zhone management system (ZMS) which significantly reduces cost of provisioning and operations. Awarded for technology innovation, SkyZhone is the only metro Wi-Fi system to provide integrated DSL backhaul and line powering coupled with an 802.11n, all-MIMO antenna architecture. The breakthrough technology design effectively solves reliability and low bandwidth issues that plagued earlier Wi-Fi systems.

In addition to metro Wi-Fi, OGERO will extend its ADSL2+ installed base and broaden its service portfolio to include VDSL2 and EFM using Zhone's MALC. The MALC's any card/any slot/any service design, paired with Zhone's feature-rich access operating system make it easy, fast and cost efficient for OGERO to add differentiated new network services.

"In less than two years, OGERO has developed Lebanon's network into a true twenty-first century IP communications infrastructure with new and ambitious projects on the way," said Steven Glapa, VP of Product Management and Marketing for Zhone. "We are wholly committed to OGERO as a vendor partner and energized by the prospects for continued innovation ahead."

About OGERO

OGERO (Organisme de Gestion et d'Exploitation de l'ex Radio Orient) is the largest telecommunications provider in Lebanon with a network that reaches 95% of the Lebanese territory and serves more than 650,000 subscribers. Established in 1972 under the Ministry of Telecommunications, OGERO now provides advanced business and residential voice and data services for national and international customers. As the leading telecommunications provider in Lebanon, OGERO's vision is to continuously introduce innovative and cost-effective products and services with outstanding quality of service.

About Zhone Technologies -- Access for a Converging World

Zhone Technologies, Inc. (NASDAQ: ZHNE) is a global leader in multi-service access solutions, serving more than 700 of the world's most innovative network operators. The company offers the industry's only fully-integrated portfolio of MSAP, FTTx, EFM and Wi-Fi access technologies, improving network agility and reducing the costs of delivering the full spectrum of access services, including residential and business broadband, VoIP, and High-Definition IPTV -- over copper, fiber, and wireless. Zhone is headquartered in California, and its MSAP products are all manufactured in the USA, in a facility that is emission, waste-water, and CFC free.

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