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Press Release

Zhone's MXK and zNID Platforms Selected by Sigmanet to Deliver FTTx Services throughout Campinas, Brazil

MXK to Deliver Voice, Data and HDTV Services for Sigmanet

Oakland, CA — February 9, 2010 — Zhone Technologies, Inc. (NASDAQ: ZHNE), a global leader in network access solutions, today announced that service provider, Sigmanet, has selected Zhone's MXK terabit-scale access platform and zNID optical network terminals (ONTs) to deliver state-of-the-art FTTx services throughout Campinas, Brazil. Sigmanet currently provides wireless services to Campinas, a city with a population of 1.1 million and a major telecommunications hub for the state of Sao Paulo. With Zhone's terabit-scale FTTx platforms, Sigmanet will now provide Voice over IP, HDTV and ultra-high speed data to corporate, residential and multi-tenant unit (MTU) customers throughout the city.

The limitations of Sigmanet's existing wireless access network and customer demand for new, higher bandwidth services motivated the company's fiber expansion.

"Growing from an all wireless network to a fiber network with the highest capacity platforms available not only expands our service model, but it represents an extraordinary expansion in the way we view our possibilities as a company," said Mucio Camargo de Assis Filho, administrative director for Sigmanet. "The MXK gives us enormous bandwidth capacity which means enormous opportunity, and Zhone's ONTs are designed specifically to maximize that bandwidth and opportunity for each service and application."

"In addition to the clear bandwidth advantages innate to the MXK, paired with zNID end terminals, Sigmanet gains important management features like auto-provisioning and Smart OMCI that are unique to Zhone's FTTx solution," said Brian Caskey, CMO for Zhone. "zNIDs are tightly engineered to be application specific, which means greater network integrity, less overhead and improved overall performance. Sigmanet can also assign any service to any port on both the MXK and zNID ONTs which means even greater network flexibility."

Sigmanet selected Zhone's MXK and zNID FTTx platforms, in part based on a collaborative reference from Desktop, a Zhone customer also based in Brazil.

About Sigmanet

Sigmanet is a growing Service Provider based in Campinas, Brazil. Sigmanet offers wireless and high-speed fiber services including VoIP, HSIA, IPTV and HDTV for corporate, residential and multi-tenant unit customers throughout Campinas. For more information about Sigmanet, please visit http://www.sigmanet.com.br

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 resulting in improved network agility and reduced costs in 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 manufactured in the USA in a facility that is emission, waste-water and CFC free.

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