Lucent to take over Chromatis

In an effort to keep up with rival Cisco Systems in the exploding market for
optical networking technology and equipment, Lucent Technologies is reportedly
close to paying $6 billion to take over start-up Chromatis Networks of Herndon,
Virginia.

Chromatis has developed advanced new optical networking equipment that allows
voice, data and video to run efficiently over the optical network on a company
campus or across an entire city. The equipment is still in beta test development
phase.

Cisco has invested close to $10 billion in the past year in companies
specializing in high-end optical networking and communications technologies. One
such investment was a whopping $7 billion take-over of Cerent, a start-up like
Chromatis with no revenue to speak of. But in less than six months, Cisco has
turned the investment into a major new source of sales and profits. The company
estimates Cerent-based sales could top $1 billion this year.