OPTICON KEYNOTE:  WU-FU CHEN ON INVESTING IN OPTICAL NETWORKING
Bottlenecks and costly bandwidth inefficiencies can be found “everywhere” in long-haul, metro and access networks, according to legendary entrepreneur Wu-fu Chen, creating great opportunities for start-ups with the right technology, management teams and investors.  Building high-capacity, long-haul fiber backbones, for instance, is extremely expensive because of the need to regenerate optical signals every 300 km.  Although Qtera (acquired by Nortel Networks) and Corvis Corp. have already pioneered the specialty of long-haul optical transport, Chen is betting that further innovations can be made to support higher channel speeds, higher number of channels per fiber and greater distances between regeneration sites.  In metro optical networks, Chen sees opportunity in the mismatch between the pipes that customers want and those that traditional SONET can support.  In addition to bandwidth inefficiency, central offices are physically constrained by power and space requirements and 60% of existing fiber in the ground is unused.  All of which are opportunities for innovation.  But Chen said the most prime optical opportunities are components and sub-systems.  Because the market for optical components is severely supply-constrained, profit margins on optical devices are extremely high., and in the short term anyone able to manufacture significant volumes is a winner.  Long term, the market will stabilize and only the best will succeed.  New forms of optical switching hold great promise.  Chen said it might be too early to tell which of the various new technologies proposed for optical switching will dominate, but he thinks MEMs-based switches have the advantage.  Chen conceded that maybe there are now too many optical start-ups.  However, he said his concern is not that there is too much venture investment in the field, but rather that too many start-ups going after the same spaces, particularly among optical systems companies. 
August 3, 2000

• Wu-fu Chen invests his own money in promising start-ups and has recently formed his own incubator, Acorn Campus  http://www.acorncampus.com.  Some of latest start-ups in which he is involved include:

LUCENT REORGANIZES ITS OPTICAL NETWORKING BUSINESS
Lucent Technologies reorganized its optical networking business into two divisions, one targeting network cores and the other focused on metro access.  Harry Bosco, the former head of Lucent's optical business, will retire from the firm.  Jeong Kim, the former head of Yurie Systems, was named group president of the company's Optical Networking business.  The product portfolio for the core business unit include the WaveStar OLS 400G, the WaveStar Bandwidth Manager, the WaveStar 10G products, and the WaveStar LambdaRouter all-optical switch.  Bob Barron, former head of Chromatis Networks, is being named president of the company's Metropolitan Optical Networking business, which will now become part of Lucent's InterNetworking Systems Group.  The metro optical business unit will offer the Lucent Chromatis platform and the WaveStar metro products -- DataExpress 10G, AllSpectra OLS and AllMetro OLS; the Ignitus 3500 Integrated Access Switch and other related metro products.  http://www.lucent.com/press/0800/000803.coa.html
Lucent Technologies, August 3, 2000

• Lucent acquired Chromatis Networks in May for approximately 78 million LU shares (valued at $4.5 billion on May 31).  Barron joined Chromatis in 1999 and previously served with Nokia/Diamond Lane Communications, Harris Corp., Stanford Telecom, Autek Systems Corp. and Zitel Corp.
  
• Lucent acquired Yurie Systems, a developer of ATM access equipment, in April 1998 for $1 billion in cash.

KOREA'S HANARO TELECOM ADDS 110,000 LOCAL ACCESS LINES IN JULY, DEMAND DRIVEN BY ADSL
Hanaro Telecom, the leading competitive local carrier in Korea, set new records for network growth by increasing its total paying subscriber base at the end of July 2000 to 624,759, a net addition of 110,208 in the last month.  The figures translate into 796,737 total subscriber lines and 126,865 additional subscriber lines respectively. Of the total, over 88% or 550,210 customers, are using its broadband Internet services, including 105,024 new users in July alone.  Hanaro bundles its Internet access service bundled with local telephony service.  The remaining 12% of the total subscribers include 62,998 local voice-only service subscribers and 1,276 leased-line service subscribers.  The company attributes its fast growth to strong demand for ADSL, which is priced at the equivalent of US$25 to $34 per month.  ADSL service grew 17% to 382,303 subscribers.  Hanaro's cable modem Internet service also added 48,133 new customers in July.  Finally, the companies newly launched LMDS wireless network in Seoul has a total of 853 residential and corporate customers after one month of commercial operation.  http://www.hanaro.com/english/main_com.html
Hanaro Telecom, August 3, 2000

PACKETVIDEO LANDS KEY MPEG-4 WIRELESS DISTRIBUTION CONTRACT WITH WARNER BROS.
PacketVideo, a start-up based in San Diego, will supply its MPEG-4 software to Warner Bros. New Media for use in distributing video content to mobile phones and other wireless devices.  Warner is currently developing its first four animated features designed expressly for viewing on small, wireless devices. It is also exploring the possibility of other wireless content, including short video games, video trading cards and greeting cards.   http://www.packetvideo.com/current_press_aug1a.html
PacketVideo, August 3, 2000

FCC ISSUES REPORT OF HIGH-SPEED ACCESS
The Federal Communications Commission (FCC) released a report on The Availability of High Speed and Advanced Telecommunications services in the US, concluding that services are being rolled out in a reasonably and timely fashion overall, although rural areas, inner city consumers, low-income consumers, minority consumers and tribal areas were vulnerable to not be able to gain access.  As of December 31, 1999, the FCC estimates that 84% of residential broadband access in the US was via cable modem, 11% via ADSL and 5% via other means.
http://www.fcc.gov/Bureaus/Common_Carrier/News_Releases/2000/nrcc0040.html
FCC, August 3, 2000

TELOS ANNOUNCES WIRELESS SOFTSWITCH FOR IP TELEPHONY
TELOS Technology announced a softswitch supporting existing 2G and 2.5G wireless standards (IS-136, CDMA and GSM), as well as future 3G (UMTS, CDMA2000) protocols on the same platform.  The company said its design is scaleable from wireless enterprise to very large cellular /PCS networks.  The product was previously demonstrated working in conjunction with Hyundai Electronics' CDMA Pico Base Stations (BTS) and a standard IP network.  http://www.telostech.com/html/News/News.htm
TELOS, August 3, 2000

• TELOS Technology supplies wireless systems for cellular, PCS and wireless local loop applications.  The company is based in Vancouver, Canada.