AT&T OUTLINES GROWTH PLANS FOR ITS BROADBAND BUSINESS
As of June 30, AT&T Broadband had 848,000 broadband telephony customers, 1.3 million high-speed data customers and 3.1 million digital video customers for a total of 5.3 million advanced service subscribers.  During the quarter, average revenue per subscriber grew to $55.34.  AT&T Broadband expects the overall revenue growth rate for the full year to be in the mid-teens.  The company also plans to spend $3.6 billion in capital in 2001, with the majority focused on providing advanced services and plant upgrades.  About 70% of its cable network has now been upgraded for advanced services.  Currently, AT&T Broadband has a 22% digital video penetration level, a 10% high-speed data penetration rate and a 14% broadband telephony penetration.  Targets for 2005 call for a mid 50% penetration of digital video, high 20% for high-speed data and mid 30% for broadband telephony.  http://www.att.com/press/item/0,1354,3921,00.html
AT&T, July 24, 2001

• Earlier this month, Comcast, the third largest cable operator in the US, made a $58 billion proposal to AT&T to merge its cable networks with those of AT&T Broadband.  The Comcast bid represented a value of over $4,000 per subscriber.  Last week, AT&T’s Board of Directors unanimously voted to reject Comcast’s proposal to acquire AT&T Broadband.

XO SIGNS MULTI-YEAR $100+ MILLION LD DEAL WITH NEXTEL
XO Communications announced a multi-year agreement worth more than $100 million to provide telecommunications services for Nextel Communications.  Under the deal, XO will serve as one of the primary underlying inter-city network service providers throughout the US for Nextel's long distance services.  http://www.xo.com/news/80.html
XO Communications, July 24, 2001

QWEST REACHES 360,000 DSL CUSTOMERS
As of the end of Q2, Qwest Communications was serving 360,000 DSL customers.  Qwest currently has 303 DSL equipped central offices, giving it an average subscriber density of about 1,187 users per central office.  The company hopes to serve 500,000 DSL customers by the end of 2001.  Overall for Q2, Internet, data and IP services revenues grew about 41% over Q2 2000.  Internet and data revenues represent more than 27% of Qwest’s total revenue.  http://www.qwest.com/about/media/pressroom/1,1720,713_archive,00.html
Qwest, July 24, 2001

• In May, Qwest announced plans to significantly expand the reach of its DSL network in 11 of 14 Western states where it provides local phone service.  The expansion will place DSL concentrators in remote terminals closer to the subscribers, thus increasing the availability of the service.  The plan would make DSL available to approximately 1.3 million additional homes and businesses in these states by the end of 2001 and 1.2 million more next year, bringing the total number of DSL-capable customers in Qwest territory to about 6 million by the end of 2002.

EUROPE’S ATRIUM PROJECT ACTIVATES ALCATEL 7770 ROUTING CORE PLATFORMS
Project ATRIUM, the European Commission's experimental next generation network, connected two Alcatel 7770 Routing Core Platforms (RCP) located at France Telecom's Research & Development labs near Paris and Alcatel's Antwerp, Belgium labs.  The ATRIUM project aims to create scalable networks combining optical transmission and IP.  The Universities of Liege and Namur in Belgium will use the ATRIUM network to research traffic engineering mechanisms.  http://www.alcatel.com
Alcatel, July 24, 2001

• The Alcatel 7770 Routing Core Platform (RCP) will feature a 640 Gbps switching fabric with an ability to scale to 5 Tbps and 10 Tbps through in-service upgrades.  It will use IBM's PowerNP network processor and customized ASICs for distributed IP forwarding and wire-speed packet handling.  Intelligence capabilities will include MPLS-guided traffic engineering, multi-layer restoration and dynamic bandwidth allocation and IP trunking.  It will also use Applied Micro Circuits Corp.'s (AMCC's) framer and PHY silicon solutions.  The Alcatel design will support multi-port POS interfaces at up to OC-192, as well as future OC-768, 10 Gigabit Ethernet and very short range (VSR) optical interfaces.

TELEFONICA DATA SELECTS JUNIPER’S M160 CORE ROUTERS
Telefonica Data selected Juniper Networks’ M160 Internet backbone routers for its domestic IP network infrastructure and for connections into its international network nodes.  Financial terms were not disclosed.  http://www.juniper.net/news/pressreleases/2001/pr-010724.html
Juniper Networks, July 24, 2001

ONI SYSTEMS ADDS TUNABLE GAIN AMPLIFIER AND DISPERSION COMPENSATION TO PLATFORM
ONI Systems introduced a tunable variable gain optical amplifier (VGA) and a dispersion compensation module (DCM) for its ONLINE metro optical transport platform.  The VGA enables dynamic, network-wide gain adjustment to maximize system optical performance within milliseconds of any network change.  The DCM optically corrects the effect of chromatic dispersion, a property of transmission fiber that causes light pulses to smear and limits the bit-rate and transmission distance.  Both modules are provided by Corning.  With the new enhancements, the ONI platform is able to carry OC-192 wavelengths to distances greater than 300 km over standard fiber spans without regeneration.  http://www.oni.com
ONI Systems, July 24, 2001

QUALCOMM WITHDRAWS PLAN TO SPIN OFF ITS SEMICONDUCTOR BUSINESS
QUALCOMM no longer plans to spin off its integrated circuits and system software business.  Since announcing the spin-off in July 2000, QUALCOMM has entered into approximately 40 license agreements or extensions covering third-generation CDMA systems.  QUALCOMM is also restructuring into two business groups, QUALCOMM Wireless & Internet Group and QUALCOMM CDMA Technologies Group.  http://www.qualcomm.com
QUALCOMM, July 24, 2001

FURUKAWA ELECTRIC TO ACQUIRE MAJORITY OF LUCENT’S FIBER BUSINESS
Furukawa Electric Co. will acquire the majority of Lucent’s Optical Fiber Solutions (OFS) business for $2.525 billion.  Corning will pay $225 million in cash for Lucent's interests in two joint ventures in China - Lucent Technologies Shanghai Fiber Optic Co. and Lucent Technologies Beijing Fiber Optic Cable Co.  Lucent's Optical Fiber Solutions business employs more than 6,000 people and is based in Norcross, GA.  http://www.lucent.com/press/0701/010724.nsb.html
Lucent Technologies, July 24, 2001

• Separately, Lucent announced a strategic manufacturing agreement with Celestica Inc. for the purchase of its manufacturing assets at Oklahoma City and Columbus, Ohio for up to $650 million.

LUCENT REPORTS LOSS, EXPECTS 15K TO 20K FURTHER JOB CUTS
Lucent Technologies reported quarterly revenue of $5.8 billion, compared to $5.9 billion in the prior quarter and $7.4 billion in the year-ago quarter. The loss from continuing operations, including $684 million in business restructuring and one-time charges, as well as the amortization of goodwill and other acquired intangibles, was $1.9 billion, or $0.55 per basic and diluted share.  In total, Lucent has reduced its work force by approximately 19,000 since January.  In addition, the company has eliminated about 5,500 contractor positions since the beginning of the year.  The company plans a further 15,000 to 20,000 layoffs and a Phase II restructuring charge of $7 billion to $9 billion.  Following the restructuring, Lucent will be organized around two major segments - Mobility Solutions and Integrated Network Solutions.  Its customer target will be the world's major service providers.  http://www.lucent.com/press/0701/010724.coa.html
Lucent Technologies, July 24, 2001

GUEST COLUMN: GETTING BACK TO BASICS Randy Shipley VP Sales & Marketing, Valiant Networks July 23, 2001 Can new carriers ever get to profitability in today’s environment? Will this become the new measurement for early stage carriers success or ultimate failure? Just a few short years ago CLECs were measuring their value based upon multiples of their Physical Plant & Equipment (PP&E). Capturing customer lines and revenue growth were given higher priority than margins, costs and ultimate profitability. Miles of fiber in the ground became more important than managing operational costs. The number of switches deployed in the network became the rallying cry. To compete in the competitive telecommunications industry, large executive teams were created. After all, if you wanted to be a phone company, you needed to look like one. Investments in offices, network operation centers (NOC) and facilities were needed to show customers that you were a player in the industry. Multiple executives were needed for focus and control of each operational department, and in turn, executives needed management staffs to be efficient. Wasn’t this the way business was conducted at a phone company? Didn’t everyone want to be a phone company? It is well known that the largest cost for a carrier is the capital expense of building a network. Once operating, the costs of operations and SG&A become the largest expenses for a carrier. Successful carriers have managed these costs effectively, but new carriers, by necessity, must manage these costs even more effectively. Read the full column http://www.convergedigest.com/Bandwidth/archive/010723GUEST-randyshipley1.htm