Wednesday, July 18, 2007

PMC-Sierra Posts Revenue of $104.7 Million

PMC-Sierra reported net revenues in the second quarter of 2007 of $104.7 million compared with $103.7 million in the first quarter of 2007. Due to a review of the company's expanded global distribution arrangement with its largest distributor, Avnet, PMC-Sierra determined it was appropriate that all future revenues generated through Avnet be reported on a 'sell-through' basis and therefore deferred until inventory is sold to the end customer. The net impact of this adjustment in the second quarter of 2007 was a decrease in reported revenue of $4.2 million, a reduction of $0.8 million in cost of sales, and an increase of $3.4 million in deferred income on the balance sheet. Net loss in Q2 (GAAP) was $22.3 million (GAAP diluted loss per share of $0.10) compared with GAAP net loss of $15.8 million (GAAP diluted loss per share of $0.07) in Q1.

"In the second quarter, we experienced improvement in our enterprise storage, fiber to the home, and telecom businesses on a sequential basis," said Bob Bailey, chairman and chief executive officer of PMC-Sierra. "We believe the overall business environment is improving as we go into the second half of 2007, and we are executing on our corporate restructuring to improve the Company's operating performance going forward."

Sprint Nextel and Clearwire to Partner on WiMAX Mobile Network Build

Sprint Nextel and Clearwire agreed to jointly build a nationwide mobile broadband network using WiMAX technology and to promote the global development of WiMAX-based services. The partnership significantly reduces the cost of network construction and is expected to accelerate the rollout of a 4G service.

Under the network build-out plan, Sprint Nextel will focus its efforts primarily on geographic areas covering approximately 185 million people, including 75 percent of the people located in the 50 largest markets, while Clearwire will focus on areas covering approximately 115 million people. Initially, the two companies expect to build out network coverage to approximately 100 million people by the end of 2008, with seamless roaming enabled between the deployed areas.

The arrangement also will provide for the exchange of spectrum between Sprint Nextel and Clearwire to enable each company to build out its portion of the network and to enhance service in its build-out territory, as well as for the exchange of other assets associated with this spectrum. In addition, Clearwire will have the ability to utilize certain Sprint Nextel 3G infrastructure.

Sprint Nextel and Clearwire will market mobile WiMAX services under a common service brand, and Clearwire will offer mobile WiMAX services in Clearwire's territories through Sprint Nextel's retail stores, and through its own distribution channels. Both companies will provide seamless reciprocal roaming service to each others' WiMAX customers, and Sprint Nextel plans to provide dual-mode (CDMA-WiMAX) services nationwide to its customers over both its own and Clearwire's portion of the WiMAX networks.

Sprint Nextel and Clearwire expect to build their respective portions of the nationwide network, and enable roaming between the respective territories. The companies also will work jointly on product and service evolution, shared infrastructure, branding, marketing and distribution.

The companies said they would work with multiple vendors in order to ensure a broad ecosystem of WiMAX vendors.

Both companies affirmed their intend to provide consumers, businesses and distributors across the country with access to the open Internet.

"This arrangement will result in stronger competition in the rapidly growing market for broadband services, and will provide consumers, national enterprises and other businesses, educators and public safety agencies greater choice and faster access to a revolutionary mobile broadband technology," said Sprint Nextel Chairman and Chief Executive Officer Gary Forsee.

Sprint did not say specifically how the new build-out will affect its capital expenditure plans, but noted that this new partnership plan is approximately a 70/30% split and would reduce expenditures.

Sprint also noted the Clearwire deal will not impact its partnerships with major cable operators.
  • Earlier this month, Clearwire closed and funded its first tranche of a fully committed $1 billion senior secured term loan, the remainder of which will be funded on a delayed draw basis in approximately 45 days. The money will be used for the company's expansion and to refinance Clearwire's existing loans.

Tekelec Selected by T-Mobile and BSNL

India's Bharat Sanchar Nigam Ltd. (BSNL) has selected Tekelec's EAGLE 5 Integrated Signaling System solution to support its transition to next-generation networks. This latest purchase order for BSNL was received through a Tekelec local reseller, ITI Limited, which also will be in charge of the project implementation. The project will expand the existing deployment of 10 EAGLE 5 ISS nodes and adds an additional 14 nodes, which is one of Tekelec's largest single shipments of EAGLE 5 ISS nodes. BSNL, India's largest telecommunications company, is also extending an existing relationship with Tekelec for traditional signaling system 7 (SS7) signaling solutions initiated in 2005.

Separately, Tekelec won a contract to upgrade the T-Mobile Netherlands signaling network. The contract is the second one T-Mobile has signed with Tekelec in fewer than six months and follows the roll-out of Tekelec's Sigtran--IP-based signaling system 7 (SS7) solution, running on the EAGLE 5 Integrated Signaling System (ISS), at T-Mobile Germany earlier this year.

Broadcom Posts Q2 Revenue of $900 Million

Broadcom reported Q2 revenue of $897.9 million, a decrease of 0.4% from the $901.5 million reported for the first quarter of 2007 and a decrease of 4.6% from the $941.1 million reported for the second quarter of 2006. Net income (GAAP) for Q2 was $34.3 million, or $.06 per share (diluted), compared with GAAP net income of $61.0 million, or $.10 per share (diluted), for the first quarter of 2007, and GAAP net income of $106.1 million, or $.18 per share (diluted), for the second quarter of 2006.

"In the midst of continued variability in the ordering patterns of a few of our larger customers, we are pleased to announce that revenue in the second quarter was in line with our guidance," said Scott A. McGregor, Broadcom's President and Chief Executive Officer.

Motorola Posts Q2 Sales of $8.7 billion, Net Loss

Motorola reported Q2 sales of $8.7 billion and a GAAP net loss from continuing operations of $0.02 per share, which includes net charges of $0.04 per share related to workforce reductions and an insurance litigation matter. The company had earlier warned of a shortfall due to weakness in mobile device sales, particularly in Asia, and the Europe, Middle East and Africa region.

"This was a challenging quarter for Motorola in which revenue fell short of our expectations due to a decline in mobile device unit shipments," said Ed Zander, chairman and chief executive officer. "However, I am pleased with the solid results within our Home and Networks Mobility and Enterprise Mobility Solutions businesses. Our vision of seamless mobility and the mobile Internet continues to resonate with our customers and partners worldwide."

Mobile Devices segment sales were $4.3 billion, down 40 percent compared with the year-ago quarter. Motorola's share of the global handset market for the quarter is estimated to be 13.5%. During Q2, Motorola shipped 35.5 million handsets. The company also noted the shipment of its 100 millionth RAZR.

Home and Networks Mobility, which includes the newly combined Connected Home Solutions and Networks businesses, had segment sales of $2.6 billion, up 9 percent compared with the year-ago quarter. Motorola cited strong demand for high-end HD DVR and IPTV devices, as well as the new digital cable host products.

Enterprise Mobility Solutions, which includes the company's two enterprise businesses - Government and Public Safety and Enterprise Mobility, had segment sales of $1.9 billion, up 42 percent compared with the year-ago quarter.

Verizon Wireless Adds 1.3 Million Mobile Users in Q2

Verizon Wireless added 1.6 million retail net customer in Q2, although total net customer additions were 1.3 million after 300,000 net reductions in the company's wholesale base, primarily due to one reseller.

At the end of the quarter the company had 62.1 million customers, including 60.1 million retail customers served under the Verizon Wireless brand.

Further details are expected on July 30 when the company issues its quarterly financial report.
  • For Q1 2007, Verizon Wireless added 1.6 million retail net customer additions (including acquisitions and adjustments) most of which were post-paid customers. The company added 1.7 million total net customers. At the end of Q1, the company had 58.5 million retail customers.

NCR to Support Alcatel-Lucent Enterprise Solutions in North America

NCR Corporation to provide on-site installation and maintenance services for Alcatel-Lucent enterprise communications customers in North America under a new agreement announced by the firms. Through its relationship with NCR, Alcatel-Lucent will expand its local service delivery capability, providing installation and maintenance to customers in previously under-served geographic areas. Under the agreement with NCR, distributors and service providers will continue to offer support packages directly to customers, and will be able to draw from the expertise, resources, and physical presence of two multibillion-dollar service organizations.

Senate Committee Approves Measure Seeking Data on Broadband Deployments

The Senate Committee on Commerce, Science, and Transportation unanimously approved a bill that directs the FCC to reconsider and update its definition of a broadband service -- currently 200 kbps, as it first defined in 1999. The bill would also direct the FCC to revise existing broadband reporting obligations to require providers to report the actual numbers of broadband connections either within a census tract, 9-digit postal zip code, or 5-digit postal zip code. Under the current system, if there is a single subscriber in a 5-digit zip code, it is assumed there is broadband availability to all within the 5-digit zip code.

Nokia Launches A-GPS Service, Framework Open to Service Providers

Nokia launched an Assisted GPS (A-GPS) service that helps Nokia Maps users find their current locations faster and get to their desired locations quicker using their Nokia mobile device with built-in GPS. The free service, which runs over a user's existing wireless data plan, is initially available on the Nokia 6110 Navigator, which has begun shipping in select markets, and the most recent software release of the Nokia N95 multimedia computer. Nokia said it intends to equip all of its future devices that have built-in GPS with this service.

The A-GPS service has the ability to reduce the time a connected mobile device with built in GPS needs to find its current position, known as time to first fix (TTFF) for most geographical locations worldwide. The service operates in tandem with a technical framework that allows third parties, such as service providers, to provide their own regional A-GPS services, making fix times even faster in certain areas-

Cablevision Offers Up to 4 VoIP Lines to Residential Customers

Cablevision Systems, which serves the metro New York market, is now offering residential customers the option of up to four lines of the company's Optimum Voice digital phone service. Residential customers with one line of Optimum Voice can add up to three additional lines for $14.95 per month per line. Each line provides unlimited calling across the U.S., Canada and Puerto Rico and features such as caller ID, call waiting, enhanced voicemail, and directory assistance. Small business customers can have up to 8 voice lines over their cable connection

Ikanos Expands in GPON-Based FTTH Market, Licensing Deal with Terawave

Ikanos Communications has licensed high-performance GPON physical (PHY) layer technology with Ethernet Layer 2 functionality from Terawave Communications as plan of a plan to enter the Gigabit Passive Optical Network (GPON)-based FTTH market.

Ikanos will combine Terawave's ITU-compliant GPON PHY technology with its own gigabit performance Fusiv Vx170 gateway processor to develop a high-performance GPON residential gateway reference platform. The Fusiv Vx170 offers 2.7 GHz of processing power, providing wire speed performance across all LAN and WAN interfaces while utilizing less than 2.5 watts of power. The device offers multiple Accelerator Processors and dedicated DSP engines for VoIP.

Ikanos said it views GPON FTTH and VDSL2 as complementary technologies, where fiber is used in the back-haul with the option of copper or fiber for the last mile. By offering GPON products along with its CO and CPE VDSL2 solutions, Ikanos positions itself to be the preferred provider of access technology in all types of fiber and fiber extension deployments (FTTH, FTTN, FTTR, FTTC and FTTB).

Broadcom and Verizon Wireless Enter Licensing Deal to Allow Banned Phones

Broadcom signed a licensing deal with Verizon Wireless that permits the continued importation and sale by Verizon Wireless of mobile devices that are the subject of the current litigation between Broadcom and Qualcomm before the U.S. International Trade Commission.

Separately, Broadcom and Verizon Communications announced that they have entered into a strategic alliance involving new mobile device chipsets and other products, including Bluetooth and wireless LAN solutions, optical network solutions, Multimedia over Coaxial Cable (MoCA) devices, GPS location technology, and DSL and fiber network components including set-top boxes.

The newly signed licensing agreement allows Verizon Wireless to sell new handsets and other wireless devices, ensuring the availability of the latest cell phone technology in handsets and personal digital assistants (PDAs) to consumers and businesses.

Under the deal, Verizon Wireless will make payments to Broadcom at a rate of $6.00 for each 1xEV-DO handset, PDA or data card sold after the effective date, subject to a maximum payment of $40 million per calendar quarter and a lifetime maximum payment of $200 million. The agreement provides Verizon a license to the six Broadcom patents currently being litigated between Broadcom and Qualcomm. Other terms and conditions of the agreement are confidential.

Verizon Wireless also agreed to cease its efforts to overturn the ITC's recent order banning Qualcomm chips and certain cell phones based on those chips from importation, and will withdraw Verizon Wireless's motion to stay that same ITC remedy previously filed with the U.S. Court of Appeals for the Federal Circuit.

Dell Plans to Acquire Silverback Technologies

Dell announced plans to acquire privately-held SilverBack Technologies, Inc., a service delivery platform provider for remote monitoring and management of information technology infrastructure such as servers, storage, networks, desktops and notebooks. Financial terms were not disclosed.

SilverBack, which started out in 1999 as a Managed Service Provider, supplies a distributed, multi-tenant platform for providing remote management across diverse, customer-controlled networks.
  • Silverback Technologies' investors include Prism Ventures, North Bridge Ventures, Matrix Partners, Spectrum Equity, and Ironside Ventures.

  • Silverback is based in Billerica, Mass.

Digital Lightwave Announces 40G and 43G Testing Capability

Digital Lightwave announced plans to introduce 40Gbps and 43Gbps test capability for its NIC Platform products in Q4 2007. The new 40/43G testing module will be available in the small and light NIC chassis as well as the larger NIC Plus and NIC EP (rack mount) chassis.

In the NIC Plus and NIC EP chassis, the 40/43G can be combined with other NIC modules to enable testing of all SONET/SDH/OTN rates from 51Mbps to 43Gbps with VCAT, LCAS and GFP, Ethernet 10/100/1000BaseT, GigE, 10GigE and PDH/T-Carrier rates from 1.5Mbps to 140Mbps in a single chassis.

Bharti Airtel Awards $2 Billion Deal to Ericsson

India's Bharti Airtel awarded a contracted valued at US$2 billion to Ericsson. The deal is described as one of the world's largest network expansion projects. It is Ericsson's largest deal to date.

The two-year contract covers an expansion of Bharti Airtel's GSM/EDGE network as well as capacity management. Specifically, Ericsson will design, plan, deploy, optimize and manage Bharti Airtel's GSM network across 15 circles in India as well as for its pan-India pre-paid platform across 23 circles. In addition, Ericsson will also deliver pan-India integrated device management solutions, enabling usage of advanced data services by all mobile customers across retail and enterprise segments.

The core network is based on Ericsson's layered architecture that will pave the way to an all-IP environment, and includes a common 2G/3G core based on Mobile Softswitch; a Mobile Packet Backbone Network for data services; and a pan-India pre-paid platform using intelligent network technology to deliver pre-paid services to users with the shortest time-to-market as well as to allow Bharti to charge differentially for both voice and data; and a state-of-the-art location-based services solution that will pave the way for unique location-based services and applications to be launched for the Indian consumer.

On the radio access side, Ericsson will supply products such as its main-remote design, the Flamingo series radio base station and the Expander solution. The core and access solutions will be supported by a network backbone for all transmission requirements through Ericsson's MINI-LINK transport portfolio.

Juniper's Q2 Revenue Rises 17% to $665 Million

Juniper Networks reported Q2 2007 revenue of $664.9 million, compared with $567.5 million for the second quarter of 2006, an increase of 17 percent. Net income on a GAAP basis for the second quarter of 2007 was $86.2 million or $0.15 per share, compared with a GAAP net loss of $1,206.5 million or $2.13 per share for the second quarter of 2006.

"We are pleased with our progress in the second quarter and first half of 2007, and we also remain fully aware of the ongoing work that lies ahead," said Scott Kriens, Juniper Networks' Chairman and CEO. "As we continue to focus intently on execution across the company, we're optimistic about the feedback we're receiving from customers and the opportunities we see in the marketplace for high-performance networking."

Juniper Networks cited strength in core networking, where its T-series and TX Matrix continued to gain momentum. During the quarter, the company announced the expansion of China Telecom Shanghai's next generation network with the TX matrix and T640 core routers to support the growth of IPTV and multiplay applications. Japan's National Institute for Informatics (NII), the country's largest and most advanced academic research institution, upgraded its nationwide SINET3 next generation network with Juniper Networks T-series routers. In addition, Bayanant Al-oula, a new service provider based in the Kingdom of Saudi Arabia, selected Juniper Networks M- and T-series routers for the build-out of its new IP/MPLS-based next generation network.