Wednesday, September 3, 2008

Telefónica to Raise Stake in China Netcom

Telefónica announced an agreement with AllianceBernstein to acquire an additional stake of up to approximately 5.74% of the share capital of the China Netcom. he acquisition will be structured in two tranches, (i) the first tranche will be in respect of shares representing approximately 2.71% of the issued share capital of CNC as of the date hereof, and (ii) the second tranche will be in respect of a number of shares in CHINA UNICOM LIMITED ("CU") issued after its merger with CNC in exchange of shares representing up to a 3.03% stake
in CNC.

After the first tranche acquisition, which will be closed in the following days, Telefónica's stake in CNC would represent approximately 9.9% (inclusive of the acquisition of a 2.2% stake announced on January 18, 2008 which is pending regulatory approvals).

In the event of the acquisition of the entire stake involved in the second tranche, Telefónica's pro forma shareholding in the enlarged entity resulting from the merger of CU and CNC following the completion of the Scheme would stand at approximately 5.50% (inclusive of the
above mentioned acquisition of a 2.2% stake in CNC which is pending regulatory approvals).

The acquisition of the first tranche will involve a total investment of approximately EUR 368 million (depending on the exchange rate prevailing when the transaction is closed). The purchase price of the shares in the second tranche may be adjusted according to the average of closing
prices of the CNC shares prior to the merger between CNC and CU. If completed, the acquisition of the entire stake of the second tranche would involve a total investment of approximately between EUR 392 million and EUR 434 million.

Fonality Closes $12 Million for Open Source Systems

Fonality, which specializes in open source phone systems and contact center solutions for small and medium-sized businesses, has secured a $12 million financing round led by Draper Fisher Jurvetson Growth Fund with participation from existing investor Intel Capital.

Fonality makes open source Internet-based telephony and unified communications solutions that tie together all forms of business communication -- instant message, landline calling, mobile calling, chat, voicemail, customer relationship management (CRM), e-mail and more -- into one unified desktop software application. Products include IP-PBX VoIP phone systems based on a patent-pending Anywhere Management Hybrid-Hosted architecture. The company's phone systems are sold direct to businesses at, through a global network of resellers, and by Dell.

Fonality said its focus on building affordable, easy-to-use, and full-featured products enables it to compete directly with Cisco, Microsoft, Nortel and Avaya while creating an entirely new market for affordable professional call centers for companies with five to 500 employees.

Fonality's headquarters are in Los Angeles with additional offices in Australia and Argentina. Company investors include Draper Fisher Jurvetson Growth Fund, Intel Capital, and Azure Capital Partners.

Nortel Cites 40G Wins with Bell Canada, Alaska Communications

Bell Canada has begun deployment of Nortel's 40G Optical Solution in its backbone network. Initial deployments are occurring within Bell's Montreal-New York, Toronto-Chicago and Toronto-Montreal traffic corridors. The solution, which co-exists within Bell's current 10G network. is built on Nortel's Optical Multiservice Edge 6500 and runs over the Nortel Common Photonic Layer line system. Financial terms were not disclosed.

Separately, Nortel announced that Alaska Communications Systems has chosen it to provide a 40G optical network for the terrestrial portion of an undersea fiber-optic cable from Alaska to Oregon. This network will position ACS to deliver end-to-end communications solutions for enterprise and mass market customers who require reliable, high-performance connectivity between Alaska and the lower 48 states. The ACS optical network solution includes the Optical Multiservice Edge 6500 convergence platform and the Common Photonic Layer (CPL) line system.

ADC Reports Sales of $390 Million, Up 13% YoY

ADC's sales for its third fiscal quarter of 2008 were $390 million, up 13% from the third quarter of 2007 and down 3% from the second quarter of 2008. Excluding sales from the LGC Wireless and Century Man Communication acquisitions of $36 million and $35 million in the third and second quarters of 2008, respectively, adjusted sales in the third quarter of 2008 were up 3% from the third quarter of 2007 and down 4% from the second quarter of 2008.

Sales outside the United States of $173 million increased 32% from the third quarter of 2007 and 3% from the second quarter of 2008. These sales were 44% of total ADC sales in the third quarter of 2008, an increase from 42% and 38% in the second quarter of 2008 and the third quarter of 2007, respectively. Comparing the third quarters of 2008 and 2007, Europe/Middle East/Africa sales of $91 million were up 28%, Asia Pacific sales of $54 million were up 52% and Latin America sales of $18 million were up 53%. Comparing the third quarter of 2008 to the second quarter of 2008, Europe/Middle East/Africa sales were approximately flat, Asia Pacific sales were up 8% and Latin America sales were up 11%. The remaining sales outside the United States were in Canada.

Ciena Posts Solid Q3 Revenues, Cautions on Q4 Outlook

Ciena reported revenue of $253.2 million for its fiscal third quarter ended July 31, 2008, representing a 5% sequential increase from fiscal second quarter 2008 revenue of $242.2 million, and an increase of 24% over the same period a year ago when Ciena reported revenue of $205 million. Ciena's net income (GAAP) was $11.7 million, or $0.12 per diluted common share. This compares to fiscal second quarter GAAP net income of $23.8 million, or $0.23 per diluted common share, and a reported GAAP net income of $28.3 million, or $0.29 per diluted share, for the same period a year ago.

Ciena said non-U.S. customers drove 38% of revenue in the quarter. The was a GAAP gross margin of 49.6% with product gross margin of 52% and services gross margin of 34%.

Ciena also struck a cautious note for the current quarter.

"In addition to existing customer-specific challenges, we have recently begun to experience order delays from many of our Tier One service provider customers, which we attribute to their guarded approach to capital expenditures given the uncertain macroeconomic environment," said Smith. "While we've seen no project or order cancellations, sales cycles are lengthening and some deployments are slowing. As a result, we now expect fiscal fourth quarter revenue in a range of $190 to $210 million."

"While current economic conditions warrant a cautious near-term outlook, the fundamental drivers of our business -- growing capacity demands and the transition to more efficient, more powerful, automated networks -- remain sound. We are confident that our portfolio and value propositions are differentiated, positioning us to take advantage of what is predicted to be a longer-term investment cycle in the transition from SONET/SDH to Ethernet-based networks," said Gary Smith, Ciena's president and CEO.

Aicent Raises Funding from Intel for 3G/4G/WiMAX Messaging Exchange

Aicent, a start-up based in San Jose, California, announced new funding from Intel Capital for its efforts to accelerate 3G and 4G global data roaming initiatives, including mobile WiMAX. Financial terms were not disclosed.

Aicent currently provides data network, messaging and roaming solutions to more than 100 GSM and CDMA mobile operators worldwide, which serve over one billion mobile subscribers in aggregate. The company operates one of the world's largest multimedia messaging exchanges, and offers other value-added services to carriers.
  • Aicent is headed by Lynn Liu. Previously, Lynn was a co-founder, Chief Operating Officer and President of Asia Pacific region for GRIC Communications (IPO in 1999).

Comscore: U.S. Catches Up with Western Europe in 3G Adoption

The United States has caught up with Western Europe in the adoption of 3G with 28.4 percent of American mobile subscribers having 3G devices versus 28.3 percent in the largest countries in Europe, according to a new report from Comscore.

The number of U.S. subscribers with 3G enabled devices has grown 80 percent to 64.2 million during the past year.

Comscore attributed the rapid adoption of 3G devices in the U.S. to the introduction of sleek devices over the past year.

Cablevision Activates WiFi Zones in Long Island

Cablevision Systems has completed an initial rollout of its Optimum WiFi service in commercial and high-traffic areas of Nassau County, in areas of Suffolk County, and on the commuter rail platforms and station parking lots across all of Long Island. The service is provided as a value-added benefit for Cablevision's Optimum Online high-speed Internet customers.

Cablevision in May announced plans to deploy WiFi in the commercial and high consumer traffic areas across its entire tri-state service area over the next two years. http://www.optimumwifi.com

Alcatel-Lucent Receives Mobile WiMAX Certification

Alcatel-Lucent has been awarded the WiMAX Forum Certified seal of approval for its WiMAX 802.16e Compact Base Station at 2.5GHz. Alcatel-Lucent's infrastructure portfolio is made up of products that strictly comply with the 802.16e-2005 standard (also called Rev-e), which supports fixed, nomadic and mobile services. The company said its "Open CPE Program" is helping to accelerate the availability of terminals by encompassing comprehensive interoperability testing programs with WiMAX chipset and end-user device suppliers.

To earn this certification, Alcatel-Lucent's 802.16e WiMAX products underwent testing by the WiMAX Forum's lead certification laboratory partner, AT4 wireless, spanning protocol conformance, radio conformance and interoperability testing.http://www.alcatel-lucent.com

Latest TiVo Records up to 150 hours of HD Content

TiVo introduced its HD XL Digital Video Recorder, featuring the ability to record up to 150 hours of HD content, THX certification, a Series3 premium backlit remote control and an included HDMI cable. Similar to TiVo HD, dual tuners allow subscribers to record two different shows in HD at the same time, while watching a third pre-recorded show. The unit uses a 1TB (1,000GB) hard disk drive.