Wednesday, November 3, 2010

Cbeyond Acquires Cloud Services Companies

Cbeyond, which provides IP-based services to small businesses across the U.S., announced the acquisitions of two companies that provide cloud services: privately held MaximumASP and privately held Aretta Communications.

MaximumASP provides cloud services such as managed virtual servers and dedicated servers, and Aretta Communications provides cloud services such as cloud PBXs (private branch exchange) and SIP (Session Internet Protocol) trunking. Both companies target small- and medium-sized businesses throughout the U.S.

The combined transaction value is approximately $40 million, payable in cash, of which approximately $33 million was paid at closing and the balance, up to 17.5 percent of the combined purchase price, will be paid upon achieving certain future milestones. The aggregate fiscal 2010 revenue of the two acquired companies is expected to be approximately $12 million.

"The acquisition of MaximumASP and Aretta Communications is an important step forward for Cbeyond's business," said Jim Geiger, chief executive officer of Cbeyond. "We believe these acquisitions will provide significant growth opportunities, leverage our existing channels of distribution, and expand our innovative technology and expertise."

MetroPCS: The Future of Wireless is No Contracts

The pay-in-advance, no-contract model is the future of wireless, said Tom Keys, Chief Operating Officer for MetroPCS.
In the company's quarterly financial conference call, Keys said MetroPCS continues to attract users looking for alternatives to long-term commitments. An internal survey by the company found that approximately 1/3 of our new gross additions were previously contracted wireless subscribers. As the first U.S. carrier to launch LTE services, MetroPCS opted to continue offering monthly service plans with no annual contract required.

Keys said the initial LTE networks are performing well and that early subscribers are responding positively. In Q4, the company plans to launch multiple Android devices. Additionally, in early 2011, MetroPCS expects to introduce its first 4G LTE Android smartphone.

MetroPCS, which operates a CDMA network, bypassed 3G EVDO in favor of 4G LTE. The company is looking ahead to migrate its voice traffic to the new network using VOLTE (voice-over-LTE) and anticipates launching a trial of this technology during the first half of 2011. Converging voice and data over the same LTE network should be more efficient over time.

Deutsche Telekom Confirms Guidance

Deutsche Telekom confirmed its guidance for the full year following a solid third quarter. Excluding the effects of the joint venture in the United Kingdom, Deutsche Telekom expects to generate adjusted EBITDA of approximately EUR 20 billion and free cash flow of at least EUR 6.2 billion. By the end of the first nine months, adjusted EBITDA amounted to EUR 14.9 billion, while free cash flow stood at EUR 4.8 billion.

"We are delivering what we promised. We have made our mark and posted good results in an environment that was not always favorable. In terms of both finance and operations, the Group's development has completely fulfilled our expectations," said René Obermann, CEO of Deutsche Telekom.

Some highlights for the quarter:

In the domestic mobile communications business, Deutsche Telekom said smartphones accounted for 53 percent of all handsets sold. The fixed-network broadband market share has remained stable at over 46 percent since 2007. A total of 1.4 million Entertain packages had been sold at September 30, 2010. The number of lines lost in the third quarter of 2010 was slightly lower than in the prior-year quarter.

Total revenue from domestic mobile communications business increased by 2.3 percent in the third quarter of 2010 to EUR 2.2 billion. This includes a one-time effect from the expiration of the national roaming agreement with O2 at the end of 2009.

The number of mobile communications customers decreased by 4.2 million compared with year-end 2009 to 34.9 million in the first three quarters of 2010. This was mainly attributable to the deregistration of inactive prepay customer cards, which had no effect on revenue. The number of contract customers was slightly higher year-on-year at 17.2 million.

In the U.S., T-Mobile USA's customer base grew by 137,000 in the past quarter to 33.8 million customers. After witnessing a decline in the total customer base both in the prior quarter and in the same period of the previous year, Deutsche Telekom's U.S. mobile communications subsidiary thus reported growth again between July and September 2010. While the number of contract customers fell by 60,000 during these three months, 196,000 new prepay customers were acquired in the same period. As a result of seasonal fluctuations and increased competition, contract customer churn rose slightly compared with the previous quarter to the level recorded in the prior-year period.

In other European markets, in spite of intense competition and a negative impact from regulatory decisions in a number of countries, the DT companies continued to record high levels of profitability. The adjusted EBITDA margin in the Europe segment in the third quarter of 2010 remained virtually stable at 35.5 percent compared with 36.0 percent in the prior-year period. Seen over the first nine months of the year, it increased by 1.8 percentage points, from 32.9 percent to 34.7 percent.

AT&T Looks to Mobilize U.S. Healthcare

AT&T is rolling out new wireless, networked, and cloud-based solutions for the healthcare industry.
AT&T, which generated approximately $4 billion in revenue from healthcare industry businesses such as hospitals, insurers, pharmaceutical companies, suppliers and physicians in 2009, sees new opportunities for mobilizing home healthcare. Examples that use AT&T's technology include:

  • Medicine bottles that remind patients to take pills on schedule;

  • Devices that monitor patients' heart levels from the comfort of their homes;

  • Audio/video links that can replace the need for an in-person visit to the doctor.

  • "Smart slippers" that wirelessly monitor a patient's gait to identify pressure signatures. Capturing changes in acceleration and pressure measurements, the sensors could alert caregivers to respond quickly to falls, or possibly help prevent them.

AT&T's mHealth Services will be focused on helping healthcare institutions and patients manage disease, take the appropriate medicine, receive home care, manage weight loss, and monitor wellness programs. AT&T is also introducing a set of cloud-based, medical image archive applications and security services which will permit healthcare providers to share clinical data in a highly-secure manner, scaled to handle the huge bandwidth demands driven by live video, images and medical records. Solutions planned to be delivered by AT&T on-demand and "as-a-service" include managed hosting, storage, security and consulting services.

Alcatel-Lucent Sees Performance Driven by IP and Wireless

Alcatel-Lucent reported Q3 2010 revenue of Euro 4.074 billion, up 10.5% year-over-year, up 6.8% sequentially. Net income was Euro 25 million or Euro 0.01 per diluted share (USD 0.02 per ADS).

The company said its financial performance was driven by an acceleration of growth in IP and wireless, partly offset by a decline in wireline networks. Terrestrial optics revenues were almost stable this quarter. Applications revenues were stable both for Networks applications and Enterprise applications. Services revenues grew at a low single digit rate with good performance this quarter for Managed & Outsourcing solutions.

From a geographic standpoint, traction remained strong in North America with a double digit rate of growth and sales trends improved in all other regions of the world, especially with Asia Pacific and Eastern Europe growing at mid single digit rates. Specifically, growth in India and Russia was significant, and resumed in China this quarter.

Alcatel-Lucent said its supply chain is still experiencing capacity constraints as the demand for telecommunications equipment and related services is recovering due to booming data traffic.

"I am pleased with the good progress made in our transformation journey, highlighted with healthy sales and improved profitability this quarter. Our solutions are recording strong traction with our customers as evidenced by a book to bill ratio up from the year ago period, and a growing share of our next generation product sales. From a geographic standpoint, on top of the established strong dynamic in North America, we experienced good growth in India, China and Russia fuelled by our recent contracts wins and better market conditions. We improved our overall profitability sequentially and year over year even though our product and geographic mix was less favourable than in the second quarter of 2010," commented Ben Verwaayen, Alcatel-Lucent CEO.

Alcatel-Lucent Announces EUR 1.2B in Contracts in China

Alcatel-Lucent announced three framework agreements valued in total at EUR 1.178 billion with China Mobile, China Telecom and China Unicom. The contracts are to be signed on November 5th in Paris, during the visit of Hu Jintao, President of the People's Republic of China, and witnessed by the key government officials of the two countries.

China Mobile -- this EUR 530 million agreement covers GSM and TD-SCDMA wireless networking solutions, transmission equipment, IP routers, and IP Multimedia Subsystem (IMS) platforms and professional services.

China Telecom -- this EUR 343 million agreement covers CDMA wireless networking solutions, high-capacity fiber-based (xPON) and DSL access platforms, IP routers, transmission equipment, and applications.

China Unicom -- this EUR 305 million agreement covers WCDMA and GSM wireless networking solutions, high-capacity fiber-based (xPON) access platforms, IP routers, transmission equipment, managed services, femtocell solutions, solutions for the convergence of telecom, internet and TV broadcasting networks and 3G applications.

"China is a booming market and we value our role in helping bring the power of IP and broadband to the hands of its people wherever they are -- on the road, at the home and in the office," said Ben Verwaayen, chief executive officer of Alcatel-Lucent.

Cablevision Loses Video Subscribers in Q3, Adds Internet, Voice, Business Ethernet

Cablevision's Q3 2010 cable television net revenues increased 4.8% to $1.366 billion, AOCF rose
2.3% to $563.3 million and operating income increased 6.3% to $372.4 million, each compared to
the prior year period. Some key metrics:

  • Basic video customers down 24,500 or 0.8% from June 2010 and down 23,500 or 0.8% from September 2009.

  • iO: Interactive Optimum digital video customers down 4,200 or 0.1% from June 2010 and up 33,700 or 1.2% from September 2009.

  • Optimum Online high-speed data customers up 9,600 or 0.4% from June 2010 and 125,000 or 5.0% from September 2009.

  • Optimum Voice customers up 9,300 or 0.4% from June 2010 and 128,000 or 6.4% from September 2009.

  • Revenue Generating Units down 9,800 or 0.1% from June 2010 and up 263,200 or 2.5% from September 2009

  • Cable Television RPS of $149.04, down $0.08 or 0.1% from the second quarter of 2010 and up $8.01 or 5.7% from the third quarter of 2009.

  • Optimum Lightpath net revenues increased 12.1% to $72.9 million, AOCF increased 18.6% to $28.5 million and operating income increased 38.0% to $5.7 million, each as compared to the prior year period. The improved results were driven primarily by a 33.1% increase in revenue from Ethernet services.

Huawei Debuts SingleRAN for WiMAX to LTE TDD Migration

Huawei announced commercial availability of an integrated WiMAX and LTE TDD SingleRAN solution that enables operators to seamlessly migrate from WiMAX to LTE TDD networks.

Huawei's solution consists of a WiMAX and LTE TDD dual mode remote radio unit (RRU) and dual mode base band unit (BBU). Both support 2.3GHz, 2.5GHz and 3.5GHz mainstream Time-Division Duplexing (TDD) frequency bands. The solution also features Huawei's SingleEPC packet core network solution, which supports GPRS, UMTS, LTE, and WiMAX users alike.

Huawei noted that its WiMAX RRU has been widely applied in several operators' current operating WiMAX networks. It is a 4T4R (four transmitters and four receivers) design that supports multi-input multi-output (MIMO) and Beamforming (BF), and it can be flexibly configured as a WiMAX module, a LTE TDD module, or a WiMAX and LTE TDD dual mode module simply by upgrading the software.

Huawei supported China Mobile to deploy the world's first pre-commercial network using its LTE TDD solution. This network successfully demonstrated a variety of mobile broadband services, including high definition (HD) transmission, HD video conference, HD video monitoring, HD video-on-demand (VOD) and HD live broadcasting to visitors in the 2010 Shanghai World Expo Park and some key pavilions.

MetroPCS Launches LTE in Los Angeles, Philadelphia

MetroPCS Communications launched commercial LTE service in its fourth and fifth markets -- Los Angeles and Philadelphia. The company previously launched LTE in Detroit, the Dallas/Fort Worth Metroplex (DFW) and Las Vegas.

"As the only no annual contract, pay-in-advance service provider offering 4G LTE services, we are building on the successful commercial launches of 4G LTE service in Las Vegas, Dallas/Fort Worth and Detroit with the launches of our 4G LTE service in Los Angeles and Philadelphia. With a compelling handset line-up and a superior network, we deliver unmatched value with the flexibility, predictability and affordability that consumers demand," said Roger D. Linquist, chairman, president and CEO of MetroPCS.

MetroPCS intends to expand its 4G services into additional major metropolitan areas later this year and into early 2011, including Atlanta, Boston, Jacksonville, Miami, New York, Orlando, Sacramento, San Francisco and Tampa.

In addition, MetroPCS began offering a nationwide plan covering 90% of U.S. markets. Customers can get unlimited talk, text and Web services wherever they go in the nation on their existing MetroPCS service plan.

Bell Canada Adds Wireless, TV and Internet Users in Q3

Bell Canada reported revenue growth of 1.8%, reflecting strong TV and wireless revenue growth of 9.3% and 8.1%, respectively; operating income growth of 15.6%; EBITDA growth of 3.1%; wireless gross subscriber activations of 537,295 and postpaid net additions of 159,465; TV net additions of 18,538 and high-speed Internet additions of 21,668. . At the end of the quarter, Bell had 2,085,227 high-speed Internet subscribers, 1,997,079 TV subscribers, and 7,125,266 wireless subscribers.

"Bell's strategic agenda has moved forward substantially, with record Q3 wireless performance, including accelerating smartphone penetration, data growth of 39% and solid ARPU growth; the launch of our next generation Bell Fibe TV service; the announcement of our acquisition of Canada's #1 media company, CTV; a wide-ranging NFL content deal for Bell Mobile TV; and enhanced ICT leadership at Bell Business Markets with the acquisitions of xwave and Hypertec announced in October," said George Cope, President and CEO of BCE. "Bell is leveraging its significant investments in world-leading wireless and fibre infrastructure to deliver Canadian consumers and business clients the best broadband services and content now and position the company for future growth."

Aviat Posts Revenue of $109M, Restructuring Continues

Aviat Networks reported quarterly revenue of $109.1 million, compared with $120.0 million in the year ago period. Net loss was $21.3 million, or $0.36 per share, compared with a net loss of $7.8 million, or $0.13 per share, in the year ago quarter.

Revenue in the North America segment was $35.6 million in the first quarter of fiscal 2011, compared with $48.0 million in the year ago period. International revenue was $73.5 million, compared with $72.0 million in the year ago period.

"While the accelerated pace of our restructuring and other changes caused temporary issues with collections and gross margins, we are encouraged. Because of strong orders during the first quarter of FY11, we are cautiously optimistic about top-line growth next quarter. The speed at which we are implementing changes gives us confidence we can complete our previously announced restructuring by the end of the third quarter of FY11," said Chuck Kissner, chairman and CEO, Aviat Networks.

Ikanos Posts Q3 Revenue of $41.5 Million

Ikanos Communications reported Q3 2010 revenue of $41.5 million compared with revenue of $55.6 million for the second quarter of 2010 and revenue of $29.3 million for the third quarter of 2009. GAAP net loss for Q3 was $33.3 million, or $0.61 loss per share on 54.9 million weighted average shares. This compares with a net loss of $10.7 million, or $0.20 loss per share on 54.5 million weighted average shares in the second quarter of 2010 and with a net loss of $15.5 million, or $0.40 loss per share on 38.8 million weighted average shares in the third quarter of 2009.

"As discussed during the second quarter earnings call, Ikanos made the decision to transition from low-margin product lines to focus the Company on the development of new compelling products," said John Quigley, CEO and president of Ikanos. "As part of that plan, we also restructured the company allowing us to substantially reduce operating expenses and better address the market opportunities ahead. Ikanos is now a leaner, more highly focused Company with the technology roadmap, product development processes and engineering teams in place to accelerate the time to market of new disruptive technologies including NodeScale Vectoring which is expected to deliver the performance of fiber at 1/10th the cost."

Alcatel-Lucent Signs 4-Year LTE Deal with Verizon Wireless Valued at $4 Billion

Verizon Wireless and Alcatel-Lucent have signed a four-year agreement expected to be worth US$4 billion for ongoing 3G network expansion and 4G/LTE network build out.

Under the agreement, Alcatel-Lucent will provide infrastructure solutions spanning its entire portfolio, including:

  • end-to-end CDMA and LTE radio network solutions;

  • IP, optical and microwave backhaul and transport; and

  • complete portfolio of professional and network integration services.

"Verizon Wireless and Alcatel-Lucent have enjoyed a strong history dating back to the introduction of CDMA, which remains a viable technology today as we're now enabling Verizon to evolve to the next generation that is 4G/LTE," said Robert Vrij, President of Alcatel-Lucent's Americas Region. "What's more, this agreement underscores Verizon Wireless' confidence in our ability to support both the existing 3G and the new 4G/LTE networks with an integrated, flexible and service-aware architecture that runs the gamut from radio access to IP backhaul and transport, core and applications."