Tuesday, August 8, 2006

Lucent to Resell TCS' Location-based Application in IMS Portfolio

Lucent Technologies will resell TeleCommunication Systems' (TCS')location-based solutions and applications. Specifically, Lucent will offer the TCS Xypoint Location Platform and Xypoint Secure User Plane for Location (SUPL) Server with its IP Multimedia Subsystems (IMS) solutions portfolio, including the Lucent Intelligent Services Gateway (ISG), iLocator application and managed service offerings to provide network operators integrated location-based solutions. The location-based services include navigation, "family finder", asset and fleet tracking, location-specific traffic and weather information, and location-based mobile alerts and advertising.

TCS said its location technology originated from its experience working with CDMA, TDMA, GSM, and UMTS operators over the last eight years. Its track record in location-based solutions include:

  • First location-based call placed by a wireless operator (supporting E9-1-1)

  • First location solution to support UMTS

  • Used by more than 45 wireless operators around the world

  • Supports handset-based (AGPS) or network-based (triangulation) location technologies

  • Supports UMTS, GSM, CDMA, and iDEN wireless infrastructure

  • Currently deployed to support multiple wireless operators from a single infrastructure

Deutsche Telekom Trims Guidance, Warns of Competitive Pressure

Citing competitive pressures in its home market, Deutsche Telekom AG trimmed its revenue guidance from the previous range of between EUR 62.1 billion and EUR 62.7 billion to between EUR 61.5 billion and EUR 62.1 billion. Revenue is expected to continue to grow at a moderate rate in 2007.

The company said the reduction in high-margin revenues in Germany will lead to a drop in expectations for adjusted EBITDA for the 2006 financial year to between EUR 19.2 billion and EUR 19.7 billion. Previous guidance was between EUR 20.2 billion and EUR 20.7 billion. Adjusted EBITDA for 2007 is expected to remain at approximately the 2006 level.


billions of EUR
Revenue Adjusted
Guidance old new old new
Fixed network
- 25.2
- 25.0
- 9.6
- 9.0
- 32.3
- 32.3
- 10.2
- 10.0
- 13.6
- 12.8
- 1.6
- 1.3
Group 62.1
- 62.7
- 62.1
- 20.7
- 19.7

Leapstone Enhances its IPTV Software

Leapstone Systems released a new version of its Communications Convergence Engine (CCE) suite incorporating enhancements designed to strengthen its carrier-grade IPTV capabilities. Leapstone's newest CCE software release now offers broadband service providers the means to implement a centralized management layer on top of IPTV platforms like Microsoft TV, enabling to offer superior VOD services.

The key enhancements in CCE Release 6.5 include:

  • Flexible Broadcast Packaging and Broadcast Listings Options: Leapstone offers service providers an automated means to localize channel lineups for the same service package and to also restrict channel information display for customers who wish to restrict content listings, such as adult program information

  • Choice of VOD Catalog Delivery: CCE Release 6.5 supports standards-based, automated interfaces to third-party content providers for uploading and creation of a comprehensive VOD content catalog that can be presented to subscribers over multiple devices such as PCs and mobile devices. Service providers can use this feature to offer differentiated video services that will help increase adoption rates and contribute to higher average revenue per user

  • Enhanced Blackout Management: The newest Leapstone release gives service providers a simplified tool for implementing sports blackouts while providing alternate programming during blackout periods

  • Improved Customer Care: Improved integration of Leapstone's CCE with the service provider's call center and self-service portals streamlines such functions as a suspension or restoration of subscriptions, while simplifying personalization features like parental PIN resets, credit limit adjustments and simplified purchase of promotional content such as VOD content

  • Faster Billing and Vendor Settlements: The latest software release incorporates features to streamline the billing and settlement of VOD purchases, helping both service providers and content owners reduce delays in revenue recognition

Cisco Selected for Unified Communications Project for Portugal's Largest Bank

Millennium BCP, the largest private financial group in Portugal, has selected Cisco's retail banking solution to transform its information and communication infrastructure to a converged voice and data IP network. Millennium BCP will be making one of the largest deployments of Cisco Unified Communications technologies in the region, replacing its various telephone systems from multiple vendors with a Cisco Unified CallManager system and 15,000 Cisco Unified IP phones at more than 900 office and branch locations in Portugal. Future plans will extend the network and communications system to 600 international branches.

The project will bring Cisco's worldwide installed based on IP phones to over 9 million.

The Cisco solution includes the following products and services:

  • Cisco Unified CallManager call control system, with integrated voice recording

  • Cisco Unified IP Phones 7900 Series

  • Cisco 2800 Series Integrated Services Routers

  • Cisco Catalyst 3560 Series Switches

Intel Sells Media and Signaling Business to Eicon Networks

Eicon Networks agreed to acquire all of the assets of Intel's media and signaling business, for an undisclosed sum.

Intel's media and signaling business includes all of the product lines from Intel's Dialogic acquisition, as well as Host Media Processing (HMP) software and HMP-enabled blades. Intel's complete line of SS7, PBX integration and gateway solutions are also included in the sale.

The sale does not include Intel's communications infrastructure products for telecommunications equipment manufacturers, including its Advanced Telecom Computing Architecture (ATCA) blades and carrier-grade rack mount servers, and its CompactPCI compute blades and chassis.

Intel's media and signaling business includes approximately 600 employees involved in a variety of functions, including engineering, product testing and validation, operations and marketing. It is expected that a significant number of these employees will become employees of Eicon.

Eicon is a supplier of media processing hardware and software for applications encompassing voice, speech, conferencing, VoIP, fax and IP based solutions. Its Diva Server family of adapters and software for media processing provide voice processing functions including tone detection and generation, voice activity detection and echo cancellation. The adapters feature onboard Digital Signal Processor (DSP) resources - dedicated to each communication channel, to ensure real-time voice processing, reduced latency and overall system performance improvement for high-density speech solutions. The company is based in Montreal.

  • In June 1999, Intel acquired Dialogic Corp., a supplier of computer telephony software, network interfaces and media processing boards that run on Intel servers, in a deal valued at $780 million at the time.

FCC Auction for Advanced Wireless Services Spectrum Gets Underway

The FCC commenced its auction for Advanced Wireless Services licenses in the 1710-1755 MHz and 2110-2155 MHz bands (AWS-1). A total of 168 bidders were pre-qualified for the auction. During the first two rounds of auction, conducted on Wednesday, the top ten bidders were:

  • Wireless DBS (backed by DirecTV, News Corp, Fox, EchoStar, Rupert Murdoch, and EchoStar)

  • T-Mobile

  • SpectrumCo (backed by Comcast, Time Warner, Cox and Sprint Nextel)

  • Dolan Family Holdings (holder in Cablevision)

  • Cellco Partnership, dba Verizon Wireless

  • Denali Spectrum License

  • Cingular AWS

  • Triad AWS

  • Antares Holdings

  • American Cellular Corp.

Daily results from the bidding are posting online.http://wireless.fcc.gov/auctions/default.htm?job=auction_summary&id=66
  • AWS-1 bands are currently being used for a variety of Government and non-Government services and require relocating incumbent operations. The lower half of these paired frequencies, i.e., 1710-1755 MHz, is currently a Government band and is covered by a Congressional mandate that requires that auction proceeds fund the estimated relocation costs of incumbent federal entities. The upper half of these paired frequencies, i.e., 2110-2150 MHz band, is used by private (including state and local governmental public safety services) and common carrier fixed microwave services (“FS�?). The 2150-2155 MHz band is currently used by the Broadband Radio Service (BRS).

Atheros Acquires Taiwan's ZyDAS

Atheros Communications completed its previously-announced acquisition of ZyDAS Technology Corporation, a Taiwan-based fabless IC design company specializing in high-performance IEEE 802.11 semiconductor and software solutions for PC, mobile and embedded applications. Atheros has established its new Taiwan Research & Development Center in ZyDAS' former headquarters in in Hsinchu Science Park.


Verizon's Video Franchises Now Cover 3 Million Households

Verizon now has video franchises covering approximately 3 million households in nine states and over 100 franchise areas. This month, Verizon began offering its FiOS TV service to 4,000 households in north Sarasota County, Florida, following the Sarasota County Commission's decision on July 12 to award a franchise to Verizon.


Zarlink and BroadLight Combine Packet Processing and GPON

Zarlink Semiconductor has completed interoperability testing of its CESoP (circuit emulation services-over-packet) technology with BroadLight's GPON solution.

The companies noted the continued importance of TDM traffic as evidenced by the recent GPON RFP (request for proposal) issued in North America, which stipulates legacy services must be supported.

"Carriers are seeking ways to add TDM service support to the new GPON infrastructure, rather than incur the expense of maintaining existing circuit networks," said Bruce Ernhofer, product manager, Packet Processing, Zarlink Semiconductor.

Zarlink positions its CESoP as a key bridging technology that allows carriers to seamlessly support TDM services over a packet network.

The tested solution, based on Zarlink's CESoP technology and BroadLight's BL3238 OLT (optical line terminal) MAC (media access controller), supports the delivery of TDM-based services across central office and customer premises GPON equipment. Using CESoP technology in the OLT, circuit-switched traffic along with associated timing and signaling information is converted into IP or Ethernet packets and tunneled across the GPON network. At the OLT, GPON access blades supporting TDM services do not need to include TDM circuitry and backplane connectivity.

At the business CPE (customer premise equipment), Zarlink's CESoP technology and BroadLight's BL2340 ONU (optical network unit) System on Chip enable channelized, fractional and clear channel T1/E1 services.

Zarlink also noted that most carriers have specified that TDM-over-packet and pseudo wire solutions for GPON deployment must conform to the IETF draft standards and MEF (Metro Ethernet Forum) 8.0 standards. Its CESoP technology meets all issued and drafted TDM-over-packet and pseudo wire standards.http://cesop.zarlink.comhttp://www.broadlight.com

NDS Sees Growth in STB Middleware as Smart Cards Decline

NDS reported revenue for fiscal 2006 of $600.1 million, an increase of 8% compared to the previous fiscal year. Conditional access revenue increased; higher security fees resulting from growth in the number of authorized cards using NDS technologies were offset in part by lower deliveries of smart cards. Revenue from integration, development and support declined. Higher middleware development revenue in fiscal 2006 did not compensate for the prior year revenue from the migration of Sky Italia subscribers to NDS technology. License fees and royalties revenues continue to benefit from the company's increased middleware shipments. The increase in revenue from new technologies was due to higher income from DVR technologies, the company's Synamedia IPTV technologies, interactive infrastructure and gaming applications.

Recent developments include:

  • Smart card deliveries for all of 2006 amounted to 24.4 million units, down from 30.8 million units in 2005

  • Middleware deployments in set-top boxes reached 21.2 million units, up from 2.0 million units in 2005. Cumulatively, there are now 41.6 million set-top boxes using NDS middleware.

  • Premiere, a pay TV operator in Germany and Austria, has chosen the NDS MediaHighway middleware solution to set-up an interactive platform paving the way into advanced digital TV services.

  • Dutch satellite service provider CANALDIGITAAL has chosen NDS MediaHighway middleware for its new set top boxes in northern Belgium.

  • SKY Italia launched the first ever interactive betting platform for the Italian market, using NDS interactive technologies, allowing SKY Italia customers the ability to place bets through two of Italy's leading bookmakers across a range of sports and betting combinations.

Verizon Wins US Army Contract

Verizon was awarded help modernize and upgrade the telecommunications infrastructure on U.S. Army posts, camps and stations worldwide over the next decade.

Verizon Business, through its Federal Network Systems (FNS) arm, was among ten prime contractors chosen by the Army to participate in future bidding for task orders in its $4 billion Indefinite Delivery Indefinite Quantity (IDIQ) Infrastructure Modernization (IMOD) program. Each contractor is guaranteed a minimum amount of the overall program


IMOD is a 10-year contract effort managed by the Program Executive Office for Enterprise Information Systems, Fort Belvoir, Va.; and Project Manager, Defense Communications and Army Switched Systems, Fort Monmouth, N.J., to update fiber-optic cable and wireless communications facilities at major Army facilities. Voice, data and video systems will be integrated into a single communications system.

The IMOD project replaces the Digital Switched Systems Modernization Program (DSSMP), which expires in June 2007.


UTStarcom Reports Revenue of $549.1 Million

UTStarcom reported net sales for Q2 of $549.1 million. Gross margins for the second quarter were 19.9% and GAAP net loss for the quarter was $21.4 million, or a loss of ($0.18) per share.

The company's cash balance was approximately $647 million at the end of the second quarter, reflecting approximately $25 million of positive cash flow from operations, offset by approximately $50 million used to pay down short- term debt in the quarter.


Monday, August 7, 2006

DIRECTV Reports Higher Profits, Emphasis on Quality Subscribers

DIRECTV reported U.S. gross subscriber additions of 863,000 for Q2, a decline of 10% compared to the second quarter of 2005 primarily due to the implementation of revised credit policies and dealer incentives aimed at improving the quality of new subscriber additions. DIRECTV now has 15,513,000, up from 14,670,000 a year earlier.

Q2 revenues increased 10% to $3.52 billion and operating profit before depreciation and amortization(1) nearly doubled to $977 million compared to last year's second quarter. The DIRECTV Group reported second quarter 2006 operating profit and net income both more than doubled to $741 million and $459 million, respectively, when compared to the same period last year. Earnings per share were $0.36 compared with $0.12 in the same period last year.

Highlights for the quarter:

  • Gross Subscriber Additions were 863,000 compared to 964,000 in Q2 2005.

  • Net Subscriber Additions were 125,000 compared to 225,000 a year earlier.

  • Average Monthly Subscriber Churn was 1.59%, compared to 1.69% a year earlier.

  • ARPU was $71.59, compared to $67.79 a year earlier.

"In many ways, the results in the quarter reflect our strategy to target higher quality subscribers. For example, although gross subscriber additions of 863,000 and net additions of 125,000 in the quarter were below expectations, it's important to note that we added 11% more higher quality gross subscribers in the quarter compared to last year. This trend -- which is driving both the top-line and bottom-line financial results -- is primarily due to the ongoing changes we're making to refine our credit policy and dealer network. These factors played an important role in reducing DIRECTV's monthly churn rate from 1.69% to 1.59% this quarter. In addition, customers are buying more premium services such as high definition programming and digital video recorders which is contributing to the strong ARPU growth of 5.6% in the quarter. The increase in operating profit -- excluding the accounting effect from the new lease program -- is also directly linked to the improved subscriber mix primarily due to the reduced acquisition costs associated with the significant reduction in lower quality customers attained and the related lower bad debt expense incurred," stated Chase Carey, president and CEO of The DIRECTV Group.


Cisco Beats Expectations and Reports Good Momentum

Cisco Systems reported net sales for its fourth quarter of fiscal 2006 ending 29-July-2006 of $7.98 billion, compared with $6.6 billion for the fourth quarter of fiscal 2005 and compared with $7.3 billion for the third quarter of fiscal 2006. Scientific-Atlanta contributed $582 million to net sales for the quarter.

Net income (GAAP) was $1.5 billion or $0.25 per share, which includes stock-based compensation expense related to employee stock options and employee stock purchases of $152 million, net of tax, or $0.02 per share. Net income prior to fiscal 2006 did not include stock-based compensation expense related to employee stock options and employee stock purchases. Including the pro forma stock-based compensation expense previously disclosed in Cisco's financial statements footnotes, net income for the fourth quarter of fiscal 2005 was $1.3 billion or $0.20 per share.

Net sales for fiscal 2006 were $28.5 billion, compared with $24.8 billion for fiscal 2005. Scientific-Atlanta contributed $989 million to net sales for fiscal 2006.

Some highlights from the quarterly report:

  • Cisco's core enterprise networking platform, the Cisco Catalyst 6500, surpassed $20 billion in sales to date.

  • More than 8 million Cisco Unified IP Phones have been shipped worldwide to date.

  • More than 60 service providers have adopted the Cisco Carrier Routing System, or CRS-1, in the first two years since its introduction. Sales are now exceeding $100 million per quarter.

  • Cisco's enterprise customer installed base surpassed the 3 million wireless access points (APs) milestone.

  • Q4 sales momentum was "good" and balance was "very good", with total orders growing in the mid-teens year over year.

  • Product gross margin was 65.1% and services gross margin was 66.3%

  • Cash flows from operations were $2.3 billion for the fourth quarter of fiscal 2006, compared with $2.4 billion for the fourth quarter of fiscal 2005, and compared with $2.3 billion for the third quarter of fiscal 2006.

  • Cash and cash equivalents and investments were $17.8 billion at the end of fiscal 2006, compared with $16.1 billion at the end of fiscal 2005, and compared with $18.2 billion at the end of the third quarter of fiscal 2006.

"From a Cisco standalone product perspective the balance was extremely good across routing, switching, and advanced technologies. Routing revenue grew year-over-year by 12%, switching revenue grew year-over-year by 8%, and advanced technologies' revenue grew year-over-year by 23%. Of the advanced technologies, storage area networking, unified communications, formerly known as enterprise IP communications, and wireless led the way. We believe we are gaining market share versus almost all of our competitors, but we also believe we are getting a larger share of our customers' total spend on communications and IT," said John Chambers, Cisco's CEO.


Cablevision Reports Revenue Growth, Stock Option Review

Cablevision reported consolidated net revenue growth of 15.6% to more than $1.4 billion as compared to the second quarter of 2005. The company did not release full Q2 results because of an ongoing stock options review and an expected restatement of financial results.

Some highlights from the period:

  • Telecommunications services net revenues, including its "Optimum" branded consumer services and "Optimum Lightpath" branded business services, rose 17.2% to $1,049.1 million, compared to the prior year period.

  • Basic video customers were up 35,328 or 1.2% from March 2006 and up 95,486 or 3.2% from June 2005, marking the ninth consecutive quarter of basic video subscriber gains

  • iO: Interactive Optimum digital video customers were up 143,499 or 6.7% from March 2006 and up 529,265 or 30.4% from June 2005

  • Optimum Online high-speed data customers were up 84,819 or 4.7% from March 2006 and up 371,578 or 24.4% from June 2005

  • Optimum Voice customers were up 122,234 or 14.1% from March 2006 and up 509,185 or 106.4% from June 2005

  • Revenue Generating Units were up 385,284 or 4.9% from March 2006 and up 1,503,577 or 22.3% from June 2005

  • Lightpath net revenues increased 11.3% to $52.9 million, compared to the prior year period. The increase in net revenue is primarily attributable to growth in Optimum Voice call completion activity and Ethernet data services over Lightpath's fiber infrastructure, offset in part by a decline in traditional phone service usage. Lightpath revenue excluding Optimum Voice call activity would have increased 1.0%.

3Com Appoints Edgar Masri as New CEO, Seeks Greater Stake in Huawei Joint Venture

3Com appointed Edgar Masri as its new President and CEO, replacing Scott Murray who submitted his resignation. Masri previously served as the Chief Operating Officer for Redline Communications. From 2000 to 2006, Masri was a general partner at Matrix Partners, a venture capital firm focusing on technology investments. Prior to joining Matrix, Masri spent 15 years at 3Com in a variety of senior management positions, including his role as Senior Vice President and General Manager of the company's former Network Systems Business Unit and President of 3Com Ventures.

3Com has also hired Bob Mao as Executive Vice President of Corporate Development to manage 3Com's interests in its China-based joint venture with Huawei Technologies, Huawei-3Com (H-3C). Mao currently is Vice Chairman of the Board of Governors of the Pacific Telecommunications Council.

3Com also announced that it will begin negotiations with Huawei with the intent to increase 3Com's ownership stake in H-3C. 3Com currently owns 51 percent of H-3C and recently began consolidating H-3C's financial results. Under the terms of existing agreements, each party has the right, commencing on November 15, 2006, to initiate a bid process to purchase the equity interest in H-3C held by the other. These negotiations are intended to result in an agreement outside of the bid process.

  • In January 2006, 3Com named R. Scott Murray President and Chief Executive Officer, replacing Bruce Claflin who retired. Murray also assumes Claflin's position on the 3Com Board of Directors. Murray will shortly become Chairman of the company's joint venture in China, Huawei-3Com. Prior to accepting the role of CEO for 3Com, Murray was the CEO of Modus Media International, a global provider of supply chain management and hosted services.

Time Warner Cable Selects ARRIS CMTS

Time Warner Cable has signed a two-year Purchase Agreement for the ARRIS C4 and C3 CMTS products. The nation's second-largest Multiple System Operator (MSO) has already deployed the 1RU-size ARRIS C3 CMTS in several of its systems and, in anticipation of this purchase agreement, placed its first C4 CMTS orders last week.

Time Warner Cable has over 5.4 million high-speed data subscribers and over 1.6 million digital phone customers.


Sony Debuts "mylo" WiFi Personal Communicator

Sony introduced its "mylo" personal communicator for the US market. The pocket-sized device works in any open 802.11b wireless network to provide instant messaging, VoIP calling, email, web browsing and media playback. Some key features:

  • the communicator comes with Skype, Google Talk and Yahoo! Messenger software

  • it includes JiWire's hotspot directory listing more than 20,000 WiFi networks in the US.

  • 1GB of the flash memory is included

  • it uses a 2.4 inch color LCD (measured diagonally) with a slide out QWERTY keyboard for thumb typing

  • a lithium-ion battery offers up to 45 hours of music playback, around seven hours of chatting and web surfing and more than three hours of continuous Skype talk time.

  • it includes a microphone, stereo headphones, a USB cable and a neoprene case.

  • the device will be sold online for $350 online at sonystyle.com