Wednesday, August 4, 2010

Deutsche Telekom Reports Better First Half Despite Customer Loss

Deutsche Telekom Group reported net revenue of EUR 31.3 billion for the first half of 2010, down by 2.5 percent year-on-year. This development was primarily influenced by positive (EUR 0.5 billion: OTE) and negative (EUR 0.9 billion: T-Mobile UK) effects of changes in the composition of the Group and by positive exchange rate effects
of EUR 0.3 billion. Revenue in the Germany operating segment stabilized in the second quarter and, at the same time, adjusted EBITDA increased. Free cash flow increased significantly. The group recorded a net profit of EUR 1.2 billion at end of half-year, compared with loss of EUR 0.6 billion in prior year.

T-Mobile USA continued its strong growth in the mobile data sector and recorded an increase in the number of contract customers for the first time after three quarters.

"On the basis of these good first six months, we can once again confirm our guidance," said Chief Executive Officer René Obermann at a press conference in Bonn. "We have achieved one of our key goals, that of making our business in Germany competitive again."

Some additional highlights:

  • The proportion of net revenue generated internationally decreased from 57.2 percent to 56.9 percent. Domestic net revenue was EUR 13.5 billion in the first six months of 2010, EUR 0.3 billion lower than in the first half of 2009. International net revenue decreased year-on-year by EUR 0.5 billion to EUR 17.8 billion.

  • In Germany, the number of mobile communications customers decreased by 2.2 million compared with year-end 2009 to 37 million in the first half of 2010.

  • For T-Mobile USA, the number of contract customers rose for the first time since the second quarter of the previous year, rising by 106,000 in the second quarter, compared with a plus of 56,000 in the prior-year quarter. The total number of customers declined by 93,000 compared with the first quarter as a result of the decreases in the prepay segment. At June 30, T-Mobile USA had 33.6 million customers, compared with 33.5 million one year before.

  • Total revenue of the Europe operating segment decreased by 6.8 percent in the first half-year, in particular as a result of the deconsolidation of T-Mobile UK.

  • German LTE Spectrum - Telekom Deutschland GmbH has purchased frequency spectrum by auction from the Federal Network Agency for around EUR 1.3 billion. Deutsche Telekom has purchased two times 10 MHz in the 790 to 862 MHz
    frequency range, the digital dividend.

  • Dutch LTE Spectrum -- T-Mobile Netherlands has purchased two-part 10 MHz bandwidths in the 2.6 GHz
    range for EUR 109,000 at the mobile frequency auction.

  • 3G in Europe -- In Austria, the Czech Republic, Romania, and Greece, Deutsche Telekom has significantly advanced its 3G/UMTS network build-out.

  • T-Mobile USA and HSPA+ -- Having deployed HSPA+ in around 50 metropolitan areas, T-Mobile USA now offers speeds comparable to those in 4G networks.

FCC Drops Closed Door Net Neutrality Talks

The FCC confirmed that it has ended a round of discussions with major Internet companies on Net Neutrality regulations. The closed door discussions had drawn criticism for their lack of transparency and public input. Separately, unconfirmed reports indicate that Verizon and Google may be nearing private deal on the same issues of Net Neutrality.

Both Verizon and AT&T issued statements lamenting the end of the talks and expressing a willingness to continue building an industry consensus.

Bell Canada Reports Financial Momentum with TV, Wireless

BCE reported improved financial performance with net earnings applicable to common shares growing by 70.5% to $590 million. In addition, Bell had revenue growth of 4.5%, reflecting strong TV and wireless revenue growth of 11.6% and 9.6%, respectively, and the inclusion of revenues from The Source and Virgin Mobile Canada (Virgin); operating income growth of 30.6%; EBITDA growth of 3.3%; wireless gross subscriber activations of 480,639 and postpaid net activations of 102,754; and TV net activations of 9,775.

BCE today announced that the annual common share dividend will increase by 5% to $1.83 per share.

"Bell's strong operating momentum and financial performance are the direct result of the Bell team's strong execution of our strategic imperatives. We continue to accelerate our growth businesses in an increasingly competitive marketplace, while continuing to invest in the service programs and broadband networks that support our growth into the future," said George Cope, President and CEO of BCE and Bell Canada.

Some additional highlights:

  • Bell Wireless ARPU increased by $1.66 to $52.12 year over year as data revenue growth of 45% more than offset voice ARPU declines due to customer adoption of richer rate plans. Wireless data revenues represented approximately 22% of service revenues this quarter compared to approximately 17% of service revenues for the same period last year. Gross activations of 480,639 and postpaid net activations of 102,754 were 19.0% and 60.1% higher than last year respectively.

  • The Bell Wireline segment had NAS losses of 129,147 this quarter, an improvement of 2.6% compared to last year. TV subscribers increased by 9,775 this quarter compared to an increase of 20,018 in the same period last year. High-speed Internet net subscribers decreased by 3,899 this quarter compared to an increase of 1,991 last year.

  • Bell Wireline operating revenues increased by 2.2% as TV and equipment and other revenue growth more than offset declines in local and access, long distance and data revenues.

EXFO Boosts its Blazer Multiservice Test Modules

EXFO announced a speed increase of up to 4X for its FTB-8120NGE and FTB-8130NGE Power Blazer Multiservice Test Modules, which offer a full suite of SONET/SDH, packet-OTN and Ethernet test capabilities in a compact, field-grade form factor.

The FTB-8130NGE Power Blazer, supporting testing rates up to 11.1 Gbps for SONET/SDH, Ethernet (including 10 Gigabit Ethernet LAN and WAN) and OTN networks, is ideally suited for the deployment and maintenance of packet optical networks. The FTB-8120NGE Power Blazer, handling SONET/SDH/OTN testing rates up to 2.7 Gbps and Ethernet testing rates up to 1 Gbps, is purpose-built for the growing deployments of Ethernet-over-TDM and Ethernet-over-SONET/SDH/OTN services worldwide.

Airspan to Resell LightSquared LTE for SmartGrid Backhaul

Airspan Networks announced an agreement to exclusively market LightSquared's 1.4 GHz wireless spectrum for Smart Grid and Smart Utility applications. Specifically, Airspan will market the 1.4 GHz wireless backhaul solution, including spectrum, equipment and services for Smart Grid applications in the electric, gas and water utility sectors in the United States. The 1.4 GHz licensed spectrum will be managed by Airspan and will be made available to utilities in their distinct geographic markets. Access to this spectrum will enable utilities to
establish optimized proprietary grid management networks.

The companies said that until now, access to licensed spectrum has been a critical "missing link" in planning and implementing wireless Smart Grid communications for middle-mile backhaul applications and for last-mile access.

"The combination of equipment and licensed spectrum eliminates the problem of relying on interference susceptible shared frequencies for mission critical applications," said Paul Senior, Chief Technical Officer, Airspan.
  • LightSquared, which is the new company backed by Harbinger Capital Partners, recently unveiled its plans to launch a wholesale-only, 4G-LTE network across the U.S. complemented by satellite coverage. LightSquared will provide wholesale wireless broadband capacity to a diverse group of customers, including retailers; wireline and wireless communication service providers; cable operators; device manufacturers; web players; content providers; and many others. The LightSquared network will allow these partners to offer satellite-only, terrestrial-only, or integrated satellite-terrestrial services to their end users.

    Nokia Siemens Networks has signed an 8-year agreement valued at more than $7 billion over 8 years to provide network design, equipment manufacturing and installation, and network operations and maintenance. The nationwide LightSquared network, consisting of approximately 40,000 cellular base stations, will cover 92 percent of the U.S. population by 2015. The satellite portion of the LightSquared network will leverage the next generation hybrid Mobile Satellite System (MSS) with an Ancillary Terrestrial Component (ATC) developed by SkyTerra.

BLADE Accelerates Test Cycle with Fanfare

BLADE Network Technologies (BLADE) has implemented Fanfare's flagship test automation product, iTest, which provides a unified approach for rapidly developing, automating, and maintaining test cases.

According to a recent case study, BLADE has saved approximately $500,000 in resource and equipment costs, sanity build times, and time to market since implementing iTest. In 2009, BLADE, the data center Ethernet switching company, was focused on developing new product features to meet the growing demand for virtualization-ready networks. BLADE's portfolio of products had increased significantly from its founding as an independent company.

Fanfare's iTest improved the testing cycle in the following ways:

  • Reduced scripting costs by more than 40 percent

  • Better utilized existing resources, regardless of skill set

  • Streamlined defect resolution, allowing more time to be spent on quality testing and development

China Unicom Implements NSN's Real Time Analysis in Shanghai

China Unicom implemented Nokia Siemens Networks' real-time traffic monitoring and analysis tool in Shanghai to ensure service quality ahead of the Shanghai World Expo.

Based on its Traffica platform, the tool identifies network problems and service quality issues in minutes and resolves them far faster, helping the operator to increase revenue. Before deploying the solution, it could take hours or days to identify and resolve certain problems. Nokia Siemens Networks' system uses key performance indicators (KPIs) to evaluate the actual quality of every service offered by China Unicom in real-time. If quality worsens, staff can act on that, before services or related network components fail.

MetroPCS' Q2 Revenues at $1 Billion, Up 18% YoY

MetroPCS Communications reported quarterly revenue of $1.0 billion, an increase of approximately 18% over second quarter of 2009. MetroPCS finished the quarter with 7.6 million mobile subscribers.

"The outstanding operational and financial results for the second quarter were primarily a result of strong net subscriber additions and lower churn primarily driven by continued acceptance of our Wireless for All plans. Strong operational results and net subscriber growth of approximately 1.4 million subscribers over the past 12 months resulted in record consolidated Adjusted EBITDA for the company of over $322 million, up approximately 38% from the second quarter 2009. We continue to build our 4G LTE network, and we are currently testing in selected metropolitan areas. We are on track for our initial 4G LTE launch in selected metropolitan areas in the second half of this year. Our goal is to provide our pay-in-advance subscribers a 4G experience equivalent to that which will be enjoyed by traditional post-pay customers," said Roger D. Linquist, Chairman, President and Chief Executive Officer of MetroPCS.

FCC Promotes Microwave in Wireless Backhaul.

The FCC proposed new rules aimed at removing regulatory barriers to the use of microwave spectrum for wireless backhaul of 4G mobile broadband services.

In a Notice of Proposed Rulemaking (NPRM), the FCC explores ways to increase the flexibility, capacity and cost-effectiveness of the microwave bands below 13 gigahertz, while protecting incumbent licensees in these bands.

The FCC said it seeks to update regulatory classifications that may not have kept pace with the evolution of converged digital technologies, and to provide for increased spectrum sharing. The proposed rule changes may be particularly beneficial to rural areas, where microwave may be the only practical, high-capacity backhaul solution available to serve certain remote locations. With spectrum sharing, 750 megahertz of microwave spectrum may be made available for broadband backhaul or other advanced point-to-point uses.

The Notice of Inquiry (NOI) requests comment on further steps the Commission can take to reduce wireless backhaul costs and increase investment in broadband deployment. It asks about changes in technical rules that would enable longer links in rural areas. The NOI also inquires as to whether permitting use of smaller antennas could similarly reduce costs and stimulate investment. Finally, the NOI seeks comment on whether the Commission should examine any additional modifications to its rules or policies to promote the flexible, efficient and cost-effective provision of wireless backhaul service.

FiberLight Deploys MRV for Carrier Ethernet Access

FiberLight, which operates its own 500,000 fiber mile network in the southeastern U.S., has selected MRV Communications' OptiSwitch Carrier Ethernet access platforms for its optical wholesale and business Ethernet services.

FiberLight worked with MRV to install OptiSwitch 900 (OS 900) Ethernet demarcation service units and OptiSwitch 9000 (OS 9000) metro Ethernet aggregation service units to enhance its LightSource Ethernet service offerings. FiberLight currently serves 20 metro markets within Georgia, Florida, Washington, D.C., Texas, Virginia and Maryland.

MRV said its equipment allows FiberLight customers to dynamically control their bandwidth without a long lead-time and through their own network management capabilities. For example, a customer could reapportion part of a 10 Gbps circuit to offer 100 Mbps of bandwidth to a new office by just making the change remotely and avoid delays on new service delivery. Using the OS900 at the demarcation point for wholesale and business Ethernet services, FiberLight is also able to support end-to-end Ethernet service visibility, service level agreement (SLA) monitoring and Ethernet virtual circuit loopbacks for non-intrusive fault analysis.

OIF Targets Micro-integrable Tunable Laser Assemblys, OSS Control Plane

The Optical Internetworking Forum (OIF) has begun work on two new projects.

The first provides a specification for a micro-integrable tunable laser assembly (uITLA). The new form factor for tunable lasers is needed as the industry moves to an XFP form factor with reduced power dissipation. This project will propose changes to the assembly electrical interfaces, optical specifications, and mechanical specifications. The uITLA implementation agreement (IA) will provide an alternative laser solution for ITLA customers contemplating the integration of a specific vendor "gold box" laser on the host PCB due to space constraints. A greater than 2X reduction in the base plate area of the uITLA relative to the ITLA-MSA-1.2 IA is desired.

The second newly created project addresses OSS Control Plane Management for Optical Transport Evolution. As the networks evolve from TDM to Packet and to MPLS-based Transport, there will be additional challenges associated with OSS integration and management of control plane-initiated services spanning multiple layers (TDM OTN and SONET, Photonic and MPLS). Adding to the OSS challenges are the operational challenges associated with these converged networks. This new project will address these OSS challenges in operationalizing the TDM control plane including multilayer TDM CP (SONET/SDH, OTN).

The OIF also announced the following elections:

Technical Committee Chair: Jonathan Sadler, Tellabs (beginning Oct 1)

Technical Committee Vice Chair: Klaus-Holger Otto, Alcatel-Lucent

Market Awareness & Education Chair, Networking: Dave Brown, Alcatel-Lucent

Market Awareness & Education Chair, PLL: Rod Smith, Tyco Electronics

Tuesday, August 3, 2010

Ikanos Reports Q2, Restructuring, New CEO

Ikanos Communications reported Q2 revenue of $55.6 million compared with revenue of $57.4 million for the first quarter of 2010 and revenue of $22.4 million for the second quarter of 2009.

"Ikanos' revenue for the second quarter of 2010 was just below our guidance," said Dennis Bencala, chief financial officer of Ikanos. "Overall, Ikanos' revenue continued to be well diversified by region. Our core VDSL business also saw double digit sequential revenue growth from first quarter to second quarter 2010. In contrast, revenue from ADSL products decreased. What we now see as a sustained decline in the market for these ADSL products led us to write down inventory by $12.9 million during the second quarter, which reduced gross margin by 23% and 11% to 24% and 31% respectively on a GAAP basis, for the three and six months ended July 4, 2010."

Ikanos announced a restructuring plan that will result in approximately a 20% headcount reduction, which will take place in the third and fourth quarter. The restructuring plan is contemplated to include the closing of three overseas offices. The company estimates this will result in an annual operational cost savings of approximately $15 million in 2011.

In addition, Ikanos named John Quigley as its new president and chief executive officer. Prior to joining Ikanos, Quigley was senior vice president at Cambridge Silicon Radio which acquired SiRF Technology where Quigley was the senior vice president general manager of the wireless business unit. Prior to SiRF, Quigley was the vice president of Engineering for Airgo Networks (now Qualcomm).

Clearwire Introduces iSpot 4G Mobile Hotspot

Clearwire has expanded its line of personal mobile hotspots with a new "iSpot" device with dedicated support for Apple's line of mobile devices, including the iPad, iPod touch and iPhone. iSpot users can share 4G speed with up to eight Wi-Fi-enabled Apple mobile devices simultaneously. Clearwire reports average mobile download speeds of 3 to 6 Mbps with bursts over 10 Mbps on its WiMAX network. Clearwire offers unlimited usage, enabling, for example, an iPad user to stream unlimited movies or television shows via the Netflix app from home, work or on the go.

Clearwire Cites Sales Surge, Adds 722,000 Subscribers in Q2

Clearwire added 722,000 net subscribers in Q2, bringing the total number of customers on the network to 1.7 million. Of this, wholesale customer additions for the quarter were 595,000, bring the number of wholesale customers to 752,000 at the end of the quarter -- and the number of wholesale customer subsequent surged past the one million mark during July.

As a result of the strong sales, Clearwire has increased it guidance for the full year.

"As of today, Clearwire has more than one million wholesale subscribers and just under one million retail subscribers on the country's first 4G network. By the end of 2010 we now expect to have approximately 3 million total subscribers, a significant increase from our previous guidance of just over 2 million subscribers. The pent up wave of demand for mobile broadband service is evident, and Clearwire is riding our expanding 4G network and growing wholesale distribution model towards a promising second half of 2010," said Bill Morrow, Clearwire's CEO.

Clearwire said the dramatic increase in wholesale subscribers includes users of multi-mode 3G/4G devices in areas where it has not yet launched 4G service but from whom it receives nominal revenue. As of June 30, approximately 52% of the company's wholesale subscribers resided outside of Clearwire's currently launched markets.

At the end of the second quarter, Clearwire's global network covered areas where approximately 62 million people reside, including international and domestic pre-4G coverage. The Company's domestic 4G coverage reached approximately 56 million people as of June 30.

Revenue for the second quarter was $122.5 million, a 93% increase over second quarter 2009 revenue of $63.6 million. Retail average revenue per subscriber (ARPU) was $41.58 in the second quarter. While wholesale subscriber growth was strong, wholesale revenue reflects the impact of nominal pricing for wholesale subscribers outside of our markets, and includes only one month of results from the strong launch of the Sprint HTC EVO on June 4.

Retail cost per gross subscriber addition (CPGA) improved to $443 in the second quarter, down from $524 in the second quarter 2009. Retail monthly churn was 3.2% in the second quarter.

The second quarter 2010 net loss attributable to Clearwire was ($125.9) million, or ($0.61) per basic share, and includes the impact of $79.0 million incurred in the second quarter, or ($0.09) per share, related to inventory allowance increases and write-offs. The second quarter 2009 net loss attributable to Clearwire was ($73.4) million, or ($0.38) per basic share.

Clearwire to Test LTE, Considers WiMAX Coexistence Strategy

Clearwire announced plans to conduct LTE technical trials this year as it considers its WiMAX strategy going forward. Specifically, Clearwire will conduct trials with Huawei Technologies and with Samsung Electronics to test multiple coexistence scenarios between LTE and WiMAX radio technologies. The company restated its commitment to use WiMAX technology for its current 4G build plan, but said the significant number of LTE devices coming to market leads it to consider how it can potentially add LTE to its network to coexist with WiMAX.

During the trials, Clearwire will collaborate with Beceem, and other partners, to determine the best methods for enabling end-user devices to take advantage of a potential multi-mode WiMAX/LTE network. Other participating vendors for Clearwire's technical trials are expected to be named at a later date.

In addition, due to the global dominance of the 2.5 GHz - 2.6 GHz spectrum band, a number of large wireless operators are expected to participate with Clearwire on these tests. Additional details about those companies are also expected to be disclosed at a later date. The tests will be conducted in the fall and throughout early 2011 in Phoenix, Arizona.

Clearwire outlined the following test scenarios:

FDD LTE: Clearwire intends to conduct FDD LTE (Frequency Division Duplex) tests using 40 MHz of spectrum, paired in 20 MHz contiguous channels, of its 2.5 GHz spectrum. Clearwire expects to confirm the capability to produce real-world download speeds that range from 20-70 Mbps. This is expected to be significantly faster than the 5-12 Mbps speeds currently envisioned by other LTE deployments in the U.S., which will rely on smaller pairs of 10 MHz channels or less.

TDD LTE: Clearwire will concurrently test TDD LTE (Time Division Duplex), in a 20 MHz configuration, which is twice the channel size currently used in its 4G WiMAX deployments.

WiMAX and LTE: Clearwire will also test WiMAX co-existence with both FDD LTE and TDD LTE to confirm the flexibility of its network and spectrum strength to simultaneously support a wide-range of devices across its all-IP network.

Google Drops Google Wave

A little over one year after unveiling its new "Wave" paradigm for rich IP communications, Google had decided to drop the project. Google Wave was an HTML 5 application for integrating email, instant messaging, whiteboarding, wikis, blogging, Twitter and social networking. However, Google said that the service has not generated the user interest or enthusiasm that it wished. Google will not continue to pursue Wave as a standalone product.

Pyramid: U.S. Mobile Revenue to Overtake Fixed-Line by 2015

Mobile revenue in the U.S. will surpass all fixed-line services in the country by end of 2015, according to a new report from Pyramid Research. The U.S. is expected to add 80 million mobile users over the period -- the most of any developed country.

Pyramid is forecasting that service revenue in the U.S. will reach $362 billion in 2010, making the U.S. more than twice as large as the next most sizable markets - Japan and China - throughout the forecast period. Over the next five years, Pyramid expects total communications service revenue to grow at a CAGR of 2.53 percent to reach $410.2 billion in 2015.

East Africa's EASSy Submarine Cable Offer 1.4 Tbps Capacity

E-Marine was awarded a maintenance and storage agreement with the East African Submarine System (EASSy), a fiber-optic cable that will serve twenty-one African nations. E-marine will now take responsibility for maintaining up to an 8,600km-strech of the EASSy submarine cable network. It will also provide secure storage for supplies and accessories in its Bonded Cable Depot in the Port of Salalah, Oman.

E-Marine owns three Cable Ships and One Special Purpose Cable laying support vessel.
  • As of 19-July-2010, all the Eassy landing stations have been completed, tested and are fully operational. Construction of the 1.4 Tbps, 10,000km submarine cable project was completed on time and on budget, according to the WIOCC, the specially-created investment company owned by 14 African telcos, although planning for the project had begun before the SEACOM cable was envisioned and deployed.

  • The nine landing countries for the EASSy cable are: South Africa, Mozambique, Madagascar, the Comores, Tanzania, Kenya, Somalia, Djibouti and Sudan.

  • EASSy Consortium Members include Bharti Airtel (India), Botswana Telecom, BT (UK), Comores Telecom (Union of Comoros), Etisalat (United Arab Emirates), France Telecom, Mauritius Telecom, MTN International Group (India), Neotel (South Africa), Saudi Telecom, Sudatel (Sudan), TTCL (Tanzania), Telkom South Africa/Vodacom (South Africa), Telma (Madagascar), and Zambia Telecom.

  • Alcatel-Lucent was the lead supplier for the EASSy project
  • In July 2010, Main One Cable has activated commercial service on its new 7,000 km undersea cable connecting West Africa to Europe. The terabit capacity cable has landing stations in Nigeria and Ghana and branching units in Morocco, Canary Islands, Senegal and Ivory Coast. The company, which is wholly African, calculates that its cable offer more than ten times the bandwidth of what was previously available. Tyco Electronics Subsea Communications (SubCom) was the lead contractor on the Main One project.
  • In July 2009, SEACOM's 17,000 km, submarine fiber optic cable system entered into commercial service, linking south and east Africa to global networks via India and Europe with 1.28 Terabit per second (Tbps) of capacity. Backhauls linking Johannesburg, Nairobi and Kampala with the coastal landing stations have been established and SEACOM is also working with its national partners to commission the final links to Kigali and Addis Ababa shortly. The entire system will be operated and controlled through SEACOM's Network Operations Centre which is based in Pune, India. The SEACOM system was designed and installed by Tyco Telecommunications.
  • In July 2010, a fault with a undersea repeater system on the Seacom cable disrupted Internet traffic in east Africa for three weeks.

Monday, August 2, 2010

Sonus Posts Q2 Revenue of $61.2 Million

Sonus Networks reported Q2 revenue of $61.2 million, compared to $62.4 million in Q1 2010 and $61.6 million for Q2 2009. Net income (GAAP) was $0.3 million, or $0.00 per diluted share, compared to a net loss of $0.1 million, or $0.00 per share, for the first quarter of fiscal 2010.

"We are pleased with our solid operating results in the second quarter," said Richard Nottenburg, President and Chief Executive Officer of Sonus Networks. "During the quarter, we successfully launched the NBS-5200 Network Border Switch on our next generation ConnexIP platform and are pleased with the traction we have made to date."

Extreme Networks Appoints Oscar Rodriguez as CEO

Extreme Networks has appointed Oscar Rodriguez as its new President and CEO, replacing Bob L. Corey, who has served as interim CEO since October. Corey will continue in his role as CFO.

Rodriguez is currently CEO of Movius Interactive Corporation, a privately held leader in messaging, collaboration and mobile media solutions for service providers worldwide. Before joining Movius in 2007, Rodriguez was Chief Marketing Officer for Alcatel-Lucent's Enterprise Business Group. He also served as CEO and President of Riverstone Networks, a public communications company delivering carrier MPLS/VPLS/Ethernet Solutions, before its successful sale to Lucent Technologies. Rodriguez also was Nortel Networks' President of both the Enterprise Solutions division and the Intelligent Internet division, delivering profitable high performance IP-based products to both carrier and enterprise customers.