Thursday, January 31, 2013

Cavium Reports Q4 Revenue of $66.4 Million, up 9% Sequentially

Cavium reported Q4 2012 revenue of $66.4 million, an 8.7% sequential increase from the $61.1 million reported in the third quarter of 2012. There was a net loss (GAAP) of $78.8 million, or $(1.56) per diluted share compared to $8.1 million, or $(0.16) per diluted share in the third quarter of 2012.  Gross margins were 62.3% in the fourth quarter of 2012 compared to 59.4% in the third quarter of 2012.

Cavium established a full valuation allowance against its US net deferred tax assets, which resulted in a one-time, non-cash charge of $43.5 million in the fourth quarter of 2012. Had Cavium not established the valuation allowance, it would have recognized a tax benefit of $2.1 million. This tax benefit along with the $43.5 million valuation allowance, produced a net tax expense of $41.4 million in the fourth quarter of 2012. The decision to establish the valuation allowance was based on an assessment made at year-end that considered factors such as 2012 actual results as well as projected US income, and does not preclude Cavium from using its loss carry-forwards or other deferred tax assets in the future.

Cavium recently restructured its Software and Services group. As a result of performing an annual goodwill impairment test in the fourth quarter of 2012, and the impact of the Software and Services group restructuring, Cavium determined that Software and Services goodwill and certain intangible assets were impaired and recorded a $33.3 million, non-cash, goodwill and intangible asset charge in the fourth quarter of 2012.

AppliedMicro Cites Progress in ARM 64-bit Development

AppliedMicro reported net revenues of $51.7 million for the quarter ending 31-Dec-2012, up approximately 12% sequentially and down approximately 8% year over year. There was a GAAP net loss was $71.6 million or $(1.08) per share compared to net loss of $21.6 million or $(0.33) per share for the previous quarter.

AppliedMicro also reported that performance simulations of its ARM 64-Bit X-Gene processor have significantly exceeded the company's expectations and resulted in an increase in the range of its estimated milestone-based payments under the Veloce merger agreement. The purchase price is now estimated to be in the range of $117 to $178.5 million, depending upon the achievement of multiple product development cycles and technical performance results.

"In the third quarter we believe we made giant strides in our product development efforts by taping out our 40nm ARM 64-Bit X-Gene server on a chip. We also taped out a test chip for our upcoming 28nm product in January. While we await final benchmarks from the actual silicon, the results from highly correlated simulations indicate that the 40nm chip performance may far exceed our original expectations. In fact, we believe the networking performance of the chip suggests that we may be able to further penetrate into Enterprise class solutions. I am also very pleased with the improvements in our base business, reflected in continued quarter over quarter revenue growth," said Dr. Paramesh Gopi, President and Chief Executive Officer.

Bob Gargus, Chief Financial Officer commented, "While we are very excited with the milestones in our ARM 64-bit product strategy, we also had a very solid quarter Company-wide and beat expectations. We feel we are making great progress towards our goal of attaining break even on a non-GAAP basis for the March quarter."

Wednesday, January 30, 2013

Vertical Systems: Rapid Growth in U.S. Business Ethernet Service Ports

The U.S. market for retail Ethernet ports grew 24% in 2012 as the rankings of top providers shifted amidst increased price competition and network expansion, according to Vertical Systems' newly released U.S. Business Ethernet Leaderboard.

"The U.S. market for retail Ethernet ports rose 24% in 2012. The year was characterized by major backbone upgrades, new market rollouts, price wars and channel expansion. Ethernet access to IP VPNs and Cloud connectivity were the fastest growing applications," said Rick Malone, principal at Vertical Systems Group. "Position changes on our Leaderboard include Level 3 moving up two spots, jumping ahead of XO and Time Warner Cable. AT&T and Verizon remain the top two providers, but not without challenges. AT&T experienced slower overall growth in Ethernet - especially in the second half of the year - and derived more Ethernet sales from wholesale partners. Verizon remained number two on our Leaderboard despite a challenging fourth quarter which resulted in loss of market share."

The top Business Ethernet providers, in rank order based on port share as of the end of 2012: AT&T, Verizon, tw telecom, CenturyLink, Cox, Level 3, XO, and Time Warner Cable. Port shares were calculated using the base of enterprise installations of Ethernet services, plus input from Vertical's independent surveys of Ethernet providers. The Leaderboard threshold is four percent (4%) or more of billable port installations.

Other providers selling Ethernet services in the U.S. are segmented into two tiers as measured by port share. The first or Challenge Tier for 2012 includes the following eight companies (listed here in alphabetical order): Charter Business, Cogent, Comcast Business, Integra, Lightpath, Reliance Globalcom, Windstream (includes Paetec) and Zayo Group (includes AboveNet).

The second or Market Player tier covers other providers offering Ethernet services in the U.S. The Market Player tier includes the following companies (listed in alphabetical order): Alpheus Communications, American Telesis, Bright House Networks, BT Global, Cincinnati Bell, Consolidated Communications, EarthLink Business, Expedient, FairPoint, FiberLight, Fibertech, Frontier, Hawaiian Telecom, IP Networks, Lightower, LS Networks, Lumos Networks, Masergy, Megapath, NTT America, Orange Business, Sidera Networks, Spirit, Sprint, SuddenLink, TDS, US Signal, Virtela and others.

Cisco Unified Access Switches Leverages New ASIC for SDN Programmability

Cisco introduced two Unified Access networking products featuring a new Unified Access Data Plane (UADP) ASIC designed to terminate wired and wireless traffic.  The UADP ASIC features a programmable data plane specifically for software-defined networking services.  Cisco said its new ASIC also provides a foundation for converged APIs across wired and wireless.

The new products are:

  • Cisco Catalyst 3850 Unified Access Switch with built-in wireless LAN (WLAN) controller functionality.   The Catalyst 3850 offers 24/48 GE switch ports, 480 Gbps of stacking, Power over Ethernet Plus, Energy Efficient Ethernet, 10G uplinks, and Flexible NetFlow on all ports.   It provides built-in wireless controller capabilities with 40 G wireless throughput, support for 50 access points and 2000 wireless clients per switch or stack, and support for 802.11ac.  Cisco said the programmable features of the ASIC make the Catalyst 3850 the foundation of converged wired/wireless SDN deployments.
  • Cisco 5760 Unified Access WLAN Controller appliance featuring IOS-based software and 60 Gbps performance. It is designed for 802.11a in mid-to-large campus deployments. It can support up to 1000 access points and 12,000 clients per controller. Other features include Flexible NetFlow, Advanced QoS, and downloadable access control lists.

Cisco said its strategy for Unified Access is to bring wired, wireless and virtual private networks (VPNs) into a single, highly secure network infrastructure based on one policy source and one management solution for the entire campus network. The company is releasing onePK,  a developer toolkit that allows applications to receive information from Cisco switches and routers with a programmable data plane.

OIF Looks to 400G Modules, Transport SDN, E-NNI Neighbor Discovery

At its meeting last week in New Orleans, the Optical Internetworking Forum approved an implementation agreement for RSVP Extensions for User Network Interface (UNI) 2.0 Signaling Specification Release 2. OIF members also evaluated the need for technology-focused projects on 400G Modules, carrier requirements for Transport Software-Defined Networking, and Neighbor Discovery for E-NNI. Specifically,

  • The Physical and Link Layer Working Group started a new project to define a module interface Implementation Agreement targeting 400G long-haul transmission.
  • The Carrier Working Group members agreed to provide Carrier requirements on Transport SDN, detailing transport functions for SDN use cases.
  • A project on OIF Neighbor Discovery plans to identify discovery requirements by OIF Carriers and expedite the deployments of OIF E-NNI and UNI standards in carrier optical transport networks. The OIF previous OIF Global E-NNI Interoperability Tests and carrier E-NNI field trials, have shown that manual configuration of E-NNI adjacency is a time-consuming and error-prone process.

In addition, Hans-Martin Foisel of Deutsche Telekom was re-elected as the Carrier Working Group chair and will serve a two-year term; and with a Board seat opening due to a resignation, Vishnu Shukla of Verizon will move to the role of president and Dave Brown of Alcatel-Lucent will serve the remainder of the board term vacated.

América Móvil Builds 100G Submarine Cable with ALU

América Móvil has selected Alcatel-Lucent to build a 17,500-km submarine cable linking the Americas.

The AMX-1 System will connect seven countries with eleven landing points: Miami and Jacksonville (United States), Barranquilla and Cartagena (Colombia), Fortaleza, Salvador & Rio de Janeiro (Brazil), Puerto Plata (Dominican Republic), Cancun (Mexico), San Juan (Puerto Rico) and Puerto Barrios (Guatemala). The system is optimized for 100G wavelengths and an ultimate carrying capacity of 50 Tbps. Construction is underway and activation is expected in late 2013.

Alcatel-Lucent is supplying OALC-4 cable optimized with coherent submarine fiber (CSF), repeaters, branching units and the 1620 Light Manager (LM) submarine line terminal equipped with Advanced Coherent technology.

América Móvil and its affiliates currently serve 256 million wireless subscribers and 62 million fixed lines.

Interoute Builds a CloudStore with Virtual Appliances

Interoute, which operates a pan-European fiber network, 9 hosting data centers, 32 collocation data centers and a cloud services platform, launched CloudStore, an online marketplace aimed at accelerating ICT service delivery.

Interoute CloudStore hosts the full spectrum of core ICT infrastructure, network, computing, communication and storage services needed to build sophisticated platforms. Enterprise IT departments, Software-as-a-Service (SaaS) developers, and even the largest websites can purchase Interoute’s network and infrastructure as a service through the CloudStore.

Interoute CloudStore also offers access to trusted appliance vendors, including Stonesoft and Riverbed, offering the cloud virtual equivalent of a firewall or load balancer.

Interoute VDC is built into Interoute’s pan-European MPLS/IP network.

"Interoute CloudStore is a game changer. It is the next generation of cloud computing; one that doesn’t compromise on data sovereignty, privacy concerns or performance. It essentially combines a seriously scalable integrated network, compute and storage infrastructure with all the appliances you need to run an IT environment. The difference with CloudStore is in the delivery. If you buy and run an enterprise application without the right platform and SLAs to support it, you are effectively placing the productivity and security of your business data in the wild. Appliance marketplaces perfectly complement the platform and are the future of the ICT purchasing model, but it is important for enterprises to understand what sits beneath them," stated Matthew Finnie, Interoute CTO.

Danaher Acquires Navman Wireless for Fleet Management

Danaher Corporation agreed to acquire Navman Wireless, a provider of GPS-based fleet and asset management technology, for an undisclosed sum.

Navman's technology currently monitors more than 175,000 vehicles owned by over 14,000 organisations on five continents, making Navman Wireless one of the world's largest fleet management providers. The company reports five successive years of revenue and installed base growth.

Danaher plans to operate Navman as a standalone company, retaining its brand, facilities and personnel. Navman is based in Glenview, IL.

  • Some of Danaher's previous acquisitions in the networking field include: VSS Monitoring, Arbor Networks, Tektronix, Visual Networks, and Fluke.

Xilinx Nears 20nm Milestones

 Xilinx announced three milestones in the development of its next generation 20nm All Programmable Devices:
  • First Design Tools for 20nm -- the Xilinx Vivado Design Suite will support initial 20nm devices in March 2013.
  • First 20nm Product Tape Out -- Xilinx expects to tape out its first 20nm product on TSMC's 20SoC manufacturing process during Q2 2013. Device samples are expected this year for strategic customers.
  • First Ten Early Access Customers -- Xilinx is now engaging with the first ten customers on 20nm architecture evaluations and implementation activities. 
Xilinx said its 20nm All Programmable portfolio is optimized for bandwidth-intensive systems in wired and wireless networks, data centers, vision based systems, and other high performance applications.

Cisco to Acquire Cognitive Security for Behavioral Analytics

Cisco agreed to acquire Cognitive Security (COSE), a start-up focused on applying artificial intelligence techniques to detect advanced cyber threats.

COSE leverages NetFlow/IPFIX inputs and Network Behavior Analysis in order fight against Advanced Persistent Threats (APT), exploit kits, zero-day attacks, molymorphic malware or trojans inside the client's network. COSE line of products integrate statistical analysis, autonomic/agent-based computing, ensemble classification, and game-theory techniques.

COSE is based in Prague, Czech Republic.

Sprint Supports LTE Acceleration Lab in Tel Aviv

Sprint announced its support for an LTE acceleration lab in Tel Aviv in collaboration with the Israel Mobile & Media Association (IMA).  The idea is to add significant momentum to the Israeli-based ecosystem of startups and developers by providing access to innovate on Sprint’s LTE network.

"As a complement to our efforts to unlock innovation in the United States, this Sprint-sponsored LTE acceleration lab will allow startups and developers in Israel valuable access to dramatically speed up their time to market," said Stephen Bye, Sprint chief technology officer.

Qualcomm Hits Revenue of $6.02 billion, up 29% YoY

Qualcomm reported revenue of $6.02 billion for the quarter ending 30-December-2012, up 29 percent year-over-year (y-o-y) and 24 percent sequentially. Net income was $2.20 billion, up 32 percent y-o-y and 42 percent sequentially.

"We are pleased to report record quarterly revenues, Non-GAAP EPS and MSM chip shipments, driven by the growing global demand for smartphones and our industry-leading portfolio of 3G/LTE chipsets," said Dr. Paul E. Jacobs, chairman and CEO of Qualcomm.  "Our broad licensing partnerships and extensive chipset roadmap, including our recently announced best-in-class Qualcomm Snapdragon 800 and 600 processors, position us well for strong growth, and we are pleased to be raising our revenue and earnings guidance for fiscal 2013."

During the quarter, MSM chip shipments reached 182 million units, up 17 percent y-o-y and 29 percent sequentially.

Broadcom Reports Q4 Revenue of $2.08B, up 14% YoY

Broadcom reported net revenue of $2.08 billion for Q4 2012, a decrease of 2.3% compared with the $2.13 billion reported for the third quarter of 2012 and an increase of 14.3% compared with the $1.82 billion reported for the fourth quarter of 2011. Net income (GAAP) was $251 million, or $.43 per share (diluted), compared with GAAP net income of $220 million, or $.38 per share (diluted), for the third quarter of 2012 and GAAP net income of $254 million, or $.45 per share (diluted), for the fourth quarter of 2011.

"Broadcom delivered record revenue in each of our three business groups and record cash flow from operations in 2012, reflecting our continued market share growth and strong economics." said Scott McGregor, Broadcom's President and Chief Executive Officer. "Based upon these results, Broadcom's Board of Directors today announced a ten percent increase in our dividend, consistent with our commitment to enhancing shareholder value."

Tuesday, January 29, 2013

Carrier Ethernet 2.0 Moves Ahead

One year after launching its Carrier Ethernet 2.0 initiative, the Metro Ethernet Forum announced significant progress in its efforts to drive the next wave of Ethernet service delivery.

Whereas the first generation of Carrier Ethernet standardized E-Line and E-LAN services, CE 2.0 standardizes Multi-CoS over eight interconnected services, including two versions of E-Line, E-LAN, E-Tree and E-Access. Newly defined Multi-CoS extensions ensure standardized performance objectives across geographic boundaries, resulting in improved QoS and optimized efficiency on a global scale. New interconnect specifications extend the reach between carriers, and new management specifications provide scalability and measurability not previously possible. A new Mobile Backhaul Implementation Agreement creates a standard for 4G mobile backhaul services through Multi-CoS-enable interconnects.

At the Americas Ethernet Summit in San Diego, the MEF announced that the first twenty equipment vendors have been certified as Carrier Ethernet 2.0 compliant: Accedian, Altera, BTI Systems, Ciena, Cisco, Cyan, FibroLAN, Huawei, Infinera, Juniper Networks, MRV, Omnitron, Overture, PT Inovacao, Pulsecom, RAD Data Communications, Telco Systems, Tellabs, Transition Networks and Transmode.

“CE 2.0 is a difficult accreditation to achieve.  To be recognised as CE 2.0 certified, each company must pass a suite that totals 634 stringent tests. Over 155 companies are now certified for CE 1.0 and the adoption signs for 2.0 are exciting. The demand for certified products and services is a driving force, and we expect a significant increase in service provider certifications not only from established markets, but also from developing economies in 2013,” stated Bob Mandeville President and Founder of test lab Iometrix, responsible for MEF’s testing process.

“The main market drivers continue to dominate business: bandwidth growth, mobile data and LTE migration and the growth of public and private cloud computing,” stated Nan Chen, MEF President. 

Some other notes from the Americas Carrier Ethernet Summit:

  • IDC: over 1.2 billion new Ethernet ports were shipped last year (400 million wired and 800 million wireless)
  • Frost & Sullivan, Vertical Systems and Infonetics: Carrier Ethernet services will be a near $48+ billion services market by 2015.
  • A lot of discussion is underway on how to leverage CE 2.0 for cloud services, including for data center interconnects and private-public cloud bursting.  The fundamental building blocks are there but more work will be needed including specifying a path to software-defined networking through open APIs and Dynamic Responsive Ethernet (DRE) or Carrier Ethernet 4 Cloud (a draft document is underway to identify the attributes).  
    • CE 2.0's Multi-CoS capability is useful for small cell backhaul.  Widespread rollout of small cells will need guaranteed bandwidth.
    • Ethernet's 40th birthday is coming up this May.  Watch for events from Metro Ethernet Forum, PARC and the Computer History Museum of Silicon Valley.
    • CE 2.0 Certification is built on MEF specifications and 1,000s of technical contributions.

    Fujitsu Claims New Protocol Delivers 30X over TCP

    Fujitsu Labs has developed a new data transfer protocol that it claims delivers a 30x improvement in throughput over conventional transmission control protocol on long-haul connections between Japan and the U.S.  

    Fujitsu's protocol uses a proprietary retransmission method based on user datagram protocol (UDP).  The protocol addresses the problem of UDP transmissions consuming excess bandwidth by performing a real-time measurement of available network bandwidth and securing an optimal amount of communications bandwidth without overwhelming TCP's share of the bandwidth.  Existing IP applications do not have to be modified.

    Fujitsu said its new protocol can improve data transfer speeds between data centers in Japan and the US. It is also expected to help improve the usability of virtual desktops when accessing a virtual desktop located on a remote server using a low-quality communications environment.  The company claims virtual desktop latency is reduced to 1/6 that of conventional TCP approach.

    Amazon's Elastic Transcoder Targets Video Production in the Cloud

    Amazon Web Services introduced a highly scalable service for transcoding video files between different digital media formats in the cloud.

    The new Amazon Elastic Transcoder enables content producers to convert their large high resolution “master” video files into smaller versions that are optimized for playback on websites, mobile devices, connected TV’s and other video platforms.

    Amazon said its new service manages all aspects of the transcoding process transparently and automatically. It offer transcoding presets that make it easy to transcode video for smartphones, tablets, web browsers and other devices.

    Amazon Elastic Transcoder offers pay-as-you-go pricing. Customers are charged based on the number of minutes they need to transcode and the selected resolution. There are no upfront fees or minimum commitments required.

    Amazon Elastic Transcoder is available in six regions: US East (N. Virginia), US West (Oregon), US West (N. California), EU (Ireland), Asia Pacific (Singapore) and Asia Pacific (Japan).

    Orange Launches LTE in Paris

    Orange officially launched commercial LTE service in the Paris Opera neighborhood and promised to cover the entire city of Paris by the end of 2013. Orange is also preparing to launch LTE in 15 other French cities in April.

    Orange is currently supporting 5 LTE smartphones: Samsung Galaxy S III 4G, Samsung Galaxy Note II 4G, Nokia Lumia 920, HTC One SV, and the Sony Xperia Z.

    In September 2011, ARCEP, the office telecoms regulator in France, awarded LTE licences to four operators to use the 2.6 GHz frequency band. Orange France won a duplex frequency block of 20 MHz, for which the company bid the sum of €287,118,501. The company also holds 800 MHz spectrum. Orange said this position will enable it to deliver rates of up to 150 Mbps downlink.

    SFR Launches LTE in Paris La Défense with NSN

    SFR launched its commercial LTE service in Paris La Défense. 4G service packages start at EUR 29 per month for 3GB. SFR currently offers LTE in six cities and four additional cities are slated open during the first half of 2013: Lille, Marseille, Strasbourg and Toulouse.

    Nokia Siemens Networks has been selected by SFR as radio supplier to implement its 4G LTE network and upgrade its existing GSM and 3G networks in major French cities. NSN will supply its Flexi Multiradio 10 Base Station as well as its Self-Organizing Networks (SON) solution.  The contract also includes Nokia Siemens Networks’ NetAct network management system and a suite of associated software tools for consolidated configuration, monitoring, and network optimization across technologies.

    See also