February, 2009

Broadband stimulus: A universal service?

Like the housing bailout, the telecom industry has its very own hot-head issue. It’s a little like crazy radio, but the people taking up the airwaves are talking about the $7.2 billion in broadband stimulus funds earmarked to help build out infrastructure for rural and underserved areas. Economists at a recent American Enterprise Institute seminar in Washington D.C., batted it back and forth: Are rural residents deserving of broadband? And would they even know what to do with it if they had it?

Drawing the most fire, former FCC economist Michael Katz bashed rural life to the extent that it got the attention of NPR’s well-modulated Morning Edition. And New York Times blogger Saul Hansel weighed in with his opinions on various economists’ views.

With its Broadband Connection Highs and Lows Across Rural America, The Daily Yonder website is keeping it rural, and offered what appears to be the most knowledgeable analysis of broadband in exurban areas, complete with a map of which counties have the highest broadband concentration. We’ll have plenty of time to point fingers on this one, but even I couldn’t help but comment given my rural background. Any type of country-wide infrastructure buildout has had some kind of government help, and in my view, this is the next universal service.

Telecom Timeout: IPTV and Ethernet for the win

This week’s Telecom Timeout features the latest information on Verizon’s new CFO, Alcatel-Lucent’s new Carrier Ethernet switch, and more on IPTV and Nortel.

Keeping you up-to-date on the latest in telecommunications industry news, views and strategy, Telecom Timeout and its weekly video blog track the highs and lows of the industry. Join us daily on Telecom Timeout for conversations on developing telecom trends and in-depth analysis of service providers, VoIP, wireless, IPTV, telecom regulation, and more.

Telecom Timeout: Trials and Tribulations

Juniper Q4 2008 results, Alcatel-Lucent’s end of year 2008 results, U.S. digital television conversion and AT&T out-sourcing suspension are a few topics covered on this week’s Telecom Timeout video update.

Keeping you up-to-date on the latest in telecommunications industry news, views and strategy, Telecom Timeout and its weekly video blog track the highs and lows of the industry. Join us daily on Telecom Timeout for conversations on developing telecom trends and in-depth analysis of service providers, VoIP, wireless, IPTV, telecom regulation, and more.

Telecom Timeout: Groundhog Day

Last week’s update is a little late, but here it is:

Alcatel-Lucent’s earnings: Moving to half-full

It’s much harder to see the glass as half-full when you’re used to half-empty — or completely empty. Enter Alcatel-Lucent’s 2008 year-end financial results and its $6.2 billion loss. So it may not sound like it at first, but there’s something in that glass, and CEO Ben Verwaayen, who took the top post in September 2008, is starting to hear the Perrier fizz.

Alcatel-Lucent stock went up after the Q4 ‘08 earnings report (released Feb. 4) -– which isn’t easy to do this year. The new chief sees positive signs in things like cash flow being at its highest level in two years, as he explained his view of the company in a BusinessWeek interview. The company plans to make good on promises made last December to reorganize and refocus its strategy, and that means less emphasis on traditional products (read telephone switching equipment).

Verwaayen is shifting the company’s focus to services and Internet-related technologies, while placing less emphasis on traditional products like telephone-switching equipment. The analyst community sees Alcatel-Lucent as doing what it promised.

As part of its new strategy, Alcatel-lucent isn’t trying to do everything itself. To address certain hardware maintenance and expense, Verwaayen said the company may outsource legacy equipment servicing to established vendors that could “co-partner” with Alcatel-Lucent.

And to gain some nimble startup advantages — which is like turning the Titanic for a company the size of Alcatel-Lucent — Verwaayen said the company has asked its Bell Labs research division and its carrier product group to keep an eye out for innovative startups and work with them.

In December, Verwaayen said Alcatel-Lucent would focus on four broad areas in 2009: IP, optical, fixed-line broadband and mobile broadband (particularly Long-Term Evolution, or LTE).

In terms of strategy and services, Tom Nolle’s commentary, Telecom operators need vendor help to justify new investment benefits, discusses how Alcatel-Lucent is one of the main vendors that could help service providers sort out their next-generation network architectures. But only if it can get out of its own way and move forward with the new strategy.

Sorry, Verizon: No 700 Mhz spectrum for you til June

It looks like our resident telecom guru Tom Nolle, who runs our sister blog Uncommon Wisdom, was right again: The House finally went along with the Senate on the second time around, passing a delay to the digital TV transition 264 to 158 and keeping winnners of the 700 Mhz auction from fully tapping their lucre — for now.

But as we examined earlier in the week, the digital TV delay won’t hurt too many telecoms hoping to capitalize on the spectrum:

… LTE is highly unlikely to be deployed within four months, and an agreement to a short delay may avoid some nasty political and public relations fallout.

“The people who bid on and won the auctions are anxious to start exploiting what they purchased,” Nolle said. “But truth be told, if there were a four-month delay in the spectrum, the effect is more psychological and financial than it is tangible.”

The deeper implications of a delay may be for smaller regional or niche media carriers that purchased a portion of the spectrum — and those that will compete against them.

“If you bought rights to get any of the spectrum that is being vacated, the delay isn’t a good thing,” said Stephen Blum, president of telecommunications consultancy Tellus Venture Associates. “If you don’t own any of that spectrum, [and] your competitors are being delayed, in the short term that’s a good thing.”

Still, if after an estimated $1 billion information campaign and numerous delays, are some people ever going to get the message?

Read more about the digital TV delay at Reuters.

The ultimate telecom Valentine?

Amy Kucharik from sister blog Network Hub sent along some Valentine’s Day gift advice from Cisco. We won’t ruin the surprise, but it sure has put my shopping-phobic heart at ease:

Telecom Timeout: Episode 2 — Quarterly Reports