March, 2009

Tough times make strange bedfellows

Well, maybe not that strange. In his commentary on the recent Vodafone/Telefonica network sharing agreement in Europe, Ovum Analyst Julian Grivolas noted that network sharing is nothing new, but a down economy might make such deals - particularly complicated in this case because it spans four countries - more common.

Grivolas wrote in the commentary Ovum sent over:

This announcement further confirms Vodafone’s positive inclination towards passive network sharing.
In developed countries, 3G coverage requirements and the impact of mobile broadband adoption, in particular on backhaul, are among the main drivers for the adoption of network sharing. On the 2G front, the well-established operators already offer 99% population coverage so there is not much difference in coverage, meaning it makes sense to rationalise costs as much as possible in this domain.

And as FierceTelecom reports, some carriers are trying to push the practice domestically.

Announced in a press release on Thursday, Verizon said it is using its fiber-optic network to provide links to cell towers and mobile switching offices across the country at “ultra-high-quality-levels that are difficult to achieve when using traditional copper-based or microwave links.”

Verizon has plenty of FiOS to go around, apparently, but the article speculates that Cox might be the most likely major buyer as it builds out is own 3G network, but even then Cox has options (primarily, Sprint, who it’s already partnered with on roaming rates).

How else have you seen carriers pushing past their traditionally go-it-alone boundaries during these tough economic times?

Mobile broadband forecast: There’s no joy in ARPU

The good news, according to global consulting firm Ovum, may be that users accessing mobile broadband-enabled laptops and handsets will increase revenue by more than 450% in 2014 compared to 2008. Mobile broadband adoption, of course, means 3G and 4G mobile data technology adoption. Projected revenue? $137 billion globally.

But wait, there’s a downside. Mobile broadband growth refers to increases in the number of users and the amount of data traffic. But the joy doesn’t spread to average revenue per user (ARPU), Ovum says. Instead wireless ARPU is expected to drop significantly during mobile broadband’s meteoric rise, with projected growth of only 44% of the rate of total users — a dilemma also faced by wireline network carriers.

Continued »

Telecom Timeout: Video investments

Telecom Timeout: Video Investments covers the latest on Nortel’s application delivery business sale to Radware, Cisco’s lay offs, a continued evaluation of Alcatel-Lucent’s future plans, as well as AT&T’s self-investment and the beginning of the process to distribute the broadband stimulus grants. Futher coverage also highlights the future plans involving IPTV by service providers, as unified communications, development of the 802.11v standard and new legislation for an updated Internet Safety Act.

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.

Your customers are interested in network optimization, too

Service providers aren’t the only one’s interested in network optimization.

As I’m continuing work on our telecom network optimization series, I came across a piece TelephonyOnline about how “demand for WAN optimization as a managed service is growing in an enterprise market,” driven by companies seeking to better utilize the bandwidth they’re paying for, along with reducing latency in their business processes.

WAN optimization is particularly popular with large enterprises and firms that pass around huge data files, like medical researchers, architects, and engineers.

And while carriers get to charge for the service, TelephonyOnline also pointed out some side benefits for the service provider.

WAN optimization also frees up capacity on the service provider’s network. “It helps the service provider, and they’re able to [sell it] as a premium service they can charge more for,” said Matthias Machowinski, directing analyst for enterprise voice and data for Infonetics Research.

If you want to know more about the enterprise demand for WAN acceleration, we’ve recently launched a whole site devoted to the WAN with special sub-categories that will be particularly useful: SearchEnterpriseWAN.com’s section on Telecom Services and on WAN Optimization and Performance.

Further Reading:

• Enterprises ready for managed WAN and application optimization
• Enterprise WAN optimization a potential moneymaker for telecoms
• WAN spending: Bright spots for 2009

Nothing but the Truth: NTCA Witness says rural telcos need investment

Can Congress handle the truth?

Or more importantly, does the House Subcommittee on Communications, Technology and the Internet have any chance of finding the truth?

As debate continues over what role broadband initiatives will play in our economic recovery, at least someone is speaking up for the little guys, even if anger over former FCC economist Michael Katz’s dismissal of rural life simmers.

Greg Hale, general manager of Logan Telephone Cooperative (Auburn, Ky.) and member of the board of directors of the National Telecommunications Cooperative Association (NTCA), testified that cost recovery is a critical issue when it comes to ensuring universal broadband access, and outlined some specific policy recommendations for the Subcommittee to take up.

“Without adequate cost recovery there will be no network for any communications service to reach rural consumers be it wireline, wireless or other medium,” Hale said, according to a transcript provided by the NCTA. “We may well need to modify the program periodically, but the key is to have the network in existence and operational in the first place.”

Hales’ recommendations, almost as eloquent as Jack Nicholson’s self-defense, are after the jump. Hopefully they’ll win rural telecoms a happier verdict.

Continued »

Telecom Timeout: Recession reactions

This week’s Telecom Timeout features Q4 results from Global Crossing, Comcast, Sprint Nextel and Rogers Communications, as well as a Carrier Ethernet progress report from the Juniper Networks and Nokia Siemens partnership, the results of the U.S. broadband stimulus package, and a 4G update on WiMAX and LTE from Verizon Wireless, Comcast, Clearwire, Qualcomm and CenturyTel. HP announces the new formation of its own telecom group, Nortel finds at least one buyer for some of its assets and YouTube is experimenting with downloadable content for a fee.

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.