Tellabs

Nielson mobile survey: Caveats on the results

A mobile Internet survey conducted by Nielson for Tellabs shows that consumers consider it a necessity, and that almost three of four users expect to use the Internet from a mobile device daily. Obviously there are a lot of problems with this survey: 1) People routinely lie in them, and 2) Three out of four people don’t use mobile Internet, ever. Still, we believe that there is some sense in the dross here.

The Internet is an information tool that people rely on regularly, and that means they won’t give it up easily. We know seniors on fixed incomes of less than $15k per year who still have broadband service and profess to need it. There is little risk that there would be a major behavioral change and that broadband would be devalued in this downturn, but similarly we know younger and wealthier people who don’t use it at all.

In the mobile space, there is no question that the use of a smartphone for navigation, information, and just fact-finding, will become the norm. You don’t need surveys to figure that out. But just as there is resistance to longer-standing wireline Internet practices, there will be to mobile, and it’s just starting out. It would serve the industry better not to over-promote.

CIMI Corp. analysis on critical telecom vendors

The February, March and April issues of our newsletter, Netwatcher, will include a special series on eight critical telecommunications vendors. We will present a SWOT analysis of each vendor based on our assessment of the critical market issues in 2009 and beyond.

     - February: We’ll cover Alcatel-Lucent, Cisco and Juniper.

     - March: We’ll cover Ericsson, Nokia-Siemens Networks and Huawei.

     - April: We will cover Ciena and Tellabs.

In April, when all the material has been published, we will prepare a special document that includes all three sets of material plus an introductory section that outlines our view of the market. This will be available at no charge to retainer clients and Netwatcher recipients. We will also provide it as part of our TMT Advisor Information Services series at no cost to any service provider planner who registers with us prior to its release.

Contact us now at tmtadvisor@cimicorp.com for registration. You must provide your name, job title, and the name and URL of the service provider that employs you, and submit your request on your company email. Copies of this document will be available to others at a cost of $150 U.S., prepaid. Contact us for details.

Tellabs to de-emphasize access business

Tellabs reported a large restructuring loss and plans to de-emphasize its access business to focus on more profitable sectors. Access is a problematic space for equipment vendors because the carriers are putting enormous pricing pressure on access technology since they are not able to profit adequately from their broadband Internet investments.

We believe that this is one of the early signs that monetization issues for operators will eventually hurt equipment spending, and we heard this week for the first time that a Tier One may cut its spending slightly for 2009. The current plan cited by the provider was to continue access build-outs but try to conserve in metro and core through more aggressive negotiations with vendors and “better technology choices”.

Tellabs also indicated that it did not expect to see a 4Q budget flush this year, which may be an indicator other equipment vendors will reduce 4Q guidance.