Telecom Ramblings

In times like these, it’s easy to develop tunnel vision as we watch telecom stocks spiral downward.  So let’s step back and see where valuations are now for  USA based, non-ILEC, longhaul and metro fiber providers.  I have compiled a quick list and calculated estimates of their current valuation based on Q2 cash and debt levels plus any known major changes since then (e.g. for XOHO).  Where available, I used [Read more →]

Well, if you read this blog much, you know my opinion.  What I’d like to know is yours.  Do you think the internet infrastructure sector is more resilient than Wall Street is giving them credit for?  Is there anything likely to be said during Q3 earnings calls over the next few weeks that will be as terrifying as last week’s market plunge implies?  Are sales about to drop off a cliff?  Or are we just

[Read more →]

In an XCHANGE Magazine article on Thursday, Level 3’s Lisa Guillaume mentioned an intriguing new aspect of its CDN business.  Here is the quote: [Read more →]

In a NY Times Bits blog post, Saul Hansell makes the case that Netflix may be in a great position as online video develops.   His point boils down to the fact that Netflix has an existing business that acts as an on-ramp to the new services.  Their DVD rental service transitions naturally to a stream-to-the-set-top-box model.  But in a blog post today on The Business of Online Video, Dan Rayburn shot some holes in this theory [Read more →]

On TechTicker yesterday, Paul Kedrosky painted an ugly picture of how the credit crisis hurts telecom infrastructure.  It goes like this:  big telecom infrastructure rollouts like 3G in China are very often financed with debt, not from cashflow.  With no access to the debt markets, the buildouts will stall and this will hurt the equipment makers.  This is a surprise? [Read more →]

In the face of a deteriorating economy, PAETEC (PAET) has scaled back plans for its new headquarters building in Rochester, NY.  Just four months ago the large CLEC’s plans were for a 37 story monster of a building with luxury apartments above office space, and just two months ago they still said all systems were go.  Now they have now settled on [Read more →]

Not everyone is paralyzed by the financial crisis.  Far from Wall Street, the economy does go on.  Fiber does get installed and lit, and services get sold.  No less than three expansions of metro and regional fiber were announced in the last few days, one by Fiberlight, another by AFS, and yet another by US Carrier. [Read more →]

In July, back when the credit markets were merely horrible, Vonage announced a financing package to allow it to refinance its debt that comes due in December, and even then it was a brutal refinancing.  Well, today Vonage announced the package has been renegotiated.  Why?  Well, I’m guessing it is because the original package ‘contemplated’ raising $30M from other parties to make it to $220M total, and that obviously didn’t happen.  Given the state of the markets, you know the new package isn’t going to be much of an improvement. [Read more →]

Back in July I posted that big money might return to telecom in the form of enabling acquisitions.  Apparently I was much to early, the opportunities then seemed clear to me but they look petty and small compared to those in the current environment.  As the financial crisis deepens, it seems inevitable to me that the vultures [Read more →]

Finally, Verizon (VZ) lost a VoIP patent case yesterday.  Cox, accused of infringing on 6 patents, took the ILEC all the way through a jury trial and won on all counts.  Well, it is Cox and not Vonage (VG) this time or someone even smaller, so this isn’t quite a giant killing story, yet it is satisfying anyway.  [Read more →]

I have to say, the last month has been truly surreal.  The financial disaster and the hurricane surrounding it has sent the stock of most fiber and data oriented companies into a huge tailspin.  The situation is fundamentally different than it was 7-8 years ago when the tech bubble burst, and yet when the street panics it doesn’t care. [Read more →]

Defying the liquidity crisis in the markets, ITC^Deltacom (ITCD) announced today it is spending $20M to upgrade its network in the southeastern US.  More Infinera DTNs will be installed, and they will even build out metro networks in several markets over the next few quarters.  [Read more →]

Well, the financial markets may be in turmoil, and fears of a spillover into telecom an infrastructure may be rampant, but one sector seems still immune.  As the quarter closed, Digital Realty Trust pre-announced record leasing rates, both for square footage and revenue.  Can nothing dampen colocation sales these days?

[Read more →]

According to a Technology Review article, researchers have succeeded in sending a 10.6Gbps wireless signal over millimeter wave.  That’s something we’ve only ever seen over fiber of course, with 100Gbps now the target.  So, does fiber have a new competitor? [Read more →]

With the financial crisis frightening the heck out of nearly everyone, it is quite noteworthy to see a confident smile now and then from a telecom CEO. And in the last week, we’ve gotten two of them. [Read more →]

Hi everyone….what a week, huh! These last few days have really tested me. Our favorite son has taken it in the shorts and after being ahead of the benchmarks for the year the last few days saw that nice fact go bye-bye. In times like these I try hard to talk to other investors to gain perspective and then go back to the numbers to see actually where we are versus what I’m expecting. [Read more →]

At Streaming Media West, Day Rayburn updated his CDN pricing report for Q3, with interesting results.  The biggest drops came at the low end – the 250Tb level – and were 35-50% in a single quarter.  I think this drop and the report that many smaller CDNs are now shopping themselves are directly linked.  It’s a simple relationship: the more revenue you have, [Read more →]

We’ve all watched the meltdown in the financial sector over the past few weeks with awe.  All these household names, giants of stability, the very definition of wealth, all seemingly helpless against a tide of bad debt of their own creation.  But what does it really mean for the internet and all the companies that hold it together? [Read more →]

At long last, Abovenet filed its 2007 10-K yesterday and we finally get to see where they stand.  Or at least where they stood 9 months ago, back in May we heard how 2006 went.  Perhaps soon we will hear about how Q1 and Q2 2008 went?  But the big news in Abovenet’s 10-K is that they showed [Read more →]

At the end of the Streaming Video West conference, there were multiple reports that consolidation in the industry was not just around the corner, but even imminent.  Well, I let that sit a while because, well, I’ve heard it before.  And I don’t really think it’s going to happen that way. [Read more →]

Today Pacnet became the latest customer of Infinera, selecting their DTN for upgrades to their land network in preparation for their part of the Unity cable (called EAC Pacific) when it comes online.  Not too many have been watching, but Pacnet has been making lots of moves this summer.  Pacnet who, you say? [Read more →]

So we weren’t able to solve the riddle posed by Dan Caruso as to who Zayo’s 11th acquisition was.  The answer?  Metro fiber assets in Phoenix, Dallas, San Antonio, Chicago, Cincinnati, and the tri-cities area of Tennessee from Citynet.  Wait, Citynet?  [Read more →]

At long last, Sprint’s XOHM exists!  The WiMAX network went live today in Baltimore.  Now, will people flock to it?  I think it depends entirely on how well it works, i.e. how reliable the speeds are and how solid the coverage area is.  Muni wifi failed largely because it, well, sucked.  DC and Chicago are next in line presumably soon, and Clearwire is due to start opening markets too.  The era of WiMAX is finally upon us, while there were a few early starts from smaller companies this marks the entry by the big players at last. [Read more →]