Telecom Ramblings

Some news gets bypassed during earnings season, let’s look at a few items I didn’t write about this week:

itcd changed its mind and withdrew its offering for $325M in senior secured notes, with which it had planned to refinance its credit facilities and thus remove some restrictive financial covenants.  The reason given was that the cost of capital rose unexpectedly and that turned an attractive deal into an unattractive one.  That’s the simplest explanation of course, and probably [Read more →]

Now that a bit of the dust has settled on the announced intention by Google (NASDAQ:GOOG, news, filings) to build an experimental FTTX network in a community or communities yet to be determined, it’s time to get a reading on what the community actually thinks they are doing.  We know what the media thinks, or at least what they think will get the most readers to read their articles.  What about the rest of us?  Here’s a quick poll: [Read more →]

Transpacific internet traffic continues to surge mightily, according to a release by NTT America today.  NTT’s total capacity on its global backbone between Japan and the USA has now reached 300Gbps, which the company bills as more than any other network.  I don’t doubt them, as this is NTT’s home turf of course.  Their bandwidth is spread across three cable systems:  Japan-US, TGN Transpacific, and of course PC-1.  It’s interesting that they aren’t including the newer Unity or TPE cables on that list yet, probably because [Read more →]

Regional and metro fiber challenger Zayo Group (news, filings) has thrown its hat into the low-latency ring.  Today they announced the deployment of a new low latency route between the Chicago and New York metro areas.  The lure of top dollar bandwidth purchases by the financial community for ultra-low-latency connections is drawing in every fiber operator who can muster the necessary assets, and who can blame them?  Zayo did not mention the actual latency levels available on the new route, if anyone out there has heard a number I’d be curious [Read more →]

Data center specialist Equinix (NASDAQ:EQIX, news, filings) reported earnings yesterday after the bell, and this morning gave us an update on its Carrier Ethernet Exchange initiative.  Overall, the company had a great Q4 in which revenues of $243M and EBITDA of $111.3 exceeded both guidance and analyst expectations.  However, guidance for 2010 apparently disappointed some analysts, though Equinix has a history of cautious initial full year projections – they looked pretty good to me.  Here is a quick summary of the company’s sequential performance and projections: [Read more →]

Oh my, Google (NASDAQ:GOOG, news, filings) does know how to make trouble don’t they?  Yesterday the internet giant announced it would delve into FTTH with a project to connect 50K-500K people to the internet at 1Gbps speeds.  They are now looking for candidate cities and municipalities to work with on this project.  Why are they doing this?  It’s a deliberately provocative move intended to make current broadband providers respond, and I think its effects will rock the access market far beyond the initial shock wave.  For now though let’s look at the immediate implications: [Read more →]

Competitive service provider PAETEC (news, filings) has joined the expansion parade with a move into Vermont.  PAETEC has long been in most markets in New England, but had not cracked the Green Mountain State in any major way.  Of course in internet geography it is well off the beaten path so there aren’t many providers who do have a major business in the state. That makes 46 states now where they have a presence, and I’m sure they will be [Read more →]

Next generation internet backbone Level 3 Communications (NYSE:LVLT, news, filings) checked in with fourth quarter and full year earnings this morning, carrying through on its guidance of an improvement in core revenues and EBITDA – but only just barely.  Free cash flow turned out positive for the year after a $97M number in the fourth quarter, beating my expectations.  Here is a quick summary of the relevant numbers, followed by my own thoughts: [Read more →]

Telecommunications giant AT&T (NYSE:T, news, filings) is finally putting its LTE buildout plans into action.  Today they announced their equipment choices, going with gear from Alcatel-Lucent (NYSE:ALU, news, filings) and Ericsson (NASDAQ:ERIC, news, filings).  These are of course the same companies that provide them with 3G gear, so this move was not exactly an earthquake.  By sticking with the same suppliers, they hope to have a smoother upgrade via easier compatibility between their 3G and 4G plants.  In fact part of these new contracts [Read more →]

Colocation and cloud computing provider Terremark (news, filings) [a subsidiary of Verizon (NYSE:VZ, news, filings)] reported earnings yesterday, and the market didn’t much like what they had to say.  Revenues of $74.3M were up from $69.8M in the prior quarter and from $65.8M in the same period last year.  EBITDA of $19.8M was up from $18.0M in the prior quarter.  Both of those numbers were solidly within guidance, but the loss per share of $0.13 was larger than apparent analyst expectations of just $0.09 and costs rose perhaps more quickly than expected.  Some of those costs kicked in as a result of [Read more →]

Tomorrow morning before the bell, Level 3 Communications (NYSE:LVLT, news, filings) will report earnings.  As long time readers know, I have long kept a detailed model of the company’s rather complicated financials and it is time once again for an earnings preview.  Level 3 has had a tough year, enduring something a perfect storm of an economic crisis, customer migrations, and the (hopefully) final repercussions [Read more →]

Competitive fiber and data provider TW Telecom (NASDAQ:TWTC, news, filings) reported Q4 earnings today in the same way it seems to do every quarter – quietly yet powerfully, and with total disregard for the daily economic weather forecast.  For the full year, revenues grew 5% despite the recession. Data and internet services rose some 16% on the year, while network services fell 5% and voice services were basically flat.  Here is a quick table summarizing the company’s Q4 performance: [Read more →]

Three interesting contracts landed this morning, let’s take a quick look at each.

RCN Metro, the metro fiber division of RCN Business (NASDAQ:RCNI, news, filings), won a deal with Pacific Northwest Net. They will be providing multiple ethernet circuits between Boston and New York, their two largest markets.  By its name, Pacific Northwest Net sounds like an unlikely buyer of east coast transport services, but [Read more →]

The Financial Times is reporting that British Telecom (NYSE:BT, news, filings) and the UK regulator Ofcom are discussing the opening of the incumbent operators ducts.  That could of course lead to big changes throughout the UK bandwidth sector, since in theory it would inable operators to pull their own fiber for many, many routes without having to dig up the streets.  That could in turn eventually lead to many more networks competing at multiple [Read more →]

Industry interest in itcd seems to have spiked lately – two relatively unremarkable bits of news (a refi, and some channel upheaval) have resulted in almost two dozen comments here on this site, and I have seen a marked increase in search queries on the subjects such as ‘delatcom rumors’.  Could Deltacom be preparing to sell itself??  Of course it’s not really so simple, the things a company does maximize its potential as an M&A target are so often the things it ought to do anyway to improve its position in the market:  improve the balance sheet, clean out the garage, etc. However, I thought I’d summarize in one place the cases for and against [Read more →]

After holding back the tide through 2009, it seems that AT&T (NYSE:T, news, filings) could no longer stall the inevitable.  In quick succession, both the Sling Player and Skype have apparently been given the green light to operate on the iPhone over the operators 3G network.  Sling Media’s app was unceremoniously rejected as a bandwidth hog back in May, and restrictions on Skype usage were fodder for many months in the network neutrality debates.  Now the barbarians have successfully entered the castle, and the question [Read more →]

According to reports, German telecommunications powerhouse Deutsche Telecom AG (ETR:DTE, news, filings) is considering an IPO or even a spinoff of its T-Mobile USA unit.  The idea would be to provide the unit with new funding with which it could reverse its flagging fortunes.  One suggestion is that they offer up some 20% of the company, which could raise some $4B for a 4G network buildout.  No doubt that would make the equipment providers very happy, since four national 4G network builds in progress over the next couple of years would be quite a boon. [Read more →]

So much of the news in the sector lately has been about hooking up data centers, both new and old, as fiber operators add depth to their networks.

Today national CLEC PAETEC (news, filings) announced plans to build a new data center in Andover, to the north of Boston.  The two floor facility will add some 40,000 square feet of raised floor space for customer use, and 92,700 square feet total.  This is the first in a series of [Read more →]

Many eyes have been trained on today’s report by Akamai (NASDAQ:AKAM, news, filings).  The company upset the status quo in the fall by lowering prices and setting off a bit of a pricing war.  Events went better than planned, and in December they unexpectedly offered increased guidance.  But what is really going on in the CDN marketplace has been somewhat opaque until these numbers.  What numbers, you ask?  Oh yeah…Here is a quick table: [Read more →]

Colocation and managed hosting provider Savvis (news, filings) [a subsidiary of CenturyLink (NYSE:CTL, news, filings)] reported Q4 and full year 2009 earnings this morning.  The company took a harder hit than most in the datacenter space during last year’s economic downturn, as churn from large financial customers took hold.  And just a few weeks ago, CEO Phil Koen stepped down.   But in the fourth quarter they seem to have regained some of their operational footing.  Here are the numbers in the context of prior quarters: [Read more →]

Optimum Lightpath, the metro fiber division of Cablevision, announced today that it is offering 40G transport links to its customers, upgradeable to 100G when the time comes.  They will be initially targeting the services at the low-latency driven financial sector in the New York bandwidth market, which is currently the focus of a great deal of attention.  No doubt over the next year or two [Read more →]

Cable giant Comcast (NASDAQ:CMCSA, news, filings) is apparently buying New Global Telecom (NGT).  While there has been no formal announcement, there is a memo circulating at Comcast about the purchase.  Terms are of course not available, but it’s safe to say that for Comcast this purchase is small relative to its overall bulk.  However, strategically it could be of much greater importance, as they are not [Read more →]

The content markets division of Level 3 Communications (NYSE:LVLT, news, filings) and its Vyvx predecessor have been delivering the Superbowl video feed from the venue to the broadcast studio for over two decades now.  In the past that meant delivering the raw feeds to a production truck outside the stadium, compressing it, and then sending on the smaller, more easily managed feed from there.  This year, however, they will be skipping the truck and delivering raw 1.5Gbps HD feeds via fiber from the stadium in Miami to CBS’s broadcast studio in New York City.  From there they will also [Read more →]