Telecom Ramblings

As an separate entity, broadband wireless provider Nextlink apparently no longer exists.  The company’s website now redirects to that of XO Holdings (news, filings) itself with this statement:

XO Communications has realigned its product offerings by integrating the Nextlink Wireless, Inc. broadband wireless products and services into the company’s existing Business Services and Carrier Services business units.

In other words, XO has quietly disassembled the unit and absorbed the pieces.  No doubt most of the revenue will go to the carrier services division, since it was mostly wireless backhaul.  The move will probably let XO save some money by reducing the overhead needed to run it as a separate segment. [Read more →]

ImClone Systems has expanded its relationship with Level 3 Communications (NYSE:LVLT, news, filings), moving from a few transport links to a package including colocation, IP transit, and IPVPN as well.  The network will hook up datacenters in Newark and Frankfurt to ImClone’s two locations in New Jersey, one in New York City, and one in Heidelberg, Germany.  One of the drivers behind the deal is apparently the need to transfer large files between Germany and the NY Metro area, presumably large amounts of medical research data.   [Read more →]

The Phoenix market has a new big data center online, i/o Data Centers has officially opened the doors of Phoneix ONE.  The new facility is, to put it mildly, huge: 538,000 square feet on 31 acres of propery, and is more than four times the size of its other facility – Scottsdale ONE. [Read more →]

In a major deal announced yesterday, British Telecom (NYSE:BT, news, filings) and Tata Communications (news, filings) have signed a five year global strategic voice services agreement.  Tata has now become BT’s primary supplier outside of its main footprint, and BT will supply Tata with access to the UK market and later Europe.  This alliance is a natural one since the two multinationals have rather complementary assets and customer bases.  With carriers of all stripes less and less interested in spending capex these days, we will likely see [Read more →]

Congratulations on finally being confirmed as FCC Chairman!  Now ignore the cameras, roll up those sleeves, and get started already!  You’re already more than 8 years behind on intercarrier compensation, the bickering over special access is getting downright mean, and and there are six trucks from Verizon, AT&T, and Comcast waiting at the loading dock ready to unload this month’s paperwork designed to slow you down.  And oh yes we’re all still waiting for that [Read more →]

Juniper Networks (NASDAQ:JNPR, news, filings) will be an integral part of NYSE Euronext’s new platform, as announced by the two companies today.  The target will be an Ethernet network that scales to very high capacities while maintining ultra-low latency (i.e. sub-50ms round trip).  Ultimately, the new infrastructure will allow consolidation from 10 to just 4 datacenters while allowing them to handle billions of daily transactions.  I’m sure other exchanges are following their progress closely. [Read more →]

For most of this year I have been wondering just how SEACOM, the undersea fiberoptic cable that will bring modern bandwith to the east coast of Africa, was going to navigate the Red Sea and the Gulf of Aden.  More specifically, how they were going to lay cable past the pirates on the Somali coast without running into some sort of problem.  Well, it turns out they did have issues in that area.  SEACOM has now officially announced a delay in the completion of the cable, which had been scheduled to be ready for service this Saturday (June 27).  The new date is [Read more →]

The regulatory battle over special access is not new, but along with the change in political winds has come a new vehicle for the have-nots.  The NoChokePoints coalition fired a volley this week complaining that some 80-90% of backhaul is under monopoly control and called for caps to be put in place to prevent excessive pricing.  Verizon and AT&T fired back immediately but mainly at Sprint, basically calling them pansies for blaming their problems on others.  The name calling, which was of course not as blunt as my own characterization, of course allows them to not answer the charges.  That’s because they can and do take advantage of [Read more →]

The summer season officially started this week, and along with it has come the announcements of several expansions that span the internet infrastructure sector.

In the metro fiber space, Zayo is expanding deep into Youngstown, Ohio. They will be lighting 60 miles in order to reach key locations such as mobile switching centers, central offices and data centers in the metro area.  The first customer apparently will be [Read more →]

Telegeography put out a nice article yesterday about the state of transatlantic bandwidth.  While supply and demand have been largely in balance over the last few years, they point out that pricing remains too low to justify new cables and the current systems will hit their theoretical maximums in 2014.  When the bubble burst, the dollars it took to build these cables was mostly written off.  The ‘balance’ right now is on an incremental basis, when you add in the costs of actually laying a new cable across the Atlantic the numbers don’t add up. [Read more →]

[TheJuice blogs about his financial models and projections for telecom companies, most frequently about Level 3 Communications. Do you want a turn at the microphone? Contact the webmaster]

Hello all.  I thought due to the recent LVLT debt activity it would be a good time to update my valuation metric.  As you can see the debt has moved up BIG TIME, from .70 cents on the dollar to .90!  Wow. [Read more →]

Over the weekend, Hibernia Atlantic completed phase 1 of a new extension of its transatlantic cable to Northern Ireland, bringing the new cable ashore in a beach in Portrush.  The new system, called Project Kelvin, will connect eight cities in Northern Ireland, and five more in Ireland itself on the way to Dublin.  In the world of high technology, the island’s profile has grown as much as anyone’s in the last decade.  But when it comes to bandwidth, everything always has always gone through England first.  With direct connectivity to Hibernia Atlantic’s transatlantic cable, the island will have substantially more options for managing its bandwidth to the rest of the world. [Read more →]

The financial wizards in Broomfield have been busy lately.  In a press release today, Level 3 Communications (NYSE:LVLT, news, filings) announced yet another series of balance sheet moves.  It’s always a bit dizzying to read one of these PRs, but it all boils down to this.

1. They made a deal with an institution that held some $282M of their convertibles due in 2010, exchanging $200M in new converts plus $78M in cash.
2. They have also been very busy in the debt markets lately, and have repurchased some $248M in debt due over the next few years at various discounts for $223M.

What does that mean in the short term?  Mainly that Level 3 has made further progress toward lowering the hurdles it has to jump if the debt markets remain stingy for a long time.   The new maturity profile: [Read more →]

European alternative backbone Colt Group (LON:COLT, news) announced today the selection and deployment of DWDM  gear from Infinera (NASDAQ:INFN, news, filings) on its intercity network.  The gear is already live in eight countries:  Belgium, France, Germany,  Italy, The Netherlands, Spain, Switzerland, and the UK.  The speed of that roll out parallels others who have chosen Infinera gear.  Actually, it seems like it gets faster every year as the industry gets more and more comfortable with PICs.  [Read more →]

Well, they’ve finally given up all pretense of restructuring Nortel.  Late Friday the company announced that it would sell its CDMA and LTE infrastructure business to Nokia Siemens  for $650M.  The company has also expressed confidence that they can sell the other business units quickly, as in ‘weeks or months’.  So now the bidding war officially begins.  It may be an ‘orderly sale’, but nevertheless everything must go.  That would include the GSM wireless, enterprise networking, and metro Ethernet units, amongst other bits and pieces.  Who will buy them?  With the credit markets apparently thawing a bit, the list of potential buyers is probably longer than it was a month or two ago.  The telecom equipment sector has been battered in this slowdown with revenues taking big hits, but many [Read more →]

So it looks like Google Voice will be publicly available soon.  Reports have it that they have reserved 1M phone numbers with voip wholesaler Level 3 Communications (NYSE:LVLT, news, filings), and there’s no reason to do that unless you’re planning to cut the ribbon and open the doors.  However, I’m still trying to figure out what effects Google’s expected launch of this product will have on the market:

[poll id=”26″]

The idea behind Google Voice is to add [Read more →]

Over on Disruptive Wireless, Dean Bubley wrote an interesting piece on the early stages of a trend that has some wireless providers offering services to other operator’s customers, i.e. going over the top.  Vodafone Group (NYSE:VOD, news, filings), for instance, has been pushing an iPhone app that works whether your phone uses their network or not.  Well, calling it a trend is probably premature.  If history is any guide, Vodafone and any others dabbling like this will quickly give it up. [Read more →]

Hewlett Packard and Alcatel-Lucent (NYSE:ALU, news, filings) announced today that they have formed a ten year global alliance.  They hope to offer coordinated solutions that incorporate both IT and communications components to corporate customers and services providers alike.  The general idea here is not particularly new.  Networks and connectivity are as critical to the infrastructure of most companies today as the various IT hardware they use, and all are increasingly interrelated.  [Read more →]

In an SEC filing today, Level 3 Communications (NYSE:LVLT, news, filings) announced a major new contract with a ‘major multinational customer’ whose name they can’t tell us.  The contract, apparently signed June 4, has a 20 year term and a minimum commitment of $140M in the first four years – that’s pretty substantial as contracts go.  In the hours since the filing, I have been peppered with emails asking for comment on a) who it might be, and b) what it might be for.  Now, I have no inside information on the subject, but since I’ve never let that slow me down before here are some brief thoughts: [Read more →]

Two months ago, Credit Suisse came out with analysis claiming that YouTube was losing some $470M annually.  This led to headlines that YouTube was doomed, that all user-produced video sites were doomed, etc.  Some in the IP/Data community objected to the assumptions, including myself in this post.  But now in a new whitepaper, RampRate has taken those objections and put them into a more realistic model for YouTube’s cost structure.  [Read more →]

Competitive telecommunications provider XO Communications today announced it has made Laura Thomas its new Chief Financial Officer.    This is an internal promotion, Ms. Thomas has been a VP of Finance for many years, stretching back into the pre-bankruptcy days.  She replaces Gregory Freiberg, who left the company in April to take up the CFO role at Savvis.  XO acted quickly and did not bother with much of a search for outside talent, but that isn’t really a big surprise.  Given the current strategic environment, one has to wonder how long XO will remain independent and outside talent would probably require a rather golden parachute.  Besides, being CFO at XO isn’t exactly [Read more →]

Today PAETEC (news, filings) announced plans to sell some $350M in senior secured notes, and will use it to pay off part of its credit facility.  They are looking to take advantage of the window in the credit markets this summer, an opening that haw been widening by the week.  Two weeks ago, PAETEC negotiated a change to its credit agreement allowing it to buy back up to $100M in the market below par and loosened the covenants such that they could sell senior secured notes.  Apparently they meant business!  I don’t know how many of the notes they managed to buy back below par, but with an additional $350M they should be able to [Read more →]

Last week, comments by CEO John Legere of glbc  about M&A in the telecom sector were all but drowned out by the Sprint/Level3 joint venture rumor.  Certainly I let them pass at first, if only because they echoed earlier comments of his from several months ago.  It certainly does seem that the whole sector is available to talk consolidation right now, if unable to actually do anything about it.  But Legere did mention one rather intriguing option for his own company that I hadn’t put any thought into:  Savvis (news, filings) [a subsidiary of CenturyLink (NYSE:CTL, news, filings)] .  [Read more →]