Telecom Ramblings

Prepare to be inundated with news about the online video world this week, it’s time for Streaming Media East this Tuesday and Wednesday in New York.  In the world of bandwidth, we must always keep an eye on where video is going, or even thinking about going, simply because of the massive numbers of bits involved.  But if, like me, you simply can’t make it to New York, or if you just want to catch a particular segment – the event is being streamed live by Scribe Media.  The keynote by Akamai’s CEO Paul Sagan alone should be illuminating.

There is also Monday’s CDN Summit [Read more →]

Upstart network provider Cogent Communications (NASDAQ:CCOI, news, filings) reported earnings yesterday, reporting revenues of $55.1M – up $54.9M sequentially.  That was below analyst expectations overall, but in this environment it could easily have been worse.  In fact, if it were just the IP Transit business, revenues would have declined between 2 and 3% even as traffic went up 21% in the same period.  What happened?  Well, the IP transit market is rough right now all by itself – customers have been delaying purchases and using more of the capacity they have already bought. Cogent has responded with promotional deals which have brought in more traffic, but precious little revenue.  They say that comes later in the year. [Read more →]

Almost exactly a year ago, Carphone Warehouse bid £550M for Tiscali’s UK arm, and Tiscali walked.  Since then they have learned what the price is when your bluff is called and everyone on the planet knows you have a busted flush.  Today they finally managed to agree to terms with Carphone, at a price of £236M or well over 50% off.  Oops.  For its part, Carphone Warehouse gets to be the top independent ISP in the UK, with some 4.25M subscribers. [Read more →]

I have posted another maps resource, European Network Maps, in which I collect and maintain links to the publicly available maps of European network providers.   In this case, my criteria are those spanning markets in at least 5 countries – smaller and more regionally focused networks will be collected on another page.  While I keep tabs on the European fiber and data market as best I can, I obviously know less about it than that of the USA and there are certainly going to be networks I have missed – big ones [Read more →]

That’s a good thing.  The market has been pricing the whole sector as if the bottom will drop out any day and everyone will fall into an alligator tank. But so far, the floor has stayed firmly attached to the walls.  Its not that there hasn’t been revenue pressure – there obviously has – it’s that it has been relatively pedestrian revenue pressure compared to the horror-fest built into expectations.  [Read more →]

One year ago today, I posted my first article on Telecom Ramblings.  Since then this site has evolved so rapidly it has just boggled my mind at times.  It started as a curiosity, soon grew into a hobby, and has been on an upward trend ever since.  I have been truly humbled by the outpouring of interest in my various ramblings about the telecom and internet infrastructure sectors.  I’d like to thank everyone out there for the feedback and support that has made it possible, as well as [Read more →]

On last week’s conference call, Level 3 Communications (NYSE:LVLT, news, filings) described a restructuring effort whose effects have been reverberating throughout the company.  As part of it they trimmed 150 people, focused on the director level and above, in their words ‘flattening the organization’ – never pleasant for those affected of course.  Obviously, with the arrival of Jeff Storey as COO and President, there were going to be changes as he puts his stamp on the organization.  While it’s still early, overall I’m actually impressed by the steps he is taking.  Dan Rayburn has a nice post today on the changes to the CDN group and the potential effects for customers of those services.  Level 3 is bringing the independently run group closer to the rest of the organization as it transitions from startup to growth mode.  But the changes to the Business Markets group go in the exact opposite direction, which is [Read more →]

Ever since the news earlier this week that Sprint Nextel (NYSE:S, news, filings) might outsource the operation and maintenance of its cellular network to Ericsson (NASDAQ:ERIC, news, filings), a question has been tugging at me.  Why is it that outsourcing of wireless networks is so hot, yet outsourcing of fiber networks is not?  In this particular case, why does Sprint not choose to outsource its longhaul network instead?  [Read more →]

RCN Business (NASDAQ:RCNI, news, filings) reported earnings yesterday, and while I don’t follow the consumer side of their business they do break out the financials of their metro fiber arm RCN Metro.  That means RCN’s report gives us a glimpse into how the ugly economic environment is really affecting the metro fiber business.  Level 3 of course has piles of metro fiber and reported last week, but their operations are so diverse that it is difficult to distill such details.  RCN Metro said back in March that the recession was not causing them problems, so did the numbers reflect that?  [Read more →]

Well, almost anyway.  That’s what Ciena (NASDAQ:CIEN, news, filings) and NYSE Euronext are saying.  The two plan to deploy 100G wavelengths between datacenters in NYC and in London that will underlie the exchange group’s next generation infrastructure.  No, not on the transatlantic route of course, just the metro ones presumably.  But this is what some would call ‘true’ 100G, meaning over a single wavelength rather than by aggregating some combination of 10G and 40G.  [Read more →]

Sprint Nextel (NYSE:S, news, filings) didn’t have a great Q1 with its postpaid customers, losing over a million of them yet again.  But this time they made up for much of it on the prepaid side with Boost Mobile and from sources like the Kindle.  Revenues of $8.2B were perhaps a tad light relative to expectations, still down $200M sequentially of course.  But cost savings brought adjusted EPS in at $0.03, which was actually a bit better than anticipated.  [Read more →]

glbc reported earnings after the bell today, showing some pressure from the economy but mostly the effects of the foreign exchange markets and the final runoff of the Camelot revenue.  Revenues of $609M included another $20M sequential hit from the currency markets, so on a constant currency basis they generally met expectations.  As compared with my own predictions – which did not include the currency effects either – I had not included the Camelot contract churn in my calculations (roughly [Read more →]

The WSJ Online is reporting that Sprint Nextel (NYSE:S, news, filings) is in final negotiations to outsource the operations and maintenance of its cellular network to Ericsson (NASDAQ:ERIC, news, filings).  The move, should it actually happen, would transfer thousands of employees across the company and save a purported $2B.  Sprint has, of course, been trying to find a way out of its downward spiral ever since the Nextel acquisition went south.  While outsourcing by cellular operators has been a growing trend in Asia and Europe, this would be the first of its kind by a major US operator.  What do you think, should cell operators be [Read more →]

glbc reports earnings after the bell today, so lets look at a quick preview of what we might see.  The way I see it, there are competing trends.  On the positive side, Global Crossing has shown increasing vigor over the past year, with solid growth in revenue, ebitda, and free cash flow.  They have indicated that while the economy cannot be ignored, they continue to see healthy demand.  On the negative side, the first quarter is historically the toughest season for the company on both costs and revenues, and this year we have to add in wildness in the foreign exchange markets.  And relative strength or not, likely revenue pressures from the overall economy cannot be ignored.  The company’s guidance for 2009 reflected conservative economic assumptions, and I see no reason for that to [Read more →]

What happens in the world of content these days has relevance to the telecom and internet infrastructure sectors.  Therefore, as far away as I usually am from the tradeshow and conference circuit, I greatly appreciate it when events are available via a free live webcast.  That’s the case with this week’s Digital Hollywood Spring conference, which covers new trends in digital media.   So if you want to do your part to increase internet traffic on the web, or just want to see a bit here or there without having [Read more →]

Dan Rayburn is reporting that CDN Velocix is currently negotiating a sale,  apparently with two buyers still in the game.  Precisely who those two potential buyers might be is not yet public, but because of Velocix’s unique approach it would seem as if a network operator would be a natural fit.  Velocix’s ‘Metro’ offering is the prize here, because it fits so well with the ISP model.  Using it, service providers can build their own private CDN that lives within the Velocix network, having some control over its design, usage, and revenue generation.  To guess what telecom might buy Velocix, we should look at [Read more →]

The earnings reports came so thick this week I couldn’t dedicate a post to each one.  Here are a few comments about the rest of the field.

q warned earlier this month that their revenues would be light, and at $3.17B they were – but it wasn’t anything shocking.  Landlines fell to 11.2M, which shocked no one.  Through the aggressive cost cutting that has been sweeping the whole sector they were able to grow earnings per share to $0.12, which seems to have pleased the market.  Will they sell the [Read more →]

Ryan Lawler over on Contentinople has an interesting piece on Akamai’s terminology shift recently, placing its own distributed architecture under the umbrella of cloud computing.   I have talked about the relationship between the CDN and the cloud before, albeit clumsily, and what Akamai (NASDAQ:AKAM, news, filings) said parallels some of my own thoughts.  When it comes to virtualization, it’s not just about the servers.  The network matters, and that Akamai has leveraged a distributed, virtualized [Read more →]

tndm reported earnings this morning, offering up revenues of $38.2M, adjusted EBITDA of $19.1M and earnings per share of $0.27.  All three metrics were well above consensus estimates, and the company raised guidance for revenues to $158-165M and adjusted EBITDA to $74-78M.  I’d go on with other metrics, but it would sound the same – they had a fantastic quarter.  Yes, again.  Isn’t there supposed to be [Read more →]

The international carrier arm of Scandanavian giant TeliaSonera AB (ETR:TLS, news, filings) has chosen to deploy gear from Infinera (NASDAQ:INFN, news, filings) in its US network.  This is the second Tier-1 European carrier customer announced by Infinera, the first was Deutsche Telecom last summer.  Like all gear makers, Infinera has seen revenues recede due to carrier spending, but while existing customers may be delaying expansions they have been doing pretty well with new customers, and that will give them some extra mojo when the rebound finally arrives. [Read more →]

Is China Telecom (NYSE:CHA, news, filings) about to snap up Pacnet?  According to sources familiar with the discussions, due diligence has been going on for some weeks now and China Telecom’s interest seems real, although financial details of such a deal are not yet clear.  Pacnet, which operates the old Asia Global Crossing cables amongst other assets, has been making noise for the past year and there has been M&A talk around them several times.  However, while those rumors – a bid for AAPT or for a content delivery network – never made much sense to me, this one actually does both on strategic and financial grounds.  Pacnet’s recent [Read more →]

Colocation and hosting provider Savvis (news, filings) [a subsidiary of CenturyLink (NYSE:CTL, news, filings)] reported earnings this morning (it’s been a busy week) and it seems that fears of a difficult year have proven unfounded thus far.  Revenues of $221.5M were down slightly sequentially overall, yet still better than I expected.  EBITDA of $58.8M and earnings per share of $0.01 were positive surprises, and the company raised guidance for both EBITDA and free cash flow for the full year 2009. [Read more →]

Remember Earthlink (NASDAQ:ELNK, news, filings)?  It was just last year that it seemed like everything was falling apart for the company, as its various efforts to leapfrog its dialup business floundered.  But not only are they still out there, they’re still profitable and they actually had a very nice first quarter.   Revenues of $199.1M and earnings per share of $0.30 were some $10M and $0.05 above expectations, respectively.  Despite the recession, they raised EBITDA guidance for the year and continued to buy back stock during the quarter. [Read more →]