Telecom Ramblings

Paolo over at Nortia Research has a nice article today on trends in the data center and colocation business, I recommend a read. Basically, he makes the case that the credit crisis is drying up the funds needed for expansion, but that expansion is driven by real demand.  The economy may be slowing the growth of that demand, but it quite clearly isn’t stopping it.

To me, this is a self-correcting problem … eventually. A constricted supply with [Read more →]

Several undersea cables were cut or damaged in the Mediterranean between Sicily and Africa on Friday, in an incident that will probably turn out to be very similar to last winter’s incident north of Egypt.  That incident was eventually blamed on a ship anchor, and I’ll bet this one will turn out to be the same – if not an anchor then something else dragged by a boat.  Two years ago of course, the earthquakes off Taiwan practically severed most of Asia from the rest of the internet for over a month.  This time, the outage is less severe, most countries that were affected initially have managed to route around the troubles and are just seeing slower speeds for now.

But it could have [Read more →]

My 8 year old daughter has figured out what a blog is, and that I write one and she wants to say hello.  She also knows how to use photoshop, far exceeding myself in that ability already.  In terms of the graphic arts my skills rank somewhere between none and utterly pathetic, I guess she gets the talent from her mother.   So on this slower-than-normal pre-Christmas weekend, she drew a Christmas card for Telecom Ramblings readers.

Hmmm, it’s nice to have some color for once.  I’m going to have to find ways to work more pictures into the blog.  Carlk is right, too many spreadsheets hurt the brain after a while.

As we approach the winter solstice, the longest night of the year, it seems as though the whole internet infrastructure sector is in a deep emotional depression.  Valuations remain rock bottom, and it’s sector-wide. Nobody has been spared, not even the datacenter space though they continue to grow despite it.  Telecom equipment makers from Alcatel-Lucent (NYSE:ALU, news, filings) to Ciena (NASDAQ:CIEN, news, filings) are preparing for disaster, and nt is even considering bankruptcy. [Read more →]

nt has joined the 100G demo group with a cool demonstration over 800 kilometers of fiber using a single wavelength. The main difference from the recent Ciena (NASDAQ:CIEN, news, filings) demo seems to be that they used a real 100Gbps Ethernet signal generated by a box from Ixia (NASDAQ:XXIA, news, filings) rather than taking ten 10Gbps signals and combining them. You can see the Ixia logo in the Youtube video near the end. [Read more →]

Sprint is supposedly about to start selling a dualmode WiMax/CDMA modem, which means it will use 4G WiMax if it can find it, and CDMA everywhere else.  Right now, that’s just Baltimore of course, but the WiMax cities should expand quickly through 2009 as Clearwire builds out.  I have to say it:  I want one of these gadgets.  It’s just that I don’t live in Baltimore, so I’ll have to wait a bit. [Read more →]

Today Earl Zmijewski at Renesys posted a fantastic article about the trends in IP backbone rankings this year.  Looking at the top 13 networks, he discusses the trends and events behind the changes in rankings over the course of 2008.  He quite properly notes that the raw ranking itself is not that meaningful, it’s not something we can translate into profitability or revenue growth.  But the relative movement does tell us things of interest.  [Read more →]

The entire telecom equipment sector may be digging in for a long winter, but that doesn’t mean it is dead.  Yesterday there was M&A activity as Overture Networks announced the acquisition of Ceterus Networks.  Since both companies are private they haven’t told us any of the financial details, however given that Wall Street isn’t handing out much money these days it was probably a stock deal.  And as deals go, this one makes some sense. [Read more →]

Security sites around the internet are telling people to avoid using IE due to a major new security flaw.  As for me, I use Firefox with Opera and Safari as my main backups and have avoided IE for years.  In fact, sometimes I think I ought to put one of those disclaimers on this blog:  “This website is best viewed in Firefox” because when I make changes I often forget to check whether they look ok in Internet Explorer. [Read more →]

Once again poking its head above the waters, abvt today launched a new video offering aimed at content producers.  Called jabNET, the service enables members of its community to move content around during the production process at high speed.

Abovenet’s move follows a similar offering from [Read more →]

Last month, internet backbone provider Level 3 Communications (LVLT) announced a refinancing initiative in which the company would sell $400M of new 15% convertible notes and tender for its 2009 and 2010 debt, but the cash being raised was conditional on some 50% of the debt to be tendered.  The credit crisis forced the company and its backers to take action, and they did – but there was a wide range of possible outcomes, with one of the most commonly voice being that they would get nothing and go back to the drawing board.  Well, not quite.

They didn’t make it to that 50% by the deadline, so they just adjusted the offer. And you can see that the terms of the offer were very fungible, Level 3 and its backers probably intended from the very beginning [Read more →]

In a WSJ article Sunday,  it was revealed that Google (GOOG)  is seeking to place servers in ISP networks, to give itself a fast lane.  The blogosphere quickly attacked them for abandoning net neutrality of course, and Google quickly responded with an explanation that boils down to the fact that they are building their own CDN just like Akamai, Limelight, etc – more detail on DataCenterKnowledge Really, it’s no big surprise to anyone who has been following the sector,  everyone wants to build a CDN.  But it does tie into my other post this morning on the evolution of the internet to incorporate CDNs.  Put simply, just how many content providers can fit servers in every ISP’s closet next to Akamai’s before it becomes a really stupid solution? [Read more →]

I have been mulling over the recent moves by Velocix and the general trends in content delivery over the internet, and I can’t help but think that we are entering a transition period in how the internet is structured.   We already have network providers looking to enter the CDN business, and although each is taking a different track they are all talking about CDN services becoming an integral part of the internet rather than an over-the-top service.

In the current era, an ISP connected to the internet by a) peering with some networks, and b) buying transit from the rest.  End of story, all else is elaboration on the tradeoffs between peering and transit and the associated soap operas.  However, [Read more →]

In an article on Bloomberg, Pacific telecom and undersea-cable operator Pacnet made some noise. As noted on this blog, Pacnet has been increasingly aggressive lately and has been rumored to be on the M&A trail with a bid for AAPT. It turns out that the interest there was real, CEO Bill Barney admitted strong interest in buying the company, although he said no bid had been made.

Barney went further though, with this bit [Read more →]

In Level 3’s (LVLT) CDN patent infringement lawsuit against Limelight (LLNW), the judge yesterday released the Markman ruling.  Reader Eric S very kindly sent me a copy, so I just spent the last half hour reading legalese.  A Markman hearing is about defining the terms to be used to describe the scope of the patents in question.  The plaintiff, of course, tries to keep the scope wide, and the defendent tries [Read more →]

Today, Alcatel-Lucent (NYSE:ALU, news, filings) announced they would cut another 1000 jobs plus an additional 5000 contractors in an effort to save just under $1B in operating costs.  According to some this will be done through attrition rather than layoffs, but it’s somewhat hard to see in this economy.  Less jobs available, more people applying to them, everyone’s savings in the toilet, and the company already in the midst [Read more →]

Telecom equipment provider Ciena (CIEN) reported earnings today , and let’s just say things could be better.  We knew their fiscal Q4 would be ugly, back in September they guided toward revenue of $190-210M, down some 25% from Q3.  The actual number, $179.7M, was well below that range.  As one might expect with such a 29% sequential revenue decrease, earnings swung from income of $11.7M in the third quarter to a loss of $25.4M.  Guidance for fiscal Q1 of $170-185M was not particularly encouraging either.

But then we knew it was going to be [Read more →]

Apparently the capital markets aren’t completely locked up.  If you’re big enough and generate enough cashflow, you can still raise good money.  Today, Verizon Wireless received commitments for some $17B from a group of 8 banks.  It will use the money for the Alltel acquisition, mainly to refinance the debt I guess.   It wasn’t long ago that there wasn’t even short term paper available, so this crack in the door of the credit markets is a good sign.  Of course, they didn’t tell us the interest rate and the size of the deal may have sucked all the remaining oxygen [Read more →]

A report from the Commerce and Energy Committe of the US House of Representatives is none too fond of how FCC Chairman Kevin Martin has been running things.  Amongst other things, he is accused of manipulating and cherry-picking evidence, being heavy handed and non-transparent, allowing undue political influence, causing distrust and turmoil amongst his fellow commissioners,  and generally creating a ‘culture of fear’.    [Read more →]

To borrow and mangle a phrase, Tulsa built it and TW Telecom came.  According to an article in Tulsa World, the city took advantage of other construction in 2007 to install 4.5 miles of downtown conduit that reaches 85% of businesses in the area – something I wish happened more often.  Sensing an opportunity, competitive fiberoptic network operator TW Telecom (TWTC) has leased space in the conduit system and seems to have entered the Tulsa metro fiber market in force.   It’s not entirely a surprise, while the company hasn’t been very public about their intentions, they have been known to be hiring personnel in Tulsa.  What wasn’t clear was whether [Read more →]

Ciena (NASDAQ:CIEN, news, filings) announced today that they successfully demonstrated a 100Gbit/s connection at the SC08 show a week or two ago, informally joining a rapidly growing 100G club.  As expected, much was made of the single wavelength, and indeed this was a great achievement!  The industry as a whole is making great strides toward a commercializable 100G technology, although that goal remains pretty far off yet.  Right now it’s all at the ‘can we do it?’ stage rather than the ‘can we do it affordably in a production network?’ stage.  And the answer there is obviously ‘YES’!  Now all we need is some standards and we can talk products. [Read more →]

You could just see it coming, couldn’t you?  First there was Unity, designed to make Level 3 Communications (LVLT) more efficient in selling, provisioning, and servicing its customers – and hence requiring fewer people.  Second a worsening economy, with a credit crisis and debt maturities that make immediate cashflow more important than anything else.  Third, the layoff parade starts elsewhere in the sector – at AT&T and PAETEC so far and of course outside the sector as well.  And in the last but perhaps largest red flag, a new President and COO known for running lean operations joins the company, ready to [Read more →]

Considering the rather unstable employment market right now, it seemed like a logical time to add a jobs board to this website.  In the top menu, there is now a Jobs link, which leads to what I hope will be a useful feature for Telecom Ramblings readers.

If you are seeking a position, take a gander through the listings – they should be relevant to the sector and are searchable.  If you have a position (or more) you would like to list, you can do that also and not only will it appear on this site it will also go into a database that populates job listings on dozens of similarly focused sites around the internet.

If you have any suggestions for how to improve this feature, please let me know!