Telecom Ramblings

Like all telecommunications equipment providers, router specialist Juniper Networks (NASDAQ:JNPR, news, filings) has had a rough year.  While the weather stopped getting worse during Q2, there has been apprehension that it might not get better quickly enough.  Hopefully today’s third quarter results will not be an isolated case of unexpectedly swift recovery.  Third quarter revenues were $824M, up almost full 5% from $786M last quarter.  Earnings per share of $0.23 was also up from $0.19 sequentially.  Both numbers were beyond [Read more →]

Telecommunications goliath AT&T (NYSE:T, news, filings) gave us our weekly peek into its finances with its Q3 earnings report this morning.  The verdict:  unsurprising unless you were silly enough to think that the iPhone wasn’t selling well.  Revenues of $30.86B were precisely on target, at least according to the analysts compiled by Yahoo finance, and earnings per share of $0.54 were even a bit higher than expected.  The highlights of course were the 3.2M iPhones activated during the quarter and the net gain of 2M wireless subscribers, now totalling 81.6M subscribers.  Those additions were huge [Read more →]

In a PR today, Level 3 Communications (NYSE:LVLT, news, filings) announced a new service for wireless tower access.  Now, that doesn’t mean what I first thought it did, which was that the company was preparing to enter the fiber-to-the-tower market in force.  They still might do that I guess but this offering seems to be more about bringing the tower to the fiber.  That is of course much less capex intensive for Level 3, and allows it to squeeze a bit more revenue out of existing facilities.   [Read more →]

Not only did they announce a blockbuster acquisition, Equinix (NASDAQ:EQIX, news, filings) reported outstanding Q3 earnings after the bell.  Revenue guidance was raised last quarter and had already seemed high, but they beat it nonetheless.  Earnings per share continued to outperform the expectations of the street.  No wonder their stock has been pushing $100 again, although naturally news of the M&A is driving it down a bit initially.  Here is a quick table summarizing their third quarter: [Read more →]

In a surprising M&A move, Equinix (NASDAQ:EQIX, news, filings) is planning to buy its smaller rival sdxc for $689M, or $19.06 per share.  That is a solid 32% premium above today’s market close of $14.40.  The acquisition will add 34 datacenters in 22 North American markets totaling more than 1 million square feet to Equinix’s already huge footprint.  16 of those markets will be new, as Equinix’s own footprint is focused heavily on the largest markets.  This acquisition will give them a more balanced footprint across the continent with a presence in smaller (but not small) markets, as well as eliminate one of the few competitors they face with such wide geographical [Read more →]

Having now finished its optical mesh deployments to India, Singapore, and France, Verizon (NYSE:VZ, news, filings) is now aiming at the Middle East.  Verizon Business’s optical mesh efforts takes advantage of the company’s tremendous inventory of undersea routes across the Atlantic and Pacific to automatically reroute traffic around trouble spots.  If you encircle the globe, you add even greater potential resiliency.  If every cable [Read more →]

Of course, no sooner did I post about the financial market contracts won by sdxc and RCN Business (NASDAQ:RCNI, news, filings) than Hibernia Atlantic issues a PR of its own.  The company announced that it has been selected by IPC Systems, which in turn provides a variety of communications solutions to financial companies.   IPC will use the company’s Global Financial Network offerings as the foundation for its next generation offerings linking market participants directly to [Read more →]

Telecom equipment upstart Infinera (NASDAQ:INFN, news, filings) announced earnings after the bell, and things look pretty good.  Revenues of $83.4M were up sequentially from both $68.9M in the prior quarter and $80.9M on an adjusted GAAP basis in the third quarter of last year.  That’s a bit higher than I expected, and hopefully is a good sign for the telecom equipment sector.  But does it mean that carrier spending is back to normal?  One [Read more →]

The latency war in financial networking continues, today with a couple of victories for the smaller companies involved.  RCN Metro, the metro fiber division of RCN Business (NASDAQ:RCNI, news, filings),  has won a contract with Lombardi & Co. to provide dedicated Internet service both on the exchange floor and in its headquarters.  Lombardi helps institutional investors with access and trading technologies and chose RCN for its “optimal TCO, minimal latency, as well as high throughput and availability”.  Yep, there’s that latency bit again, and apparently that recent upgrade to [Read more →]

A bit of a scuffle broke out over a new report from Arbor Networks concerning the state of the internet.  Wired ran an article pegging Google’s bandwidth costs at zero, which was a rather poor choice of words at best.  Dan Rayburn does a good job ripping apart the article itself and Data Center Knowledge added its own two cents, suffice to say that the Wired article wasn’t very well thought out.  But they are hardly alone in their superficial look at bandwidth costs.  The central fallacies here are ones that the press often gets tangled up in, i.e. that transit is always expensive while peering is always free, and that using dark fiber magically [Read more →]

Sprint Nextel (NYSE:S, news, filings) is finally buying its wireless affiliate ipcs in a deal worth a total of $831M.  That’s $24/share plus the assumption of $405M in net debt.  A substantial 30+% premium above the current stock price, but at an EBITDA multiple of about 6 which is not that exorbitant.  Sprint hopes to save $30M annually in synergies on the $550M or so in acquired (but probably overlapping) revenues.  [Read more →]

According to a nice piece from TelephonyOnline, the new metro gear that Infinera (NASDAQ:INFN, news, filings) is introducing today does not use the company’s flagship technology, the photonic integrated circuit or PIC.  The new metro gear is a three rack unit called an ATN, and it carries eight 10Gbps ports.  Rather than saving money when scaling to huge bandwidths, the ATN apparently serves Infinera customers by interfacing more directly with its DWDM gear, saving some transponders and hopefully [Read more →]

Earnings season for telecom and internet infrastructure rolls in this week.  Well, it started last week with a few earlybirds like Nokia but things really get going in the next few days.  What to expect?  The market has been happy lately, hopefully it is foreshadowing numbers that show us emerging from the recession.  However, Octobers with positive expectations scare me so I’m not holding my breath.  At least not for Q3 numbers, which will surely still be weak even if we are seeing some pickup in sales given the usual lag time before they show up in revenues.  As usual, it will be Q4 comments that everyone will be parsing for any signs that this winter won’t be so cold.  Now for a few [Read more →]

Dan Rayburn reports that CDN challenger EdgeCast was profitable in Q2.  That’s quite impressive actually, considering the relatively low $10M of capital invested and revenues in the neighborhood of $15-20M.  To reach scale so quickly when few others have done half as well with twice as much suggests that these guys aren’t going away.  It also throws into a favorable light the choices by [Read more →]

This is turning into quite an interesting battle.  The special committee of the board of directors of international wholesale VoIP provider IBasis (news) [a subsidiary of KPN (NYSE:KPN, news)] has again rejected the advances of Dutch incumbent and majority shareholder KPN (NYSE:KPN, news).  The new price of $2.25 per share may have been some 40% higher than the initial bid, but the special committee still found it ‘grossly inadequate’.  They cite many reasons, but it all boils down to the fact that they feel KPN is trying to [Read more →]

According to reports, Finland has made it a legal right for all citizens to be able to have a broadband connection – in this case a minimum of 1Mbps.  Not instantly, but by next summer – which is close enough to turn a few heads.  They had already planned to make a 100Mbps legal guarantee by 2015, but decided for an intermediate step.  Finland has just 5.3M people, and 1.52M households already have broadband connections.  Even if one assumes an average of 3 people per households that still leaves some work to do.  But the law just says you must be able to get one, not that you must [Read more →]

IDT (NYSE:IDT, news, filings) is now looking to sell off its LMDS spectrum, hoping to recoup some value from the asset. The portfolio, held by subsidiary IDT Spectrum, includes some 931 licenses at 38 GHz and 16 licenses in the 28-31 GHz LMDS range.  Originally, IDT Spectrum planned to use it to build a backhaul network, but that plan fizzled and they mainly just lease it out where they can.  Who might want to buy it from IDT and how much might it sell for?   [Read more →]

Primus Telecommunications today announced that it is opening a Chicago office.  Their main focus will be hosted IP-PBX services for small and medium enterprises.  Primus is known much better in Canada and Australia, in the US they operate mainly in the wholesale voice markets.  And now they’re back in the US market again with a hosted IP-PBX offering.  The effort headed by Kevin Weber, formerly of CBeyond, with whom [Read more →]

Miami-based TeleCuba has received permission from the US government to build the first modern submarine cable between the US and Cuba.  The cable will be only 110 miles long and cost just $18M, but per mile it will probably have the largest effect on communications in its region than any cable has in a long time.  Right now internet traffic goes in and out of the reclusive country via satellite, which means it is slow and expensive.  The new cable, which is planned to go into service in 2011, will supposedly be able to carry as much as 8-10Tbps – a hefty number. [Read more →]

It has been rather quiet over at Internap Network Services (NASDAQ:INAP, news, filings) for a few months, as the company spent some time reorganizing internally after changing CEOs and retooling to increase their focus on colocation services.  But in the last two days, there have been signs of life from the company’s IP services business.  Yesterday, Internap expanded its network into the North Bergen, New Jersey facility of sdxc, which opened just last year.   Then today Internap added Hibernia Atlantic to its already diverse list of providers.  Hibernia’s facilities will give [Read more →]

Sprint Nextel (NYSE:S, news, filings) yesterday announced an interesting initiative for wholesale exchange of VoIP traffic, called the Partner Interexchange Network (PIN).  The switchless routing framework will be based on the SIP protocol, and will allow VoIP providers to exchange voice traffic directly.  This kind of offering of course works best with lots of members, so the key will be to entice those providers to come.  I’m not sure how the economics work out, presumably Sprint charges for the service but on the other hand without scale there’s not so much to charge for yet.  With the [Read more →]

Over the weekend, MicroSoft and TMobile announced that they had managed to lose some subscribers’ Sidekick data.  The media has gone into overdrive blaming this on a failure of cloud computing, although it’s not entirely clear that this in fact had much to do with that.  Data Center Knowledge has a nice summary of various responses.   [Read more →]

Southeastern service provider itcd has announced that it has deployed Infinera’s new ATN metro edge platform.  Deltacom’s Interstate FiberNet group had previously deployed Infinera longhaul gear, and apparently things have gone well.  Infinera has yet to formally introduce the ATN metro edge platform, that step will come at Supercomm next week.  But with the gear in the field already and an announcement already pre-announced, I do wonder why we bother with these formal introductions and such.  [Read more →]