DSL Prime News Briefs

In this week's edition: the DSL business continues around the world, with equipment buys as far afield as India and Ecuador. Several new books are out. Also, watch Wall Street carefully.

by Dave Burstein DSL Prime [January 9, 2003]

E-mail

• An note came in as I went to press that SHDSL was recommended for the Ethernet in the First Mile Long Reach PHY after spirited discussion in Vancouver. The ADSL proposal did not reach the required 75 percent vote. More details next issue.

Briefs

• Zhone is shipping their do-everything box to ANDINATEL in Ecuador, and ZT just won a small order for DSLAMs from India's Mahanagar Telephone Nigam.
  
  
• FinePoint introduced prequal software developed initially for Frontier, who sucessfully identified a servable customer at 28K feet. The customer downloads software that performs fairly extensive testing from their existing analog modem to a test unit several stages removed in the provider's network. They claim results considerably better than Telcordia's equivalent that stalled in the market because of a high price.
  
  
• A note from Moscow said the telcos were moving slowly, and equipment costs were high. Corecess is now marketing heavily there, however, possibly driving down prices.

Chips

• The disputes over symmetric standards and interference continue raging, and I've invited some of the people involved to turn their comments into articles. Articles for DSL Prime are summarized in the e-mail and printed in full on the web. Requirements are simple: interesting to the pros in this business, minimal marketing hype.

People

• Thomas Starr, John Cioffi, and Peter Silverman wrote the best technical book on DSL, Understanding Digital Subscriber Line Technology, and now have collaborated with Massimo Sorbara for an updated volume, DSL Advances. Starr and Sorbara lead the key industry technical committee, Cioffi developed much of the technology, and Silverman has played a major role in the DSL Forum. An excellent book, by pros for pros.
  
  
• Peter Heywood tells me Light Reading will be more actively covering the access market. Very happy to hear that: we need all the strong reporting we can get. If you don't follow LR, check out their excellent, spirited work. They just wrote up FastWeb in Milan, one of the most interesting independents in the world. Backed by the local electric company, they're running fiber to home and office in six major cities.
  
  
• Bruce Kushnick now is offering his book, The Unauthorized Bio of the Baby Bells, as a free download here. Bruce is such a vehement critic that when we're on the same panel, I sound like an apologist for the telcos. But he brings an enormous amount of research to the table, including the billions of dollars the bells have collected in rate increases that should have paid for the fiber transition.
  
  
• For employment ads, visit the DSL Prime website.

Wall Street

• Vik Grover of Kaufman says in his reports what other analysts hide in euphemisms. Instead of putting a "hold" rating on Sprint PCS, he said "sell". The issue he saw was the radio shack reports that said wireless sales were down; Sprint had boosted them with easy credit terms last year.
  
  
• Anton Wahlman of Needham took the rare step on Wall Street of downgrading Adtran on good news that drove up the stock price. He (and I) continue to respect the company, but he noted the price had already gone up to his (raised) target. One of the grave mistakes of the last few years was overpaying even for good companies.
  
  
• Reminder, as always. These news items aren't my recommendations—I don't pick stocks. I've seen too little rationality in the market to predict it in either the short or intermediate term. The last six months reinforced my hesitation. Some of the smartest folks I know predicted imminent trouble for the telcos, including the twenty or so who signed the "fast fail" letter urging the FCC not to bail them out. The U.S. telco stocks have gone up 20 to 30 percent since then.
  
  
• Long term, the key factor driving telecom equipment and chips is the intense international competition, with overcapacity and prices challenging for the next several years. The next 2 to 5 years for the telcos will see limited growth in Europe and North America, with profitability challenged by VoIP, cable, corporate offload, and slow economic growth making the high profits of the last five years difficult to match. In France, the U.S., and many others, the telcos have built strong political pressure for government bailouts of their faltering profits. The Journal reports Mike Powell will do just that, wiping out most of the competition that remains. So it's possible high and increasing rates will prop up the U.S. telcos for several years, at the expense of the U.S. economy.
  
  
• Needham is also sponsoring a conference in New York Tuesday to Thursday, bringing to town ADI, Globespan, Carrier Access, Sigma Designs, Paradyne, and ADTRAN. Sorry to miss it for CES.

Copyright 2003 Dave Burstein.
The DSL Prime Newsletter is reprinted with permission.

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