FCC Overhauls Spectrum Leasing Rules

The FCC adopted new rules intended to make spectrum leasing more responsive to market forces. The FCC said its streamlined procedures would encourage licensees to freely lease their unused or unneeded spectrum capacity, thereby increasing the amount of spectrum available to prospective users and new wireless technologies. Similarly, the steps taken to streamline the license assignment and transfer process will also enhance access to spectrum by a variety of entities. The FCC is encouraging the development of secondary markets for spectrum by providing a streamlined approval process for transfers and assignments of licenses. The new policies affect both mobile and fixed services, including Cellular, Personal Communications Services (PCS), Specialized Mobile Radio (SMR), Local Multipoint Distribution Service (LMDS), fixed microwave, 24 GHz, and 39 GHz, among others.


FCC Chairman Michael K. Powell described the action as "one of the most important spectrum reform decisions by this Commission in the last decade." Powell predicts that consumers will ultimately benefit because the cost-benefit equation for spectrum sharing will be transformed. A carrier with a business plan that calls for serving only the most densely populated portions of its service area now has every incentive to lease the balance of their spectrum to someone else. As cognitive radios and frequency-agile technologies are introduced, the more flexible spectrum leasing rules could open new opportunities.
http://www.fcc.gov

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FCC Proposes Additional Spectrum for Unlicensed Use

Agreeing with a proposal from the Wi-Fi Alliance, the FCC will seek to make available for unlicensed use an additional 255 MHz of spectrum in the 5.470 to 5.725 GHz band. This would increase the spectrum available for use by unlicensed devices in the 5 GHz region by 80%. The FCC also proposed additional technical requirements for devices operating in this spectrum.
http://www.fcc.gov

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ECI Telecom Names New Chairman, Reports Revenue

ECI Telecom named Shlomo Dovrat as its new chairman, replacing David Ball who stepped down. Krish Prabhu, the former CEO of Alcatel USA, was named as the new vice chairman of ECI Telecom.


Separately, ECI Telecom reported Q1 revenue of $118.7 million, compared to $149.2 million in Q4 2002 and $175.4 million recorded in Q1 2002. Gross income was $48.7 million, or 41.0% of revenues. There was an operating loss of $5.6 million compared to an operating loss of $2.9 million in Q4. The Inovia Broadband Access Division recorded revenues of $50.8 million compared to $52.0 million in Q4. The Lightscape Optical Network Division (which includes Enavis) recorded revenues of $42.4 million compared to $51.7 million in Q4.
http://www.ecitele.com

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TI and STMicroelectronics Enter cdma2000 Market

STMicroelectronics and Texas Instruments (TI) unveiled plans to offer CDMA chipsets using technology developed jointly with Nokia. ST and TI will offer the chipsets to manufacturers of cdma2000 1X and 1xEV-DV (1x Evolution for Data and Voice) mobile Internet handsets. The first chipsets are expected to sample next quarter.
http://www.ti.com
http://www.st.com

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CIENA Outlines LightWorks Initiative

CIENA introduced the next phase of its network strategy -- the LightWorks Services initiative -- aimed at helping carriers improve margins for existing private line and ATM, Frame Relay and DSL services, while introducing new services, especially Ethernet and SAN connectivity. LightWorks Services has three aspects. First, CIENA will extend its distributed control plane across all of its products from the network core to the edge. Second, CIENA is adding new service delivery platforms to its portfolio. Third, CIENA is adding new data-focused technologies and features to its existing portfolio of products. Specifics of the initiative include:

• the integration of Ethernet, ATM/Frame Relay, Fibre Channel, ESCON, and FICON protocols in the ONLINE Edge, ONLINE Metro, MetroDirector K2, CoreStream and CoreDirector products
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  the integration of Layer 2 functionality along with features such as generic framing procedure (GFP), link capacity adjustment scheme (LCAS) and virtual concatenation (VCAT) across product lines
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  the addition of the WaveSmith Networks Distributed Node DN 2100, DN 4100, DN 7100 and DN 8100 multiservice edge switching products into the LightWorks family
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  the integration of acquired and partner products into CIENA's network management system; this already includes the management integration of WaveSmith and Equipe Communications' switches
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  the implementation of distributed intelligence across the entire LightWorks product portfolio

CIENA estimates that by providing better integration between data services and the underlying optical transport infrastructure it can help carriers improve margins for private line services by 4%, improve margins for FR/ATM by 8% and improve DSL margins by 6%http://www.ciena.com

• In April, CIENA announced plans to acquire WaveSmith Networks for its multiservice switches. The WaveSmith platform is designed for central office switching and applications such as DSL aggregation.
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  CIENA also sells and supports Equipe Communications' Equipe 3200 ATM/MPLS multiservice core switch into targeted Tier One service provider accounts.

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XO Reports Q1 Revenue of $286.1 million

XO Communications reported Q1 revenue of $286.1 million, compared to $299.4 million for Q4 2002 and $333.4 million for Q1 2002. XO reported an improvement in its loss from operations, which was $14.0 million for Q1 2003, versus $176.5 million in Q4 2002. Of the total revenue reported, $150.7 million was derived from voice services, which includes revenue from local, long distance and other enhanced voice services, and $102.0 million was attributable to data services. Revenue from integrated voice and data services totaled $33.4 million.
http://www.xo.com

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Comcast Issues $1.0 Billion of Notes at 5.30%

Comcast sold $1.0 billion (aggregate principal amount) in 5.30% notes due 2014. Proceeds from the offering will be used for working capital and general corporate purposes including repayment of borrowings under revolving credit facilities.
http://www.comcast.com

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Deutsche Telekom Reports Profit for Q1

Deutsche Telekom reported Q1 net income of EUR 0.85 billion, its first quarterly profit since 2000. Revenues increased 6.6% year-to-year to EUR 13.6 billion, with EBITDA climbing almost 30% to EUR 4.9 billion. Some highlights of the quarter:

• net debt was reduced to EUR 56.3 billion, down 7.9% since the end of December
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  there was EUR 2.0 billion in free cash flow for Q1, up from EUR 0.3 billion a year earlier
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  revenues generated by DT's international subsidiaries and shareholdings rose 20.2% in the quarter and now constitute 37.5% of the company's overall revenue
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  as of 31-Mar-03, Deutsche Telekom had 3.5 million T-DSL contracts sold in Germany. T-Online has an additional 187,000 broadband subscribers in its European subsidiaries, such as Spain's Ya.com and France's Club-Internet.
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  T-Systems, the company's integration business, boosted revenues by 2.8% to just under EUR 2.6 billion, despite poor market conditions
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  T-Mobile boosted revenues 18.9% year-to-year to EUR 5.3 billion. Much of the increases are due to growth at T-Mobile USA, which added 3.3 million users compared to a year ago. Overall, T-Mobile had 55.1 million users worldwide at the end of the quarter, up by 8.8 million over a year ago.
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  CAPEX for Q1 was EUR 0.9 billion, compared to EUR 1.7 billion for Q1 2002. By division, CAPEX for Q1 totaled EUR 0.3 billion for T-Com, EUR 0.4 billion for T-Mobile, EUR 0.1 billion for T-Systems, and EUR 0.1 billion for T-Online and all other company groups. Anticipated CAPEX for the full year is in the range of EUR 6.7 to 7.7 billion.
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  Anticipating lower CAPEX, additional efficiency gains from restructuring and further free cash flows, Deutsche Telekom said it aims to be net income positive for the full year, 2003

http://www.telekom.de

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Optical Internetworking Forum Approves Security Mechanism

The Optical Internetworking Forum (OIF) approved a new Security Extension for the User-to-Network Interface (UNI) and Network-to-Network Interface (NNI) Implementation Agreement (IA). The implementation agreement defines a common set of security mechanisms to protect the signaling and routing of optical connections. The mechanisms, which leverage the IETF's IPsec standard, safeguard transport networks against attacks that may compromise their control planes, seek unauthorized use of their resources or attempt to gain unauthorized information about their configuration and usage.


In other news, the OIF announced that Marco Carugi of Nortel Networks and Vishnu Shukla of Verizon were appointed to the Forum's board of directors. Shukla joins Tom Afferton of AT&T as the second carrier member on the OIF's board of directors.
http://www.oiforum.com

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360networks completes acquisition of Dynegy

360networks completed its previously announced acquisition of Dynegy's North American network business for an undisclosed sum. The deal includes an inter-city network spanning 16,000 route miles with 65 wholesale customers and access points in 44 U.S. cities. 360networks has also assumed Dynegy's existing customer base, its remaining fiber leases, and its co-location facilities. Including these new assets, 360networks' optical mesh fiber network now spans 33,000 route miles (53,000 km) and reaches 60 major cities in North America. The company also operates 17 metro fiber networks in nine Canadian provinces.
http://www.360.net

• In July 2002, Dynegy wrote-off its investment in the communications business with a charge of $212 million to its Dynegy Global Communications division.
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  In January 2003, Dynegy sold its European communications business to a division of Klesch & Company.
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  In October 2001, Dynegy Global Communications completed a nationwide, optically switched, mesh network spanning 16,000 route miles and reaching 44 of the largest US cities. The backbone uses Tellium's optical switches and Fujitsu's DWDM platform.
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  360networks emerged from Chapter 11 protection in the US and CCAA protection in Canada in November 2002. The company subsequently acquired GT Group Telecom, which operated a Canadian network with 454,125 strand kms of fiber.

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Covad and Z-Tel Sign Broadband Agreement

Z-Tel Technologies signed a two-year, non-exclusive agreement enabling it to deliver broadband services using Covad's DSL network. Z-Tel will offer DSL services under its own name, so customers will receive one bill from Z-Tel for both voice and broadband services. The company plans to begin providing Covad-powered SDSL services to business customers within the next 60 days. The fee structure of the contract is on a per-subscriber basis and does not require Z-Tel to purchase a minimum amount of Covad services.
http://www.covad.com
http://www.z-tel.com

• As of 31-March-2003, Covad had approximately 417,000 lines in services, up 9% over Q4 2002.

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ITXC Carries 13% of Incoming Voice traffic to the Philippines

ITXC estimates that its VoIP network is now carrying approximately 13% of all incoming phone-to-phone traffic to the Philippines. On peak days, ITXC sends over 2 million minutes per day across ITXC.net to the Philippines from ITXC customers around the globe. On Mother's day, the volume rose to 4 million minutes sent to the Philippines, accounting for more than 13% of the 29 million minutes that were transported on ITXC.net that weekend.
http://www.itxc.com

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SBC Expands Homeland Security Services

SBC Communications is offering a security risk assessment program to city, county and state governments to help to prevent hackers and cyber terrorists from breaking into and disrupting their networks. The program would help these government networks to comply with new U.S. Department of Homeland Security standards and recommendations. The federal government has earmarked $200 million to reimburse the costs incurred by the states and cities to protect critical infrastructure.
http://www.sbc.com

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WSJ: Verizon to MCI – Drop Dead

Verizon Communications is spearheading an effort to derail MCI's pending emergence from Chapter 11 bankruptcy protection, according to a high-profile article from The Wall Street Journal. In the WSJ interview, William Barr, general counsel for Verizon Communications, argues that the bankruptcy process should not be a mechanism that enables companies to benefit from their fraudulent behavior. Michael Salisbury, MCI's general counsel, counters that the company was not built or created by fraud and that substantial changes have taken place during the restructuring.
http://www.wsj.com

• On 14-April-03, WorldCom filed its proposed Plan of Reorganization with the U.S. Bankruptcy Court, relocated its headquarters from Clinton, Mississippi to Ashburn, Virginia and changed its brand name back to MCI.

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WP: MCI Chosen to Build Mobile Network in Baghdad

MCI was awarded a contract by the US Department of Defense to build a small GSM network in Baghdad for serving humanitarian aid workers and key Iraqi government officials, according to The Washington Post. Neither the value of the contract not the completion date were mentioned, but an initial installation is expected to be operational in June. A report earlier this month from The Washington Post indicated that the U.S. Agency for International Development, a division of the State Department, had decided not to issue a much larger contract for rebuilding Iraq's telecommunications infrastructure because "telecommunications was not part of its portfolio." Previously, there had been speculation that either Lucent or Motorola would be chosen to build a mobile network in Iraq.
http://www.washingtonpost.com

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