Trapeze Names Ex-Nortel Exec as CEO

Trapeze Networks, a start-up based in Pleasanton, California named James W. Vogt as its new president and CEO. Prior to joining Trapeze, Vogt was president and CEO at Ingrian Networks, where he led the privately held secure appliance firm through two rounds of funding. He also was president of the Nortel Networks small business solutions group, and before that, served as vice president of product management for Bay Networks' desktop products group.


Trapeze Networks offers a wireless LAN Mobility System. http://www.trapezenetworks.com

• Trapeze Networks offers a WLAN Mobility System that allows enterprise users to login once, roam and retain their access privileges and policies wherever they go on the corporate network. Seamless roaming is a key enabler for time-sensitive applications like Voice over Wireless IP (VoWIP). The Trapeze system preserves existing network engineering -- VLAN and subnet assignments, authentications and ACLs -- while enabling the deployment of new services like prioritization, access controls, roaming policies, location tracking and usage metrics on a per-user basis from wired to wireless. The Trapeze WLAN Mobility System includes the Mobility Exchange, Mobility Points, Mobility System Software and a tool suite. The Mobility Exchange System offloads Extensible Authentication Protocol (EAP) processing, session consolidation, and hardware-accelerated encryption and key generation from AAA servers. This reduces 802.1X authenticators by 20-to-1, according to the company. Trapeze also supports standard WLAN cryptography, including Wi-Fi Protected Access (WPA), the Temporal Key Integrity Protocol (TKIP), the Advanced Encryption Standard (AES), and dynamic Wired Equivalent Privacy (WEP) with rotating broadcast/multicast keys.

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Marconi Supplies Access Hub to Versatel Deutschland

Versatel Deutschland is deploying Marconi's Access Hub Multi Service Access Node (MSAN) platform to support its rollout of broadband access services to private customers. Specifically, Marconi is supplying its AXH600 and AXH2500 platforms, alongside its Distributed Multiservice Platform (DMP). The combined platforms will enable Versatel to offer broadband access services, including ISDN and xDSL. Financial terms were not disclosed. http://www.marconi.com

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Rogers Cable to Launch 5 Mbps Home Service

Canada's Rogers Cable is planning to launch a new, 5 Mps Internet service in Ontario and New Brunswick. This new service will be in addition to the current offering with speeds up to 3Mbps (already faster than the DSL competitor) provided to existing Rogers Hi-Speed Internet customers. http://www.rogers.com/

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BellSouth Adds 127,000 DSL Subs in Q4

Long distance and DSL revenue growth offset access line declines at BellSouth during 2003, holding the company's communications revenues nearly flat at $18.4 billion compared to 2002. For Q4, BellSouth reported consolidated Q4 revenues of $5.7 billion, an increase of 0.9% compared to the same quarter of the previous year. Net income was $787 million compared to $574 million in the same quarter a year ago. Operating free cash flow totaled $5.3 billion for the full year. Over the last seven quarters, the company has increased its quarterly dividend 31.6% to 25 cents per common share. Some additional highlights:

• CAPEX: Capital expenditures for 2003 were $3.2 billion, a reduction of 15.5% compared to 2002. The 2003 CAPEX to revenue ratio was 14.2%. For reference, CAPEX in 2001 peaked at $6.0 billion and the CAPEX to revenue ratio was in the mid-20s.



• Debt: Total debt at December 31, 2003 was $15.0 billion, a reduction of $2.4 billion since the first of the year.



• Service Bundling: In Q4, BellSouth Answers packages increased to more than 3 million, which represents a 24% penetration of primary access lines. Answers combines customers' local, long distance, Internet and wireless services all on one bill. BellSouth Unlimited Answers contributed to the growth in package customers with subscribers exceeding 1 million at the end of fourth quarter. Unlimited Answers allows customers to call anywhere in the United States anytime for a flat monthly fee.



• Long Distance: BellSouth added approximately 3 million long distance customers during 2003, for a total of 3.96 million customers and almost 30% penetration of its mass-market customers by year-end. During Q4, about 40% of new customers included international long distance in their calling plans.



• DSL: BellSouth added 126,000 net DSL customers in Q4, bringing its end of year total subscribers to 1.46 million.



• Data: Led by DSL, data revenues of $1.1 billion grew 4.0% in Q4 2003 compared to the same quarter of 2002. DS1 and DS3 circuits continue to account for about 60% of BellSouth's wholesale data revenues. In Q4, DS1 units grew 1.3% and DS3 circuits were flat.



• Access lines: Total access lines of 23.7 million at December 31 declined 3.6% compared to a year earlier, impacted by the economy, competition and technology substitution. Residence and business access lines served by BellSouth competitors under UNE-P increased by 199,000 in Q4.



• Domestic Wireless: Cingular Wireless added 642,000 net cellular/PCS customers in Q4, ending the year with more than 24 million cellular/PCS customers.By the end of 2003, the company's GSM/GPRS network was available to 93% of its potential customers and with approximately 57% of subscriber minutes traveling on this upgraded network.

http://www.bellsouth.com

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Tellabs' Q4 Revenue Up 14% to $279 Million

Tellabs reported Q4 revenue of $279 million up 14% from $245 million in Q3 2003, marking the fourth increase in sequential revenue in the past five quarters. Tellabs International generated 40% of the quarter's overall revenue. The company recorded a net loss of $23 million or 6 cents per share. Excluding previously announced restructuring charges of $44 million, Tellabs earned 3 cents a share or $12 million in Q4 2003. Some highlights:

• Optical Networking -- Sales of optical networking systems, which include Tellabs' strategic North American products, were $117 million, up 11% from the third quarter. About 2% of Tellabs' overall revenue came from new products in North America.



• Next-Gen SDH and Managed Access Services -- Sales of next-generation SDH and managed access systems totaled $74 million, up from $70 million in the third quarter. About 6% of Tellabs overall revenue came from new products in international markets; sales of these new products surged 48% to $16 million from $11 million in the third quarter. This increase came largely on the strength of the Tellabs 6350 switch node, for which the company has now received more than 300 orders. Among customer wins announced in the quarter were T-Mobile, Vodaphone, Embratel, and Beijing Zhetong for the Beijing Olympics.



• Other Products -- Voice-quality enhancement, telephony distribution solutions, data and other revenue amounted to $51 million, up 65% from $31 million in the third quarter.



• Services -- Services revenue was $37 million, basically flat with $39 million in the third quarter.

http://www.tellabs.com

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IBM Releases Linux Platform for Telecom Applications

IBM released a new Linux-based Carrier Grade Open Framework (CGOF) Reference Implementation platform for telecom service providers. The platform includes CGOF compliant hardware and middleware components and services. The Carrier Grade Open Framework (CGOF) Reference Implementation is available through IBM Global Services.


The Linux framework is being supported by various network equipment manufacturers and IBM business partners, including Cirpack, jNETx, Lucent, Snowshore, Sylantro, and Ubiquity.


IBM said its Carrier Grade Open Framework would address three of the key factors that challenge telecom service providers:

• how to combat the increasing costs of network operation;


• how to decrease the complexity of introducing change into a network infrastructure;


• and how to reduce the cycle time of implementing new packet-based services to meet growing customer demand.

IBM said its intends to further its commitment to the telecommunications industry with the introduction of a modular, CGOF compliant product offering -- the IBM eServer Integrated Platform for Telecommunications (IPT) in 2004. The IPT offering will include a variety of IBM eServer systems including BladeCenterand the new BladeCenter T, which will also be available later this year. IBM also plans to offer expanded software solutions including IBM Director for systems management, IBM middleware and services that address both the NGN and Telecommunications back office requirements support for Linux with OSDL specified Carrier Grade Linux features. http://www.ibm.com

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Global Crossing Stock Begins Trading on NASDAQ

Global Crossing's new common stock began trading on the NASDAQ National Market on 22-January-2004, under the trading symbol GLBC. The company's stock had been trading in the over-the-counter market under the symbol GLBCF since Global Crossing's emergence from Chapter 11 on 09-December-2003. http://www.globalcrossing.com

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Nortel Networks/Flextronics to Evolve Supply Chain

Nortel Networks will divest substantially all of its remaining manufacturing activities, including product integration, testing, and repair operations carried out at its facilities in Calgary and Montreal (Canada), Campinas (Brazil), Monkstown (Northern Ireland), and Chateaudun (France). It will also divest itself of certain related activities, including the management of the supply chain and related suppliers for these locations.


Nortel Networks is in discussions with Flextronics about the activities being considered for divestiture. The company said that a successful completion of these discussions could result in Flextronics undertaking and managing in excess of US$2 billion of Nortel Networks annual cost of sales on a go forward basis and involve the transfer from Nortel Networks to Flextronics of more than US$500 million of manufacturing and inventory assets. In return Nortel Networks anticipates receiving from Flextronics proceeds in excess of US$500 million in cash, over a nine-month period, for primarily inventory and certain manufacturing assets, as well as an additional amount for certain intangible assets. At this stage, however, Nortel Networks said there can be no assurances that these discussions will lead to a binding agreement.


A deal with Flextronics could affect up to approximately 2,500 Nortel Networks employees. http://www.nortelnetworks.com

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Vitesse Returns to Profitability

Vitesse Semiconductor reported quarterly revenues of $50.3 million, compared to $35.7 million in the same period last year and $42.8 million in the preceding quarter. On a GAAP basis, net loss for the first quarter of fiscal 2004 was $8.0 million or $0.04 loss per share. Pro-forma net income for the first quarter of fiscal 2004 was $172,000 or $0.00 income per share. http://www.vitesse.com

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UTStarcom Reports 16th Consecutive Quarter of Revenue Growth

UTStarcom reported Q4 net sales of $643.6 million, an increase of 114% over net sales of $301.1 million reported in the fourth quarter of 2002. Full-year net sales increased to $1.96 billion, an increase of 100% over net sales of $981.8 million reported in 2002. Net income for the fourth quarter of 2003 was $66.4 million, or $0.52 per share.


The period marked the 16th quarter of record revenues and profitability since the company's IPO in March 2000.


Backlog at the end of 2003 was $1.06 billion, an increase of 75% over the $605.4 million backlog reported at the end of 2002.

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MCI Provides 2004 Guidance.

MCI is on-track to emerge from Chapter 11 bankruptcy protection in February 2004. The company issued the following financial guidance for full-year 2004:

• revenue is expected to be between $21 billion and $22 billion, a decline of approximately 10 to 12% versus expected 2003 results, primarily reflecting overall industry conditions and continued declining trends in the consumer market.



• operating income is expected to be between $1.1 billion and $1.3 billion, which includes depreciation and amortization of $1.7 billion and restructuring charges of approximately $100 million, resulting in an increase of $300 million to $400 million versus expected 2003 results.



• net operating cash flow is expected to exceed $1 billion, after capital expenditures of 6 to 8% of revenues, but including proceeds from the sale of certain non-core assets.



• business Markets revenue, which includes sales to U.S. domestic enterprise customers, is expected to decline 6 to 8% versus 2003, due to continued competitive pricing pressure, especially in Small and Medium-sized Business and traditional long-distance services.



• International revenue is expected to decline at similar levels to Business Markets.



• revenue, or sales to domestic U.S. consumers, is expected to decline 20 to 25% versus 2003. This reflects continued long-distance industry revenue declines primarily due to wireless substitution, intensified competitive conditions and the impact of national Do Not Call legislation.



• MCI will launch a consumer VoIP initiative in 2004.

http://www.mci.com

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AT&T Wireless Evaluates Acquisition Bids

AT&T Wireless confirmed market reports that it is currently entertaining acquisition bids from several industry players. The company postponed its annual analyst meeting and said there can be no assurance that a transaction will occur.

Separately, AT&T Wireless posted Q4 services revenue of $3.904 billion, up 4.4% from the year-ago quarter. For the fourth quarter, net loss per share (EPS), was ($0.03) per share.


ARPU for Q4 was $58.70, down 2.2% from the same period last year. Steady ARPU was supported by data revenues, international toll, and higher regulatory fees, while offset by continued pricing pressure and less breakage from wireless minute buckets.


Churn for the year was 2.6%, matching 2002's full year level and reflecting the company's long-term strategy of improving the profitability of the overall subscriber base. Fourth quarter churn was 3.3%, driven by a high number of contract expirations of the prior year's holiday contract signings, systems-related impacts on customer care, and LNP.


Net subscriber additions were 128,000 for Q4 and 1.060 million for the year, bringing the company's total consolidated customer base at the end of 2003 to 22.0 million, an increase of 5.4% over 2002. http://www.attwireless.com

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AT&T Posts Double Digit Revenue Decline

AT&T cited increasing pricing pressures and predicted declining overall revenues for 2004. The company reported Q4 2003 consolidated revenue of $8.1 billion, which included $5.9 billion from AT&T Business and $2.2 billion from AT&T Consumer. This represented a consolidated revenue decline of 12.8% versus Q4 2002, primarily due to continued declines in long distance (LD) voice revenue, partially offset by the continued success of AT&T Consumer's bundled local and LD offering, as well as growth in several key markets of AT&T Business. Net income from continuing operations was $340 million and earnings per diluted share were $0.43. Free cash flow was $0.7 billion for Q4. The company met its 2003 financial guidance. Some highlights for the quarter:

• Q4 revenue for AT&T Business was $5.9 billion in the fourth quarter of 2003, a decline of 10.9% from the prior-year. AT&T blamed Pricing pressure, LD voice competition, demand weakness in data and retail LD voice, as well as overall weakness in telecommunications spending for the decline.



• AT&T Business long distance voice revenue declined 13.1% on a quarter-over-quarter basis, reflecting a shift from retail to wholesale services. Volumes grew nearly 7% on a quarter-over-quarter, also reflecting the same wholesale shift.



• AT&T Business local voice revenue grew 15.0% from the prior year Q4. Local access lines totaled nearly 4.5 million at the end of 2003, representing an increase of almost 136,000 lines from Q3.



• AT&T Business data revenue declined 6.7% from the prior-year quarter and 4.6% for the full year. Growth rates were negatively impacted by pricing pressure, particularly on high-capacity bandwidth circuits, as well as weak retail demand.



• AT&T Consumer revenue was $2.2 billion for Q4, representing 18.9% compared to Q4 2002. Declines were driven by lower standalone LD revenue as a result of the continued impact of competition, wireless and Internet substitution, and customer migration to lower-priced products and calling plans, partially offset by pricing actions. These revenue declines were also partially offset by growth in bundled revenue, which grew nearly 65%.


AT&T also announced the following expectations for 2004:


• Consolidated revenue decline between 7-10%;


• Consolidated operating income margin between 6-8%;


• AT&T Business revenue decline between 4-7%;


• AT&T Consumer revenue decline between 15-17%;


• Capital expenditures of approximately $2.5 billion, compared to $3.4 billion for 2003.

http://www.att.com

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