FCC Schedules Meeting on Video Competition for Feb.10 in Texas

The FCC will hold an Open Meeting on Friday, February 10, 2006 in Keller, Texas to discuss the status of competition in the video delivery. The meeting begins at 11:00am CST and will include presentations on video competition from a panel of industry, governmental and public parties.

http://www.fcc.gov

• The town of Keller, Texas is the first market where Verizon launched its FiOS TV service. In its most recent quarterly report, Verizon noted that it reached 21% market penetration for the service in the first four months.

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Western Union Exits Telegraph Business after 155 Years

Western Union ceased offering its signature telegram service as of January 27, 2006. Western Union now focuses exclusively on money transfer services.

http://www.westernunion.com/info/osTelegram.asp

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Alcatel Posts Strong Q4 Sales and Profit

Alcatel saw Q4 sales rise by 7.6% to EUR 4.094 billion compared with EUR 3.806 billion (up 5.9% at constant EUR/Dollar exchange rate) in the same period last year. The gross margin was 34.8%. Operating profit amounted to EUR 541 million, a 13.2% operating margin.



Serge Tchuruk, Alcatel Chairman and CEO, said: "Alcatel has turned in a record fourth quarter, with revenues and profitability at significant levels and a strengthened net cash position of EUR 1.5 billion resulting from a strong free cash flow generation of EUR 0.9 billion. By mid year 2005, we saw a turnaround in our wireline business due to the success of our triple play strategy coupled with a breakthrough in our IP carrier data solutions. In addition, we registered continued expansion in our wireless business fuelled by our radio multi standard product strategy, which is well aligned with market trends, and a very efficient R&D program. In 2005 we grew our carrier business by over 10%, outpacing the market growth. In our private business, trends were mixed with a weakness in our satellite business while momentum grew both in enterprise and in the vertical markets.



Some highlights from the quarterly report:

• Geographic breakdown: W. Europe 42%, North America 15%; Asia 14%; and RoW 29%.



• Fixed communications: Q4 revenues increased by 12.3% based on strong sales in the access, optical, and IP carrier data segments. The access division recorded a historical high in DSL volume shipments at 6.7 million lines, bringing the cumulative total to 21.6 million lines for the full year, a 10% increase. The IP DSLAM product family continues to grow and represents a significant portion of lines shipped with over 60 customers to-date. Growth in access has been driven by the DSL replacement market as well as the increasing demand for video over the carrier network. The increase in the optics business continues to be driven by the new submarine projects as well as sustained demand in the terrestrial metro sector coming from the preparation for deployment of triple play services. The IP division turned in a very robust performance with the IP routing business gaining significant market share with over 100 customers and 5,000 systems shipped to-date and continued to more than offset the slight, anticipated decline in the MSWAN ATM based technology. The NGN/IMS business continued to record good momentum during the quarter, registering a win in Europe with the newly launched combined fixed/mobile application server for presence based services. The segment's growth was partially offset by the continuing decline in TDM voice switching.



• Mobile communications: Q4 revenue increased by 15.2%. Strong growth in radio continued in hybrid 2G/3G with market share gains in the emerging markets of Africa, the Middle East, and Southeast Asia where subscriber demand for basic voice services remain strong. In the 3G sector, Alcatel's HSDPA technology has been well accepted by customers and trials are ongoing in developed countries. The NGN/IMS mobile core business recorded a good level of revenue during the quarter with its call server now performing well in live high traffic conditions in North America, where a record-setting 10 billion calls have been handled by the server. New customers were recorded during the quarter, in particular in Russia and Indonesia. Mobile applications continued to grow with a focus on converged pre and post paid payment solutions and User Centric Applications (video, music). To date, Alcatel solutions are enabling 20% of video mobile users on a worldwide basis.



• Private communications: Q3 revenue decreased by 4.8%. Growth was robust in the enterprise and vertical market businesses. The Enterprise activity continued to grow its IP telephony with a particular focus on small businesses, and particularly in Europe.

http://www.alcatel.com

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Comcast Targets 1 Million New VoIP Subscribers in 2006

Comcast is expecting to significantly accelerate its VoIP rollout, hoping to add 1 million new customers by the end of the year. Comcast added 202,000 Comcast Digital Voice (CDV) customers in 2005, reflecting the rollout of the service to 25 new markets including Boston, Chicago, Seattle and Atlanta. At year-end 2005, CDV was being marketed to 16 million homes. Meanwhile, the decline continues in the number of circuit-switched telephone customers it serves, as Comcast transitions to VoIP. As a result, Comcast Cable reported 98,000 net new phone customers in 2005 compared to a loss of 43,000 in 2004.



Comcast's phone revenue remained relatively unchanged in 2005 from the prior year at $687 million.



Brian L. Roberts, Chairman and CEO of Comcast Corporation said, "We have also made great strides in building the foundation that will significantly accelerate our Comcast Digital Voice business in 2006. This in turn will allow us to fully market a bundled offering of voice, video and high-speed Internet products. In 2006 we expect to add at least 3.5 million new revenue generating units, a 35% increase over 2005, including 1 million new Comcast Digital Voice customers."



Some additional highlights from the comopany's quarterly report:

• REVENUE: For the year ended December 31, 2005, Comcast Cable reported revenue of $21.2 billion, a 9.5% increase from the same period in 2004. Video revenue increased 5.7% during the year, driven by higher monthly revenue per basic subscriber and a 1.1 million or 13.1% increase in the number of digital customers, the highest rate of digital subscriber additions in 3 years. For Q$, Comcast Cable reported revenue of $5.4 billion, representing an 8.4% increase from the fourth quarter of 2004.



• DIGITAL CABLE: ended the year with 9.8 million digital cable subscribers and digital cable penetration reached 45.6% of basic subscribers. Basic subscribers declined 0.5% to 21.4 million at December 31, 2005.



• VOD: During 2005, Comcast Digital customers watched 1.4 billion programs on demand; reaching 30 programs a month in December with an average viewing time of almost 30 minutes. Pay-per-view revenues increased 16.4% from 2004 driven by movie and event purchases through the Comcast ON DEMAND service, representing the second consecutive year of pay-per-view revenue growth of more than 15%.



• SET-TOP BOXES: During the year, Comcast Cable deployed 1.5 million advanced set-top boxes with DVR and/or HDTV programming capability. At December 31, 2005, 25.2% of digital customers have one or more advanced set-top boxes compared to 13.1% at the end of 2004.



• HSD: Comcast High-Speed Internet service revenues increased 27.6% to $4.0 billion in 2005, reflecting a 1.5 million or 21.8% increase in subscribers with stable average monthly revenue per subscriber of $42.82. Comcast Cable ended 2005 with more than 8.5 million high-speed Internet subscribers or 20.7% of available homes. The company added 378,000 HSD customers in Q4.



• RGUs:During 2005, Comcast Cable added a total of 2.6 million new revenue generating units. Revenue generating units (RGU) include the sum of analog and digital cable subscribers, high-speed Internet subscribers and phone customers. As of December 31, 2005, Comcast reported 41 million revenue generating units, a 6.9% increase from 2004. In addition, Comcast had more than 2.7 million advanced set-top boxes with DVR and/or HDTV programming capability in digital customers' homes, driving growth in video revenue per subscriber.




• CAPEX: Cable capital expenditures in 2005 remained relatively unchanged at $3.6 billion when compared to one year ago. Expenditures for 2005 reflect increased purchases of digital set-top boxes to meet strong demand for HDTV and DVR digital services, costs associated with readiness and deployment of CDV and the impact of hurricane-related reconstruction costs, offset by declines in plant upgrade spending.

http://www.comcast.com

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France Telecom and ST Enter R&D Partnership

France Telecom and STMicroelectronics announced an partnership to utilize their respective and complementary business strengths and technical R&D competencies to jointly analyze and define end-to-end services and platform requirements, to enable faster service deployments and greater end-user satisfaction.



The first joint R&D project addresses the analysis of end-to-end advanced security for mobile devices and services. The goal of the project is to define architectural solutions for the next generation of mobile platforms able to support mobile operators' constraints and requirements for the deployment of new secure and interactive services. The project will address many different mobile device components: the application processor and operating system; SIM Card ICs; and contactless interfaces.



Combining France Telecom's know-how in telecoms with ST's security technology developed for its Nomadik family of multimedia application processors, France Telecom and ST will work together to develop a secure and open environment for personal multimedia services and next-generation portable platforms. The final objective is to define a global trusted platform architecture.



In addition, the two companies will combine efforts to improve the SIM Card IC architecture and its connectivity within the mobile platform. They will work together to define efficient architectural solutions that will enable new and enhanced mobile services. The R&D activities will be centered on the use of multi-megabyte SIM memory capacities, high-speed SIM-to-mobile- platform interfaces, SIM IC support for contactless operation, and the use of the SIM IC as a dependable basis for the trusted mobile platform.
http://www.st.comhttp://www.francetelecom.com

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ECI Telecom Revenues Rise to $169 Million

ECI Telecom reported Q4 2005 revenues of $169 million, a 21% increase from the $140 million recorded in the fourth quarter of 2004 and compared to $162 million recorded in the third quarter of 2005.



For the entire year 2005, revenues rose 27% to reach $630 million.



Net income for the fourth quarter of 2005 reached $7.6 million, or $0.06 per share on a fully diluted basis, compared with fourth quarter 2004 net income of $8.9 million, or $0.08 per share, prior to the acquisition of Laurel Networks, which was completed in June 2005. In the third quarter of 2005 ECI earned $6.2 million, or $0.05 per share.



Some highlights for quarter include:

• Revenues for the Optical Networks Division continued to grow and totaled $88 million for the fourth quarter of 2005, up 22% from the year ago period and compared to $85 million in the third quarter of 2005.



• ECI's Broadband Access Division sold and installed over 4 million ADSL lines during the year, reflecting growth of more than 40% for the year. Revenues for the fourth quarter of 2005 totaled $68 million, up 13% from the year ago period and compared with a similar level of sales in the third quarter of 2005.



• Revenues for the Data Networking Division (formerly Laurel Networks, acquired in June 2005) totaled $2 million for the fourth quarter of 2005, similar to the third quarter, while the operating loss was $8.7 million, compared to an operating loss of $7.7 million in the prior quarter. ECI has made significant progress in the integration of the division and in building a sales pipeline. Management expects a significant increase in sales of the division's products later in 2006.

Rafi Maor, ECI's new President and CEO stated, "During the fourth quarter of 2005, we continued deploying our leading edge IPTV solutions at one of our primary European customers. During the first quarter of 2006, ECI will begin a large-scale deployment of advanced IPTV solutions with another major European customer. The customer is expected to offer advanced triple play services including High Definition TV (HDTV) broadcasts of the World Cup soccer tournament, to be held in June of this year."http://www.ecitelecom.com

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Fujitsu Enters North American GPON Market

Fujitsu Network Communications is expanding its North American access by introducing its widely deployed Gigabit Ethernet Passive Optical Networking (GEPON) systems from the Asian market. These systems will be complemented by its Multi-Service Access Node (MSAN) solution and IP Digital Subscriber Line Access Multiplexers (DSLAMs) from its U.K. deployment programs.



Fujitsu said its GPON architecture is designed to significantly lower the cost of deploying and operating passive optical networks, while providing seamless integration with both existing Time Division Multiplexed (TDM) networks and next-generation packet transport networks.



GPON supports downstream rates of 2.488 Gbps and upstream rates of 1.2 Gbps, allowing for bandwidth in excess of 75 Mbps per home. The use of generic framing in GPON, compared to ATM cells in BPON, also eliminates much of the external ATM legacy costs for service providers. Broadband Passive Optical Networking (BPON) networks are limited to 622 Mbps toward subscribers (i.e. downstream) and 155 Mbps from subscribers (i.e. upstream), with approximately 20 Mbps allocated per home.
http://us.fujitsu.com/telecom

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iBasis Carries 2.3 billion minutes in Q4, up 15% Sequentially

iBasis carried 2.3 billion minutes of traffic in Q4 2005, a 15% increase over Q3 2005. Revenue for the fourth quarter of 2005 was $107.6 million, compared to $75.1 million for the fourth quarter of 2004. Net income for the fourth quarter of 2005 was $0.6 million, or $0.01 per share, as the company returned to profitablility.

http://www.ibasis.com

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First Avenue Prices 100 Mbps Wireless Service at $2,000/Month

First Avenue Networks, a fixed wireless services provider, introduced a flat-rate plan structured to provide Carrier Ethernet services up to 100 Mbps as well as NxDS-1, DS-3 or OC-3 connections to government agencies and suppliers for $2,000 per month.



First Avenue Networks said it will deliver government-grade connectivity over licensed spectrum with high availability (99.995%).



The fixed wireless transport service utilizes the company's nationwide, multi-channel 24 GHz and 39 GHz licensed spectrum holdings. The company serves major metro markets.

http://www.firstavenet.com

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AOL Reaches ISP Marketing Deal with Charter

AOL announced a partnership with Charter Communications to offer consumers the AOL service using Charter's cable modem service at the competitive price of $25.90 per month.

http://www.aol.comhttp://www.charter.com

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3Com Acquires Majority Ownership of Huawei-3Com Joint Venture

3Com has purchased from Huawei an additional two percent interest in Huawei-3Com, Ltd. (H-3C), a China-based joint venture formed by 3Com and Huawei in November 2003. The sale was completed on January 27, 2006 following final approval from the government of the People's Republic of China, resulting in 3Com owning 51 percent of the joint venture and Huawei owning the remaining 49 percent.



"When the joint venture was formed in 2003, we had three key objectives: First, to establish a substantial presence in China, the world's fastest growing market; second, to create a resource capable of building enterprise-class, cutting-edge switching and routing products faster than we could deliver on our own; and third, to capitalize on a rapidly growing pool of engineering talent," said Scott Murray, president and CEO of 3Com. "We are extremely pleased with Huawei-3Com's performance, and its potential for continued growth."



According to industry research firm, IDC's Q3 2005 APAC LAN tracker, H-3C currently holds 31 percent share of the Chinese LAN switch market. Additionally, in its most recent financial earnings announcement, 3Com reported that during its calendar third quarter ended September 30, 2005, Huawei-3Com revenue was $111 million, an increase of 69 percent over the same period in the prior year. Gross margin for the quarter was 42 percent.

http://www.3com.com

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CapRock Completes $200 Million for Global Satellite Communications

CapRock Communications, a global satellite communications provider to extreme and remote locations, completed a $200 million recapitalization through a majority share sale to Boston private equity firm ABRY Partners.



"CapRock has enjoyed a strong 25 year history, but the last four years have seen dramatic double digit compound annual growth fueled by globalization and vertical market expansion," CapRock CEO Peter Shaper, said.

http://www.caprock.com

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Sprint's Local Spinoff to be Named "EMBARQ"

Sprint Nextel's local communications company, which is expected to be spin-out from the parent company in Q2 2006, will be called "EMBARQ".



EMBARQ expects to trade on the New York Stock Exchange under the ticker symbol "EQ". A key partner in the development of the brand strategy, name and logo was SALT Branding, based in San Francisco.




EMBARQ is expected to have approximately $6 billion in annual revenues, rank among the Fortune 500 and serve as the fifth largest local communications company in the United States based on the company's 7.4 million access lines as of Sept. 30, 2005. The company will provide a suite of communications services, consisting of local and long distance voice and data services, including high-speed Internet access. The company expects to have approximately 20,000 employees at the time of the separation from Sprint Nextel.



"The company's new name, EMBARQ, and logo are meant to signal the way we will do business and establish what a next-generation local communications company can be," said Daniel R. Hesse, the company's designated CEO.

http://www.sprint.comhttp://www.embarq.com

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Widevine Offers Application Level Encryption for Video Content Protection

Widevine Technologies introduced an Application Level Encryption method for protecting video content, eliminating the need to integrate with downstream video infrastructure equipment.



The company said its patent-pending encryption system significantly reduces the capital and operational costs normally required to integrate content protection with VOD and nPVR/nDVR systems and expands video operators' flexibility to securely deploy a variety of video consumer devices, business models and service offerings.



Unlike traditional DRM/CAS solutions, Widevine Cypher Suite encrypts content anytime prior to the video processing on a VOD or NPVR/NDVR system, including upstream at a content provider's location. It also enables operators the flexibility to deploy multiple VOD systems within the same content delivery network. Finally, it renders obsolete the traditional process of decrypting and re-encrypting content late in the process -- a major concern with content owners. In traditional systems, encryption is typically applied too late in the process -- and removed too early -- to provide the appropriate level of encryption required for next generation video networks.



Widevine's Application Level Encryption has been tested and is deployed with the following video server vendors: Arroyo, Alcatel OVS, Broadbus, Concurrent, Entone, Infovalue, Kasenna, NCube/C-COR, QuickTime Darwin Server, Real Networks, SeaChange, Streaming21, Windows Media Server and VideoLAN.

http://www.widevine.com

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Centillium Posts Q4 Revenue of $20.3 Million

Centillium Communications reported Q4 revenues of $20.3 million, compared with net revenues of $20.0 million in the third quarter of 2005. The gross margin in the fourth quarter of 2005 was 59.7 percent, compared with 56.5 percent in the prior quarter. The net loss in the fourth quarter of 2005 was $394,000, or $0.01 per share, compared with a net loss of $822,000, or $0.02 per share, in the third quarter of 2005.



For the year ended Dec. 31, 2005, net revenues were $76.1 million, compared with $71.2 million in 2004.



The company noted that 2005 revenues outside of Japan were $27.1 million, up 77 percent, compared with $15.3 million in 2004. Revenues outside of Japan accounted for 36 percent of total revenues in 2005, compared with 22 percent in 2004. Our non-DSL revenues, including Voice over Internet Protocol (VoIP) and Optical revenues, more than tripled to $15.8 million, from $4.4 million in 2004.

http://www.centillium.com

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The Cloud Raises Funding for Wi-Fi Expansion

The Cloud, the largest hot spot operator in Europe, raised closed its third round of funding, bringing total investment in the firm to EUR 20 million. The funds will be used to expand The Cloud's UK network through initiatives such as its recently announced plan to provide wide area outdoor coverage in nine cities in the UK, and its deployments in rail stations, hotels, airports, universities and a wide variety of other public spaces. The Cloud will also use the funds to build on its existing presence in Germany and Sweden, both markets where the Cloud is the second largest WiFi operator but growing rapidly, and expand into the rest of the Nordic region.



Existing investors, 3i and Accel, contributed to the round, along with Provider Venture Partners, a leading Swedish VC.



The Cloud also announced its acquisition of NetCheckiN (NCI), a German WiFi operator.

http://www.thecloud.net

• Launched in mid 2003, The Cloud actively partners with O2, BT, Vodafone D2, Skype, Ericsson and Intel among others.

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