FCC Eliminates Mandated Line Sharing for DSL

The FCC voted 4-to-0 to eliminated the line sharing requirements on facilities-based wireline broadband Internet access service providers. The decision puts DSL operators on regulatory par with cable operators, who are not required to share their cable modem facilities with independent ISPs following the recent Supreme Court ruling in the Brand X case.


Specifically, the FCC determined that wireline broadband Internet access services are defined as information services functionally integrated with a telecommunications component. In the past, the FCC required facilities-based providers to offer that wireline broadband transmission component separately from their Internet service as a stand-alone service on a common-carrier basis, and thus classified that component as a telecommunications service. With the new ruling, the FCC has eliminated this transmission component sharing requirement, finding it caused vendors to delay development and deployment of broadband services to consumers. To ensure a smooth transition, the Order requires that facilities-based wireline broadband Internet access service providers continue to provide existing wireline broadband Internet access transmission offerings, on a grandfathered basis, to unaffiliated ISPs for one year.


The Order also requires facilities-based providers to contribute to existing universal service mechanisms based on their current levels of reported revenues for the DSL transmission for a 270-day period after the effective date of the Order or until the Commission adopts new contribution rules, whichever occurs earlier. If the Commission is unable to complete new contribution rules within the 270-day period, the Commission will take whatever action is necessary to preserve existing funding levels, including extending the 270-day period or expanding the contribution base.


The Order also allows wireline providers the flexibility to offer the transmission component of the wireline broadband Internet access service to affiliated or unaffiliated ISPs on a common-carrier basis, a non-common carrier basis, or some combination of both. Some rural incumbent local exchange carriers, or LECs, have indicated their members may choose to offer broadband Internet access transmission on a common carrier basis.


FCC Chairman Kevin Martin said "the Order that we adopt today is a momentous one. It ends the regulatory inequities that currently exist between cable and telephone companies in their provision of broadband Internet services. As I have said on numerous occasions, leveling the playing field between these providers has been one of my highest priorities. With this Order, wireline broadband Internet access providers, like cable modem service providers, will be considered information service providers and will no longer be compelled by regulation to unbundle and separately tariff the underlying transmission component of their Internet access service."http://www.fcc.gov

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FCC Imposes CALEA on VoIP Providers Offering PSTN Interconnection

Responding to a petition from the Department of Justice, the Federal Bureau of Investigation (FBI) , and the Drug Enforcement Agency (DEA), the FCC ruled that certain types of VoIP services must accommodate law enforcement wiretaps. The action was described as "the first critical step to apply CALEA obligations to new technologies and services that are increasingly used as a substitute for conventional services."


The FCC reasoned that VoIP services which essentially replace conventional telecommunications services are subject to the Communications Assistance for Law Enforcement Act (CALEA), which gives law enforcement agencies the authority to conduct court-ordered wiretaps.


The Order is limited to facilities-based broadband Internet access service providers and VoIP providers that offer services permitting users to receive calls from, and place calls to, the public switched telephone network. These VoIP providers are called interconnected VoIP providers.


The Commission found that the definition of "telecommunications carrier" in CALEA is broader than the definition of that term in the Communications Act and can encompass providers of services that are not classified as telecommunications services under the Communications Act. CALEA contains a provision that authorizes the Commission to deem an entity a telecommunications carrier if the Commission "finds that such service is a replacement for a substantial portion of the local telephone exchange."


Because broadband Internet and interconnected VoIP providers need a reasonable amount of time to come into compliance with all relevant CALEA requirements, the FCC established a deadline of 18 months from the effective date of this Order, by which time newly covered entities and providers of newly covered services must be in full compliance.


The FCC also adopted a Further Notice of Proposed Rulemaking that will seek more information about whether certain classes or categories of facilities-based broadband Internet access providers -- notably small and rural providers and providers of broadband networks for educational and research institutions -- should be exempt from CALEA.
http://www.fcc.gov

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FCC Modifies 90 MHz AWS Spectrum Plan

The FCC modified the band plan, and licensing and service rules -- originally adopted in October 2003 -- for the 90 MHz of Advanced Wireless Service (AWS) spectrum at 1710-1755 MHz and 2110-2155 MHz.


The original band plan for this spectrum adopted by the FCC in October 2003 included a mixture of license sizes and geographic areas in order to accommodate the needs of wireless providers of various sizes serving a range of different geographic areas. Today's Order maintains such a mixture but increases the amount of spectrum licensed on a small geographic area basis (Cellular Market Areas, or CMAs) from 10 MHz to 20 MHz in order to provide greater opportunities for smaller rural or regional providers to obtain access to this spectrum at auction. The Order also provides for an additional 10 MHz of spectrum licensed by Economic Areas (EAs).
http://www.fcc.gov

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FCC Adopts Policy Statement on Broadband Internet Access

The FCC adopted a policy statement that outlines four principles to encourage broadband deployment and preserve and promote the open and interconnected nature of public Internet:

• (1) consumers are entitled to access the lawful Internet content of their choice




• (2) consumers are entitled to run applications and services of their choice, subject to the needs of law enforcement;




• (3) consumers are entitled to connect their choice of legal devices that do not harm the network;




• (4) consumers are entitled to competition among network providers, application and service providers, and content providers.

The FCC has not adopted formal rules to enforce these principles, but said it would incorporate these principles into its ongoing policymaking activities. The FCC's policy statement also noted that "all of these principles are subject to reasonable network management."


In a separate statement, FCC Chairman Kevin Martin said "Cable and telephone companies have led the way in bringing broadband to millions of Americans. The evidence today is that their internet access consumers have the ability to reach any internet content. Indeed, cable and telephone companies' practices already track well the internet principles we endorse today. I remain confident that the marketplace will continue to ensure that these principles are maintained. I also am confident, therefore, that regulation is not, nor will be, required."http://www.fcc.govIn February 2004, the previous FCC Chairman, Michael K. Powell, issued a challenge to high-speed Internet providers to adopt a set of four voluntary “Net Freedom�? principles:

• Freedom to Access Content. Consumers should have access to their choice of legal content.



• Freedom to Use Applications. Consumers should be able to run applications of their choice.



• Freedom to Attach Personal Devices. Consumers should be permitted to attach any devices they choose to the connection in their homes.



• Freedom to Obtain Service Plan Information. Consumers should receive meaningful information regarding their service plans.

“I would emphasize that consumers also have a role in this challenge to preserve ‘Net Freedom,'�? said Powell. “I encourage consumers to challenge their broadband providers to live up to these standards and to let the Commission know how the industry is doing.�?

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Shaw Signs VOD Deal with Paramount Pictures

Shaw Communications signed a Video On Demand agreement with Paramount Pictures, providing access to the Paramount film library to its customers across western Canada.
http://www.shaw.ca

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BellSouth and CWA Reach Settlement

BellSouth and the Communications Workers of America (CWA) have reached a five-year tentative agreement covering approximately 500 employees of BellSouth Internet Services. The previous contract was set to expire at midnight on Aug. 6, 2005.


"We are pleased that once again the company and CWA have been able to work together successfully to find solutions to the complex issues facing our business," said Dick Sibbernsen, vice president of Human Resources for BellSouth. "This agreement allows BellSouth to effectively compete in the marketplace and continue to provide customers with high-quality products and services."http://www.bellsouth.com

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Industry Reaction to FCC DSL Ruling

Verizon: "This is an important step toward a national broadband policy that allows consumers to enjoy the full benefits of competition. At last, regulations are catching up to where consumers and technology have been for some time. This decision will help accelerate deployment of broadband networks, enabling greater choice and increased access for consumers." Susanne A. Guyer, Verizon senior vice president for federal regulatory affairs


Earthlink: "Today's FCC ruling effectively preserves DSL access for the next year. Beyond that, we are confident that we will extend our existing commercial agreements with the Bells so that we can continue to deliver DSL services. EarthLink will continue to work with our cable partners and explore next generation broadband alternatives to give consumers competitive alternatives for their high-speed Internet service." Dave Baker, vice president, law and public, EarthLink


Covad: "While the full text of today's FCC order is not yet available, based on statements made at the meeting the order does not impact Covad's ability to provide broadband and VoIP services. Covad strongly believes that having open networks promotes broadband growth in the U.S., and that requiring broadband service access for independent ISPs has led to lower prices, more innovation and greater consumer choice. In light of this decision, it is clear that Covad offers the only national alternative broadband network to ISPs and VoIP providers. With the nation's largest DSL footprint, Covad is uniquely positioned to offer the ISPs an alternative for connections to their customers." James A. Kirkland, Covad senior vice president and general counsel.


CEA: "We applaud today's action by the FCC creating regulatory parity among all broadband service providers. More importantly, we commend the Commission's endorsement of principles ensuring that Americans retain their freedom to access content, use applications and connect devices of their choice to high-speed Internet networks. Adherence to these principles is vital to ensure the development of new innovative consumer electronic devices that depend on unrestricted connection to broadband networks. In the coming days, we will examine the policy statement in full to ensure that it includes the necessary provisions and mechanisms that fully preserve these principles." Michael Petricone, Consumer Electronics Association (CEA) Vice President, Technology Policy.
http://www.convergedigest.com

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CWA Members Vote Strike Authorization at Qwest

Members of the Communications Workers of America working at Qwest Communications voted overwhelmingly to give CWA leaders authorization to call a strike if a fair contract cannot be reached. The current contract covering 25,000 CWA- represented workers at Qwest will expire at 12:01 a.m. on Aug. 14.


"CWA wants to reach a fair agreement with Qwest, but management must recognize that our members have made substantial sacrifices to help keep Qwest in business over a very rocky period," said Annie Hill, CWA District 7 Vice President. "Our members want Qwest to succeed, but we also expect management to come to the bargaining table with fair proposals, not excessive demands for shifting health care costs to workers and retirees, and demands for increased mandatory overtime work that force workers to spend even more time away from their families."


The CWA noted that this is the first full contract bargaining session since 1998. Two contract extensions were approved by CWA members in 2001 and 2003, in the wake of Qwest's serious financial difficulties caused by the previous management team headed by Joseph Nacchio.
http://www.cwa-union.org/

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WebEx Partners With NTT Communications in Japan

WebEx Communications has entered into an agreement with NTT Communications to launch a contact center solution for small and medium size businesses (SMB) in the Japanese market. The new Customer Connect solution bundles several enterprise-level contact center functions into a hosted solution. It combines NTT Com IP audio, automatic call distribution capabilities and the WebEx Support Center application. The service is offered as a turnkey, hosted contact center solution for SMBs. It features NTT Com IP Centrex for voice conferencing, automatic call distribution to quickly route calls to appropriate agents, interactive voice response for voice activated navigation and detailed logs for advanced reporting.


"The seamless integration of WebEx Support Center allows agents to easily escalate from a support call into a virtual hands-on remote support session," said Ray Villareal, vice president field operations and marketing at WebEx.
http://www.webex.com

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BellSouth Debuts Pre-WiMax Service

BellSouth has begun offering its FastAccess Internet Service powered by wireless broadband technology in Athens, Georgia. Pricing will range from $24.95 to $39.95 per month, depending on the speed selected and if the customer has BellSouth wireline service.


BellSouth said it plans to offer the wireless broadband in select Florida cities later this year.
http://www.bellsouth.com

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NEC and Harris Settle Patent Infringement Claims

NEC reached a settlement with Harris in its lawsuit regarding infringement of its Digital Microwave Radio ("DMR") patent. Harris has agreed to take a royalty-bearing, non-exclusive license under NEC's Digital Microwave Radio ("DMR") patents. NEC has dismissed all other claims. The patent infringement lawsuits were filed in September 2004. Financial terms were not disclosed.


In addition with the settlement, Harris agreed to purchase from NEC, and NEC agreed to sell to Harris, certain PBX patents possessed by NEC. Also, the parties agreed to a patent cross license as to all other product categories.
http://www.nec.co.jp

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Belgium's Mobistar Expands from Mobile to DSL

Mobistar, the second largest mobile operator in Belgium, has decided to make a strategic shift from a purely mobile operator to a fully convergent ISP with wireline facilities. Mobistar will deploy the Alcatel 7301 Advanced Services Access Manager DSLAM, managed by the Alcatel 5523 ADSL Work Station (AWS) and the Alcatel 5530 Network Analyzer.


Mobistar is part of France Telecom's Orange Group. http://www.alcatel.com
http://www.mobistar.be

• As of 30 June 2005, Mobistar had 2,867,522 active customers , 205,186 more than a year before, representing growth of 7.7%. The proportion of postpaid customers increased markedly to 39.8% of the active customer base, against 32.9% on 30 June 2004. According to its estimations, The company said it holds a market share of more than 33% of the mobile telecommunication business in Belgium.

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Russia's VimpelCom Selects Alcatel Mobile NGN

VimpelCom, a leading international carrier operating under the "Beeline" brand in Russia and Kazakhstan, will deploy Alcatel's mobile Next Generation Network (NGN) solution in the Urals. Specifically, VimpelCom will deploy the Alcatel 5020 Spatial Atrium Softswitch, a multi-standard mobile call server for controlling distributed media gateways and managing call/session control for voice and data services. The project is scheduled for completion in Q3 2005. Financial terms were not disclosed.
http://www.alcatel.com

• In September 2004, Alcatel agreed to acquire Spatial Wireless, a start-up offering software-based and multi-standard distributed mobile switching solutions, for approximately US$250 million. Spatial's flagship product, Spatial Atrium, is a multi-standard mobile softswitch that controls distributed media gateways and manages call/session control for voice and data services. It works seamlessly in GSM/EDGE, 3G/UMTS and CDMA networks. It also enables an evolution to 3GPP Release 5 and Release 6 networks via software-only upgrades. The company said that its network architecture allows a mobile operator to invest in only a few Mobile Call Servers spread though a limited number of centralized control sites located in its largest traffic zones, while having a larger number of lower-cost Media Gateways located close to the access network to switch the traffic locally. Spatial's distributed solution is in commercial use and in market trials, with major GSM and CDMA operators in the world, in particular in North America, China, and India - with over one million ports deployed in 2004.

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Motorola Seeks Enforcement via Telsim's International Roaming

Motorola is seeking to collect the international roaming and interconnect revenues of Telsim Mobil Telekomunikasyon (Telsim), the second largest mobile operator in Turkey, as a means of enforcing its approximately $2.5 billion arbitration claim against the company.


On June 13, 2005, a panel of arbitrators from the Zurich Chamber of Commerce issued a final award ("the Final Award") in the arbitration pending between Telsim and Motorola Credit Corporation ("MCC") concerning the amounts due by Telsim to MCC under the financing arrangements between the parties. Telsim had borrowed nearly $2.0 billion from Motorola for the financing of a Motorola-constructed cellular telephone system and has failed to pay Motorola despite the system's operational success.


Telsim has refused to pay Motorola. This week, courts in the United States and the United Kingdom granted Motorola's request to attach the international roaming and interconnect revenues Telsim has earned in those countries. As the result of the decisions from the U.S. and U.K. courts, Motorola will be able to attach and/or freeze the monies other carriers would have otherwise paid to Telsim for international roaming and interconnect services.


Motorola said that because its claim is not against the other carriers, this order will not effect international roaming and interconnect services.


Motorola also said that it will continue to aggressively seek enforcement of the judgment for $2.13 billion rendered on behalf of Motorola against the Uzan family of Turkey for perpetrating the massive fraud against Motorola relating to the Telsim loans.
http://www.motorola.com

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Alltel Cites Wireless for Gains in Profitability

Alltel reported quarterly revenues of $2.3 billion, an 11% increase from a year ago. Net income (GAAP) was $402 million, a 53% increase. Net income from current businesses was $284 million, an 8% increase from a year ago.


Wireless revenue was $1.5 billion, a 16 percent increase from a year ago. Segment income was $307 million, a 17 percent increase.


Average revenue per wireless customer was $50.55, a 6 percent increase year-over-year and the highest ARPU in 5 years, driven by improvements in data revenue and quality customer growth. Post-pay churn was 1.58 percent, which was flat year-over-year.


Wireline revenue was $595 million, down 2 percent from the previous year. Segment income was $215 million, an 8 percent decline. The company added 36,000 broadband customers, bringing its total broadband customer base to 319,000. Average revenue per wireline customer was $66.83, a 1 percent increase.


Equity free cash flow from current businesses was $260 million. Net cash provided from operations was $465 million. http://www.alltel.com

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European Commission Adopts R&D Plan

The European Commission announced plans to invest € 1 billion to launch 276 new research projects in the field of Information and Communication Technologies (ICT). Over 1,300 proposals were submitted in response to the 4th Information Society Technology Call for Proposals under the EU's Sixth Research Framework Programme. 462 proposals met the quality criteria, of which 276 were retained.


The selected projects aim in particular to achieve industrial and societal breakthroughs in fields that are of strategic importance to Europe, and where it has recognized strengths. They include micro- and nano-electronics, mobile communications and broadband technology for accessing the internet. In broadband, research funding has been an incentive for European equipment manufacturers to make, over the past years, internet access in Europe faster and cheaper, thanks to optical network technology and low-cost ADSL modems.


In the coming five years, the Commission will also support new fields with high potential for industrial and commercial breakthroughs, such as:

• cognitive systems that can sense and interpret real-world events and help humans deal with them;



• improvements in the security and dependability of information and communication technology systems;



• new applications that will affect our lives in health, transport, content creation, and in government administrations and services.

"Investment into research in Information and Communication Technologies is our best-bet contribution to growth and jobs. However, Europe continues to under-invest considerably into ICT research for lack of sufficient resources both at EU level and at national level. Today, half the ICT research projects proposed for EU funding have had to be turned down, despite meeting all the requisite quality criteria. If Europe wants to be part of the game of global competition for better ICT services, we need to step up our resources considerably," said Information Society and Media Commissioner Viviane Reding.http://europa.eu.int

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America Online Acquires Xdrive for Online Storage

America Online has acquired Xdrive, a privately-held provider of online storage and backup services. Financial terms were not disclosed. Xdrive manages an online, centralized storage platform that gives subscribers access to, and protection of, all their digital files.


Xdrive, founded in 1999 and headquartered in Santa Monica, California, will operate as a stand alone, wholly-owned subsidiary of AOL under the Digital Services business unit and continue to be based in southern California. The company has 34 employees.


The Xdrive unit, the Xdrive management team, and its talented, highly-skilled 34 employees will report to Gio Hunt, Senior Vice President of New Business Ventures, AOL Digital Services.
http://www.aol.com
http://www.xdrive.com

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Tekelec Acquires iptelorg GmbH for SIP Routing

Tekelec has acquired iptelorg GmbH, a developer of Session Initiation Protocol (SIP) routing software, for approximately $7 million in cash, plus $4 million of Tekelec shares, which are subject to repurchase for a nominal amount if certain of the former iptelorg shareholders terminate their employment with Tekelec within four years. Tekelec said the acquisition would extend its IP Multimedia Subsystem (IMS) capabilities.


iptelorg, which is based in based in Germany and the Czech Republic, offers a SIP Express Router is used in commercial deployments, anchoring offerings from T-Online International AG and EarthLink, among others. Tekelec said the technology is optimized for integrated communications solutions such as the Tekelec EAGLE 5 Signaling Applications System platform.


"The fact that IMS networks are very signaling intensive plays to our strength. Integrating SIP-signaling applications with our SS7 applications provides a perfect complement to our portfolio, supporting customers with legacy and next-gen environments alike. We help operators evolve their networks at the pace and scale that make sense for their businesses," said Fred Lax, Tekelec CEO.
http://www.tekelec.com/news/prdetail.asp?prnum=543http://www.iptelorg.com/

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Tekelec Reports Revenue of $133M, Acquires Remaining Santera Interest

Tekelec reported Q2 revenue of $133.0 million, compared to $95.6 million in the second quarter of 2004. Net income (GAAP) was $5.6 million, or $0.08 per diluted share, for the second quarter of 2005, compared to a net loss of $304,000, or $0.00 per diluted share, in the second quarter of 2004.

Tekelec also announced plans to purchase the minority interest in Santera for cash in the amount of $75.6 million. The transaction is expected to close in early October 2005.

• Network Signaling Group revenue increased to $81.5 million, up 20%, compared to $68.0 million in Q2 '04, and increased 10% sequentially, marking the highest quarterly signaling revenue in the history of the company. Bell Canada has selected Tekelec's Eagle 5 Signaling Application System and integrated network monitoring platform to address its evolving signaling requirements as it enhances its core infrastructure. Bell Canada is replacing legacy signaling and monitoring equipment with Tekelec solutions.



• Switching Solutions Group revenue increased to $33.3 million, up 158%, compared to $12.9 million in Q2 '04, and increased 34% sequentially, as we added 19 new switching customers during the quarter. Celcom, Malaysia's largest mobile operator, will be deploying the T8000 wireless media gateway as part of an IP-based next-gen switching solution.



• Communications Software Solutions Group revenue increased to $7.1 million, up 65%, compared to $4.3 million in Q2 ‘04, but declined 26% sequentially, or $2.4 million. As part of a bundled Tekelec solution, Bell Canada is also deploying Tekelec's network-wide monitoring solution. This implementation will feed the critical business intelligence data required for the applications that run the carrier's customer care, call center operations and customer settlements processes. Also, DTAC Thailand, a leading Thai mobile operator, has selected Tekelec's Integrated Application Solution for roaming management.

Tekelec President and CEO Fred Lax commented, "Tekelec's results were strong in the second quarter, with orders up 27% year-over-year and up 29% sequentially, and revenue increasing 39% year-over-year and up 11% sequentially. For the eleventh consecutive quarter, strong order volumes provided us with a book-to-bill ratio greater than one."http://www.tekelec.com

• In June 2003, Tekelec acquired the majority interest in Santera Systems, a start-up that developed an integrated voice and data switching platform for delivering Class 4/5 services, PRI offload, packet/cell switching and voice over broadband services.

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Alcatel Opens NOC in Hong Kong

Alcatel will establish a Network Operation and Integration Centre in Hong Kong and Hutchison Global Communications will become its first client.


Alcatel will use the new Centre to offer a full range of essential network operation and integration support services such as performance and fault monitoring, service management, network and customer services. Customers in Hong Kong will benefit from OPEX reduction, improved operational efficiency, better market focus to meet business challenge and better time-to-market for new technology-based products.


To accelerate the growth potentials of its integration services business in Hong Kong, Alcatel has signed an agreement with Hutchison Global Communications (HGC) in which HGC agrees to transfer to Alcatel certain of its engineering and operation functions, which support HGC's telecommunications network in Hong Kong. It is intended that more than 300 network engineering and operation personnel will be transferred to Alcatel from HGC by mid September 2005. http://www.alcatel.com

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