Merrill Lynch Selects Avaya for Corporate VoIP Network

Merrill Lynch selected Avaya IP telephony solutions for its three-year-old corporate campus in Hopewell, New Jersey and its new regional headquarters building in Tokyo, Japan. The deployment will include Avaya Communication Manager IP telephony software and Avaya Media Servers. Merrill Lynch will use a mix of IP and digital handsets to serve its 5800 employees in New Jersey and 1800 employees in Japan -- routing IP calls over its data network and digital calls over its new voice network. Financial terms were not disclosed.
http://www.avaya.com

• Merrill Lynch had previously been using thousands of Cisco IP phones in its network.

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AFC Reports Revenue of $83 Million

Advanced Fibre Communications (AFC) announced Q2 revenue of $83.0 million on a GAAP basis, compared with $80.5 million in the preceding quarter and $86.3 million for Q2 2002. Net income for Q2 2003 was $3.3 million, or $0.04 per share, compared with $8.3 million, or $0.10 per share, in Q1 2003. ALLTEL and Sprint were each 10% customers in the quarter. AFC said service providers will remain cautious about spending in the near term, but that investment in the access network will be a key focus for carriers in the future as they roll out DSL and Fiber to the Premise (FTTP).
http://www.afc.com

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Avaya Reports Relatively Flat Quarterly Revenue of $1.072 billion

Avaya reported quarterly revenue of $1.072 billion, slightly below revenue of $1.081 billion for the preceding quarter. The company reported net income of $8 million and earnings per diluted share of $0.02 per share. Avaya noted its cash balance increased for the fourth straight quarter to $843 million. Net debt decreased to $150 million and is at the lowest level it has been since the company became an independent business.
http://www.avaya.com

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Nortel Networks Sees Revenue Decline 3% from Q1

Citing cautious spending by service providers, Nortel Networks reported quarterly revenue of US$2.33 billion, down sequentially approximately 3%. This compares to US$2.77 billion in revenue for Q2 2002. There was a net loss in the second quarter of 2003 of US$14 million, or US$0.00 per common share, compared to net earnings of US$54 million, or US$0.01 per common share, in Q1 2003. Some highlights:

• Compared to Q1 2003, Wireless Networks revenues increased 4%, Enterprise Networks revenues decreased 11%, Wireline Networks revenues decreased 12% and Optical Networks revenues increased 10%.
• 
  
  Compared to Q1 2003, sales in the US decreased 5%, the Europe, Middle East and Africa region (EMEA) decreased 9%, Canada increased 6% and Other areas increased 10%.
• 
  
  Gross margin was 43.7% of sales in Q2 2003, up from 42.9% in Q1 2003, and 34.5% in the second quarter of 2002.

http://www.nortelnetworks.com

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Universal Access Closes $16 Million Investment

Universal Access Global Holdings, a communications and network integrator based in Chicago, received a $16 million equity investment from CityNet Telecommunications, a carrier that has pioneered deployment of last-mile fiber optic networks through in-city sewer systems. Under the deal, CityNet has invested $16 million in cash in Universal Access. CityNet has also contributed fiber optic network assets in exchange for a 55% fully-diluted stake in Universal Access. CityNet originally funded $5 million of its total investment in April in the form of secured debt, which was repaid as part of this transaction.


Separately, Universal Access announced that Randall Lay has been appointed as CEO. Lay previously served as the company's COO.
http://www.universalaccess.nethttp://www.citynettelecom.com

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Level 3 Sees General Price Stability Trend, Positions for Upturn

Level 3 Communications reported Q2 revenue of $941 million compared to $1.23 billion for the previous quarter, which excludes $17 million and $20 million of revenue, respectively, from Software Spectrum's contact services business which is included in discontinued operations. Level 3's Q1 figures also reflected one-time settlement revenues. The net loss for Q2 was $0.95 per share, or $462 million. This includes a $190 million charge associated with the premium that was paid for the full conversion of the company's 9% Junior Convertible Subordinated Notes due 2012. Level 3 noted the communications revenue was slightly ahead of its expectations. The company said it was continuing to make steady progress in the integration of Genuity, however sales cycles were longer than expected. Some other highlights:

• Pricing for circuits at OC-3 and below has remained stable; however there is a lot of price competition for higher speed circuits
• 
  
  IP price compression also continues, especially in larger deals
• 
  
  Level 3's sales of wavelength IRUs increased in Q2. Prospects for metro IRUs are good, especially for MSOs
• 
  
  Level 3's colocation business grew slightly in the quarter, pricing is stable, and the market is in turmoil due to Sprint and C&W exiting from this segment
• 
  
  Level 3's softswitch business also remains stable, although price declines are expected as major contracts across the industry come up for renewal. Traffic volumes for Level 3's managed modem service averaged about 29 billion minutes per month, down 14% from Q1 due to seasonality.
• 
  
  Level 3 is developing plans for a hosted PBX service sold through channel partners. The service would be based on a platform acquired through Telverse. The IP PBX service would be aimed at small to mid-size businesses and connected via private line, DSL or cable modem.
• 
  
  Level 3's top ten customer list (alphabetical order) includes AOL, Cable & Wireless, Calpoint, Earthlink, France Telecom, Microsoft, SBC, United Online, Verizon and 360networks. These companies account for 54% of Level 3's communications revenues.
• 
  
  In a conference call, the company said its Q2 EBITDA margins of 26% compare favorably with the Q1 EBITBA margins of AT&T at 26%, Sprint at 18%, MCI at 10%, WilTel at 0% and Global Crossing at -2%.
• 
  
  The company will continue to consider acquisitions to add customer traffic to its network.

http://www.level3.com

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Kabira Enhances Messaging Gateway New Services

Kabira Technologies released commercial grade enhancements for its Convergent Message Gateway that enables customizable business rules for services, rapid service deployment, intelligent push for messages, network initiated messaging, and very-high volumes exceeding thousands of messages per second. Kabira's platform serves as a mobile message gateway supporting MMS and packet message services. Kabira said examples of new messaging services include buddy-list messaging; mobile gaming; photo, music and video-clip downloads; location aware messages; corporate campus messaging; value-add news alerts; urgent email alerts; enterprise and web portal wireless content and services; and other new mobile services based upon either push content, pull content or smart content.
http://www.kabira.com

• Kabira's Mobile Messaging Gateway supports MMS and packet message services.

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AOL Names New CTO

America Online named John McKinley as its new Chief Technology Officer (CTO) and President, AOL Technologies. He will serve as the company's chief technology strategist as it moves into areas like broadband, wireless and premium services. In addition to technology strategy, McKinley will also oversee the teams in charge of product engineering, network infrastructure and data centers, and internal business systems and computing. McKinley previously was CTO for Merrill Lynch and GE Capital.
http://www.aol.com

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CableLabs Issues More DOCSIS Certifications

CableLabs certified four more DOCSIS 2.0 cable modems from Terayon, Texas Instruments and Thomson. There are now 22 cable modems with DOCSIS 2.0 certification.


CableLabs also announced that eight companies gained certified status for DOCSIS 1.1 products and two companies gained DOCSIS 1.0 certification. Two companies obtained DOCSIS 1.1 qualified status for headend equipment.
http://www.cablelabs.com

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AT&T Reports Revenue of $8.8 Billion, Down 8.2% from Q2 2002

Despite an overall weak telecom market, AT&T said it continues to take market share and outpace its competitors for high-end enterprise communications. The company's continued focus on cost management yielded significant free cash flow of $1.4 billion for Q2. AT&T plans to further reduce its overall debt, increase its dividend to shareholders, and continue to out-invest its competitors in building the network of the future, an all-IP, seamless global network. Highlights of the financial report include:

• Q2 revenue of $8.8 billion, which included $6.4 billion from AT&T Business Services and $2.4 billion from AT&T Consumer Services. The total is down 8.2% compared to Q2 2002, which the company attributed to continued declines in long distance voice revenue, partially offset by the continued success of AT&T Consumer Services' bundled local and LD offering, as well as growth in several key markets of AT&T Business Services. Reported income was $536 million and earnings per diluted share were $0.68.
• 
  
  CAPEX in Q2 was $790 million. Spending is being directed to improving the overall customer experience
• 
  
  net debt at the end of Q2 was $10.8 billion, down $1.2 billion from Q1 2003
• 
  
  by the end of the year, AT&T expects its employee headcount will be down 9% compared to the end of 2002

AT&T Business Services:

• Revenue was $6.4 billion, a decline of 5% from the prior year second quarter.
• 
  
  Long distance voice revenue declined 11% on a quarter-over-quarter basis, while traffic volumes grew 12%
• 
  
  Local voice revenue grew approximately 39% from the prior year second quarter. Local access lines totaled over 4.2 million at the end of the current period, representing an increase of nearly 135,000 lines from Q1 2003.

AT&T Consumer Services:

• Revenue was $2.4 billion, a decline of 18% percent versus the prior year second quarter
• 
  
  Operating income totaled $489 million, yielding an operating margin of 20.6%
• 
  
  At the end of Q2 2003, there were 3.1 million local access customers in 12 markets across the U.S. The company plans to serve 22 local markets by the end of 2003.

http://www.att.com

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Service Bundling Slows UNE-P Losses at SBC

SBC Communications reported record net adds in both long distance and DSL service for Q2, however overall revenues declined, margins for voice services were down and the overall number of local access lines in service continued to fall. SBC credited service bundling, especially its promotion of unlimited, all-distance calling plans, for a 37% sequential decline in UNE-P line losses to competitors. Q2 revenues totaled $10.2 billion, compared with $10.8 billion in the year-ago period. Reported earnings per diluted share were $0.42, compared with $0.53 in the year-ago quarter (excluding Cingular Wireless). Highlights of the quarter include:

• added 2.3 million long distance lines, up 54% compared to its net gain in Q1. In July, SBC passed the 10 million mark for long distance lines, up 65% since the beginning of the year. More than one million consumers have subscribed to the all-distance, unlimited calling bundle.
• 
  
  Added 304,000 DSL lines, bringing its total to 2.8 million. Q2 was the best quarter to date for DSL subscriber gain. DSL revenues and subscriber totals are up 60% compared to this time last year. SBC's DSL penetration rate nationally for locations passed is 9%. In California, SBC's DSL penetration is 12% of locations passed. About 66% of SBC's access lines are now DSL eligible.
• 
  
  Data revenues in Q2 were up 2.7% compared to Q2 2002 and up 0.5% sequentially. High-cap revenues declined 3.5% year-over-year. Data revenues now represent 27% of SBC's overall wireline revenues.
• 
  
  31% of SBC's residential customers subscribed to a service bundle with more than one key service (local access line, long distance, DSL or wireless).
• 
  
  Reduced total debt, net of cash, by $2.0 billion during the quarter and by $11.9 billion, or 47%, from the end of the second quarter of 2002. Total debt net of cash at the end of the second quarter was $13.4 billion.
• 
  
  SBC's out-of-region ATM backbone expansion was completed in June.
• 
  
  40,000 net adds at Cingular Wireless, nearly triple the first-quarter total.
• 
  
  the new Echostar alliance is expected to deliver significantly greater value to the service bundles, without major investment from SBC.

http://www.sbc.com

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F5 Networks Acquires uRoam for SSL Remote Access

F5 Networks acquired the assets of privately-held uRoam, a developer of SSL-based remote access solutions, for $25 million in cash. uRoam's line of "FirePass" servers enable secure web-based access to any network application from any remote client-including wireless devices-with no client set-up and no additions or modifications to the back-end resources being accessed. uRoam's largest customer is SAP America. F5 has hired substantially all of uRoam's employees, including core founders, key development and sales personnel. uRoam is based in Sunnyvale, California.


Separately, F5 also announced quarterly revenue and earnings of $29.2 million and $0.05 per share respectively, above management's prior guidance of $27.5 million to $29.0 million and $0.02 to $0.04 per share.
http://www.f5.com
http://www.yroam.com

• uRoam is headed by Skip Glass, who previously served as a venture partner at Lightspeed Venture Partners.
  

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BellSouth Sees Continued Line Loss, Growth in DSL

Major trends at BellSouth continued during Q2 2003: the company added DSL and long distance subscribers, lost local access line to UNE-P competitors and technology substitution, continued to cut its capital expenditures, held its operational costs steady, and further reduced its debt. Service bundling is leading to better retention and reacquisition of residential and small business customers. Some specifics of the quarterly report include the following

• Q2 revenue was $5.6 billion, compared to $5.8 billion in Q2 2002.
• 
  
  BellSouth added 103,000 net DSL customers in Q2 for a total of 1.2 million at quarter-end. BellSouth began offering tiered DSL service levels this month. In Q1 2003, BellSouth added 101,000 DSL customers.
• 
  
  BellSouth added 856,000 net long distance customers in Q2 and now serves a total of 2.8 million customers.
• 
  
  BellSouth now has 2.1 million customer for its Answers consumer bundle, which has ARPU of $62.
• 
  
  Communications Group revenues were $4.6 billion compared to $4.7 billion in Q2 2002, a decline of 1.8%.
• 
  
  Total data revenues of $1.1 billion were essentially even with second quarter a year ago, and included retail data revenue growth of 11.5%, driven primarily by DSL.
• 
  
  Residence and business access lines served by UNE-P competitors increased 249,000 in Q2 and now exceed 2 million, an 80% increase over last year. Residential UNE lines increased sequentially by 18% while business UNE lines remained relatively flat. UNEs now account for 86% of all wholesale lines served by BellSouth. In Q1 2003, UNE-P lines served to competitors grew by 231,000. Meanwhile, BellSouth's total access lines are down by 988,000 to 24.25 million, representing a drop of 3.9% year-over-year. The company said it remains cautious in its outlook for line loss.
• 
  
  Consolidated operating expenses were $4.2 billion, compared to $4.6 billion in the same quarter of 2002. Net income was $951 million compared to $263 million in the same quarter a year ago.
• 
  
  Operating free cash flow (defined as cash flow from operations less capital expenditures) was $1.8 billion. The company has generated over $3 billion in free cash flow this year.
• 
  
  CAPEX in Q2 2003 was $729 million for a total of $1.4 billion year-to-date, a reduction of 33% compared to $2.0 billion in the first half of 2002.
• 
  
  For Q2, the CAPEX-to-revenue ration was 13.0%. For the year to date, this ratio now stands at 12.3%.
• 
  
  Total debt was reduced by $1.2 billion in the quarter and now stands at $15.4 billion. Net debt is $11.3 billion.
• 
  
  Cingular Wireless added 540,000 net customers.

http://www.bellsouth.com

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RedClover Achieves 10Gbps NRZ Transmission

RedClover Networks, a start-up based in Sunnyvale, California with a subsidiary in Ottawa, Canada, announced a new performance benchmark for 10 Gbps NRZ optical data transmission. RedClover has pushed the reach of its Transdaptor interface sub-systems beyond 240 km over SMF-28 fiber, without the need for any additional NRZ data encoding, spectral shaping, forward-error-correction (FEC), or dispersion-compensating fiber (DCF) modules. In addition, RedClover has demonstrated that, when used in conjunction with the company's Transdaptor products, conventional 80 km 10 Gbps transponders can have their reach extended to greater than 150 km. RedClover said its technology could provide plug-and-play replacement for conventional 10 Gbps transponders, thereby improving access, storage, metro, CATV, or long-haul optical networks.
http://www.redcloverinc.com

• In March 2003, RedClover introduced its “Transdaptor�? family of highly integrated and adaptive universal transponders. The product line includes a 10 Gbps universal transponder module that combines the functionality of a standard SFI-4 electrical interface, 10 Gbps optical interface, and ultra-compact embedded adaptive fiber transmission impairment compensation. It also includes a WDM Optical Transdaptor that adds the functionality of a tunable laser for full C-band or L-band operation. Both products are compliant with 300 pin MSA standards, and support multiple data rates: 9.95 Gbps (OC-192, 10GE WAN), 10.3125 Gbps (10GE LAN), 10.664 Gbps and 10.709 Gbps for different FEC applications. RedClover has targeted its Transdaptor family of interface products at intelligent optical hardware for access, storage, switching, and transport networks. Separately, RedClover announced partnerships with Ixia and with Oki Electric Industry Co. focused on 10 Gbps and 40 Gbps optical interface components and subsystems.

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HP Acquires PipeBeach for VoiceXML System

HP has acquired PipeBeach AB, a Stockholm, Sweden-based provider of speech-based products and technology that enable the delivery of interactive voice solutions. PipeBeach offers a VoiceXML system that lets users speak into their mobile phones and devices to obtain Web-based information such as news, stock prices and e-mail, as well as conduct transactions, such as online banking. The information and options are conveyed to the user through speech -- instead of text or images. HP said it intends to integrate PipeBeach's VoiceXML-based products into its OpenCall suite of enhanced telecommunications software. Financial terms were not disclosed.
http://www.hp.com

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Lucent Posts Q2 Revenues of $1.96 B, Down 18% Sequentially

Lucent Technologies reported Q2 revenues of $1.96 billion, down 18% compared to the previous quarter and down from $2.95 billion in revenues in the year-ago quarter. The net loss for the quarter was $254 million or $0.07 per share. The loss included charges associated with an impairment of goodwill related to certain multiservice switching products and the revaluation of warrants that are expected to be issued as part of Lucent's global settlement of shareowner litigation. Lucent cited a decline in revenues for its Mobility business but said it continued to make progress on its improving its bottom line.

• Gross margins were 29% of revenues, compared to 32% in the previous quarter.
• 
  
  Revenues in the U.S. were $1.2 billion, a decrease of 17% compared to the previous quarter and down 41% compared to the same period last year.
• 
  
  International revenues were $763 million, a decrease of 20% compared to the previous quarter and down 15% compared to the same period last year.
• 
  
  Revenues for Integrated Network Solutions (INS) were $1.06 billion, an increase of 2% sequentially and a decrease of 22% compared with the year-ago quarter.
• 
  
  Revenues for Mobility Solutions were $826 million, a decrease of 36% sequentially and a decrease of 45% compared with the year-ago quarter.

Lucent now expects a return to profitability in 2004 instead of later this year. The company does not provide forward-looking quarterly revenue guidance.
http://www.lucent.com

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China Unicom to Deploy Alvarion Broadband Wireless

China Unicom, the second largest cellular communications operator in China, selected Alvarion's wireless broadband solutions for deployment in seven cities: Tianjin, Xining, Huhehaote, Nanning, Dalian, Changsha, and Zhengzhou. China Unicom has licenses to operate 3.5GHz networks across the country. The deployments will use Alvarion's WALKair 1000 Broadband Multiservice Platform to support TDM legacy voice, data and multimedia services, including videoconferencing. Alvarion's local partners include Datang and BISC. Financial terms were not disclosed.
http://www.alvarion.com

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Resilient Packet Ring (RPR) Advances Closer to Standardization

The IEEE 802.17 Working Group approved the latest Working Ballot of the Resilient Packet Ring (RPR) standard (draft 2.3) at its meeting this week in San Francisco, moving RPR one step closer to standardization. The Resilient Packet Ring Alliance, an industry advocacy group promoting RPR technology, said more and more vendors are developing standards-compliant silicon, systems, and test equipment.
http://www.RPRAlliance.org

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Telstra Deploys Juniper Edge Routers in Wi-Fi Hotspot Rollout

Siemens is supplying Juniper Networks' E-series platform and the SDX-300 Service Deployment System to Telstra to support new Wi-Fi hotspot services. The Telstra Wireless Hotspots initially are being deployed in selected Qantas Club Lounges and Rydges Hotels in Australia.
http://www.juniper.nethttp://telstra.com

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AT&T Wireless Selects Nortel Networks, Ericsson for W-CDMA

AT&T Wireless selected Nortel Networks and Ericsson for what is expected to be the first commercial W-CDMA (Wideband Code Division Multiple band Access) wireless network in North America. AT&T Wireless and DoCoMo plan to launch W-CDMA in four U.S. markets by the end of 2004. The W-CDMA radio equipment will operate on the 1900 MHz spectrum and use the same core equipment AT&T Wireless currently employs to support advanced voice and data services through GPRS and EDGE radio technologies. The deployments will also support an all IP-based network architecture. AT&T Wireless said W-CDMA would allow it to significantly increase subscriber capacity on the networks and pave the wave for 3G services. Financial terms were not disclosed.
http://www.attwireless.com

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