IEEE ComSoc Telecom and Networking Newsletter- ADDENDUM to Special Edition: Where is the Growth?
Updates:
1. The draft report of the 2007 UTHF: Trends of the Wireless World conference, briefly described in the last issue of this newsletter, is now posted. [It will be completed once I receive the notes from the Panel Session.] Topics of this conference included Telco 2.0, converged mobility and wireless healthcare from speakers representing companies, such as Microsoft, Google, Nokia, Sagacity Networks, and Digital Fountain.
Please cut and paste this link into your browser:
2. The Financial Times World Telecom Conference this week focused on Emerging Countries- a major growth market for telecom. Strong economic growth and rising populations in the emerging markets is fuelling a rising demand for telecoms. By 2010, it is predicted that emerging markets will account for more than 2/3rds of the world’s telecom connections, and almost 90% of all growth in the world’s mobile sector, with China and India leading the way.
Moreover, innovation in the world telecommunications industry is shifting away from the developed economies as emerging market users spend increasing amounts, not only on calls, but also on digital entertainment and mobile media lifestyle services.
3. At the November 8th SCU Technology Benefiting Humanity: Taking Innovation to the Next Stage, Allen Hammond of the World Resources Institute spoke about an innovative mesh WiFi project in rural Vietnam. The project uses mesh WiFi equipment, VoIP switch, and a new Intel WiFi backhaul product (RCP) to provide VoIP over WiFi phone service, as well as Internet service over a 1km coverage area. The local population served -6K to 7K households- resides in 3 adjacent communes (clusters of Vietnamese villages are administratively organized in communes). VoWiFi phones, costing approximately $100 each, are distributed free to the local people who would otherwise not have phone service. It is expected that Internet service will be available from notebook PCs used in local cafe's, in schools, and in hospitals.
The total cost of this project is said to be only 1/5 the cost of an equivalent coverage cell phone network -plus Internet access is provided at no additional charge. Could this be the new model for providing low cost cell phone and Internet service to rural areas in developing countries? It sure seems so. This project is an example of providing low cost, scalable technology solutions to a developing country.
Summing up, we think mesh WiFi and 3G cellular will be the preferred BWA technologies for the developing world, with WiMAX restricted to backhaul.
4. Cisco reported sales of $9.6bn in its fiscal first quarter to October 27, an increase of 17% over the same period last year. Earnings at the networking company rose 37% to $2.2bn. There was a huge increase in overseas sales- where the growth continues to be.
However, the company said sales to US companies -accounting for 25% of overall rerevenues-declined by 4%. The worst declines came from Cisco's top 25 U.S. customers. Considering that big financial companies are among the most voracious consumers of technology, it seems clear that credit woes have played a part in crunching Cisco. There’s little reason to suspect sales to these customers will rebound soon.
On a conference call, Cisco Chief Executive John Chambers struck an optimistic note about the company's growth prospects. Cable and telephone companies have turned to Cisco recently for new gear to help deliver Internet, television and phone services to consumers and businesses. He noted that new technology such as Cisco's high-end video-conferencing service and collaboration software has also helped increase internal-network traffic by 400%, and he said he expects more growth as more businesses adopt the technologies.
"This is the top of the first inning in a nine-inning game," Mr. Chambers said. But he cautioned that U.S. spending on networking equipment may be "lumpy" over the next few months as companies hurt by the housing slump and credit crunch cut their technology budgets.
Some of the company's investments are paying off with faster growth in some of the new technologies. Revenue from Cisco's Advanced Technologies unit, which houses businesses such as videoconferencing and TV set-top boxes, rose 27% from the previous year to $2.4 billion. Note: Cisco now owns STB maker Scientific Atlanta.
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IEEE ComSoc Telecom and Networking Newsletter- Special Edition: Where is the Growth? (mailed on Nov 3, 2007)
Overview: Recently, we've heard dismal, disappointing news from Alcatel-Lucent, Qwest, Ericsson, Motorola and other telecom players. Rather then highlight the negative, let's look at the positive. There is growth (at least telco spending) in residential video (over hyped IPTV or other mechanisms over GPON, EPON or FTTN-copper technology), broadband wireless Internet access migrating to the mobile Internet, carrier Ethernet (especially in Asia-Pacific) and selected niche market services. There seems to be potential and promise in combining Web 2.0 applications with traditional telco services, something Microsoft calls Telco 2.0 (more on this in 3. below).
In this issue, we highlight growth trends in the telecom industry. Let's start with a market assessment from the FCC:
1. Wireless Broadband Showed Highest Growth In 2006; ADSL increased more then Cable Modems!
The Federal Communications Commission has released data on the deployment of high-speed and advanced services, derived from required submissions of FCC Form 477. The latest report covers data as of December 31, 2006. High-speed services, defined as data rates of at least 200 Kbps in one direction, showed the most growth in the mobile
wireless sector, nearly doubling from June to December of last year.
Overall, high-speed connections to the Internet increased by 27 percent during the second half of 2006, from 65.0 million to 82.5 million connections in service. For the full twelve month period ending December 31, 2006, high speed connections increased by 61 percent (or 31.3 million connections).
Mobile wireless showed the most gains. In December of 2005, there were 3.1 million mobile wireless broadband connections. This grew to 11 million by June of 2006, and nearly doubled by December of 2006 to just under 22 million. ADSL lines increased by 2.8 million lines during the second half of 2006 compared to an increase of 3.2 million lines for
cable modem service. For the full year, ADSL lines increased by 5.9 million lines compared to an increase of 5.5 million lines for cable modem service. Of the 82.5 million total high-speed connections, 38.9 percent were cable modem, 32 percent were some form of DSL, 27.8 percent were "other technologies" - fixed and mobile wireless, and satellite -
while 1.2 percent were fiber to the premises.
According to the FCC, high population density has a positive association with high-speed subscriptions, and low population density has an inverse association. For example, high-speed subscribers were reported to be present in more than 99 percent of the most densely populated Zip Codes and in 90 percent of Zip Codes with the lowest population densities.
The comparable figure for the lowest-density Zip Codes was 88 percent a year earlier.
For details, see
http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-277784A1.pdf
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2. Asia Pacific leads Ethernet adoption spending $5.5 billion in 2006 - Japan tops all
Global enterprise Ethernet services grew 32 percent in 2006 with the Asia Pacific region accounting for more than 50 percent of the total volume. The Ethernet market eclipsed $9.8 billion last year, according to a report released by Ovum yesterday. And it will continue to grow at a rate of nearly 21 percent annually topping $31 billion by 2012.
For more info see: http://www.computerworld.com.au/index.php/id;318471157;fp;4194304;fpid;1
We also observed that Nokia - Siemens acquired Carrier Ethernet equipment vendor Atrica (a local start-up company that had been struggling)
For more info see:
http://www.webwire.com/ViewPressRel.asp?aId=51505
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3. Highlights of 2007 UTHF Annual Conference: Trends in the Wireless World
Note: The draft will be finalized sometime next week and posted on the North American Taiwanese Engineer's Association web site. Please refer to this article in the previous post.
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4. GPON Builds Momentum
We have long favored GPON over any other Fiber to the Node or Premises technology. Occam Networks Announces GPON Product Line
Please refer to:
http://www.viodi.com/newsletter/071001/index.htm#gpon
http://www.pr-inside.com/occam-networks-announces-gpon-product-line-r261988.htm
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5. Muni WiFi alive and well- WiMax not really a contender for muni wireless access, but may play a significant role in wireless backhaul
This article is a report on the well attended Muni Wireless conference in Santa Clara on October 22-23rd.
http://www.viodi.tv/2007/10/23/muni-wifialive-and-well/
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Please email me your comments, feedback, suggestions.
alan@viodi.com