Business Week had an interesting article today on the advent of XORP (the eXtensible Open Router Platform).  The concept is simple: provide enterprises cheaper and more flexible routers built on commodity hardware and open-source software.  The cheaper hardware comes from microprocessor vendors such as Intel (Nasdaq:INTC), whereas the software would be open-source.  The project has the backing of players such as Microsoft (Nasdaq:MSFT) and the NSF (National Science Foundation).  The first release of XORP came out in July, and more are expected in the future. 

Of course, this is still very much a work in progress, which at this point in time is still far from posing a threat to other router vendors such as Cisco, Extreme or Foundry.  Also, this is not the first attempt to create a software-based router based on open-source code.  But the backing of above-mentioned players lends some level of credibility to this work.  Perhaps another validation comes from the fact that nowadays, even Cisco has a line of low-priced networking gear based on Linux, that targets the pragmatic, cost conscious consumer.

But ultimately, the appeal of XORP is not only the lower cost, but also the level of customization that it empowers end-users with.  These end-users can configure the software to suit their own particular needs and/or applications.  Not only that, the network routing can be embedded as software inside a server or other devices.   

Back in September, Philadelphia's WiFi plans were discussed here. The ambitious project called for turning the city's entire main core of 135 square miles into the world's largest wireless Internet hot spot.  The plan was to offer inexpensive wireless Internet as a low-cost municipal service, charging end-users less than what is currently charged for DSL or cable broadband. That announcement generated a lot of optimism, since it epitomized the good that a forward-thinking government can deliver to its citizens.

Unfortunately, that did not initially sit well with the commercial interests of the local incumbent phone company, Verizon Communications Inc. (NYSE:VZ).  The RBOC did back House Bill 30 (HB30), a measure that would curb the ability of city governments to provide high-speed Internet access for a fee, effectively making providing a subsidized low-cost service illegal. High tech enthusiasts, activists and users at large are urging legislators and Gov. Rendell to postpone that bill's passage, or perhaps even kill it outright. Governor Rendell has until Nov. 30 to veto the bill or sign it into law.

For that matter, Verizon was not alone in trying to impede these types of deployments.  Other regional and long-distance phone companies (selling broadband Internet to consumers and businesses) have recently increased their efforts to quash similar creative municipal wireless initiatives, in locations such as San Francisco, Chaska (Minn.) and St. Cloud (Fla.).  Verizon has changed its attitude since coming out in support of HB30 and now states unequivocally that it will not block Philadelphia's WiFi plans.

Despite that, the marketplace consensus is that the RBOCs, IXCs and other broadband service providers are crying foul because they argue that a city can raise money via taxes, while a private company must pay interest on borrowed capital.  In the meantime, consumer advocates are claiming that cheap WiFi services fill a void that the operators either cannot or simply have no intention to deliver.  Philly's CIO (Dinah Neff), claims that Philadelphia currently ranks 33rd in the US in terms of availability of wired or wireless connections (less than 60 percent of the city's neighborhoods have the option of subscribing to broadband, either DSL or cable).

The bottom line is that the City of Brotherly Love can still deploy its network (according to this article), as long as it can be operational by January 1, 2006 (the city originally hoped for an in-service date of June 2006). 

But ultimately, the government will have the final say.  If the U.S. is to accelerate its broadband penetration and catch up to leaders such as Korea and Japan, more proactive measures that encourage these types of municipal initiatives are required.  And bills such as HB30 should be shot down, because having a legislature overturn a municipality's ambitious "broadband for all" plan - just for the benefit of a few service providers - does not make sense at all.

Note: Another couple of good articles on the same thread can be found here (another good insight from MuniWireless.com) and here (WSJ article, so password is required).

There have not been too many positives for Nortel's stock lately, whose performance has been plagued by the company's ability to get its financial restatements done in a timely fashion.  Because of the delays in reporting the results, Nortel (NYSE:NT) stock has been downgraded by the likes of Prudential, Goldman Sachs, and CIBC World Markets, among others.  

For most shareholders, the delay in the restatements has been an unfortunate development, particularly now that the company is making positive strides on the technology side of the equation.  For instance, in VoIP, Nortel has a leadership position in the Class 5 softswitching market, as reported on Light Reading.  Nortel has also a strong position in the wireless market, having been on the short list for many RFPs for CDMA and UMTS tenders.  Despite all the accounting woes, the company still is able to be at the forefront of cutting edge technologies, such as mesh networking.  And the enterprise IP PBX opportunity should be also a positive development, as the existing installed base begins to mature and starts transitioning from TDM to IP (Nortel has a substantial installed base of TDM equipment - Meridian PBXs and Norstar key systems).

Still, all this progress is not as relevant now, as the company focuses in delivering its results before the end of the year.  The bookkeeping blunders need to end in order for Nortel to avoid the unthinkable: delisting.  For instance, the NYSE listing can come up for formal review unless the vendor can file the restatements by year-end.  The company is working diligently in meeting that deadline.  Mark Evans, the technology reporter for The National Post, found the following gem (John Manley, a board member, offered the following comments on the accounting efforts):

Nortel shareholders hope that John is right and that this time around, all the numbers will be OK.  In the meantime, there was some good news this week.  Nortel claimed (following discussion with the Office of the Chief Accountant at the SEC) that it will not change its accounting treatment for optical product sales. This is good news, since it might be a clue that the restatements will not go back to the years before 2001.  Hence, it could also mean a higher likelihood that the 2001-2003 numbers will be filed within the next six weeks.  The other piece of good news is that Nortel confirmed what some Wall Street analyst firms (such as Solomon Smith Barney) already suspected to be the case: the NYSE will not begin a delisting review process until after December 30th, and Nortel would likely have an additional three month grace period.

So, in conclusion, Nortel would likely not be delisted (in a worst case scenario) until April 1, 2005. Right now, it looks more likely that NT will file at the latest by January 2005, so it should be able to avoid the bleak delisting scenario. All in all, the probability of such an event was decreased with this week's news. Hopefully, after the restatement becomes a reality, past accounting practices will no longer overhang the stock, and investors will finally be able to focus on the company's fundamentals, technology and market performance.

Broadcom (Nasdaq:BRCM) has introduced a new line of 802.11 chipsets geared towards increasing the range of WiFi networks by as much as 50 percent.  The new BroadRange 54g chips are enhanced with the company's BroadRange technology, which utilizes advanced digital signal processing techniques to deliver the highest receive sensitivity of any 802.11g chipset on the market. The general rule of thumb for WLLAN systems is that as the wireless endpoint (PDA, laptop, 802.11 handset) moves away from the AP (Access Point), the transmission worsens.  Hence, the WLAN system has to transmit at a lower bit rate to compensate for that.  With the BroadRange chips, the connection does not degrade as quickly with the increase in distance, and hence, higher throughputs can be achieved at longer distances away from APs.  Another important new feature supported by BroadRange is lower power consumption (as little as 9 mW in idle mode). 

As if users did not have enough worries about viruses hitting their PCs (whether at home or at work), the latest Trojan hit mobile handsets running Symbian-based OS.  The latest piece of malicious code has been dubbed "Skulls" by the anti-virus experts, and comes disguised as a theme manager for Nokia phones in the Symbian Installation Format, such as the 7610.   The virus kills off system applications and then replaces their icons with skull images.

But Skulls is not alone in Trojans creating havoc for cell phone users.  A program called Delf, was used in Russia to infect PCs so that spam could be sent to mobile users across Russia.  Similar viruses have been written to attempt to infect devices such as PDAs running on Windows CE.  Hackers will be increasingly focusing on creating viruses that can infect mobile handsets.   

Three years after spinning off its mmO2 subsidiary, BT (NYSE:BT) launched a new mobile service. The MVNO service, dubbed BT Mobile, offers a range of enterprise mobile services. The introduction is part of the company's new network agreement with Vodafone. BT Mobile will therefore act as "virtual network provider" with its customers' calls being carried over Vodafone's network.

The new agreement should supercede any prior arrangements, including former deals with mmO2 (allowing the telco to offer BT enterprise customers airtime on the O2 network) and T-Mobile (a deal geared towards consumer subscribers).    The 305 k existing wireless customers will be transferred to the new BT Mobile service within the next few months.  There are plans for plans for a combined mobile and fixed-line phone service.  BT also announced its plans to hold a wireless broadband WiMAX trial sometime next year.

Satellite radio has been getting quite a lot of press lately, particularly after radio celebrity "shock jock" Howard Stern signed a deal in October with Sirius Satellite Radio (Nasdaq:SIRI), one of two satellite radio service providers.  Many Wall Street analysts feel that Sirius was able to overcome some problems and catch up to its competitor XM Satellite Radio (Nasdaq:XMSR).  Sirius has attained more than 700,000 subscribers (representing roughly a 20% market share) and relies mainly on two distribution channels: automotive OEMs (BMW, Daimler Chrysler and Ford) and aftermarket (via plug-and-play radios sold via Best Buy, Circuit City and Radio Shack).  There are some OEMs that are nonexclusive (e.g. Nissan and Toyota), and those are expected to have a 50/50 split between XM and Sirius.

This week's announcement that Mel Karmazin will take over as the new CEO of Sirius (with the current CEO Joseph Clayton becoming the Chairman of the Board) has been viewed very positively by the Street.  The optimism is due to Mr. Karmazin's extensive operating experience in the media industry (including his recent tenure as President and COO of Viacom for the past four years, his years at CBS, where he played a key role in the TV network's turnaround and his role at Infinity Broadcasting). Karmazin represents a great coup for Sirius, because it instantly makes a positive impact on the depth, quality and credibility of the company's management team. Moreover, he has a great reputation as a strong manager with a tight focus on cost controls, which could improve Sirius' financial discipline as it relates to advertising, distribution and programming deals.

More about the satellite radio industry:  many observers expect satellite radio will eventually be viewed as a traditional duopolistic market (with Sirius and XM as the two players). This is the prevalent thinking for the time being, because the FCC is unlikely to allocate additional spectrum for new entrants. Moreover, it would be very difficult for a new entrant to obtain funding, given the uneven history of the existing players and the long-term exclusive distribution contracts that XM and Sirius have signed.

Sirius and XM will be competing for talent both against each other and non-satellite radio operators. Sirius paid top dollar to get NFL rights and sign Howard Stern, whereas XM locked in Major League Baseball. Also, another factor that is still to be determined is whether or not the FCC will clamp down on content in the future.  Right now, Sirius is exempt from FCC decency regulations, which allows it to carry risque programming such as Howard Stern and Eminem.

Om Malik had a thought-provoking article on Business 2.0 about Microsoft's VoIP plans.  They are nothing less than ambitious: become the key enabler of the technology (via Longhorn - the next-gen OS that will include SIP addresses everywhere, a corporate IM client codenamed Istanbul, and its newest release of LCS).  Again, I personally believe that Microsoft will not quite compete against the likes of Avaya, Nortel, Cisco and other PBX/IP PBX vendors. 

However, there is little doubt that the folks from Redmond want to be an integral part of applications that will be key in providing the productivity enhancements that VoIP promises to deliver.  For instance, the tight integration of Istanbul and LCS can mean that a conference call can be simply initiatied by dragging and dropping (via MS OLE) a bunch of contacts from a Microsoft Outlook address book.  A phone number in that same contact list might have an embedded SIP link that will automatically spawn a VoIP call.  This means Microsoft will be, at least on the application side of things, the de-facto platform for VoIP in the enterprise (despite the fact that the currently, the only two vendors running Microsoft Windows OS on their IP PBX servers are Cisco, with the Call Manager, and Siemens, with the HiPath 5000). 

SBC (NYSE:SBC) became the latest RBOC to announce the availability of residential VoIP services.  The service provider expects to go live with VoIP in early 2005, and has already been testing technology with about 1,000 customers in Los Angeles, Dallas, Chicago, and San Antonio.

The VoIP service will rely on DSL to deliver not only voice calling but also additional enhanced features, including a web portal and advanced call- management capabilities that make it easier for customers to manage their communications. Among these features are "find me" and "do not disturb," which enable subscribers to specify which numbers can ring through, in addition to a click-to-call capability allowing customers to call friends and family with the click of a mouse.

This comes on the backdrop of SBC's announcement of Project Lightspeed, an initiative to deliver digital TV, VoIP and super high- speed broadband services to 18 million customers in two to three years (via FTTN with VDSL/ADSL 2+). After the FCC's RBOC-friendly fiber ruling, observers expected these deployments to be accelerated.

Note: SBC also announced during the week that it has chosen the new Microsoft IPTV edition software for Project Lightspeed.  The deal, worth $400 million over 10 years, calls for the deployment of IPTV software in set-tops that will be deployed as part of the Lightspeed buildout.  SBC Labs had been testing the Microsoft platform since June of this year, and trials are expected in mid-2005, with commercial availability expected in late 2005.  Features include IPGs (Interactive Program Guides), customizable channel lineups, VOD, DVR, event notifications, instant channel changing and a security system that includes subscriber digital rights management technology to protect content across devices.

Motorola (NYSE:MOT) announced yesterday the acquisition of MeshNetworks, a Florida based startup focusing on wireless application development.  No financial terms were disclosed, and the transaction is expected to close by the end of the year.  Motorola had already been licensing MeshNetworks' software.

Mesh networking is a cutting edge technology that allows users of mobile devices "create self-forming and self-healing wireless networks" that can go above and beyond the range of established wireless hotspots.  In other words, mesh networking also empowers network operators to move beyond the limitations of 'hotspots' that typically restrict wireless service to within 100 meters of an access point.  Mesh networks can therefore augment the reach of wireless networks and offer continuous outdoor coverage over large metropolitan areas.

MeshNetworks relies on a proprietary technology called QDMA, which can send and receive data in vehicles travelling up to 200 miles an hour, compared with about 30 miles an hour for WiFi, which operates in the same 2.4GHz radio spectrum.

Another innovation milestone was reached by Korean manufacturer LG Electronics (LGE).  The company announced this week the introduction of the world's first wireless handset able to receive terrestrial DMB (Digital Media Broadcast).  In achieving this goal, LGE won the DMB satellite race, becoming the first cellular phone manufacturer to make handsets that allow consumers to receive satellite broadcasts to watch satellite programs while simultaneously speaking via a mobile phone.   

The Korean-based vendor incorporated the standard home TV antenna functionality into the new mobile handset to receive broadband DMB.  The total investment in this project was about 20 billion won (roughly 18.3 million dollars).  In achieving this feat, LGE's team of 130 researchers was able to solve issues such as power consumption and bulky terminal size.  The DMB receptor chip is currently an OEM, but LGE plans to make its own chip by the end of 2005.

Outsourcing is also bringing a lot of contact centers to India.  The latest example is Dell, which opened up a 300 agent contact center in Chandigarh:

The Indian market has been quite hot in the past couple of years, with newcomers adopting aggressive strategies such as offering premium salaries for the agents and substantially discounting services, in order to get a piece of the $400 million Indian contact center outsourcing pie.  This has lowered margins even more in an industry already known for tight margins. 

Note: There is an interesting web site totally dedicated to the Indian contact center industry and offshore call centers: Call Centers India.

With the advent of VoIP, cable companies have started making a foray into the telecom marketplace by offering bundles of voice, video and data services (constituting the so-called "triple play"). In competing against the RBOCs, the MSOs have one compelling advantage (video), but also one potential Achilles' heel: the possibility of a "quad play" with wireless services. Hence, it was not surprising to see yesterday's story on IT Manager's Journal that the cablecos are considering launching a joint cell phone venture.

According to some insider information from the Wall Street Journal, the US largest MSOs have been discussing the possible formation of a joint venture geared towards offering cell phone service.  The informal consortium includes cablecos such as Advance/Newhouse Communications, Comcast (Nasdaq:CMCSA), Charter Communications (Nasdaq:CHTR), Cox Communications (NYSE:COX) and Time Warner (NYSE:TWX).

The idea of such a JV for these large MSOs has been floating around for quite sometime, but there have been rumors that the talks to carry out this plan have heated up in the past few weeks, with the cablecos interviewing investment banks to act as advisors for a potential deal. 

One alternative is the outright acquisition of an existing cellular operator.  Another more likely option would be to use the cellular network of an established wireless operator, reselling the service under a separate brand.  Virgin Mobile uses such an arrangement in the US (with Sprint PCS) and Canada (with Bell Mobility).  Ditto for Qwest, which also uses Sprint's PCS wireless service.  MCI and Sprint both signed contracts with Time Warner to carry and terminate VoIP traffic.  

The potential MSO cell phone JV can really add wood to the fire in the MSO versus RBOC war, improving the cablecos position on the "quad play".

After attending VON last week, I was unable to go to the CTIA show happening this week at the Moscone Center in San Francisco, but some of my colleagues attending have given me the latest scoop of some of the major developments and announcements at the event.  Among the major developments at the show were:

Intel (Nasdaq:INTC) announced today at the CTIA show that it will make a "significant" investment with Clearwire, a wireless broadband startup funded by Craig McCaw.  The partnership is geared towards accelerating the development and deployment of WiMax networks.  The agreement stipulates that both companies will be actively engaged working collaboratively to develop WiMax products and deploy WiMax networks as the technology matures.  The Intel VC arm (Intel Capital) did not disclose any specific financial terms of the deal. 

Clearwire already offers WiMax service in Jacksonville, FL and St. Cloud, MN.  The company is planning to offer services based on the emerging 802.16e IEEE standard (an extension of the original 802.16 WiMax standard that addresses the mobility aspect).  The plan is for NextNet Wireless (a Clearwire subsidiary) to use the newly unveiled Rosedale Intel chip in new WiMax gear.  The deal will be a catalyst for the fixed wireless broadband industry, and Intel believes that next-gen products supporting mobility and using its chips should be widely available by 2006.

The last few days have kept me quite busy at VON.  It has been the most attended VON event that I have ever been at, and there has been some electricity in the air (perhaps due to the rosier prospects of VoIP or maybe because the Red Sox have come back in dramatic fashion on a couple of occasions to force a deciding game 7 today against the Yankees).

Due to the great attendance at the show, the enterprise panel session in which I participated had a big audience.  This was a bit of a pleasant surprise to yours truly, given the fact that concurrently, Anoop Gupta, the VP of the RTC (Real Time Collaboration) Business Group at Microsoft was delivering his keynote speech (I heard that in Anoop's session, there was standing room only, and that auditorium was much bigger than the room in which the analyst round table discussion was held). 

As suspected, Microsoft (Nasdaq:MSFT) unveiled its unified desktop client, dubbed Istanbul.  I was able to get the details from Ellen Muraskin, who wrote an article in eWeek about that session.  Istanbul, which runs in concert with the new version of the LCS (Live Communications Server), is a client application offering integrated IM, desktop videoconferencing, and IP telephony capabilities.  The product is currently undergoing beta testing and should become generally available in the first semester of 2005.

The key question is: does this mean that Microsoft will finally make a foray into the IP PBX marketplace?  I suspect that the answer to that question is no, at least not in the short term future.  However, in the longer term future, anything is possible, particularly if the traditional PBX/IP PBX model, as we know it today, goes through some changes (particularly for small and medium enterprises - SMEs).  The crown jewel of the PBX is the call processing software: that is the highest margin piece of the product. 

It is conceivable that in the future, some vendors might adopt a software-based model for SME products, and offer platform vendor independence (i.e. standard hardware/servers from vendors such as Dell, IBM, HP, etc.).  In that case, instead of the single, monolithic PBX, we would have call processing functions plus some standards-based hardware.  With this Istanbul move, Microsoft definitely makes a push into trying to control some of these functions.  However, from there to developing a full blown IP PBX, there is a lot of room.  It is more likely that Microsoft will initially want to become a technology enabler for some of these services.  As Gupta said: "We need a sophisticated ecosystem surrounding this. We don't build PBXes".

Much has been already written about the FCC decision on fiber and the impact it will have on the consumer broadband choices. Since I am in Boston for the Fall VON Show, here is a take on the subject by Hiawatha Bray from the Boston Globe.

But I also enjoyed Om Malik's opinions on the topic and its implications.  In one entry, Om states his disbelief that alternative technologies such as BPL or WiMAX can provide the competition necessary to make the duopolistic equilibrium price (i.e. the current set price of MSOs and RBOCs) lower - au contraire, the consumer bills will sky rocket.  In another story, Om focuses about how RBOCs like SBC will proceed with their plans: FTTH (FTTP) in some situations such as greenfields, and mostly, FTTC with ADSL 2+ or VDSL. 

I will zero in on the technical considerations of going with a FTTC with ADSL2+/VDSL solution. As the figure below shows, there is a tradeoff between the loop range and the throughputs (upstream/downstream): the longer the range, the lower the data speeds.  Distance matters for digital service lines, because they represent a "dedicated line configuration".

The implications can be arrived at from loop length analysis (data is available from several sources including DSL Prime, Telcordia, the NCTA, etc.).  Verizon, for instance, has about 50% of its loops in the 11,000 feet and longer range.  SBC has roughly over 50% of its loops in the 11k feet and higher range.  Bell South has about 45 percent in the 11k feet and more and the same is true for Qwest.  So what can be done with that?  One option is another location, sometimes co-located with the DLC.  This is in the Service Area Interface (SAI) or a cross-connect cabinet.  Hence, the rollouts that are being talked about the RBOCs are either FTTH (in a few cases only, for new greenfields, particularly after the FCC ruling) or bringing fiber to the above "neighborhood nodes" instead of to the curb.  Also, FTTC with ADSL 2+/VDSL will be used for the shorter distance loop lengths.

Since Avaya, Proxim and Motorola announced the initial results of their research on seamless roaming between 802.11 (WLAN) and 2.5/3G cellular networks earlier this summer, there have been a flurry of announcements of plans to converge cellular and Wi-Fi networks. Case in point: yesterday, Chris Rice, the CTO of SBC (NYSE:SBC), claimed that the carrier's public Wi-Fi hotspots will be used to carry calls from Cingular users by 2006.  The new modus operandi will be for phones to become aware when a WLAN Access Point (AP) is nearby and automatically handoff the call to the Wi-Fi network (what I call the ABC - Always Best Connected - model) 

Rice said that SBC can improve Cingular's cellular coverage by filling in the gaps, relying on Wi-Fi hotspots in places like restaurants, hotel lobbies, coffee houses, etc. to mitigate some of the spectrum demands on the wireless operator.  Achieving this goal might be a challenge from a timeline perspective, as there are quite a few details that still need to be worked out.  For instance the systems that can support the 3G/WLAN seamless roaming entail special client equipment, only working with APs supporting newer technology (e.g. 802.11e, which is the QoS standard that also enables longer battery life, due to the "deep sleep feature").  What about all the older APs that have already been deployed?  Nevertheless, it was interesting to see SBC give a sneak preview about its future Wi-Fi/wireless strategy.

Motorola (NYSE:MOT) has teamed up with Master Card to develop mobile handsets that are able to perform secure financial transactions.  The phones are being equipped with PayPass, a contactless payment service developed by Master Card and VivoTech.  Master Card is seeking for customers having many low-value transactions that are mainly cash based.  McDonald's, for instance, is one of the restaurants that announced it will accept the transaction system by the end of the year (i.e. in Dallas and NYC, with more cities to be added in 2005).  Master Card is also teaming up with other cellular phone manufacturers such as Nokia (NYSE:NOK) on tests of Pay Pass capable phones in Dallas, TX.

Ellen Muraskin has a pretty thought-provoking article in her latest eWeek column.  The key question is: will Microsoft be making an entry in the enterprise IP Telephony space with SIP and the newest release of its Live Communication Server (LCS 2005, code-named Vienna)? 

Ellen mentions a piece by Mary Jo Foley in Microsoft Watch (interesting to see more on Istanbul, a client that will be able to empower users to change content between text and voice).  So we have a client able to dynamically switch content, a SIP-based server, presence information... all the elements required to build a comprehensive enterprise SIP-based IP PBX.  Can this become a reality?  Maybe so this time around, although it may not be announced at the upcoming VON show.

Note: Just to throw some wood on the fire: Anoop Gupta, Corporate VP of the Real-Time Collaboration Business Unit at Microsoft is delivering a keynote on Tuesday at 11:15 AM.  Since I am participating at an analyst roundtable happening at the same time, I will not be able to attend Anoop's speech, but look forward to hearing feedback later on during the show. 

Mobile Tracker, a widely read blog about mobile communications, had a piece on MobiTV's newest partnership with AT&T Wireless (NYSE:AWE) to allow the latter to offer a $7.99 per month service that enables cellular subscribers to access TV content on their mobile handsets.  The Berkeley, CA based-company (financed by VCs such as Menlo, Redpoint, Gefinor and Sorrento) had previously signed a deal with Sprint PCS (NYSE:FON).  The channel lineup includes quite a few stations.  The AT&T Wireless service is available for either the Nokia 6620 or the Motorola V600.  The article also links to a critique from Russell Beattie, who described his experience on a Nokia 6620.

This past week, WiMAX proponents were bolstered by a couple of announcements: one from AT&T (NYSE:T) and another one from Covad (OTC BB: COVD.OB).  Both companies made their announcements at Web 2.0 Conference that took place in San Francisco last week (Ed. note: Om Malik had a few interesting postings in his blog about the conference).

Ben Charny had an interesting article on the WiMAX announcements on CNET news.  It was not surprising to hear that IXCs such as AT&T or xSPs such as Covad exploring WiMAX as a potential alternative to FTTH/FTTC in offering VoIP and broadband access bundles to consumers.  The end of UNE rules in June has forced IXCs, CLECs and xSPs to make sweeping changes in their strategies and focus on wholesale, enterprise and perhaps some innovation, as weapons to stay competitive against the RBOCs.  Not only that, WiMAX has the promise of cheaper costs ($75 versus $1,500 or more per dwelling).  As mentioned in a few posts here, there are quite a few issues left to be solved for WiMAX, but there is potential for a broadband wireless solution to still emerge as a viable alternative. 

Not only that, but the RBOCs' FTTH exercise will take quite sometime, and within a much shorter time window (i.e. 2-4 years), the prospects of  WiMAX (or even a proprietary broadband wireless scheme) will look a lot brighter.  It might require a bit of creativity, but it is something that could be done.  It will be for instance, interesting to see some electric utility act as a landlord and lease some of its feeder network to act as a backhaul access to a WiMAX network operated by a player such as Covad.  The future will tell whether such partnerships could eventually become a reality.

Note: Mark Goldberg (who authors Occam's Razor, my favorite Euro VC/strategy blog) had a good compilation of WiMAX articles in a previous post in his blog.

David Isen posted in his blog the the VON Magazine article he wrote about Japan, which I highly recommend.  I will not rehash his themes and closer examination of what Japan is doing right to lead the way in the delivering broadband services to the consumer market. 

Instead, I will talk about how some of Japan's neighbors are tackling the best way to deliver FTTP (Fiber To The Premise) to their countries.  Without a doubt, Japan is the leader in broadband in the Asia Pacific (APAC) region, with over 1.5 million FTTH customers currently getting the service.  After getting burned with ISDN, NTT made a slower foray into FTTH, but seems to be picking up speed in delivering the service (competing with the pioneer Usen Broad Networks) and establishing a goal of 2 million FTTH subs by 2005.

But what about the other countries?  Australia also seems to be getting quite serious about FTTH.  One of the first companies to deliver optic fiber in Australia was Bright Telecommunications, offering service to about 200k homes in Perth.  The company has several packages, including video, high speed Internet and voice services bundles.  Telstra is working on an FTTH trial at Brookwater Estate, Greater Springfield, a new housing estate on the outskirts of Brisbane.  Bundling will also be centered on voice, video and broadband access, with a caveat: Telstra will be tuning down the throughput to match that of existing cable and ADSL services.  In Canberra, TransACT Communications will be offering broadband at 36 Mbit/s downstream and 1.6 Mbit/s upstream, relying on FTTC (Fiber To The Curb) and ADSL 2+.

In China, China Telecom (the country's largest broadband Internet provider) plans to try out FTTH services in the future, but for now will primarily rely on DSL to provide broadband access to its customers. Despite that, with the 2008 Olympic Games looming on the horizon, many telecom service providers in Beijing have prepared study plans to further develop the region's infrastructure.  Beijing's metro fiber optical network is projected to connect to other cities and connect contest and non-contest venues.  China Telecom has been quite active, and recently bought some optical infrastructure from Nortel (NYSE:NT).  As well, China Netcom is rolling out a wireless broadband solution using the 3.5 GHz spectrum, relying on Alvarion's WalkAir 1000 platform.

Finally, Korea has already deployed more than 50,000 km of fiber.  Korea Telecom (KT) is rolling out a FTTH pilot service in Kwangju, a southwestern city in Korea, for 100 subscribers.  The aggressive target set was to deliver between 50 to 100 Mbps of bandwidth to about three quarters of the total households by the end of 2010.

Another VC blog that I am a big fan of is Jeff Nolan's (I also happen to like his sense of humor - on the title Jeff has "In the tradition of Dan Rather... Fake, but Accurate!").   

Jeff has a couple of great posts on the Vortex 2004 Conference that he attended.  It was an event that provided great insights into the future of the enterprise and the IT industry.  He posted some very interesting Q&A sessions, including one with Mike Volpi, SVP, Routing Technology for Cisco and previously Cisco's M&A czar.  Read it all here in Jeff's post.  On the exchange, I found the following replies quite interesting:

Keep in mind the disclaimer that Jeff had in his blog (comments were paraphrased and not made "ad literem").  But there are a lot more interesting speeches - Geoffrey Moore, Jonathan Schwartz, Shane Robison, among others.

CNET author Ben Charny had a story on how Cox is rolling out VoIP services across several locations in the U.S., including Oklahoma (Tulsa), Louisiana (Lafayette and Baton Rouge) and Texas (Midland).  The U.S. MSOs are much further ahead than their Canadian counterparts in deploying these services (there are other examples, such as Comcast, which is relying on Cisco gear and Time Warner and Charter, which bought into Sprint's Wholesale VoIP solution, which uses the Nortel gear).

What is the price of Cox's bundle?  $100 a month for voice, video and data.  In the meantime, over here in Canada, Rogers is planning to introduce VoIP services in the first half of next year (there are some indications that the company will use Cisco's gear).  Perhaps the slower deployment of IP by the Canadian MSOs can be partly attributed to the still uncertain regulatory picture.  Despite that, some Canadian MSOs like Rogers have a trump card they can play, namely wireless as a the fourth component of the bundle.

IP World Canada is a Canadian telecom show focused on IP that is going full steam ahead this week in Toronto.  Regretfully, due to a last-minute contingency, I was unable to be there this morning to attend a great tutorial about SIP by Henry Sinnreich (the father of SIP and Distinguished Member of Engineering from MCI), but I will be there tomorrow to catch Mr. Sinnreich and others present various interesting sessions.

Jake Gordon, the conference organizer, has assembled a great lineup of telecom executives (truly a who's-who list of the telecom world in Canada), including the likes of Michael Sabia (President and CEO of Bell Canada), Joe Natale (EVP and President, Client Solutions at Telus), John MacDonald (Allstream President), Don Smith (CEO of Mitel), Isabelle Courville (President, Enterprise Market for Bell Canada), Frank Panza (Director, IP-One Marketing), Phil Edholm (CTO and VP of Network Architecture for Enterprise Networks at Nortel), and Ibrahim Gedeon (CTO Telus Communications), among others.  These and many other speakers will be able to give a good pulse of the true adoption of VoIP thus far in Canada.

The agenda includes several tracks, including technology solutions, enterprise/SMB solutions and customer case studies.  The show definitely looks promising and is generating a lot of attention.  I am therefore pleased to have been invited to speak in a couple of sessions (one is an analyst roundtable discussion on the current state of the industry, and the second one is a longer session on the evolution from TDM to IP PBXs).

NTT DoCoMo and Fujitsu Laboratories have teamed up to develop a prototype micro fuel cell for 3G FOMA phones.  [Ed. note: FOMA is the name of DoCoMo's proprietary 3G network in Japan]  The logic behind the move is to cater to the power demand by heavy-duty 3G cell phone users.  But even normal users will also benefit, given the increasing power consumption of cell phones (which can be also used to play games, store information such as photos, play different music ring tones depending on the caller ID, etc.). 

The greater power capacity is due to the micro fuel cell, which is able to store 10 times as much power per unit weight as a conventional lithium-ion battery.  The fuel cell generates electric power through a chemical reaction by mixing hydrogen and methanol.  CNET reported that Fujitsu was able to increase the methanol concentration in the fuel cell by developing a better membrane.  The prototype unit measures 152mm x 57mm x 16mm and weighs 190g. 

The charging device is shaped like a normal cradle used to recharge handsets, and it meets all the specs of other FOMA mobile phone rechargers besides being compatible with all FOMA handsets as well.  Both companies anticipate that the prototype will be further refined, with development being completed by the end of 2005.  The key question is when the prototype will become commercially available - thus far, the jury is still out on some of these fuel cell initiatives in terms of products actually launched in the marketplace.

Note: TechTree (an interesting Technology Daily from India, which I enjoy reading) also mentions that Fujitsu apparently has another prototype power unit that incorporates the technology.  Perhaps this work can be extended to other devices, such as PDAs and laptops.  A 300 ml. methanol solution can hypothetically charge a notebook for close to 10 hours.

Israeli WiMAX vendor Alvarion (Nasdaq:ALVR)announced earlier this week that it had signed a deal with French operator Altitude Telecom to deploy an advanced wireless broadband network across France.  Altitude will rely on Alvarion's BreezeMAX solution to roll out broadband wireless VoIP services to SMEs in addition to large businesses.  The French service provider is deploying Alvarion's solution to build a nationwide network using their 3.5GHz spectrum, to complement and upgrade its existing 26 GHz wireless telecommunications infrastructure.

This is certainly good news for folks in the WiMAX camp, although the spectrum is still an issue to be considered for a wider uptake.  Case in point: Altitude is the only current operator with a license to operate in the 3.5GHz throughout France.  Globes (an Israeli business e-daily) reports that the BreezeMAX network will be rolled out in four counties (initially in the Loire Valley, with plans for additional counties within a year).

Here is another story from the Korea file.  Telecoms Korea had a piece on new phones and services to be introduced in Korea.  The latest model to be offered by KTF (a Korean mobile operator) features a mobile caption service which displays lyrics of the song played on MP3 phones in real time.  This is the first time I hear a mobile operator providing such a service.  Given the success that the ringtone download service had in regions such as Europe, I expect other Euro wireless carriers to follow suit.  This particular phone also comes with a 3-megapixel camera and TV receiver.  There are plans to add caption to all the MP3 phones or PDAs released through KTF in the future. 

Curitel, the South Korean handset maker that made the news in late August when it announced a deal to ship a new camera phone to Verizon Wireless (NYSE:VZ) also grabbed some headlines last week, with the launch of the P1, a slick-looking camera phone with a twist: speech synthesis.  Yes, the phone has text-to-speech as a built-in feature.

Given that the speech engine being used is in shrink-wrap mode, it might not have a large vocabulary.  The speech synthesis is done to output via voice the contents of the text data such as alarms, scheduling and SMS.

The cam-phone, which comes in different color models, is held sideways.  P1 is also equipped with a 2-megapixel digital camera and a 1.9 inch wide TFT LCD screen. (hat tip: Telecoms Korea)

There was an interesting InfoWorld article posted earlier this week about how Texas Instruments (NYSE:TXN) is skeptical about the prospects for a wider adoption of WiMAX.  The TI executive (Joseph Crupi, VP of TI's Broadband Communications Group, and the ex-CEO of Telogy, which was bought by TI) argues that the WiMAX could be an unfulfilled promise, just as the initiatives previously put forth by the Broadband Wireless Internet Forum (BWIF), an industry group that advocated for the adoption of proprietary specs for wireless broadband access a few years ago.  Crupi also mentions that operators for the most part still have not embraced WiMAX as a viable alternative to DSL and delivering broadband to the home.  The article mentions how China Telecom (the largest Chinese ISP) plans to rely on DSL to deliver broadband access to its subscribers, with WiMAX not being mentioned as part of the strategy.

But just because some service providers are slow in picking up new technology or the previous BWIF initiatives failed, is it fair to say that WiMAX is doomed to failure?  One has to wonder if underneath all of this skepticism, perhaps there could also be an effort to slow down Intel's (Nasdaq:INTC) quest to prominently figure in another segment of the wireless market.

That sentiment was echoed by Nancy Gohring in an article in her blog, WiFi Networking News.  She correctly notes that in the US only a few spectrum holders own the licenses suitable for WiMAX, and their interest in the technology has not yet been ascertained.  For instance, Nextel Communications (Nasdaq:NXTL) owns the spectrum, but hinted at using other proprietary schemes in that frequency range.  However, other major operators remained sidelined due to concerns of deploying in unlicensed frequencies. 

Besides spectrum, another obstacle for WiMAX is the development of the IEEE 802.16e specification for mobile wireless broadband.  This spec (part of the larger WiMAX 802.16 standard) is not expected to be ratified until the end of 2005.  Other restraints include base station interoperability and higher costs until that issue is solved and economies of scale can be achieved.

Note: Thus far, the few operators that are rolling out broadband wireless services are mostly relying on other technologies using licensed spectrum (e.g. the JV between Allstream, Microcell and NR Communications, which operates in the 2.5 GHz band, providing services in Canadian locations such as Cumberland, Ont. and Richmond, B.C.). That said, in June, Intel announced a WiMax trial to provide Internet services in two Chinese cities, Dalian and Chengdu.

Yesterday, I had posted a story on LG Electronics' strong performance in 3G wireless handsets.  At the end of the piece, I mentioned an article that I came across Telecoms Korea talking about a potential deal involving LGE selling its communications unit to either Nortel or Cisco (I discovered the original article on Tuesday this week, but could not find any official news item on Google News or any other source).

Well, today, someone e-mailed me a Dow Jones Newswires story claiming that that rumor is now official: LGE will spin-off its telecommunications unit and establish a JV with Nortel:

Interesting news item - but it is still early to jump to any conclusions until more details are announced.  For instance, I wonder if the JV will or will not include the 3G handset part of the LGE communications organization (the original report mentioned specifically that the 3G operation would not be a part of the JV exercise).  If so, then the deal makes sense for Nortel, since the company is actively competing in the 3G space, and this can create some synergies (e.g. Hutchison 3, a leading W-CDMA operator). 

However, speculatively speaking, there will be some duplication in the enterprise division (in terms of the LGE KTS and PBX, as well as the interest in KTS vendor Vodavi).  I would imagine LGE would keep its enterprise product lines and sell them in Korea and APAC (except possibly for Australia and other areas where Nortel is strong).  Nortel would still use its enterprise product lines in the remaining regions around the world.  Again, the information is still very fluid, so it is early to make too many conclusions.

Note: The story originally appeared on Edaily, a respected Korean publication.  Since I don't speak Korean, I tried searching for LG in the text and found the article.  Then, finding an online Korean to English translation tool was difficult (Google's language tools currently do not include support for Korean-to-English translation).  Altavista does have such an engine, albeit the translation is not the best (I guess the engine is still a work in progress).  But here it is, in any event.  The URL is:

http://www.edaily.co.kr/news/exclusive/read.asp?newsid=02102486573423072&strPage=1&curtype=read

(scroll down to "Traduci una pagina web" and copy and paste the above URL).  Then, choose "da Coreano a Inglese" on the combo box and click on the button that says "Traduci".

The CRTC VoIP hearings continued today, the final day of the three-day public consultation period that will determine the regulator's stance of VoIP.  Yesterday, Jeff Pulver posted his own submission to the CRTC in his blog.  Not surprisingly, Jeff pitched an FCC-like stance, much like the same position that I have been advocating here at TF.  But I liked the way he so candidly said:

Time will tell whether or not the CRTC will take a page out of the FCC book and adopt a minimum-regulation position.  Actually, it is not just the FCC that took that route; in fact, there are other countries such as the UK, Austria and Singapore that have also reached the same conclusion.  As Richard Stastny points out in his blog, it seems that regulators that have already dealt for some time with issues such as ENUM are apparently more forward-thinking towards VoIP (Ed. note: Richard has been one of the key players in Austria's ENUM initiative and has spread the ENUM gospel in a few VON conferences).

Once the hearings are completed, the commission will have to ponder upon a lot of issues, before making its final decision, which is expected to happen in the first half of next year.

Update: Transcripts should be available sometime soon (now that the hearings are over) - check the main CRTC VoIP hearings page.