DSL Prime News Briefs

DSL industry news from North America and around the world.

by Dave Burstein DSL Prime [May 19, 2004]

E-mail

• "How can you write 'DSL.net will aim high' when the company has so many problems?" came the question from Wall Street. I don't believe the investors would bring in someone like Buddy Pickle without a plan to recover. But I think I made the risk clear writing, "With luck, their recent 63 layoffs will be their last, and their NASDAQ problems get resolved happily. However 'the company has experienced sustained operating losses that raise substantial doubt about its ability to continue as a going concern.'" That's accountant speak for extremely severe problems.
  
  
• "Pricing won't hold if it has to compete with zero, will it?" Richard Karpinski wonders, after I wrote that cable will aim for only a small discount from telco prices. That's the rub, of course; Roberts is betting that only a few will actually switch to Skype, Vonage, and the 100 Vonages that are about to pop up. Might be a bad move, but I believe Comcast has decided not to scare the telcos too much with low prices.

Briefs

• Covad's business plan requires adding more customers to get up to a profitable volume, so their quarterly drop of 1,200 is more worrying than the accounting issues that have also come up. Covad's strength was their better services than the bells, for which they could charge a higher price. The bells still have a long way to go, but have improved dramatically, requiring Covad to find another strategy to differentiate themselves. Everyone's doing VoIP, so that's not enough. Perhaps leapfrogging the bells with 15 Mbps ADSL2+ and VDSL at 10/10 in the cities?
  
  
• Yahoo BB added 73,000 to 4,076,000 in April, which would be a great month for most companies although disappointing for Son. Japan as a whole added 318,000, an improvement over the prior few months.
  
  
• With numerous Dutch offerings around 15 euros, growth is rapid. KPN reached 913,000 from 746,000 the prior quarter. 99 percent of COs are covered.
  
  
• "Nerds on strike" they were singing as teaching assistants and adjuncts marched across Columbia University next door to me. Since I don't cross picket lines, I might have to miss the very interesting CITI event on May 25, almost a mini-VON conference. Guests include Stagg Newman, Kevin Werbach, Lawson Hunter, Robert Pepper, Jeffrey Citron, Jeff Pulver, and Frank Governali. Two perhaps less familiar are Glen Campbell, who's doing some imaginative analysis at Merrill Lynch and Raul Martynek, whose Eureka Networks is confounding folks by demonstrating the building LEC model can work with good management.
  
  
• For the really dedicated, the daylong event is followed by similar at the New York Bar Association, adding Sen. John Sununu. I'm going to ask him whether he wants to preserve universal service or instead raise rates to "bail out" the failing telcos. I know whose side I am on, so I hope they suspend the strike and I can join. After all, as the sign said on College Walk, "X-ray astronomers need to eat, too."

Press

• Almar Latour broke wide the story that the bells have over-milked the directory business, in a Journal story Baby Bells Feel Heat on Cash Cow: Mr. Walsh's Yellow Book Pushes Into $14 Billion Market With Cheaper Ad Rates. Latour and Jesse Drucker also got right the outrageous Spread of Hidden Fees Rate Increases That Look Like Taxes Hit High-Speed Internet, Cellphone Bills, following up Jim Hu at CNet and especially Karl Bode of DSL Reports. Another respected paper wrote the same story almost straight from a Verizon press release, adding an error significant enough they need to print a correction.

Stock market

• Mark Thorsheim of DH Capital raised $4.1 million for fast growing Albany, New York CLEC Tech Valley. Lloyd Sams and Chuck Wiebe of BIA Digital, a well-connected small investment house, put up the money. (Dick Wiley and Anne Bingaman are advisors.) It's a hard time for CLECs to get funding.

People

• Krista Jacobsen, one of the most distinctive voices in DSL standards, is leaving Texas Instruments and taking some time off. In her note to the T1E1.4 committee, she urges her colleagues to make sure she doesn't return to the DSL arena in several months and find them still discussing how many latency paths and how many bearers VDSL2 will support. After Fast Net, I became convinced that VDSL, not ADSL, is the right choice where distances are short, including essentially all multi-tenant units by late 2005. Prices will be almost the same, and customers want the upstream speed even more than the downstream. That makes getting VDSL2 to market imperative for the DMT companies.
  
  
• Wei Yu, another student of John Cioffi's at Stanford, chose to remain in academia at the University of Toronto. He's a contributor to the new paper, Proof of the Optimality of Optimal Spectrum Management, available from T1E1.4. Other authors are Raphael Cendrillon and Marc Moonen of Katholieke Universiteit Leuven, Belgium with Jan Verlinden and Tom Bostoen Alcatel. I hope other academics in our field send me their papers—even if I won't always be able to follow the math.
  
  
• For DSL Prime job ads, visit the DSL Prime website.

Copyright 2004 Dave Burstein.
The DSL Prime Newsletter is reprinted with permission.

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