DSL Prime News Briefs

E-mail is dying, Sandvine is growing, and the telcos flex their money power.

by Dave Burstein of DSL Prime and Future of TV and the Web Video Summit [January 8, 2008]

E-mail

• Private note from a friend "A professor who likes what I say wants to include it in a report but he's upfront that ATT is paying for the report so he needs to come to the right conclusion. I won't mention his name."

Briefs

• Alcatel-Lucent signed contracts with China Mobile (NYSE: CHL; 941.HK) and China Unicom (NYSE: CHU; 762.HK) worth 600 million and 150 million euro, respectively, on November 26, reports qq.com.
  
  
• Extraordinary growth at Sandvine, despite the controversy at Comcast. Q3 rose 162 percent to $21.2 million from $8.1 million in Q3 2006. Edge controllers have legitimate uses against malware, denial of service attacks, and massive peaks. Using them for excessive traffic shaping is just an invitation to be publicly shamed.
  
  
• Hanaro in Korea is being taken over by SK, the leading mobile company. American International Group and Newbridge Capital held an auction for the controlling stock holding. When Macquarie Bank of Australia looked to be the winning bidder, Hanaro workers took to the streets and editorials insisted the #2 broadband provider, SK step in.
  
  
• Kevin Walsh kept his ego in check despite Calix winning an important partner, Microsoft IPTV. "There's no truth to the rumor that we're going to buy Cisco," he tells Light Reading. Some of the mid-sized telcos wanted Microsoft software and alternative to Alcatel for the hardware.

Press

• Heise Online reports strong statements on telcos blocking content from Eco, Germany's important internet alliance. "The Empire Strikes Back," Klaus Landefeld terms the attempt to take control. IMS and ipSphere represent "one ring, in order to bind all." Tiscali is threatening to block the BBC and Deutsche Telekom bragging about how much they will collect from anyone who wants to stream video over the net. About 80 percent of DSL Prime readers are strongly opposed to Net Neutrality, wanting telco freedom from government regulation. The European and Japanese battle is getting explosive; let's all try to keep the argument centered on facts. Heise's full reporting is in German only, which I can't read. They are so valuable I daily run through Google Translate. Paul Davidson at USA Today points out something U.S. policymakers are forgetting: cost cuts at the Bells are impacting service quality for basic phone service. This is a major story, easy to confirm, extremely under-reported.
  
  
• Nicholas Carlson has jumped from internet.com to ValleyWag, where he's not afraid to make the statement, "E-mail is dying as a form of communication." He backs it up with Comscore U.K. data showing a drop in e-mail traffic and big increases in "social networking." Carlson may be seeing what others are missing because he's just a few years out of school. Danah Boyd a while back pointed out young people don't use e-mail. SMS is the big thing.
  
  
• Silicon Alley Insider, with Henry Blodget and Peter Kafka, has rapidly become one of the most interesting tech publications in North America. Substantial original reporting and truly provocative analysis have quickly made it a must-read. SAI is part of a remarkable shift in internet focus from Silicon Valley to New York, symbolized by the new editor at Techcrunch.

People

• J.H. Snider has left the New America Foundation to form iSolon.org, dedicated to democratic reform including "Citizen Assemblies." Honorable work, but it means D.C. telecom policy is losing one of its most important advocates. He did important work on opening wireless to new providers and consumer's choice of devices. If only the FCC would listen more. Snider and Columbia Professor Tim Wu were important early voices for wireless Net Neutrality, an important influence on the open access debate.
  
  
• With Martin Geddes, STL has become the most innovative small consultancy in Europe. Smart folks, and their Telco 2.0 conferences are among the best of the year.

Wall Street

• Centillium received an order for "hundreds of thousands" of chips for home fiber terminals (ONU). This is crucial for the company, whose Japanese DSL sales are inevitably declining as the country switches from DSL to fiber. Centillium worked on Japanese DSL standards for several years before the revenue came in. Soon after, Japan had world-leading DSL growth with Centillium the preferred supplier. Now, DSL subscribers in Japan are switching to fiber and their number decreasing, leaving only a modest replacement market. Centillium invested heavily to develop the fiber terminal chip, hoping to get orders like this.

Copyright 2008 Dave Burstein.
The DSL Prime Newsletter is reprinted with permission.

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