Faroese Telecom getting no technical support from Audiocodes
By Faisal Kawoosa
| February 2, 2008
I posted a writeup on Faroese Telecom’s NGN project couple of weeks back. Apparently the telco has deployed VoIP equipment 2 years ago. And although it has found ways to utilize the deployed equipment, the utilization remains minimal. Enterprise VoIP for which the service provider had deployed Broadsoft and Audiocodes products is yet to be launched. Reason? Unresolved technical issues related to Audiocodes media gateways.
To make enterprise VoIP services a reality, the service provider needs to interconnect with the existing PSTN for which it uses the Audiocodes product. Unfortunately the interconnections have not worked as expected. The other problem has been the lack of technical support. The service provider was told that Audiocodes has stopped providing support to the product deployed by Faroese Telecom.
Net revenues for the quarter were $540 million up by 8.6% yoy. Sequentially it was up by 3.3%. Communications contributed around $102.6 million. Other segments that contributed include Computing 31%, Consumer 29% and industrial 21%.
The net realizable bookings across segments were at $476.4 million down by 9% due to seasonality, fire at a major customers’ factory and the macro economic concerns of certain customers.
Maxim announced a cut in the R&D budget resulting in $15 million annual benefit towards operating expenses. It reduced investments in RF Wireless and Telecom. In the RF Wireless it announced discontinuation of investing into low-margin handset RF transceivers and in the area of Telecom it has decided to defer additional R&D investments till it sees market acceptance of recently introduced products.
Revenues in Q4 were up by a modest 2% qoq which stood at $323 million. New category products saw revenues grow 9% sequentially in this quarter. In terms of product families, CPLDs declined by a percentile which are used in a number of communication devices. FPGAs however grew by 4%. Among the products Max II CPLDs registered record revenue in this quarter which was up by 8%.
Operating expenses were around 44% of the revenues. Of these $71 million were spent on R&D. Although operating expenses were cut by 3% the R&D spending went up by 6% reflecting better expense management on selling, management and other costs.
Communications segment was the strongest segment in the quarter. It grew by 4% while other segments were pretty flat. Telecom business was down but wireless and networking grew by double digits.
Stay tuned during the month of February. SeaMeWe permitting, we will post for you a brand new CEO interview each working day for the remainder of this month!!! That is right. We take you direct to the horse each day. Drink deep from the fountain of Wisdom 2.0
That is what I have been doing myself. Over the last year or so, I have enjoyed interacting with the top bosses at some of the most innovative outfits. Think they are a bunch of accountants managing company books? Think again. While they may need to be calculated and careful about what they say, I have usually found them approachable, open, and intelligent. I hope you find the content from these CEO interviews stimulating.
Most of my interviews take place on phone. Some however will come in form of video clips.
Your TSB applications platform comes with a few web mashups which seems like a progressive move. What traction are you getting for this product?
As of now, we are seeing interest both from Italian and EMEA tier 2 operators and large multinational companies. We are basically positioning our TSB product to both the telco operators and enterprises that want an easy integration of web 2.0 services in the existing fixed mobile and enterprise networks.
What role do you see the social networks playing and could they become your future customers?
Social networking is a fundamental aspect of web 2.0 evolution and is changing the way people interact with the media and communicate. Due to the rise of social networking, media companies have to spend more on technology to handle such interaction. Cisco recently announced it is designing a new kind of operating system called EOS (entertainment operating system) dedicated to on-line communities. Italtel is evolving its next generation networks strategy with robust web 2.0 applications in order to support service providers’ transition to new media. For example, we enable live calls on Second Life and set-top-box interaction for IPTV open environment.
Does your TSB platform support advertising based telephony?
Advertising on free phone calls is effective on the Internet and it is becoming a viable business model also on cellular phones. We are ready to support service providers that decide to adopt this type of models. TSB can mix existing and new services with advertising in a fast and easy way to fit in with the time-to-market requirements of service providers. As an example, through TSB, it is possible to make a selective and personalized introduction of messaging with personalized advertising, either on mobile phones or on TV platforms.
What is the update on your commercial deployments?
Through the second half of 2007 we had thousands of seats out there through beta tests and trials. And those tests and trials across multiple OEMs have gone well and there have been related announcements related to general availability of PBX products integrated with our solution towards the end of 2007. We have pipelines built up with all our OEMs to supply our products for large enterprises as well as SMEs as we go into 2008.
There was a lot of interest in FMC at the end of 2006 but during 2007 there has been a lull although there was relatively more action on enterprise FMC side.
On the carrier side there has been a lull due to the fact that wireless carriers are asserting their control. And the way they are doing that is by exploring other FMC options like femtocell. However we did see some offers being launched in 2007 such as T-Mobile UMA based FMC service. On the enterprise side we have seen FMC continue to march forward. The delay there has been due to delays from PBX vendors in integrating this and bringing it to market. Nortel’s CS1000 which is their main PBX platform took six months till the end of 2007 to integrate our product. There are 3000 test cases just from the mobility aspect to validate a product for CS1000 platform. So it is a very strenuous process. We have also seen similar delays with Cisco and Avaya. But all major PBX vendors have announced their products now and hopefully that lull will disappear during 2008.
What percentage of IP PBX extensions do you expect to add FMC capability to, going forward?
Three years out we are looking at estimates of anywhere between 8% to 24% of enterprise PBX extensions being installed as mobile or FMC enabled. For 2008 I expect adoption of under 1% range. And that is a large figure. Enterprise PBX market is a huge market and we are looking at something in the region of 100 million lines per year being shipped worldwide.
Quarterly revenue for IDT was $201.2 million which reflects a decline of 5% qoq. Communications related revenues were approximately 32% of the total revenues which has declined from 34% last quarter. Other segments’ revenue shares were Consumer 19%, and Computing 43%. The rest came from audio segment.
The company continued their engagements with base station manufacturers on the wireless infrastructure side who are working on IDT’s Pre-processing Switch for next generation wireless rollouts.
I am not sure how familiar you are with the name CounterPath, but the mouse just swallowed another little cub from the FMC zoo. Bridgeport Networks is the second FMC vendor acquisition of the week for the relatively lesser known CounterPath that licenses out its softphones to vendors and service providers. The first acquisition of the week was Firsthand Technologies that also falls under the FMC category.
So where would CounterPath be taking its FMC assets? Neither of the two acquired companies offer UMA flavour. So there are not going to be any consumer FMC deployments just yet. The only successful consumer FMC offerings that can be seen out there are UMA based which is a more mature FMC option. The company will have to perhaps wait one more year to see VCC gaining traction. It now has both an enterprise FMC product (Fristhand) and consumer FMC product (Bridgeport) under its belt. I would guess that the company will perhaps target MVNOs that are the ideal VCC target customers.
On the enterprise FMC side it is likely to continue working with OEMs like Nortel, a channel that Firsthand had secured prior to their acquisition. A better strategy would be to target the SOHO service provider breed such as Vocalocity, Phone.com, and Toktumi. GIPS, another softphone vendor like CounterPath that powered the early versions of Skype, is also changing direction somewhat and offering feature server capabilities geared toward the SOHO service provider segment. GIPS’ first customer is Toktumi.
Your offering very much emphasizes connecting IP PBX to digital proprietary phones. What is the logic here? Utilize the existing phone wiring?
Exactly. The existing phone wiring as well as the existing phones as well. We make an adaptor that connects over 24 proprietary digital phones manufactured previously by the likes of Nortel and Avaya. So with our offering you take benefits of VoIP without getting rid of your digital phones and wiring.
Is the adaptor like a multi port ATA ?
It goes a step beyond that. It supports not just analog phones but also digital phones that the PBX manufacturers have made historically. You cannot take a Nortel business phone and plug it into an RJ11. Your proprietary phone at your desktop at work speaks a totally different language. It only knows how to talk to the PBX made by the same manufacturer. Our intellectual property is about how each of those proprietary digital handsets signal when you press ‘Conference’ or ‘Hold’. In our case it sends that signal to our box and our box then relays that signal onward to an IP PBX or a hosted PBX making the features transparently available to proprietary phones.
When we bought our PBX, we bought for about $1000 and the desktop phones cost really peanuts, something around $20 kind of range. I thought that it was counter intuitive to be concerned about handset costs rather than the PBX? But since you tell me that you preserve investment in digital phones, the approach makes sense.
Those phones used to cost upwards of 500 to 1000 dollars. They are really sophisticated phones with 20 buttons on them. And the old ones have better audio technology. They have better quality proprietary chips rather than cheap chips in the present day IP Phones.
Normally you would see IMS being pitched at the local incumbents. Belgacom International Carrier Services (BICS), however, chose IMS blueprint over the softswitch environment even when the cost of IMS implementation was higher. According to BICS, developing applications with softswitch environment would have cost them much more.
The service provider has already realized break even on the investment made in deploying IMS. It reached a break even point in just 10 months after deployment. On the CAPEX it saved 30% and the OPEX was remarkably lessened by 70%. And BICS says IMS stuff is green. Compared to the legacy switches and other infrastructure they saved around 20% in energy consumption which included power consumption of the actual equipment, ventilation and air conditioning of the place where the equipment is located.
Gareth talks about SIP trunking integrated with Microsoft OCS, possible hosted model for OCS, and Arena. Arena is a service offered by Interoute that includes things like switch partitioning and VoIP peering. This is a much shorter version of the video conversation. A full transcript of the interview will follow later this month.
Providing VoIP service since: August 2004. GoIP started with its own developed VoIP system for retail service. Subsequently GoIP International was formed to offer service as an Application Service Provider (August 2005) for consumer VoBB and Mobile VoIP. Retail business sold off to debitel.dk (www.debitel-ip.dk)
Most memorable challenges so far: Providing system deliveries faster to service providers, and avoiding custom development.
Interview with Steven Francesco, CEO, Cohere Communications
By Faisal Kawoosa
| February 11, 2008
You offer services to SMBs mainly, which is now a crowded space? What is your unique selling point there?
Apart from maintaining high call quality, we also deal with organizations that require diversity on their network as well as flexibility in their growth. We are probably the only provider for contingencies in the network to ensure service availability.
You have been through the market downturn having managed Nx Networks. What advice would you have for start up companies in VoIP?
Everyone thinks that VoIP is an easy business to replicate and support. It is probably a lot more difficult operating in an unregulated market. A lot of new companies get into this market and panic and start selling on price alone forgetting to provide quality. So if they are going to enter this market, they better know what they are doing. Otherwise not only will they suffer but their customers will suffer fairly quickly.
You have been involved in acquiring VoIP companies in the past. We see some of the startups merging in the VoIP market. Does merger of startups usually work?
Everybody wants a rollup strategy right now especially since VoIP is a crowded space. Problem is that everyone thinks that they are worth a billion dollars even if they are losing money. They believe they are selling services like MySpace and Google is buying. They don’t realize they will be selling dial tone which has being commoditized for over 100 years now.
Revenues for the 4Q 2007 were $35.3 million, up 5% sequentially. Revenue from multiservice access VoIP processors increased by 13% forming 28% of the quarter’s revenues. High-performance analog products showed an increase of 4% totaling contribution of 30% to the revenues while WAN communications remained flat by contributing 42% towards the overall revenues.
Geographically, Asia-Pacific contributed half of the revenues while Americas earned 39% of the revenues. Europe contributed 11%. Cisco was the only 10% end customer.
You have recently articulated three main areas of focus: your traditional hosted PBX offering, mobility and Voice 2.0. How do these three areas gel together?
We are focussed on re-inventing voice for carriers. Although the contribution of voice in the overall telecom business is diminishing by the day but voice business generated over $1.2 trillion dollars for carriers last year. Re-inventing voice is a huge business opportunity. It can mean several things. It can mean integration of voice with PC based and mobile based applications. It can also mean making voice services available to the user anytime and anywhere he is.
From operator perspective they want certain common capabilities in their network. Take BT21CN project which is a reference blueprint in the industry. There is a push to minimize complexity of managing tasks. There are some common capabilities across networks and across services. That is what voice will have to adapt to. Sylantro’s multiplay application server will become a key application building block of tomorrow’s network architecture. It will serve as that common capability platform for different services. So in short our strategy has evolved to serve two areas: common capability multiplay platform and re-inventing voice.
You mentioned multiplay platform. There is one such deployment at Swisscom where the same feature server is being used for fixed as well as mobile voice. Right?
Yes. Swisscom deployed Sylantro platform when Siemens was their systems integrator. We deployed fixed line voice for consumer voice. At the beginning of this year Swisscom decided to merge and evolve their network to an IMS architecture to combine and converge two network architectures. And Ericsson took the lead and worked directly with us as supplier for the IMS architecture. Swisscom asked Ericsson to use the same feature server that was used in fixed voice. Today Sylantro platform serves the common voice capability in Swisscom network.
Any other operators out there that have deployed your platform for both fixed as well as mobile voice services?
Yes. Wateen in Pakistan is the largest IMS based VoIP over Wimax network. The service enables mobile Wimax at the access side serving both consumers as well as businesses. They launched the services in November and it has been a big success. Similarly we have a project going on with Korea Telecom. That is also a Wimax project where business customers are integrating VoIP with their Microsoft OCS platform. There are two large trials – one of them in the US – that also use our platform as a multiplay platform. These deployments really challenge the traditional FMC set up. We see a much more creative convergence than the traditional definition of FMC.
• 4.102 million VoBB subscribers in France as of end 4Q07. Added 617k subscribers during 4Q07.
• VoBB subscriber base represents about 36% ADSL customer accounts.
• 677k VoBB customers outside France (mainly in the UK). Poland: 132k VoIP subscribers, other European countries 544k.
• IP TV Subscribers: France 1,149k, Poland 40k, other European countries 54k.
• Orange Unik FMC subscribers: 573k users as of October 2007, up from 468k users at end 3Q07.
If you are a developer who is particular about the underlying chip for your application, your demands will by and large boil down to Processing power the chip has, the Space it occupies, and the Power it consumes.
You need the processing power and speed so that you are able to add on multiple applications which can perform various functions. But adding more applications result in two things. It demands more power consumption and since the base band will be capable of giving output in various forms and for many applications, there will be more and more peripherals added to it. So demanding more processing power effectively results in increase of power consumption and the size.
What sort of VoD content do you see out there in the IPTV market? Is it the same VoD content that you find with other forms of delivery?
The most popular content for VoD is recorded TV. You record the TV channels and you make that available on demand. The second most popular VoD content is movies. Local content is also becoming a big factor especially in IPTV services. These are the three major VoD content forms that are popular with IPTV users but none of these three are IPTV specific only.
What in your experience are VoD demand trends in emerging versus established markets?
In the US, the initial IPTV deployments do not necessarily have a VOD component. They rather focus on linear TV. You see more openness in deploying VoD in emerging markets versus the US where the traditional telcos have been more cautious about the introduction of new services. They typically go for linear TV first and then add some VoD and only later the real promise of IPTV services which is the new services over TV.
Are you involved in any hybrid offerings such as Verizon that is offering the VoD component over IP and the rest over legacy network?
We have a few customers in Israel, Far East and Europe, where the channels are being delivered over the air – either over satellite or over digital terrestrial – and the interactive on-demand content is delivered over IP connection through DSL or FTTH. We definitely see the hybrid approach as a trend.
When you evaluate central office of a telco for possible IPTV deployment, what would you ideally want to see there? What are the ingredients of a suitable telephone plant for an IPTV deployment?
Revenues for the 4Q 2007 touched $2.96 billion up by around $260 million compared to 3Q 2007. Total shipments for the period were 2.36 million units (all 8” wafers now). Shipments for the quarter were up by around 5.9%. In 3Q 2007, the revenues had increased by 17% and the shipments by 20% which in this quarter has considerably gone down to 5.5% and 5.9% respectively. 68% of the quarter’s production was consumed by fabless/system customers while IDMs consumed the remaining 32%.
Geographically North America accounted for majority of the sales: 79%. Asia followed with 11% of total. Europe accounted for 8% of the sales. Japan contributed 2% of the sales.
Communications segment continues to be major sales contributor segment for TSMC. In 4Q 2007, communications chip contribution remained flat at 42% of the sales. Other segments contributing to the quarterly revenues were Computer 35% (up 3%), Consumer 15% (down 2%), Memory 3% (down 2%) and others 5% (up 1%).
In terms of chip technology, 90nm chips were the maximum revenue contributors for the quarter by fetching 29% of the revenues. In the quarter TSMC also announced shipping of one-millionth 12” 90nm wafer in less than 5 years. That was followed closely by 0.15/0.18um chips contributing 27%. The 0.11/0.13um, 0.25/0.35um, 65nm and 0.50um+ contributed 20%, 10%, 10% and 4% in that order. By chip technology 90nm chips saw some increase while others had a dip or remained flatter.
Interview with Alastair Westgarth, CEO, Tango Networks
By JR
| February 14, 2008
Alastair discusses factors determining FMC growth and reasons for slow FMC uptake so far. Tango Networks claims that its hybrid FMC architecture is a win-win solution for both the PBX vendors and carriers thus avoiding possible cannibalization of revenues of these two important players in the FMC game. You can hear more from Tango Networks during our upcoming webinar on FMC security.
• Added over 2.5 million VoIP subscribers during the Year 2007 - an increase of 61%.
• Comcast ended 2007 with a total of 4.4 million VoIP subscribers.
• VoIP service now marketed to 42 million homes representing 86% of Comcast's footprint
• 4.4 million VoIP base represents 11% penetration of the total Comcast addressable market
• Phone revenue increased 85% to $1.8 billion due to significant growth in VoIP subscribers, offset by a $229 million, or 50% decline in circuit-switched phone revenues as Comcast transitions to marketing only VoIP in most areas.
• Entering 2008, Comcast has fewer than 200,000 circuit-switched customers, with the winding down of that business expected to be completed by the end of 2008.
• Comcast ended 2007 with 13.2 million high-speed Internet subscribers, or 27% penetration of homes passed.
Atheros posted a revenue of $114.3 million in 4Q’07 which was up by 8% reported in the last quarter. Income for the period was $21.4 million. The networking chipsets fetched revenues of 52% while PC OEM got in 43% and the rest of 5% was brought in through consumer chipsets.
Major growth was seen in core wireless LAN segment, particularly the 11g solutions that contributed primarily to the overall growth in this quarter. Wireless LAN chipsets contribution by types was 11a/g (16%), 11g (67%) and 11n (17%) of the total wireless LAN revenues.
Hon Hai Precision Industry was the only 10% customer for the period.
By the end of the quarter, Atheros had shipped over 20 million Ethernet ports to around 20 different customers on a cumulative basis. In 2006 they had just 1 customer for this product line.
Why provide a service rather than license the platform to service providers?
Our background is actually building platforms for carriers. Our team built platforms, and enhanced applications on top of those platforms, for AT&T, Sprint, Pacbell, GTE and several wireline and wireless carriers. What we experienced is that innovation always came from carriers and at their own initiative. Your fantastic features and APIs don’t mean much to them. At the end of the day, what we found was that carriers did not have the infrastructure or the business model to allow their networks to be opened for third party developers. With Ribbit, we have switched gears a little. We decided instead to open the platform to developers. And we are not going to wait for two years to bring new features to consumers that could be offered yesterday.
There are service bureaus out there like Tellme that offer something similar to enterprises. Would you regard them as similar to Ribbit?
We have seen service bureaus out there that serve large enterprises providing APIs that are telco oriented. These companies use SIP APIs but there are very few developers out there that really understand SIP stacks. We are trying to make those APIs one level easier. We provide Flash APIs so that the developer does not have to necessarily know the bits and bytes of telephony protocols.
Is time-to-market the main reason why you go direct to the consumer or is it the lack of compatible carrier infrastructure?
The issue is the time it takes carriers to incorporate things into their network. The issue I think is much less how they open up their APIs to the core elements of their network. You see some of the progressive carriers attempting to do this. BT has their web21c program. But even so it is coming on slow. And again if you look at the interfaces that are being provided it is being provided with the concept of deriving a telephony application, adding telephony to an existing workflow type of application for example.
This model can easily be replicated by social networking sites like Facebook. Are we looking at some sort of competition from those guys in the future? They could aggregate these Voice 2.0 applications and offer a services bundle.
It is possible. But telephony is a different game than providing various types of web services. You have to have telephony experience. There is also the billing issue. In communications we have applications that we need to bill for and we are going to see that for a long time to come. Social networking sites generate revenues based on advertising. It is very hard to subsidise phone calls through advertisements today. Social networking sites have a different mentality. We help developers monetize the application. Facebook type sites are not concerned about monetization aspect of the applications.
• Added 56,000 net subscriber lines during the quarter to end the year at nearly 2.6 million lines.
• Lost 230k customers during the quarter. Average monthly customer churn during the quarter stood at 3%
• Marketing cost of customer acquisition: $223 per customer. Total marketing costs during the quarter: $63 million.
• IP litigation costs during the quarter were $1.3m compared to $133m in the previous quarter
• 4Q07 revenues $216 million, 2% increase q-o-q and 19% increase y-o-y. Net loss $9 million
• ARPU: $28.19 down from $28.24 in 3Q07.
• Current cash and marketable securities and restricted cash at quarter end was $190 million.
Providing IPTV service since: August 2007 (in Norway)
List of challenges: Integration between ERP systems and IPTV provisioning systems; STB problems; VOD software bugs; Content owners that do not allow the company to sell channels one at the time (only bundled in packages); difficulties raising enough capital; content distributors that own distribution infrastructure.
I am not yet clear if stress leads to a creative outlet or creative exhaustion. For me the months of Jan and Feb are always stressful in terms of workload. And I have noticed that I am not able to generate any micky mouse ideas these days that I could feel excited about. So although I have only one data point here to make an inference, I would say that extra workload is not good for creativity. There is another thing that is not good for creativity. I am officially (and regretfully) a smoker but my average is like 5 cigarettes per month. When I have a smoking streak (like in Jan and Feb), I lose it all. I mean creativity :) The fags just do not work for me. They make me dumb. Not sure how Freud and Einstein managed!
Anyway, I will blog about a few ideas that my smoke infested grey matter came up with. One is a mobile VoIP aggregator. Since you are going to see dozens of mobile VoIP offerings during 2008, why not develop a Least Cost Routing softclient that interfaces with various mobile VoIP offerings out there. Making cheap calls has to be one of the main motivations for using Mobile VoIP. And a single provider can never ensure best rates for all long distance routes. The LCR softclient can also similarly aggregate the mobile callback offerings out there if the APIs are available from companies like mig33 and Jajah. And while you are at it, you can make this a flash phone client so that we do not have to download anything.
There are two guys here at iLocus that use Jajah for international calls. I have been told that the call set up time is very quick. However we don’t have DIDs so once Jajah sets up the calls for them, the calls come via the PBX. And that is really annoying.
Jajah needs to let the user specify that he is behind a PBX and does not have a DID. Jajah system should then attempt to call the switch board number and, immediately after sensing a response, punch in the extension number provided (Auto-Attendant letting you dial your extension is now a standard feature). There might be certain errors in DTMF relay if that stuff does not interoperate but at least you have a go at the problem.
Right now Jajah type web-initiated calling services are limited to consumers only. The company needs to develop business features to attract small businesses like us.
Ability to monetize local and user-generated video content on IPTV
By JR
| February 17, 2008
I think this would be another way to encourage local content. If you help monetize the local video content, you might have a few potential producers out there. Among various forms, local video content could take form of video interviews you do with various members of the community, something like a local community news magazine on TV. In terms of the platform that hosts this content, I think TV stands a much better chance than a website.
Advertising server companies like Packetvision and VoD server vendors like BitBand would need to provide capabilities in their platforms to monetize this video content. I am blogging about the local community content for the second time because I feel there is a genuine demand for such content worldwide. This is an area where Internet has done a very poor job so far. And local video content may not prove to be suitable through an online site since maintenance of the site would require a substantial commitment. Instead if you make such content available over the TV in form of VoD, it might work.
• Revenues $31.4 million, up 32% y-o-y and 6% q-o-q
• Geographic split: 45% North America, 55% Rest. Direct 31%, Indirect 69%
• Three channel partners, Alcatel Lucent, Ericsson and Nokia Siemens Networks, were 10%+ customers in the quarter and represented 46% of the company’s quarterly total revenue
What is the existing conferencing market in India like? How does your offering fit in?
Conferencing market is currently a tedious process and an extensive one. You have to go to one of the service providers, sign up for an account, and sign up the agreement plan they have. They are charging between Rs 3-4 a minute per user which is expensive for a lot of SMEs. These providers are not based in India. They are extensions of certain global payers.
We are offering a free audio conferencing service. People can call in a number which is either local or national long distance to them and wont cost more than Re 1 a minute. There is no incremental cost. We make money by playing a 5-second pre-roll voice advertisement.
So what has the signup and usage been like?
We are seeing serious signups happening and conference calls going on. The longest so far has been for around 3 hours. We are seeing requests coming for toll free numbers, offering calls with more than 10 people. We are seeing Indian as well as global players using our services.
The feedback you have had so far, what feature are you getting the most requests for?
What we are missing right now in terms of a key feature is a scheduler.
Sabeer Bhatia and you have so many projects live online – VoiFi, Aarzoo, etc. and now Sabsebolo. Which one of these is a hundred million dollar idea?
We strongly believe Sabsebolo has the potential to be a dominant player in the market. Not only in the audio conferencing but may be the whole voice platform.
Vonage is not influential enough to trigger a review of the patent law in the US. It would be realistic to expect quite the opposite. All those US based VoIP providers that have done the hard work these past few years will be running scared in 2008.
Therefore, rather than have more suits I think more and more VoIP companies in the US will either be bought up by Verizon (or other large companies), or you will see some kind of licensing agreement where Verizon will start getting royalties. The suits are likely to end pretty quickly because if Vonage – with comparatively larger cash reserves – lost, these other VoIP providers that are not so well known and don’t have the resources that Vonage has will probably opt for an out of court settlement.
Verizon on its part will also prefer more deals done at the back. So while we may not see many suits that should not lead us to think that Verizon is done with the VoIP providers. Verizon recently went after Cox and Charter. And if the company does not make a deal with Comcast it will go after Comcast. The issue with cable MSOs is that although they originate calls over cable lines but they still use the public internet for the service. Any IP-PSTN session breakout would potentially fall within the scope of Verizon patent(s). And the words used to describe these patents are very broad.
I have not come across a lot of companies with an ASP model that are offering VoIP as well as IPTV.
That is right. We are trying to unify three services into one, which include communications, information, and entertainment. We have designed our IPTV services to incorporate social networking from day one. We enable real-time opinions and real-time ratings and multiple ways to communicate around the content.
You don’t own the last mile. So how can you reliably offer IPTV with all the QoS issues?
Our technology accommodates for a great deal of latency. We are also very light on the bandwidth consumption for IPTV delivery. Most services out there require 500 to 600 kbps kind of bi-directional connection. We don’t need that kind of bandwidth. We operate in about 280kbps kind of range.
You have over a million users. How does that subscriber base break down by the application subscription or usage?
We have near about 3 million users now. I would say that over 80% of our subscribers use the communications side which includes IM and VoIP. The IPTV side and Video-on-Demand is utilized by about 60% of the subscribers. There is obviously an overlap.
• Estimated 1.9 million VoIP subscribers at the end of 4Q07.
• 21CN update: More than 35% of UK core network already rebuilt,
• Wholesale Broadband Connect, ADSL2+ rollout from Spring 2008 with speeds of up to 24Mb available.
• During the quarter the number of IPTV subscribers more than doubled to 120k. Latest Feb figures released: 150k subscribers.
• Stopped marketing BT Fusion, the incumbent’s FMC services that had signed up under 50k subscribers.
• VoIP subscription revenue $10.9 million, an increase of $0.3 million from the previous quarter.
• VoIP subscribers: Customers 2,315; Stations 56,005, Sites 4,024.
• VoIP ARPU: Customers $1,635; Stations $64; Sites $924.
• IP trunking revenues of $1.4 million.
• 530,000 access lines in service.
• LPVA (line-powered voice access) recently launched with EarthLink.
Revenues in Q4 stood at $395.3 million, up by 1% compared to last quarter. Of this, communications chip manufacturing share was estimated at about $197 million. The chips were mainly made for the 3G handsets for various vendors.
SMIC also curtailed the DRAM foundry services and by the end of the year had cut the shipments by 22%. With the result the revenue from DRAM business was just 16.7% in the quarter compared to 23.6% in the third quarter. However the non-DRAM business grew by 13.5% in the quarter.
The total number of new customers reached 77 in the fourth quarter.
Which markets are you finding more traction for IPTV these days?
IPTV is picking up in Asia and Eastern Europe. It is not doing so well Western Europe and North America. The only major player in North America is AT&T.
Within Asia what has been your experience in markets such as India, Japan and China?
China and Japan are 2 different markets. In Japan it is all about HD. In China we see 50-100 channels kind of set up and that is nearly all SD. We do not see HD in China yet. Another aspect about China is that some of the operators are not using middleware. Subscribers go up and down the channels on the remote control. Some of the deployments I have there are live TV channels. There is little conditional access and in most cases no video-on-demand. I am not aware of any installation in China that uses VOD.
Moving over to India there was a lot of noise recently from players like BSNL, MTNL and Bharti Airtel.
BSNL’s IPTV will be based on our solution. In fact all but Reliance are using our solution. Bharti has not started the service yet. In India the lowest number of channels you start with is 150. But it is mostly SD.
What will be the single biggest trend during 2008 in IPTV?
The main trend we are likely to see is the popularity of Internet TV. This is a major competition for IPTV providers going forward. Internet TV is especially gaining popularity in the US. If you log into the websites of content owners such as Fox you see good quality videos that you can download.
Q4 revenues were $16.2 million up by 14% q-o-q. Net income for the period was $2 million. Enterprise and Datacenter segment fetched the most - 73% of the sales. Remaining 27% was brought in by access service provider, consumer broadband software services segments. Geographically China, Europe, Japan and Taiwan were significant business contributors for the company.
Cavium announced development of OCTEON Plus CN50XX MIPS64 embedded processor family which has a wide usage in the communications area for the devices like VoIP gateways, etc.
• Revenues $22.3 million, an increase of 8% from the previous quarter. Overall net income was $9.9 million.
• Quarterly net income (non-GAAP) was $3.8 million.
• One customer accounted for more than 10% of Radvision's revenues in 4Q07: Cisco
• Top 10 customers accounted for 60% of Q4 revenues, an increase from 56% in the 3Q07.
• Geographic split: 61% North America, 22% EMEA and APAC 17%.
• Radvision ended the period with $131 million in cash and cash equivalents and no debt.
• Radvision expects first quarter 2008 revenue to be $20 million.
• Scopia 5.5 , HD videoconferencing solution, was the major product/service announced in the quarter
• Yearly revenue $92 million.
• Total Networking Business Unit revenues for the year were $68.7million, a 3% increase over 2006.
• Total Technology Business Unit revenues for the year were $23.3 million, a 4% decrease over 2006.
• 4Q07 VoIP revenues $20.9m, an increase of $1.5m from the previous quarter. Overall net income of $2.1 million.
• VoIP gross margins for the quarter were 64%, increase from 50% in 3Q07.
• One customer accounted for more than 10% of Veraz revenues in 4Q07 : Belgacom International Carrier Services 13% ( VoIP switching and peering).
• Top 10 customers accounted for 53% of Q4 revenues.
• Split: 22% North America, 77% International.
• 32% wireless carriers, 66% wireline carriers.
• Service revenues $5.8m
Quarterly revenues for F5 Network were estimated at $154.2 million up 6 % compared to the last quarter. Geographically Americas represented 57% of revenue, EMEA 21% and APAC 22% of which Japan contributed half.
Among demands in their application delivery networking products, the company witnessed a strong growth in Europe, Middle East and Africa. Asia Pacific showed a decline in demand while America showed a modest rise.
F5’s core AND(application development network) was the main revenue generator which fetched in $139.4 million or 90% of total revenues. Besides other product segments, telecommunication accounted for 23% of revenues.
You are focusing on the SOHO and micro enterprise market. What special requirements does SOHO and micro enterprise segment have that demands a service provider like you dedicated just to them?
They typically do not have a dedicated bandwidth connection. They do not have IT support in-house. And despite that they want to project the image of a large setup. Those requirements will not be served by either the large telcos or those serving the smaller businesses such as Fonality and Packet8. You have to offer solutions that maintain voice quality over low speed connections, are easy to setup and offer features such as auto-attendant etc.
You also offer other enhanced services such as the search dialling feature. How does it work and what does it do basically?
Search dialling lets you dial someone just by searching the name describing who and what you are looking for. It searches your PC based directory and the online directories. Our PC integration lets you do that. Search dialling is simply not possible on standalone phone. PC interface also simplifies several other things such as the conference set up process for instance. Using phones to set the conferences up is a tedious process.
What software and hardware do you use at the backend?
It is a combination of our software and GIPS elements in the data center. The client is all ours. For people who want to use our service with a regular phone, the adaptor we use is a custom design of a standard chipset that is used for USB phones.
What about the feature set? You source that from people like Broadsoft?
No that is actually part of GIPS solution as well. They modified their existing platform. They did not have features like auto-attendant. So we worked together on their new version of software to incorporate those features. The solution was custom designed for us but they are now making it available generally. We are the launch customer for the solution that incorporates hosted PBX features, firewall traversal and the voice quality software.
Hosted test bed for applications involving downloads
By Faisal Kawoosa
| February 23, 2008
If we are to believe in the upcoming applications renaissance, then we have not seen anything yet. New Web 2.0 / Voice 2.0 applications will keep coming every day. And while I have tested over a hundred so far, I am not going to test one every week, let alone one every day. One of the reasons is that for a lot of these services there is a downloadable. As such I have to go through the ritual of downloading and installing and testing and uninstalling (if I decide not to keep the application).
There has got to be a more efficient method of testing these new services. Perhaps a site that hosts a test account where feasible. The developers could work directly with the site owner to arrange a test account (or several such accounts). People like me would certainly want to use such sites rather than download-and-install things all the time.
The car stereos that come with USB ports can take in the wireless Internet USB sticks. In theory you should be able to add a chip inside the stereo that links to online services like iTunes to download music while driving.
A better option would be for car stereo makers to develop an operating system that can incorporate any 'music dialer' that connects to particular music site(s). That could be just the start. On top of this car stereo OS, you could then unleash the developer program and let people develop applications on top of this ‘platform’.
If you think about how much time you spend with the car stereo, the usage time would surely exceed your talk time on your mobile. Surely this ‘platform’ could be better leveraged.
Are Skype type services virtual or hosted - or both? They are probably both but it depends what the context is. In the S2C (service provider to customer) context it could be interpreted as both. If Skype served the service providers in a S2S (service provider to service provider) scenario, then hosted would take a new meaning altogether.
The reason I write about this is because people use virtual and hosted interchangeably and I get confused. The hosted switching – if the context is S2S - would be enabled through platforms such as Broadsoft and Sylantro whereby they enable wholesale hosted PBX services i.e. a wholesaler such as NGT hosting the platform and partitioning it for other service providers to offer retail services to their enterprise customers.
In the call center world there is an even higher level of confusion for me when they use ‘virtual call center’ and ‘hosted call center’ terms interchangeably. A service provider in S2C scenario can offer virtual call center in absence of hosted call center but not other way around.
Charlie discusses managed services model for IPTV advertising, the trials PacketVision has so far been involved in, and how the company's solution matches buyers and sellers of advertising time thus effectively operating a clearinghouse. Charlie also talks about the IPTV advertising benefits for the emerging new channels.
T-Mobile USA has gone ahead with its fixed line VoIP service with the commercial launch last week. While its parent company T-Mobile is testing Femtocell based convergence elsewhere in several countries, the US based arm decided to leverage the ubiquitous WiFi instead.
Femtocell has been in vogue throughout 2007. Faced with the prospect of possible GSM-to-WiFi traffic substitution due to FMC, nearly all major cellular operators have been exploring the Femtocell based FMC that helps you stalk your customer all the way around his house. However, Femtocells are not widely deployed yet and they deal with licensed spectrum making management rather complex. WiFi on the other hand is unlicensed and ubiquitous.
Interview with Michael Lantz, CEO, Accedo Broadband
By Faisal Kawoosa
| February 26, 2008
What value does your product Accedo Application Provisioning Solution add to an IPTV installation?
Our product enables an operator to distribute value added applications in a cost efficient way to any STB. We have integrated it with all the leading STB manufacturers and many middleware platforms.
What kind of value added applications are IPTV service providers deploying?
Value added services are largely confined to gaming in IPTV deployments. Within that we see multiuser games in demand. With the traditional broadcast networks it was not possible to have multiuser capability. Over the IPTV it can be done easily.
How has the gaming and related applications bit done so far in the IPTV segment?
After the movies, gaming is the most interesting application for end consumers. We normally get 20-25% of subscriber base that play games on a monthly basis. It’s a very very high usage of casual gaming on the TV. TV is created for light entertainment. People like to play games like Suduko, Poker, etc. while waiting for their favorite programme to start.
BroadSoft is getting ready to unveil its voice-web mashup strategy. The interesting part is that BroadSoft will make the application mash-ups available through service providers as well as direct to end-users thus providing an additional channel to market. The vendor will effectively create a marketplace where both developers and service providers will supply voice-web mashups. The buyers will be both end-users and service providers. BroadSoft will act more like a market maker, a clearinghouse of Voice 2.0 applications.
However there is no commission or cut involved for BroadSoft. The company will dedicate resources for the developer program mainly to enhance its BroadWorks platform. BroadSoft will release its voice web APIs that are RESTful based interfaces, which allow applications to be written in simple XML type languages.
Revenue posted by Cypress Semiconductor in 4Q was $431 million which represented a decline of 4% q-o-q. The main reasons for the decline was a decrease in Consumer and Computation Division (CCD) and Data Communication Division (DCD). However the Memory and Image Division (MIV) fetched 4% more revenues.
North America was the strongest market with 4% increase in revenues while Europe showed a modest growth of 1%. Asia reported 6% decrease with Japan however showing increase of 2% in revenue.
In the communication space West Bridge was the strongest product which alone fetched $5 million of the total revenues.
During this quarter it shipped 40 millionth CapSense system used in handsets. Cypress Semiconductors also announced programmable peripheral controller product Astoria.
• Telio had 144k subscribers at end 4Q07. Total increase of 4k during 4Q07
• Majority of customers (102k) in Norway
• Revenues: NOK 94.3 million, were up 7% from NOK 89.2 million in 3Q07
• Average monthly revenue per subscriber NOK 268
• Average monthly gross profit per subscriber NOK 173.4 (up from NOK 162.8 in 3Q07).
• Passed 1,000 lines to the SMB market
• 2008 focus area: Mobile VoIP
• 3.2 million residential broadband customers. Same number of VoIP subscribers in theory
• 750K IPTV subscribers, up from 600k at the end of June 2007
• In business VoIP, 40% of new data link customers take up VoIP
• 300k mobile customers which includes a small proportion of WiFi-GSM subscribers
• Added 61k new VoIP subscribers during 4Q07. Total subscribers: 847k
• VoIP subscriber base represents 40% penetration into broadband accounts
• Netherlands VoIP market: KPN 847k subscribers; Cable 1.05 million subscribers; Others 280k. Total around 2.18 million subscribers
the telco operators and enterprises that want an easy integration of web 2.0 services in the existing fixed mobile and enterprise networks.
related announcements related to general availability of PBX products integrated with our solution towards the end of 2007. We have pipelines built up with all our OEMs to supply our products for large enterprises as well as SMEs as we go into 2008.
mean several things. It can mean integration of voice with PC based and mobile based applications. It can also mean making voice services available to the user anytime and anywhere he is.
also becoming a big factor especially in IPTV services. These are the three major VoD content forms that are popular with IPTV users but none of these three are IPTV specific only.
one. You have to go to one of the service providers, sign up for an account, and sign up the agreement plan they have. They are charging between Rs 3-4 a minute per user which is expensive for a lot of SMEs. These providers are not based in India. They are extensions of certain global payers. 
networking from day one. We enable real-time opinions and real-time ratings and multiple ways to communicate around the content. 
will not be served by either the large telcos or those serving the smaller businesses such as Fonality and Packet8. You have to offer solutions that maintain voice quality over low speed connections, are easy to setup and offer features such as auto-attendant etc. 
The car stereos that come with USB ports can take in the 
If you think about how much time you spend with the car stereo, the usage time would surely exceed your talk time on your mobile. Surely this ‘platform’ could be better leveraged. 
