BLOG

Would Nokia Sell AlcaLu’s Optical Landline Business?

May, 2015

A few years ago, Nokia decided to unload NSN’s optical networks division to focus more on the wireless sector. Now, with the proposed acquisition of Alcatel-Lucent, it will be entering the fiber optic business once again, only this time taking on a comparatively gigantic piece of the pie. While there would be some potentially attractive aspects of the product line including for backhaul applications, it would not be completely surprising if Nokia were currently thinking about divesting the entire optical segment down the road because the market has only worsened since its sell-off to Marlin Equity Partners. The expected spinoff of the submarine optics portion of the business makes the remaining product line even less desirable because as a general rule, the margins tend to be much higher with subsea because in cases of new construction, customers require a full turnkey job including cabl ...

Read More

Avago’s Spinoff of Optics in Short Term?

August, 2015

While for now, Avago Technologies will be preoccupied with the immense and time-consuming effort of its integration process with Broadcom, not too long afterwards, it would not be surprising if there would be a spin-off that would include a large number of the combined company’s optical networking assets. The progressive shift from a technology-focused firm to one that is more business-oriented should inevitably go beyond just making further sizable acquisitions, but to improve the balance sheet through aggressive divestment. Although KKR does not hold a stake in Avago anymore, we believe the supplier has been heavily influenced by the private equity firm’s modus operandi – purchase assets, find value, package parts, and sell off. One may easily presume that calling the merger, “Broadcom” instead of “Avago” probably has significance for its future technology direction. Within our industr ...

Read More

AT&T/DirecTV: Epitome of Bellhead Ploy

November, 2015

While the industry narrative continues to push the illogical idea that AT&T is leading the pack internationally as a transformational player, the operator has seemed to be more concerned in remaining a copper service juggernaut. It appears to us that perhaps the most important, although not apparently stated reason for its acquisition of DirecTV, was to provide extra capacity for data transmission on its U-verse/DSL modems (to become more competitive with CATV providers) as the video services would now obviously be increasingly provided by satellite. One of the biggest ironies is that while incumbent providers have maintained their historical reluctance to move to new solutions offered by their equipment suppliers, they have no problem in overspending billions, if not tens of billions of dollars in purchasing companies to primarily, if not totally, bring in novel technology – only later ...

Read More

Verizon Comes to Senses With XO Fiber

March, 2016

Late in 2015, Verizon was apparently considering a terribly reckless action involving ridding itself of its invaluable enterprise properties. The purchase of XO’s assets definitely indicates a reversal in this line of thinking. Nevertheless, the industry discussion of this acquisition, which Verizon bought at a very attractive price, has not concentrated enough on the blatantly important on-net connections with businesses, but on other seemingly less vital considerations, including in support for future 5G applications, which are hardly around the corner, in what at least partially appears to be in order for top-level, wireless-centric executives at the large service provider to save face. There definitely seems to be an excessive preoccupation in the investigation of this buyout on backhaul/fronthaul applications as well as on spectrum. One may presume that Verizon could have rented (wi ...

Read More

AT&T's “Open ROADM”: More Skepticism

April, 2016

In defiance of AT&T’s uniquely leviathan network involving layers of infrastructure built over many years, the service provider continues to promote further leading-edge concepts that would ostensibly change the fundamental nature of its cost structure as well as its spider web of operational entanglements. These major shifts have been projected to occur in an immense way a long way down the road, whether it was getting to all-IP by 2020 (somehow in 2012, all of the T1s would be expected to disappear and OTN would cease to becomes a reality), and in 2014, it projected that over 75% of its network would be software-centric by the end of the decade. AT&T’s latest scheme was introduced at OFC 2016, the “Open ROADM", and while also based on the notion of "software control," it brings in the idea of “open hardware” or Open Line Systems (OLS) in which Verizon, at the same conference, discredit ...

Read More