Archive for April 2nd, 2009

VZW Ethernet backhaul built by Cisco

Verizon Wireless is using Cisco’s ASR 9000 edge routers to fulfill its recently announced plans to use carrier Ethernet to boost the capacity of its wireless backhaul networks to accommodate 3G and 4G bandwidth needs.

Cisco isn’t the only vendor Verizon is using for this upgrade, but the carrier won’t identify its other source. (Feel free to make the case for your own guess in the comments section below.)

The ASR 9000, which just became available in this year’s first quarter, is only a carrier Ethernet product if its user chooses to deploy it as such. The edge gear supports either Layer 2 or Layer 3 functions within the same line card, giving carriers the flexibility to establish their own preferred balance of the two technologies.

It also shares the same operating system as Cisco’s giant CRS-1 core router and a distributed control plane architecture that pushes resources from the core to the edge, so it makes sense that VZW, which late last year became the CRS-1’s biggest customer, would follow with the 9000s.

A Verizon spokesperson declined to offer much detail into their deployment of the ASRs. “We use the ASR 9000 for aggregating our cell site routers,” he told Telephony today. “It serves the function of an MLS (multi-layer switch) and a router.”

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AT&T union members gird for weekend strike

With less than three days left to hammer out a contract and avoid a strike, negotiations between AT&T and its union wireline employees don’t appear close to resolution, according to news reports, and about 110,000 employees are preparing to strike when their contract expires at midnight this Saturday.

With health care costs a particular sticking point, one union official told the press this week that negotiations were “not going well at all.”

In a research note published this morning, Morgan Keegan analyst Simon Leopold wrote, “We won’t go as far as predicting a strike [but] we have concluded that the risk feels higher than usual. Our checks indicate that AT&T’s non-union employees have received strike-duty assignments, as is typical in such situations, and training that sounds more extensive than in the past.”

However, both parties have indicated to the media that extending the current contract to let negotiations continue was still a possibility.

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Cable cord cutting debate rages on

There’s a great debate raging on blogs and other sites, over whether Internet video is prompting a lot of folks to cancel their pay TV service — cable, satellite or IPTV. If you’ve got a few minutes, there’s an excellent synopsis of both sides of the argumentin this exchange between HDNet’s Mark Cuban and Boxee’s Avner Ronen. Boxee is company that offers freeware to enable consumers to view, share and recommend many different types of Internet content, but is currently only available for Mac users. more

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Qwest could become RLEC consolidator, analysts say

Qwest Communications could become a consolidator of rural telcos if and when it divests its long-haul network (as the Wall Street Journal reports it is now looking to do), according to analysts at Stifel Nicolaus, who issued a research note this morning.

“A sale would certainly help alleviate near-term debt maturity concerns for [Qwest] and, we believe, would position the remaining ILEC business to be a player in the M&A game itself going forward,” the analysts wrote.

Qwest has long been imagined as a potential consolidator of rural telcos but has thus far stayed on the sidelines as, for example, CenturyTel acuired Embarq last year.

But the impending maturity of the company’s debt could motivate it to liquidate its long-haul assets sooner rather than later. Qwest has $2.8 billion in debt maturing between now and the end of next year and less than $600 million in cash at the end of 2008. That could pressure the company to sell quickly, Stifel Nicolaus said, and — in today’s tight economy — at a lower price than the carrier might have gotten 6 or 12 months ago.

Splitting off the long-haul assets would essentially undo the merger of Qwest and local incumbent US West enacted in 1999 by Joe Nacchio, who is currently counting on the US Supreme Court to keep him from serving a 6-year prison sentence for insider trading.

Industry prognosticators have cited Level 3, TW Telecom, Global Crossing, AT&T and Verizon as potential bidders for Qwest’s long-haul network.


April 2009
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