NFOEC SHOW OVERSHADOWED BY CAPITAL SPENDING REALITIES
About Us
CTIA Show News
Print Subscriptions
White Papers
Webinars
Free Newsletters
Calendar of Events
HOME
NEWS
CURRENT ISSUE
DEPARTMENTS
ONLINE EXCLUSIVES
Page 1 of 2
RESOURCE GUIDE
NFOEC SHOW OVERSHADOWED BY
CAPITAL SPENDING REALITIES
SITE SEAR
Liane H. LaBarba
Telephony, Sep 23, 2002
Print-friendly format
E-mail this information
Unlike previous years in which the
National Fiber Optic Engineers
Conference was a virtual superstore
for new technologies and a coming
out party for dozens of small
vendors, this year's sparsely
attended event in Dallas was focused
more on outlining company survival
tactics.
For service providers, that means
leveraging existing network
infrastructure. For equipment
vendors, it translates into offering
equipment that works with legacy
infrastructure.
DEPARTMENTS
News
Access Technology
Back Office
Broadband Services
Enterprise
Finance
Optical
Regulatory
Switching
Wireless
RESOURCES
White Papers
Webinars
InFocus Features
Analyst's Corner
Calendar of Events
CTIA Show News
Resource Guide
JobZone
Previous Issues
Providers roaming the show floor —
a rare species at the Dallas
Convention Center — did show some interest in new technologies that can extract
greater value from current networks. SBC Communications inked a multimilliondollar, three-year deal with Alcatel for its 1680 OGX optical cross-connect. That
deployment will span at least 10 states in SBC's territory and is intended to boost
efficiency within central offices, according to Thomas Fuerst, director of global
solutions for Alcatel's terrestrial networks division.
Indeed, SBC appears to be one of the few active carriers aggressively deploying
fiber in the current environment.
“We are looking beyond copper to fiber,” said Greg Beck, vice president of network
engineering for SBC. Because of the lowering economics associated with passive
optical networking, SBC is considering deploying the technology in conjunction with
WDM. So far, though, SBC has only one pet fiber-to-the-user project, in the Mission
Bay area near San Francisco. SBC is also using Alcatel equipment for that build.
Other carriers at NFOEC at least acknowledged plans to spend in the future, a major
turnaround from earlier this year when capital budgets were slashed.
“We'll have to come back down to the ground and start buying again,” said Chuck
Norman, director of network design for Sprint, adding that lower equipment costs
With grow
are a top priority. “One of the easiest things for us to do is to beat up vendors to get DSL deplo
cheaper [equipment prices].”
them, will t
http://telephonyonline.com/ar/telecom_nfoec_show_overshadowed/index.htm
5/10/2004
NFOEC SHOW OVERSHADOWED BY CAPITAL SPENDING REALITIES
Editorial Guidelines
For Our Advertisers
04 Editorial Calendar
For Search Partners
About Us
Primedia
Telecom World
WIRELESS REVIEW
04 Editorial Calendar
Page 2 of 2
Unfortunately for equipment vendors, this year's financial results and next year's
capex budgets will be closely linked.
“The 2003 budgets [will be] set on 2002 circumstances and will be set much more
by CFO thinking rather than input from CTOs as in the past,” said Adam Quinton,
managing director at Merrill Lynch.
As a result, vendors won't see a return to the free-spending days of 2000 anytime
soon. U.S. service provider spending will be down 39% this year and 5% in 2004,
according to Nikos Theodosopoulous, managing partner at UBS Warburg.
“There should be more consolidation, but it hasn't happened yet because small
companies have cash on hand,” he said. “And big companies raised public money,
giving them another 12 to 18 months.”
Until the industry right-sizes itself, and service providers see enough growth and
revenue potential to spend again, the current malaise will continue. Such conditions
may cause larger vendors to exit much of the equipment business, according to
Theodosopoulous.
able to ove
Q1 was
won't b
maintai
growth
The RB
roll and
surpass
The RB
legitima
but neit
MSOs w
industry
Vote
View Resu
Indeed, Krish Prabhu, partner at Morgenthaler Ventures and former chief operating
officer at Alcatel, said he believes many vendors with cash and liquidity issues may
restructure as services companies.
Even so, Prabhu didn't paint a bleak picture of the industry. “In 2000, when
[prosperity] seemed to go on forever, all the analysts said it would,” he said. Since
then, a lot of private equity has been raised and not invested, but that will change,
Prabhu said. “When times are bad, it's the time to invest,” he said. “We expect the
investment dollars to go further. We scrub their business plans much more now.”
© 2004, Primedia Business Magazines and Media, a PRIMEDIA company. All rights reserved.
This article is protected by United States copyright and other intellectual property laws and
may not be reproduced, rewritten, distributed, redisseminated, transmitted, displayed,
published or broadcast, directly or indirectly, in any medium without the prior written
permission of PRIMEDIA Business Corp.
Want to use this article? Click here for options!
© 2004, PRIMEDIA Business Magazines & Media Inc.
Print-friendly format
E-mail this information
What shou
do next in
arena?
Stay aw
regulato
decide
Pass a
next ye
rest of t
alone
Pass a
next ye
the rest
Act beg
Wait to
as part
compre
of the T
beginni
Vote
View Resu
© 2004 Primedia Business Magazines and Media. All Rights Reserved.
PRIMEDIA BUSINESS
http://telephonyonline.com/ar/telecom_nfoec_show_overshadowed/index.htm
| Contact Us | For Advertise
5/10/2004