Archive for May, 2008
Why Wireless is Crucial to Cable's Competitive Future - IP Democracy
How wireless is more than compensating for landline loss at the Telcos, and how the cable guys will find themselves in the same situation in the not too distant future.
Google spotlights data center inner workings | CNET News.com
Google is secretive but this article has interesting data.
Scott McNealy On The Bubble and Regulation
But two years ago we were selling at 10 times revenues when we were at $64. At 10 times revenues, to give you a 10-year payback, I have to pay you 100% of revenues for 10 straight years in dividends. That assumes I can get that by my shareholders. That assumes I have zero cost of goods sold, which is very hard for a computer company. That assumes zero expenses, which is really hard with 39,000 employees. That assumes I pay no taxes, which is very hard. And that assumes you pay no taxes on your dividends, which is kind of illegal. And that assumes that with zero R&D for the next 10 years, I can maintain the current revenue run rate. Now, having done that, would any of you like to buy my stock at $64? Do you realize how ridiculous those basic assumptions are? You don’t need any transparency. You don’t need any footnotes. What were you thinking?
Scott McNealy, Business Week, April 2002.
Wholesale fiber carrier stats - connected buildings/market and fiber route miles/building.
Infonetics reports on VoIP - fibresystems.org
Nice overview of VoIP equipment market growth. 75m residential/soho subscribers worldwide today.
Finisar Ships 250,000th SFP+ Optical Transceiver
Most of Finisars shipments are into the Fibre Channel market.
Technology adopition trends for 15 products spanning 1900-2000. Note landline penetration is now at 1960’s levels.
Image Courtesy NYT
I’m a sucker for cool Venn diagrams and this is the best I’ve seen in a while. More people now have mobile phones than landlines. And Mobile owners are more likely to use VoIP. Neat stuff.
Tales from the Field: The Show-Me POP
Field Tech discovers local Tastee-Freez is also a carrier hub.
GaveKal has released a new book “A Roadmap for Troubling Times”. There is no better value for the dollar than their books, which are compendiums of their paid research service. For $27 you get their opinions, which would have cost $15k+ if you subscribed for the previous year. It’s highly opinionated, easy reading, and good macroeconomic exposure for people in industry. Buy directly from GaveKal.
Vitesse Q208
Vitesse provided a “State of the Company” update, most likely it’s last ad-hoc quarterly call as audited results are expected to be made available by next quarter. We analyze their core business trends, including discussions about Chinese GE-PON, an update on EDC/SFP+ 10GbE, and the impact of removing distributor incentives. While Vitesse is cheap when compared to peers the risk of an unanticipated short-term revenue decline poses an unseen risk.
Finisar Corporation - Finisar and Optium Agree to Combine in All-Stock Merger
This is a big deal for the industry. It is the Black Swan that needed to arrive. It is analogous to Warner Bros. switching formats in the Blu-Ray/HD-DVD war, which caused a rapid cascade of change no one foresaw. Get ready for some M&A action boys and girls.
Riveting newsletter that summarizes the underlying causes of oil and Food inflation. Some tidbits: China’s energy use is growing 5% faster than GDP - their energy efficiency (GDP/BTU) is getting worse, not better. Japan consumes 10x the protein they did 50 years ago - what about China? American farmers 3x as efficient as the Russians and Russia plants 12% less land than 10 years ago. Conclusion: Emerging markets have deadly exposure to a double whammy of inflation due to Energy and Food, and lack the ability to deal with it.
3 in 10 get all or most calls on cell phones
"Households with both cell and landline phones who rarely or never get calls on their landlines tend to be better educated and have higher incomes." - Uh-oh.
PC World - Business Center: Hacker Writes Rootkit for Cisco's Routers
Cisco routers are typically compromised by hackers who are able to guess their administrative passwords… but there are few tools around to check these systems for signs of hacking. "How would you find out?" he said. "That's the big problem."
Lightwave - Ovum: Optical networking market tops $3 billion for seventh consecutive quarter
Includes good chart porn with top 10 vendor market share for Q108 and Q407. According to Ovum spending was down in Q1 with the exception of North America. Nortel is in a tailspin.
Tech Trader Daily - Earthlink: To Shut Philly Wi-Fi Net; Can't Give It Away
Muni-Fi as a potentially profitable enterprise is dead and the body is now cold.
Most readers here are chip, optics, or hardware focused but a few care about carriers. Here’s a couple of new blogs on Carriers that are worth reading if you’re interested.
CEO of Zayo - a wholesale carrier. http://www.bearonbusiness.com/
Good detail on the major carriers - http://ikeelliott.typepad.com/telecosm/
New one on Level3 that looks good. http://www.itaoran.com/
Just off the Vitesse Q208 Investor Conf Call. Not sure what kind of logic goes into an investor asking a CEO why he doesn’t resign - such questions should be addressed to the Board, not the CEO. If he is so burnt up there is a market for his shares and he should sell them.
The incident is positive in a way: I have found that many small-cap companies simply don’t take calls from anyone they don’t know. The fact that VTSS takes calls from all in the queue is a sign of openness. Other companies, including IKAN and others (yes I keep a record) practice what I call “Queue Management”, taking calls only from people in the queue they know to be friendly.
So, to the investor who asked the question - at least recognize the fact you were allowed to have a voice in the first place. Most companies wouldn’t have allowed you even that. And next time just take your loss and don’t waste my time.
