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Technology Stocks : LAST MILE TECHNOLOGIES - Let's Discuss Them Here
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To: MikeM54321 who wrote (8771)10/5/2000 11:48:51 AM
From: elmatador  Read Replies (2) of 12823
 
Re: SBC Project Pronto - Lucent $1 Billion Contract

There is not much ADSL sauce in this plate:
According to Tom Nole:

nwfusion.com

"SBC Communications recently announced that it will be investing $6 billion to enhance the delivery of broadband services throughout its service region. This move was widely reported as SBC spending $6 billion on digital subscriber line (DSL) or Internet access. In truth, that's not what was announced at all, and what's really going to happen may have more impact on businesses than on residential Internet users.

This 1 billion contract is in fact:
The modernization SBC proposes involves spending $1.5 billion on improved trunking facilities, the connections between switching sites. The goal is to improve the handling of packet services, particularly those based on IP.

Lets wait for the other shoe to drop:
The remaining $4.5 billion will be spent on what service providers call "outside plant," the gear from your phone connection block inward to the carrier's serving office. This outside plant will be optimized through the introduction of new devices that SBC calls "neighborhood gateways."

RHK back-of-the-envelope estimate makes clear that broadband DLC is where the money is:

The equipment cost of 25,000 broadband DLC boxes is in the range of $1.0 billion to $1.2 billion. Labor costs, which are likely to be capitalized, add another $600 million to $800 million.
The equipment cost of deploying DSLAMs in 900 additional central offices, assuming a 50% fill rate and two 96-port shelves per office, is in the range of $25 million.
One rule of thumb for the cost of installing fiber cable is $10 per meter. At 12,000 miles, this works out to roughly $200 million. The fiber cable can add $200 million to $300 million more.
The ATM infrastructure for an additional 900 DSL-equipped central offices is around $70 million to$90 million.
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