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Technology Stocks : INTERPHASE(INPH): Good future for this stock -- Ignore unavailable to you. Want to Upgrade?

To: peter a. pedroli who wrote (718)	12/18/2000 10:20:49 AM
From: peter a. pedroli	Read Replies (1) \| Respond to of 825

this will help next year.. Monday December 18 9:58 AM ET Nortel Readies to Wage Wireless Battle By Susan Taylor OTTAWA (Reuters) - Nortel Networks Corp. (NYSE:NT - news) (Toronto:NT.TO - news) is going all-out in the race to build a new generation of high-speed wireless networks, but analysts suggest its quest for second spot behind Ericsson in a cut-throat market won't come easy. Europe will be a critical battleground for Nortel's campaign to boost its sales of third-generation (3G) network equipment, which connects mobile phones to the Internet, now that operators have obtained licenses in many major markets. Nortel would have to take on such entrenched suppliers as Ericsson (LMEb.ST), the world's No. 1 vendor of wireless equipment. Ericsson recently said it would do whatever's needed to win the largest piece of the 3G market and tackle cost reductions later. ``Oh, it's competitive,'' said Jane Zweig, vice-president at wireless consulting group Herschel Shosteck Associates. ``2001 will be a big year for awarding contracts.'' Nortel and its competitors want to cash in on a spending spree that kicks off in 2001 when mobile phone operators are expected to spend billions on new wireless networks. Nortel will now push sales in countries such as Britain and Germany that were home to billion-dollar bidding wars for 3G licenses. To date, 23 licenses for 3G spectrum have been granted in Europe. But that's expected to boom in the coming year, reaching between 70 and 80 licenses by the end of 2001. Nortel has struck a three-year $780 million deal with Britain's BT CellNet. In Spain, it won a three-year $935 million deal with Xfera and a one-year $100 million deal with Airtel. Rich Rewards ``I think it's safe to say that over the next five-plus years you'll see over $100 billion spent on third-generation global system solutions,'' said Scott Searle, a wireless research director at SG Cowen. ``This is a market that's growing and I think that the big winners in the space are actually going to be able to expand market share,'' he said. Nortel estimates the 3G network equipment market will be worth $11.3 billion in 2001, with about $5 billion from Europe and the remainder in Japan and Asia. By 2003, it forecasts a total market value of $37.3 billion, with Western Europe representing $15.7 billion in sales, Japan $5.7 billion and North America $5.9 billion. Those rewards are sufficiently rich that suppliers such as Nortel are offering to finance part or all of the equipment purchase and even network construction to win contracts. By the end of 2000, Nortel said its vendor financing will reach $2.1 billion and that will swell to about $3.5 billion by the end of 2001. Nortel has been conservative in extending financing only to large companies, but in some cases it has financed both equipment and capital used to build the networks, said Christin Armacost, an SG Cowen analyst who follows Nortel. ``In my mind that gets a little bit excessive,'' she said. ''It's obviously necessary to win some of these deals, but when you are vendor financing 150 percent of the contract, the value of the equipment that you're selling becomes less attractive.'' Hard-Fought Battle ``Nortel plays to win,'' said Anil Khatod, Nortel's president of Internet business. ``Ultimately, Nortel would like to be in the No. 1 position in all the markets we serve. But first, I think we have a step to take.'' That step is grabbing ``substantial'' 3G market share in the next 24 months to take the No. 2 sales spot, he said. The question is how? ``There's a big bet that we see going on between Nortel, Lucent Technologies Inc. (NYSE:LU - news), Alcatel (CGEP.PA) and Cisco Systems Inc. (NasdaqNM:CSCO - news) who are betting on the optical side of things,'' said Zweig. ``And Ericsson and Nokia (NOK1V.HE) are betting on the RF (radio frequency) side of things. And this is going to be a major issue in the long-term.'' Part of Nortel's sales pitch centers on the connection of wireless networks and base stations to its market-dominating high-capacity fiber-optic networks. ``What we have been able to consistently prove is when you build a wireless network in conjunction with Nortel's optically-optimized core network, you substantially reduce the cost,'' said Khatod. Carriers pay 20-40 percent less for construction and operating expenses, he said. Nortel is also focusing its efforts on the biggest deals. ``Clearly, Nortel's strategy is slightly different from Ericsson,'' said Armacost. ``It's not to pursue every single service provider who's out there bidding for a license (but) really only focus on some of the top in each of their respective segments.'' But the fight for market share won't come easily in a highly competitive market. Recent Merrill Lynch research shows Ericsson with 20 percent of the 3G contracts awarded over the last 18 months, Nokia with 19 percent and Nortel 17 percent. A rank of the contract values puts Ericsson at No. 1 with 29 percent, followed by Nortel at 20 percent and Nokia at 15 percent. ``Nortel gained the most market share in the last 12 months,'' the report said. ``Next year there's going to be a lot of positioning -- it's going to be getting infrastructure up into place, trialing it, (and) making sure that it works'' said Searle. ``The networks really won't start to be deployed until early next year and given the acceptance milestones that are likely to be attached to those contracts, you probably don't see revenue recognition really starting to materialize until 2002.'' In 1999, Nortel recorded about $5 billion in wireless revenues, Armacost estimates. She expects that will grow to $6.3 billion in 2000, $7.3 billion in 2001, and she has a ''conservative'' estimate of $8.8 billion for 2002.

To: peter a. pedroli who wrote (718)	12/19/2000 3:04:48 PM
From: peter a. pedroli	Read Replies (1) \| Respond to of 825

more on sun and what interphase may be working on with them. it looks like they may be developing 3g solutions using chorusOS. 32 Chemin du Vieux Chêne Meylan, 38240 France Phone: +33 04 76 41 42 43 Fax: +33 04 76 41 42 41 Corporate Headquarters 901 San Antonio Road Palo Alto, CA 94303 Since its inception in 1982, a singular vision - The Network Is The Computer™ -- has propelled Sun Microsystems, Inc, to its position as a leading provider of industrial-strength hardware, software and services that power the Internet and allow companies worldwide to dot-com their businesses. The ChorusOS™ operating system is a highly scalable and reliable embedded operating system, that has established itself among top telecom suppliers. The ChorusOS operating system is used in public switches and PBXs, as well as within access networks, cross-connect switches, voice-mail systems, cellular base stations, web-phones and cellular telephones. An open and flexible solution, the ChorusOS operating system and the Interphase 4532 ATM over OC-3/STM-1 PMC communications controller have allowed developers to rapidly respond to customer needs and market conditions by quickly and cost-effectively creating and deploying new services and mission-critical applications. The 4532 is the first product of its kind for carrier class ATM communications designed to maximize the benefits of CompactPCI' distributed architecture and real time operating systems, such as ChorusOS. With enhanced networking features, the ChorusOS operating system seamlessly supports third-party protocol stacks, legacy applications, real-time and Java technology-based applications simultaneously on a single hardware platform. Email: suncontact@france.sun.com URL: sun.com