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Technology Stocks : Ciena (CIEN) -- Ignore unavailable to you. Want to Upgrade?

To: James Fulop who wrote (10622)	3/11/2001 10:37:34 AM
From: Kenneth E. Phillipps	Read Replies (1) \| Respond to of 12623

James and Frank, I have a question (not a rhetorical one). lightreading has a current paper from Sycamore on end to end Ethernet. Here is the link: lightreading.com The article mentions Yipes, Teleson & Utfors as providers using ethernet in the WAN and MAN. I know Utfors uses the Nortel solutions. Which vendor or vendors provide the ethernet solution for Yipes and Teleson. Regards, KEP

To: James Fulop who wrote (10622)	3/11/2001 11:04:20 AM
From: James Fulop	Respond to of 12623

By now most of you should be aware of the article in Barron's that mostly uses material that has been out in the market for quite some time by Susan Kalla of BlueStone Capital. Here is the article posted on the SDLI thread: Message 15479704 Since Kalla 's views on the telecom equipment sector have been discussed quite a bit on many threads on SI, I am only going to point out something that is Ciena-specific in the article: >>Kalla also paid attention to early signs the service providers would have to go through massive restructuring, which could crimp their spending on equipment. Kalla points to a major Ciena customer, Global TeleSystems, which missed earnings last fall and since has started to restructure. "Prices are dropping very rapidly, and [service providers] are very highly leveraged. They're going to come to a point in time where they're going to have to make a decision between paying their suppliers or paying their interest," says Kalla. Actually GTS (which has been renamed Ebone) is probably not a very big customer any longer. It was one of the three >10% customers last year but since there was a great deal of press a couple months ago about them, Ciena management was specifically asked about them in the Dec. CC. Greg Smith, COO, clearly stated that GTS was for the most part finished with their network buildout and that he did not expect them to be contributing materially to revenue in the future. Also the CFO was asked if there were any issues outstanding regarding payments by GTS, to which he replied there were not. And on the Feb. CC, Ciena specifically stated that one of last quarter's >10% customers had changed, giving me the impression that another company had taken GTS's place in that large customer category. But since they did not name GTS by name, I can only say this is my "educated" guess. And FWIW, GTS has already become delinquent on interest payments for bonds issued by a subsidiary but since they received permission to do this from an agreement with the bond holders, GTS has not filed for bankruptcy. The situation is rather complicated but if someone wants additional info on the subject, just ask and I will look for the links to a number of articles on the situation. And it is interesting to note that Qwest has been (and I believe continues to be based on comments by Ciena as recently as Feb 15) one of the three >10% customers... >>The only companies she's favorably inclined toward are the Baby Bells and Qwest Communications, but she doesn't formally cover them at this point. <snip> That's not a good sign for service providers, many of which are cash-flow negative and will need to raise new cash. Qwest and the Baby Bells are the exceptions to the rule. Qwest, an upstart long-distance company, purchased Baby Bell US West for $42 billion last year. And while long-distance prices have fallen off a cliff, local prices have remained much more stable thanks to less competition and less deployment of fiber. It's tougher to lay fiber in the local markets, because it involves digging up streets and getting government approvals. That, combined with the effective monopoly the Bell companies still have on the market, means that the cost per mile for voice and data on a local network is 140 times more than it is for long-distance. Local business, which represents three-quarters of Qwest's sales, gives the company a stable, annuity-like revenue stream. Kalla predicts Qwest will get the regulatory relief it needs to sell its local customers its long-distance services in a year or two. "Qwest will be able to leverage its existing customer base and sell them additional services."<< PS It would have been nice if the difference in demand for legacy versus next gen equipment had been covered in the article....and there seems to have been a heavy dependence on voice pricing in the analysis....

To: James Fulop who wrote (10622)	3/11/2001 1:38:44 PM
From: Frank A. Coluccio	Read Replies (1) \| Respond to of 12623

James, some clarifications you requested in your last two replies to me. re: POS, yes, I was referring to Packet over SONET. I seldom use the other pos term in my posts ;) and re: trading, I did not intend to use the term "trading" to connote a brokered transaction as in bid-ask, but that is also beginning to happen now, albeit slowly. When I used the term "trading" I meant the traditional forms of "hand off" that occur from one carrier to another, as in when an interexchange carrier hands off to (it's actually a two-way deal, therefore, trading, with) a local exchange carrier. Or, when one ISP hands off to another in a transit or peering sense. Thanks for the TLAB links. Yes, I guess I was getting a bit ahead of myself there. On that note, one thing that the startups enjoy that the NT/LU/TLABs don't in this regard, is the tonnage, as in impressively large amount of weight, of legacy code that the latter breed must contend with in their OAM/P and OSS systems and overall architectural workings. Having to maintain backwards compatibility from a software perspective, as well as meeting carrier productization (services definitions) objectives that were predicated on a slower carrier-centric model, hampers the larger players in ways that the more recent optical players don't really need to contend with, unless they are vying for the same space. To explain what I mean by the same space, here I'm referring to dropping in one of the newer optical boxes into the old architecture. I.e., where they would receive instructions to create path maps, and where their peering elements were of the older generation, that sit in wait for a specific point in time for invocation. Or, where they are used to restore networks when a link fails, say. In the more conventional all-electronic digital cross-connects (and even those with optical interfaces) in many cases the path creation/restoration times are painfully slow, sometimes taking up to several hours or more to complete. A part of this has to do with the time required to do network surveillance and data collection, which are things that need to take place throughout the network if a new configuration is to be assured during re-maps. In contrast, today's network elements are equipped to be "network aware" at all times. But those older networks are operating (i.e., the speeds of executing route changes were gated) at speeds that were never intended to be lightspeed in nature, consequently far slower, although they were deemed acceptable (actually, they at one time represented a revolutionary improvement at a time when routes were patched manually, or through cross-bar switching) up until now. FWIW. FAC