Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Ascend Communications-News Only!!! (ASND) -- Ignore unavailable to you. Want to Upgrade?

To: uu who wrote (453)	11/3/1997 4:58:00 PM
From: michael modeme	Respond to of 1629

Just a little tidbit of information: 10% growth sequentially per quarter is equal to 46.4% yearly growth (.....hmmmmm, I think I can live with that)

To: uu who wrote (453)	11/3/1997 5:09:00 PM
From: Maverick	Respond to of 1629

(1 + 0.1) power 4 = 1.4641. 10% seq. rev. growth equals 46.41% compounded annualized rev. growth which outperforms the NW sector (30 - 40 %) in general. Mgmt said this qtr had a good start. Together w/ a significant AR exiting 9/97. Revenue visibility is good for this qtr and next year. Note that mgmt has been deliberately erring on the conservative side going forward, which is a prudent thing to do.

To: uu who wrote (453)	11/4/1997 7:46:00 PM
From: Maverick	Read Replies (1) \| Respond to of 1629

BN 11/4 Ascend CFO Says Company Will Meet Earnings Estimates (Update1) Ascend CFO Says Company Will Meet Earnings Estimates (Update1) (Updates with closing stock price.) San Diego, Nov. 4 (Bloomberg) -- Ascend Communications Inc.'s new chief financial officer, Michael Ashby, said the company will meet earnings estimates this quarter and next year as it cuts expenses and lowers prices. Ascend, a maker of computer network equipment, reported its profit declined in the third quarter, breaking a string of more than a dozen straight quarters of record earnings. The decline came after technical problems delayed shipments of its products in the second quarter and international sales slumped. ''The company will be able to maintain its (profit) margins through both cost reductions and changing the discount levels that are offered to some of their major customers,'' said Ashby, 48, who was hired on Friday. Shares of Alameda, California-based Ascend, a maker of computer network equipment, are down 69 percent since peaking at 80 1/4 on Jan. 23, with lost market value exceeding $10 billion. In today's trading, Ascend fell as much as 6 percent to 24 11/16, a new 52-week low, before closing down 1 at 25 5/16. Ashby said he expects the company to meet analyst estimates of 23 cents a share in the current quarter, which ends Dec. 31, on revenue of $280 million to $290 million. The company plans to lower ''street'' prices for its products by about 10 percent in the first half of 1998, Ashby said, and he expects to meet estimates of $1.15 to $1.20 a share in earnings next year. For the first nine months of the year, Ascend lost $172 million, or 92 cents a share, compared to a profit of $119.4 million, or 61 cents, in the year-earlier period. The loss included acquisition charges of $18 million for its purchase in the first quarter of InterCon Systems Corp. and $11.3 million in the second quarter for buying Cascade Communications Corp. and Whitetree Inc. Revenue increased 45 percent to $874.8 million from $602.5 million. Ashby said gross profit margins are now targeted at 62 percent to 64 percent for 1998, down slightly from the company's historic 65 percent margin level. The gross margin is the percentage of sales remaining after deducting the cost of goods sold. 'Growth Track'

To: uu who wrote (453)	11/4/1997 7:47:00 PM
From: Maverick	Read Replies (2) \| Respond to of 1629

Ascend CFO Says Company Will Meet Earnings Estimates, Part II ''We need to produce a couple of good, credible and consistent quarters,'' said Ashby. ''Over the next two or three quarters, we'll start to rebuild the business and get back onto the growth track.'' Ascend's net income soared to $113.1 million last year from $1.3 million in 1993 before the company stumbled in the second quarter this year, when technical problems with 56-kilobit modems delayed shipments of new products. Ascend is the No. 1 maker of remote-access concentrators, used to link telephone callers into the Internet. Ashby replaced Bob Dahl, who became executive vice president and chief of planning. Ashby was previously chief financial officer for Pacific Bell, a unit of SBC Communications Inc. He was interviewed at the American Electronics Association's financial conference in San Diego. ''This is a baptism by fire at the AEA conference, meeting with investors,'' he said. --David Evans in San Diego through the New York newsroom (212)318- 2300 /ebr

To: uu who wrote (453)	11/5/1997 1:34:00 PM
From: Maverick	Read Replies (2) \| Respond to of 1629

Voice on the Internet Say Good-Bye to Circuit Switching Industry luminary Nick Lippis delves into the details of the "second-generation" Internet Circuit switching is dead. Not today. Not tomorrow. Not even the day after. But 10 years from now the technology will be on its last legs. In 15 years it will be a quaint anachronism. And the same goes for today's circuit-switched public network. In its place will be a packet-switched infrastructure that can field voice, video, and data. And IP will be the transport of choice for both. In fact, voice over IP will be a global phenomenon. Sound like science fiction? It's already happening. The Internet is a crude indicator of the shape of things to come. A second-generation 'Net is in the offing-one that will ultimately deploy a mix of multigigabit and terabit routers and ATM (asynchronous transfer mode) and Sonet (Synchronous Optical Network) switches, along with high-speed access schemes like xDSL (digital subscriber line) and cable modems. The carriers and RBOCs (regional Bell operating companies) know what's coming (at least the smart ones). Some have started to invest in packet-switched backbones. The ISPs (Internet service providers) know it. In fact, voice over IP and other enhanced offerings are key to their economic survival. The IP equipment suppliers are counting on this paradigm shift to create a market for voice over IP gateways. Sure, some of these devices come from startups like E-Fusion Inc. (Portland, Ore.), Inter-Tel Netsolutions Inc. (Chandler, Ariz.), Netspeak Corp. (Boca Raton, Fla.), and Vocaltec Inc. (Northvale, N.J.). And some of these newcomers may not survive; others could end up billion-dollar players. But internetworking giants like Bay Networks Inc. (Santa Clara, Calif.), Cisco Systems Inc. (San Jose, Calif.), and 3Com Corp. (Santa Clara, Calif.) are taking voice over IP very seriously. The same goes for other heavyweights like Lucent Technologies Inc. (Murray Hill, N.J.), Microsoft Corp. (Redmond, Wash.), Northern Telecom Ltd. Mississauga, Ontario), and Siemens AG (Munich, Germany). There's even a Voice over IP Forum. That's no guarantee of the technology's success, of course, but the 100 vendors that have already signed on represent a united front and a common purpose. Most important of all, though, are the economic drivers. Voice over IP and packet switching will win out in the end because they can deliver services far more cost-efficiently than today's circuit-switched technology.

To: uu who wrote (453)	11/5/1997 1:35:00 PM
From: Maverick	Respond to of 1629

Voice on Internet, Part II Doing Business Over IP When it comes to voice over IP, think evolution, not revolution. Businesses will likely be the first beneficiaries: Over the next few years companies will start to use the technology to enhance their Web pages (and their Web presence). Cybercustomers will be able to browse online catalogs and click on an icon to call customer service to see if the items they want are in stock or hear about current specials. That sure beats waiting a couple of days for an e-mail message to get back to them letting them know their order has been delayed. And while it may sound like a small thing, that sort of cybercourtesy can go a long way to keeping customers happy-and coming back for repeat orders. Other companies will use voice over IP to enhance productivity. Consider a virtual presentation on the corporate intranet. Participants can view documents on a Web server and call in their comments via Internet phones. That's a lot easier than faxing information out to remote offices worldwide and then trying to coordinate global conference calls. The Equipment Angle It all sounds great. But a couple of things are definitely needed if voice over IP is going to go anywhere. Let's start with gateways, devices that translate between the circuit-switched and packet-switched worlds. Cisco is positioning its 3600 router as a voice over IP gateway; Lucent has a gateway. And 9 other vendors are shipping products, with about 20 expected soon. Sure, some of the products aren't much more than toys. But the same was true for the PC in the early 1980s. And gateways are just the beginning. Nearly every major vendor has either announced or delivered an IP voice product. Some are offering IP-based central office equipment, typically incorporating high-density modems and Layer 2 and Layer 3 switches that can field voice, video, and data. Cisco is melding its AS5300 ISDN/analog modem bank with the Catalyst 5500 switch. Ascend Communications Inc. (Alameda, Calif.) is bundling its TNT dial-up gear with its GRF gigabit router. And 3Com is adding voice over IP and fax to its Total Control Hub. Is it all just a bunch of hype? Not according to various market researchers, who've pegged the voice over IP market at about $1.8 billion by 2001. And they put the numbers for IP access gear at roughly $7.5 billion in the same time frame. Then consider this: Historically, equipment revenues have generated 10 times their total value in services. So if the trend works out true to form, the IP over voice market could translate into $90 billion for service providers. Yes, that number is very ambitious, and it won't happen overnight.

To: uu who wrote (453)	11/5/1997 1:38:00 PM
From: Maverick	Respond to of 1629

Voice on the Internet, Part III On To the Infrastructure Still, a bunch of boxes isn't going to be enough. For voice over IP to really take off, it's going to need infrastructure. Lots of it. That's where the RBOCs come in. Telecom reform has given them a chance to consolidate their operations and pool their resources as they get ready to run against long-distance carriers and cable providers. It's the resources that really matter, since the RBOCs have plenty of cash to build up their backbones and buy up ISPs. Let's start with the backbones. At the core, these will boast a mix of supersonic IP routersfrom the likes of Avici Systems Inc. (Chelmsford, Mass.), Berkeley Networks Inc. (San Jose, Calif.), Gigapacket Networks Inc. (Littleton, Mass.), Juniper Networks (Santa Clara, Calif.), Neonet LLC (Westborough, Mass.), and Torrent Networking Technologies Inc. (Landover, Md.). These routers will be joined by ATM and Sonet switches from Ascend, Cisco, and others. But don't let the presence of ATM and Sonet raise any doubts. IP is the protocol, and it will be routed. ATM and Sonet will serve as the transport. And running IP over Sonet will help overcome some of ATM's inherent inefficiencies. The Cash Consideration All of this ignores one crucial question: Why are the RBOCs-or the carriers for that matter-going to spend money building an industrial-strength IP infrastructure and snapping up ISPs? There's an easy answer: To make money. Right now, it costs carriers about 6 cents per minute to deliver a voice call over their circuit-switched backbones. Voice over the Internet costs between 1 and 2 cents per minute. That's a compelling argument. And it's not lost on the RBOCs. Why should they bother expanding into the long-distance market using 1980's technology? Simply said, packet switching gives them a way to steal market share from their competitors. US West Inc. (Englewood, Colo.) is already doing exactly that. It's announced a push to implement xDSL nationwide. It already has frame relay for data. Now it wants to

To: uu who wrote (453)	11/5/1997 1:42:00 PM
From: Maverick	Respond to of 1629

Voice on the Internet, Part IV leverage its infrastructure and layer voice on top of it. Its protocol? IP, of course. Worldcom Inc. (Jackson, Miss.) is also well aware of the changing telecom environment. That's what makes its proposed buyout of MCI Communications Corp. (Washington, D.C.) so compelling-and so potentially lethal to its rivals. Think of it. Worldcom already owns the premier ISP-Uunet Technologies Inc. (Falls Church, Va.). If its MCI bid succeeds, it adds the carrier's voice expertise to its unmatched IP experience. Being in control of circuit- and packet-switched technologies could give it a huge edge going into the next century-on a worldwide scale. Circuit switching is dead. Long live packet switching. All hail IP. Nick Lippis is president and founder of consulting firm Strategic Networks (Rockland, Mass.)

To: uu who wrote (453)	11/5/1997 1:49:00 PM
From: Maverick	Read Replies (1) \| Respond to of 1629

AT&T WorldNet CURRENT BACKBONE ARCHITECTURE The AT&T IP backbone has been deployed with 11 initial nodes and a partial mesh of multiple DS-3 connections. High-performance routers are employed at the nodes interconnected by ATM/OC-3 links through ATM switches. The network has been designed to contain no more than three facility hops (wide- area hops) at its furthest point. All routers and switches are deployed in a redundant fashion. The network has redundant management systems which are used to monitor its performance. The dial platform contains 220 local dial access numbers as well as Megacom 800 service for toll-free access. Local distribution nodes are connected to hub nodes via dual DS-3s. The hub nodes, which utilize network routers and ATM switches, are connected to the IP backbone via OC-3 links. AT&T's network is 100 percent digital with over 40,000 miles of fiber optic cable carrying 95 percent of the traffic. The network completes more than 190 million voice, data, and image transactions each business day. Underlying this large infrastructure is FASTAR, a system which automatically routes AT&T's backbone traffic around cable failures. In its current design, the company says, FASTAR can restore 90-95 percent of a large failure within two or three minutes. FUTURE EXPANSION PLANS AT&T plans to extend the current OC-3 hub architecture and expand the network capacity to OC-12 and OC-48. AT&T is currently deploying ATM switches to its backbone nodes. The next phase is to convert the backbone network to an ATM switch fabric. AT&T plans to spend $8 billion to $9 billion to upgrade its core infrastructure to SONET/ATM for all voice and data services. As part of this effort, AT&T has already installed 30 OC-48 SONET rings across the U.S., and plans to install an additional 50 in 1998. Currently, dedicated AT&T WorldNet Managed Internet Service customer circuits are back-hauled to one of the 11 backbone nodes for connection to the network. The next wave of development for this infrastructure will be to deploy 100 concentrator nodes. The concentrator nodes will be connected with the 11 backbone nodes through DS-3s. This second tier of development will begin later in 1997 and continue into 1998. With the deployment of the concentrator nodes, customer circuits will then be back-hauled to either the nearest concentrator node or backbone node for connection to the network.