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

To: Jinfu Chen who wrote (633)	12/3/1997 2:52:00 PM
From: Sector Investor	Read Replies (1) \| Respond to of 1629

Synopsis of comments from Furman Selz (FS): Not Out of the Woods, But The Current Quarter is So Far on Track. FS says that at this point they believe ASND is tracking to show modest sequential revenue and EPS growth in 4Q97 (December). They say that for now they are maintaining their current estimates for Q4 at $292 million revenue and $0.25 EPS (vs. $0.23 EPS consensus). They state that they will revisit their estimates again over the next two weeks before the company enters its quiet period. ASND is scheduled to report Q4 results on January 20th. FS Key points: They state that North America seems to be generally on plan, while an improvement in Europe is at least somewhat offsetting notable weakness in Japan. They add that core switching continues to be the strongest sequential growth area, especially in ATM switching for carriers' infrastructure networks. FS says that RAS ports should show some modest sequential unit and revenue growth, and that carriers (telcos) should be a higher percentage of revenue in the current quarter, as opposed to ASND's traditional ISP customer base. FS comments that North America Is On Track, Europe Is Getting Better, and Japan Is Weak. They also say that ASND's order flow from North America customers seems to be generally tracking to plan with Worldcom/UUNet remaining key customers for core switching and remote access, respectively. Interestingly, FS says that in addition to BellSouth and Bell Atlantic/NYNEX which are already core switching customers, ASND has sold core switching product to another undisclosed RBOC in the current quarter. Regarding Europe, FS says that the outlook for ASND has improved since last quarter, although certification testing for the TNT is not complete with all European customers. FS mentions that Deutsche Telecom and Unisource have ordered TNT ports after recently completing extensive audit reviews with ASND on the company's commitment to the demands of the carrier marketplace for both new product development and supporting current generation equipment upgrades. FS expects that ASND will be able to ship the TNT in volume to all or at least the vast majority of its European customers by 1Q98. Regarding Japan, FS says it continues to be weak with no near term outlook for a significant uptick, including looking into ASND's 1Q98, which is Japan's fourth fiscal quarter and usually the strongest of the year for that region. However FS adds that a notable exception to the weakness in Japan is ASND's core switching business at NTT which is doing well at this stage with over $30 million in revenue. FS says that ASND released the TNT for shipment to Japan as of last week, and that so far in the quarter the lack of the TNT in Japan does not seem to have been a critical issue as the issues seem to have more to do with the macroeconomic impact. FS adds that they continue to believe that the acquisition of Cascade earlier this year was a key acquisition for ASND, because the company has core ATM and Frame Relay WAN switching technology now at a time when carrier demand is increasing steadily. It also reduces ASND's former sole dependence on remote access products, which is a clearly a benefit to the company in terms of its current order and revenue run rate. FS states that the benefits of the Cascade acquisition are visible in that the company's core switching unit is showing the most significant and steady improvement by product line, especially in ATM WAN switching with good balance across its principal geographic regions, and that Worldcom, NTT and an additional and undisclosed RBOC customer are key customers for ASND's ATM WAN switching. Regarding the TNT, FS says that ASND continues to make progress on the software and delivery of key billing and customer management features. They add that ASND is scheduled to release a major software update for the TNT this month. The TNT highlights an area in which there is need for further and ongoing improvement, e.g., better planning of system software updates with high quality control - in other words "systemizing the process". Regarding Product demand forecasting, FS states that this was a key issue for the company in its disappointing 3Q97 performance. ASND now conducts weekly product forecast (as opposed to monthly previously) conference calls with key customer unit sales managers for North America (telco, ISP, VARs and distributors) and international (Japan, Europe, Pacific Rim and Latin America) operations. FS' final comment is that the primary fundamental factor which could potentially reduce their opinion on ASND going forward is related to CSCO. CSCO is being aggressive in pricing on a deal-by-deal basis but FS views this as normal activity in such a highly competitive market. Since any erosion in ASND's fundamental position is likely to be to CSCO's gain FS recommends that investors think of owning CSCO as a hedge against a long position in ASND.

To: Jinfu Chen who wrote (633)	12/3/1997 8:26:00 PM
From: Maverick	Respond to of 1629

AT&T's VPN makes remote access reality By Laura Kujubu InfoWorld Electric Telecommunications carriers are rushing to provide new services that solve one of IT managers' biggest problems -- remote access. The latest offering is from AT&T, which announced AT&T WorldNet Virtual Private Network (VPN) Service at Comdex in Las Vegas. (See "AT&T WorldNet plans VPN service, 56Kbps modem access," Nov. 10.) Denise Grey, marketing director of VPN solutions at AT&T, and Tri Nguyen, technology consultant at AT&T, spoke with InfoWorld reporter Laura Kujubu about the VPN service and the enhancements that are being planned for the future. InfoWorld: What are some of the problems that remote users face, and how does AT&T's VPN service help solve those problems? Nguyen: WorldNet Virtual Private Network Services is designed to enable large corporate customers to outsource dial access or remote access. Because the biggest problem for corporate customers is the cost of maintaining their remote-access infrastructure, by outsourcing this to AT&T, they reduce costs and get ubiquity and better service levels across our virtual private network. Grey: A big need that we see from our customer base is business-quality dial-up service. Using the Internet, business users can sit there during peak hours and not get a response. The other thing customers have said to us is that they need business-quality, end-user support. So your end-user can call in to the service, and we'll guarantee that within 2 minutes that phone call is answered. InfoWorld: How is VPN service better than other types of remote-access solution? Grey: When you compare [VPNs] to Internet-based services, again, you're just not getting business quality [over the Internet]. For example, on the Internet, you dial into your ISP's network, and the Web site you might be trying to get to could be three or four hops of a network away from you, so you've got to traverse all of those networks. And nothing is guaranteed; the bandwidth is not guaranteed. With this VPN service, you're dialing into AT&T's network, you're going across AT&T's network, and you never jump onto someone else's network. Our SLA [service-level agreement] can guarantee end-to-end, 99.7 percent availability. And our SLA includes the customer's local loop. So for a LAN site, basically, the SLA includes the router, across the private line, across our IP backbone, and into another LAN site. You're going LAN to LAN, and all of these components are included in that 99.7 percent uptime figure for the SLA. No one else in the industry does that.

To: Jinfu Chen who wrote (633)	12/3/1997 8:28:00 PM
From: Maverick	Respond to of 1629

InfoWorld: VPNs are a relatively new technology. What standards are important in this area? Nguyen: There are definitely two camps of thought in the industry. People who just use IP as their protocol will probably look at IPsec [IP security] as the standard for VPNs. There are, however, a lot of people interested in using the Layer 2 tunneling, which is L2TP [Layer 2 Tunneling Protocol] and PPTP [Point to Point Tunneling Protocol] in order to support situations like multiprotocol support, legacy-protocol support, like IPX. And basically, both camps have their valid points. IPsec has the advantage that it offers much stronger encryption and authentication. Both L2TP and IPsec are in the standards track on the IETF RFC [Internet Engineering Task Force Request for Comment] database. We look forward to working with industry consortia such as the Auto Industry Action Group that are driving the IPsec standard to completion, and we hope that there will be a quick adoption of the standards, both in products and in terms of infrastructure that supports those products. InfoWorld: Which standards does AT&T support? Nguyen: At the moment, we do dynamic packet-filtering technology based on trusted address space or protected address space. Packet filtering is a technology that's used by firewalls, for example, and it's supported on all routers. We've taken packet filtering to the next level by doing packet filtering with a protective address space. Over time, during the first quarter next year, we will be introducing our first Layer 2 tunneling capability, based on the [L2TP] protocol. And by the third quarter to fourth quarter next year, L2TP and PPTP will become more prevalent and we will be supporting them in terms of managing that capability from an end-to-end perspective for customers. But we are also looking forward to [supporting] Layer 3 tunneling via IPsec. We're glad to see those emerging standards and we're glad to see that we can take those technologies and solve customers' problems. And our challenge is to keep up with that. InfoWorld: What other enhancements are planned? Nguyen: We're going to offer certificate management, both in terms of certificate authority, and also certificate management and distribution across our directory services to standard LDAP [Lightweight Directory Access Protocol] directory services. Grey: We'll also be offering quality of service guarantees, different classes of service, and more guaranteed bandwidth. One of the key things that's growing are the applications. They're just demanding more and more bandwidth, so we'll be able to provide that at the edge of the network, and we'll be able to guarantee that across the network. One of the things we'll be doing with our customer base next year is giving you software-based tools where you can provision your own service in real time. What customers want to get to is real-time self-provisioning as a service.