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


To: djane who wrote (49605)7/10/1998 1:39:00 AM
From: djane  Respond to of 61433
 
Networking Cos. Seen Meeting 2Q Views With Few Surprises
(from CSCO thread)

ASND excerpt:

Stix estimates Ascend Communications Inc. (ASND) will report earnings of 27 cents a share for its second quarter, ended June, compared with 31 cents last year.

The analyst said the company's core ATM and frame-relay switching business is strong, while revenue from its remote-access business should be "flat to slightly up sequentially" in the quarter.

Sagawa noted that Ascend's remote-access business has booked long-term contracts with a number of Internet service providers including WorldCom Inc.'s (WCOM) UUNet Technologies, GTE Corp.'s (GTE) GTE Internetworking and PSINet Inc. (PSIX), among others. These contracts, he said, act much like annuities, producing a steady income stream.

Many analysts see Ascend as the next likely target for a voice-equipment company and believe Lucent Technologies Inc. (LU), which will be free to do pooling-of-interest deals in October, could make a play for the company then.

Dow Jones Newswires -- July 8, 1998
By Joelle Tessler

NEW YORK (Dow Jones)--Although many of the computer-networking
companies should post June quarter earnings that are below year-ago
results, analysts said the sharp pricing pressure and slowing demand that
have plagued the industry for the past year and a half appear to have
leveled off.

While most of the data-networking companies won't deliver upside
surprises, Hambrecht & Quist analyst Farrokh Billimoria doesn't expect a
repeat of the earnings disappointments that have become common in recent
quarters.

"The industry has definitely slowed down, but it's a lot better than last
quarter within the context of slower demand," said Sanford C. Bernstein &
Co. analyst Paul Sagawa.

The companies that make equipment for the wide area networking market -
the telecommunications carriers and Internet service providers - are
particularly well- positioned since many emerging independent carriers are
spending heavily on frame-relay and ATM switches, routers, and
remote-access products, said Cowen & Co. analyst Chris Stix.

Stix said the local area networking companies should benefit over the next
few quarters from stabilizing pricing, the introduction of layer 3 switches -
which can perform many of the functions of routers but are less than half the
price - and a Fast Ethernet upgrade cycle as corporations migrate their
networks from Ethernet technology.

Sagawa added that LAN equipment suppliers should see seasonal strength
in the June quarter since many corporations that were still sorting out their
budgets in the first quarter finalized their spending plans and began investing
in their networks in the second quarter.

Still, Stix warned, the local area networking companies could see a
slowdown toward the end of the year as the Fast Ethernet cycle slows.

And Nutmeg Securities analyst Andy Schopick stressed that the annual
growth rate for the data networking industry as a whole, which had ranged
from 30% to 50% for a number of years earlier in the decade, will be well
below this in 1998 for the second year in a row.

Sagawa expects the industry to grow at about 15% this year, compared
with 16% to 17% last year, and 45% in 1996.

Schopick explained that while some technologies like ATM and frame relay
are growing quickly, many older product families that drove industry
growth for a number of years - like intelligent hubs - "are turning into
negative growth areas." Prices have been declining rapidly for mature lines
like adapters and hubs, he said.

In addition, Schopick noted, the severe economic turndown in Asia is
slowing growth in the networking industry.

Results from the two companies with quarters ended in May, 3Com Corp.
(COMS) and Cabletron Systems Inc. (CS), were mixed.

3Com reported operating earnings of 18 cents a share for its fiscal fourth
quarter, beating the consensus estimate by a penny and its year-ago results
of 12 cents. The company also reassured analysts that it has brought its
channel inventories in line with lower targeted levels. 3Com had been
plagued by bloated channel inventories for several quarters and slowed
shipments to distributors to address the problem.

3Com's systems products business - which includes switches, hubs,
routers, remote-access concentrators and network-management software -
showed a particularly robust 22% sequential growth in sales. But sales of
client-access products - adapter cards and v.90 modems, which are based
on the new 56K standard - rose only 1% sequentially.

Cabletron, on the other hand, missed the consensus estimate by 2 cents a
share and gave analysts cautious guidance on its near-term sales. For its
fiscal first quarter, the company reported earnings of 4 cents a share
excluding charges related to its acquisition of Yago Systems Inc.,
compared with 37 cents a year earlier.

Cabletron has been coping with pricing pressure, a heavy concentration of
older products like intelligent hubs, limited penetration in the carrier and
low-end enterprise markets and a sizable presence in shared media - which
is rapidly being replaced by switched technology in the networking industry.

Cowen & Co. analyst Stix projects Cisco Systems Inc. (CSCO), the giant
of the data-networking industry, will report 48 cents a share for its fiscal
fourth quarter, which ends in July. This compares with 37 cents adjusted
for a 3-for-2 stock split a year ago.

Sanford C. Bernstein's Sagawa explained that Cisco has been able to
consistently outpace the industry in growth because it has a hand in so
many different parts of the networking business, a position that protects it
from downturns in particular product segments.

Analyst Schopick of Nutmeg Securities added that the company's
aggressive acquisition strategy and its success in gaining market share -
usually at the expense of its competitors - have enabled it to "succeed in an
otherwise challenging year for the industry."

According to Stix, Cisco is benefiting from strong growth in a number of its
product lines, including the Catalyst 5500 modular LAN switches; the
Catalyst 2900 work-group switches; the Catalyst 8510, a layer 3 switch
that began shipping in June; the 3800 access platform, which uses
frame-relay or ATM switches to send voice traffic; and the AS5800
universal access server.

Sanford C. Bernstein's Sagawa projects Bay Networks Inc. (BAY) earned
14 cents a share in its fiscal fourth quarter, ended June, compared with 15
cents a year earlier.

Bay Networks has been struggling to compete against Cisco and recently
agreed to be acquired by Northern Telecom Ltd. (NT) in what many see
as the start of a wave of consolidation among the data-networking and
telecommunications-equipment companies.

Year-end sales incentives, strong demand in its LAN switching business -
particularly Bay's 10/100 auto-sensing switch and its low-cost System
5000 modular Ethernet switching hub - and contributions from the
company's new Accelar routing switches should help Bay in the fourth
quarter, Sanford C. Bernstein's Sagawa said.

Hambrecht & Quist's Billimoria warned, however, that Accelar will face a
competitive market since Cisco, 3Com and Cabletron are all introducing
their own layer 3 products. While the Accelar line began shipping in late
1997, sales did not ramp up quickly enough to offset declining sales in
older product categories like shared media hubs in the third quarter.

Billimoria estimates Fore Systems Inc. (FORE), which specializes in ATM
technology, earned 13 cents a share in its fiscal first quarter, ended June,
compared with 5 cents a year earlier.

Nutmeg Securities' Schopick expects the company's revenue to grow by an
annualized 30% this year to between $580 million and $600 million since
the "opportunities in the ATM market seem to be genuinely gaining
momentum."

Stix estimates Ascend Communications Inc. (ASND) will report earnings
of 27 cents a share for its second quarter, ended June, compared with 31
cents last year.

The analyst said the company's core ATM and frame-relay switching
business is strong, while revenue from its remote-access business should be
"flat to slightly up sequentially" in the quarter.

Sagawa noted that Ascend's remote-access business has booked
long-term contracts with a number of Internet service providers including
WorldCom Inc.'s (WCOM) UUNet Technologies, GTE Corp.'s (GTE)
GTE Internetworking and PSINet Inc. (PSIX), among others. These
contracts, he said, act much like annuities, producing a steady income
stream.

Many analysts see Ascend as the next likely target for a voice-equipment
company and believe Lucent Technologies Inc. (LU), which will be free to
do pooling-of-interest deals in October, could make a play for the
company then.

Schopick estimates Xylan Corp. (XYLN) earned 20 cents a share in the
second quarter, ended June, compared with 7 cents a year earlier. Xylan
said after its first-quarter earnings report that it expects double-digit
sequential revenue growth in every quarter of this year.

Schopick said he remains "a little nervous about their aggressive growth
goals" since the company does have exposure to Asia and relies heavily on
original equipment manufacturer - or OEM - sales to International Business
Machines Corp. (IBM) and to Alcatel Alsthom (ALA). OEM sales to
these two companies accounted for 40% of Xylan's total sales in the first
quarter.
interactive.wsj.com



To: djane who wrote (49605)7/10/1998 1:48:00 AM
From: pat mudge  Respond to of 61433
 
djane --

Welcome back. This thread was a ghost town without you. Actually, most threads I follow have been really quiet since school let out.

I look forward to your contributions.

Night --

Pat



To: djane who wrote (49605)7/10/1998 1:51:00 AM
From: djane  Read Replies (1) | Respond to of 61433
 
6/98 DataComm LAB TEST. DSL: Worth Its Wait
(positive review of ASND IDSL)

data.com
(excerpts below. See above link for entire article)

By David Newman, Michael Carter, and Helen Holzbaur

Easier, faster, cheaper: Those are just some of the advantages emerging DSL technologies hold over T1/E1 leased lines

TOP PERFORMERS

Time for a pop quiz. DSL technology is a) Highly
cost-effective as a T1/E1 replacement b)
Networking's newest source of inflated
performance claims c) A useful way to augment
leased lines d) Not much of an improvement over
current digital services.

Confused? No wonder. There are nine different
types of DSL floating around, and with many of
them aimed at residential users it isn't clear what
corporate customers stand to gain.

To bring things into sharper focus, Data Comm
teamed up with National Software Testing
Laboratories (NSTL, Conshohocken, Pa.) and
conducted the industry's first public comparison of
DSL (digital subscriber line) technology. Instead of
evaluating similar products in the same category,
we compared different DSL technologies to see
which fares best for corporate use.

Table 1: Selected
Vendors of DSL
End-User Devices

Vendors made our job easier by failing to supply
five of the nine DSL varieties. But three of them
were able to come through with the other four:
Ascend Communications Inc. (Alameda, Calif.)
supplied IDSL (ISDN-like DSL). Paradyne Corp.
(Largo, Fla.) delivered MSDSL (multirate
symmetric DSL) and RADSL (rate-adaptive
DSL). And Telmax Communications Corp.
(Fremont, Calif.) supplied products based on the
emerging HDSL 2 (high-bit-rate DSL version 2)
spec (see Tables 1 and 2).

Posting Results

Figure 1: Comparing
Relative DSL
Performance

Figure 2: Comparing
Absolute DSL
Performance
So how well did the DSL technologies stack up?
Because each tops out at a different rate, we've
normalized all results by presenting them as
percentages of theoretical maximum throughput
(see Figure 1). That's a fair way of comparing the
ability of each to make good on its potential. But
some readers are interested in raw performance
above all, so we've also presented results in terms
of absolute throughput (see Figure 2).

In comparing the normalized results, IDSL
(represented by Ascend's MAX DSL and Pipeline
50) appears to have a distinct advantage over the
rest. In the raw BLAST tests, it showed almost no
degradation in throughput for all but one
impairment. IDSL appears even more stable when
handling live application traffic: Results are virtually
identical, regardless of how bad line conditions
become. Latency was also rock-solid across all
impairments: 17 microseconds for 64-byte
payloads and 139 microseconds for 1,024-byte
payloads. These numbers suggest IDSL would be
a good choice for applications that demand very
predictable response times.

_____________________________________________________________________

Data Comm and NSTL gratefully acknowledge
the support of vendors that supplied equipment
for this test. Thanks especially to Ascend,
Paradyne, and Telmax for taking part in a
comparison of technologies rather than
products. Thanks also to Consultronics Ltd.
(Concord, Ontario), which supplied the
DSL-400 Wire Line Simulator and DLS-90
18-kfeet Extender, and to Network Associates
Inc. (NAI, Santa Clara, Calif.), which supplied
an Expert Sniffer protocol analyzer. Thanks
also go to Steven Eliot of McGraw-Hill
Professional Publishing, who supplied a copy of
ADSL and DSL Technologies by Walter
Goralski (McGraw-Hill, 1998), a useful
reference in researching this test.

David Newman is senior technology editor for
Data Comm. His e-mail address is
dnewman@data.com. Michael Carter is a
project manager at National Software Testing
Laboratories Inc. (NSTL, Conshohocken, Pa.);
his e-mail address is mikec@nstl.com. Helen
Holzbaur is manager of licensing and
methodologies for NSTL and can be reached at
helen@nstl.com.



To: djane who wrote (49605)7/10/1998 2:08:00 AM
From: djane  Respond to of 61433
 
VoFR is part of a developing picture (info on LCI and US West contracts with ASND)

americasnetwork.com

June 15, 1998

By Annie Lindstrom

Voice over Internet protocol (VOIP) is turning lots of heads these days,
but its relative infancy as a technology has some business customers looking at
other ways put voice onto data networks.

Frame relay service providers and equipment suppliers confirm that more of
their customers are considering and implementing voice over frame relay
(VoFR) because it enables them to maximize the efficiency of their frame relay
networks by pumping voice calls to their branch offices over their data
networks rather than across the public switched telephone network (PSTN).

One big difference between VoFR and VOIP is the ubiquity of the networks
which support them. With the proper standards in place, VOIP will enable
everyone connected to IP networks or the Internet to converse with one
another. In general, VoFR users may converse only with other frame relay
users.

"VOIP can actually impact a bigger audience," says Rick Malone, principal of
Vertical Systems Group (Dedham, Mass.) "If there are half a million frame
relay ports in service, that's the cap on who you can reach. There are 20
million people on the Internet, so eventually there will be more voice over IP.
But I think it will take a while before it is the primary way that corporations run
their voice networks."

Malone says there will be about 46,000 VoFR ports installed worldwide by
the end of 1998, growing to 112,000 by 2000.

Popularity award

Interest in VoFR is rising. For about a year, VoFR has been the most popular
application tested at MCI's Richardson, Texas-based Developers Lab,
according to a company spokesman. The lab allows vendors and customers to
evaluate the real-world performance of potential equipment and services on a
piece of MCI's live network - which, for security's sake, does not carry
customer traffic.

Although MCI does not have a VoFR offering, the carrier helps its customers
engineer their networks to support VoFR by making sure they have specified a
high enough committed information rate (CIR) to carry the additional traffic and
by tuning their networks so that they have the appropriate sensitivity to delay,
says Edsel Garciamendez-Budar, director of broadband engineering for MCI.

"Voice, video and fax can all tolerate delay of a total of 50 to 150
milliseconds," says Andy Voss, vice president of marketing for Nuera, the San
Diego-based developer and manufacturer of the Access Plus family of
VoFR/IP gateways.

In most cases, MCI gets requests for help with VoFR from large customers
with complex frame relay networks. "A little more than a year ago, queries
about VoFR were an exception. Now it is becoming much more common,
especially for customers that have nailed down communities of interest,"
Garciamendez-Budar says.

LCI International (McClean, Va.) also reports a groundswell of interest in
VoFR. Customers who are expanding their networks are the most curious, says a company spokesman. "We just struck a deal with Ascend for B-STDX
9000 multiservice frame relay switches, which will enable us to better serve our
customers who want to do voice over frame relay," he says. "We are hearing
from customers more and more that they want that option available."


The impending merger between LCI and Qwest (Denver), which is building an
IP-based network, reportedly will not lead LCI to favor VOIP over VoFR.
"Qwest knows we have customers who are very comfortable with, and like the
cost efficiency of, frame relay," the spokesman notes.

Quality of Service

Even though many frame relay networks are already capable of supporting
VoFR and many customers are implementing the solution unbeknownst to their
service providers, several interexchange and local exchange carriers (IXCs and
LECs) are developing quality of service (QoS) offerings that will streamline
their customers' implementation of voice and video over frame relay. Frontier
Communications Services (Rochester, N.Y.) plans to roll out QoS for frame
relay by 1999, says Michael Holodnik, Frontier's product manger for frame
relay.
[ASND contract?]

"More and more customers are looking at consolidating all of their services
across a single pipe," Holodnik says. "There is a certain technology leap they
need to take to move to ATM [asynchronous transfer mode] as well as higher
cost. Frame relay also provides a certain amount of security as well as discrete,
identified bandwidth between locations, which you might not be able to get on
an IP network or over the Internet."

"All of the real-time applications people are being told they need to go to ATM
for are quite doable over well-engineered frame relay networks," Voss adds.

US West is working with Ascend to enhance its frame relay offerings and offer
QoS by year's end, says Larry Floyd, group manager of data transport
services for US West !nterprise Networking Services. "We do think there is a
significant market with this," Floyd says.


Sprint Business (Kansas City, Mo.) is evaluating the merits of offering a VoFR
class of service later this year, because "we see things heading that way," says
a company spokesman.

Carriers are getting involved in VoFR to hold on to their customers, says
Andre de Fusco, vice president of business development for ACT Networks
(Camarillo, Calif.). ACT's NetPerformer product combines data, voice, fax
and video transmission over the same frame relay link. "I think carriers will get
involved because they are going to want to offer VoFR as a native service and
help their customers handle load, balancing and congestion issues," he notes.
"Today, every public network out there is carrying VoFR."

That includes satellite networks. GE Spacenet (McLean, Va.), Victory
Communications (Rio de Janeiro) and Comsat do Brasil (Sao Paulo) use
ACT's SkyFrame product to provide frame relay service via satellite to global
companies operating in parts of the world with underdeveloped
communications infrastructures, de Fusco says.

Standards stand up

The Frame Relay Forum last year adopted FRF.11, which specifies two voice
compression algorithms for VoFR products, says Mark Amick, frame relay
product manager for Adtran (Huntsville, Ala.). The two algorithms are adaptive
differential pulse code modulation (ADPCM), which compresses voice into 32
kbps of bandwidth, and the International Telecommunication Union's (ITU)
G.729, which employs an algorithm owned by a group known as the G.729
consortium, which compresses voice into 8 kbps of bandwidth. To date,
vendors such as Adtran have not embraced FRF.11, because ADPCM uses
too much bandwidth, and because vendors have to pay the consortium $7.50
per server port and additional fees to use the G.729 algorithm, Amick says.

Adtran's FSU 5622 frame relay access device (FRAD) and Atlas integrated
access device (IAD) support VoFR, using the ITU's G.723 standard for
VOIP which compresses voice into 6.3 kbps of bandwidth, Amick says.

"We use the VOIP algorithm because we want to be able to address VOIP,
but we think the biggest marketplace is VoFR," Amick says.

June 15, 1998 table of contents

Copyright 1998 Advanstar Communications. Please send any technical comments or
questions to the America's Network webmaster.



To: djane who wrote (49605)7/10/1998 2:15:00 AM
From: djane  Read Replies (3) | Respond to of 61433
 
Ascend has followed Cisco into the optical networking arena with its GX 550 ATM core switch products, which the company unveiled at the show. As with the optical networking strategies
announced by its major competitor, Ascend sees a direct
connection from its switch to DWDM equipment as the bridge into
the optical layer for traffic based on data protocols. Williams
Communications will begin field trials of the Ascend equipment in
July, with an eye toward deploying the switches throughout its
fiber-optic network a month later. The Ascend switch has an
OC-48 interface but is "OC-192 capable," according to a source
at the show.

broadband-guide.com

from "This Week in Fiber," Week of June 12

Summaries of the week's major news in fiber-optic technologies from across the
globe.

By Stephen Hardy, editor in chief, Lightwave