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Technology Stocks : Harmonic Lightwaves (HLIT) -- Ignore unavailable to you. Want to Upgrade?

To: Frank A. Coluccio who wrote (2539)	10/2/1998 8:51:00 AM
From: growthvalue	Read Replies (1) \| Respond to of 4134

"They tend to look for incremental improvements in technology which are based on standards, sameness across the board, homogeneity, which enables them to select from a wide range of suppliers and exert leverage." I agree, but there are those rare companies with an essential technology and decent insulation from competition - these of course are the holy grail. HLIT looks like it has a shot at being one of those companies, but then again, so did CIEN (when I first heard of them). This is what I'm trying to work out. Apparently, one of the reasons a lot of VoIP equipment makers are so cheap is that it would take very little for LU or CSCO to develop competitive products. In connection with your above statement, I would also say that buyers look also for one-stop shopping where they can negotiate volume discounts - this is why CSCO and LU are so dominant. It's a win-win - CSCO and LU get the business, the buyer gets a good price. And buyers can also use secondary suppliers to keep CSCO and LU honest. GV

To: Frank A. Coluccio who wrote (2539)	10/5/1998 8:24:00 AM
From: Hiram Walker	Read Replies (1) \| Respond to of 4134

Frank, you are right, they are very conservative. I expect to see the CLECS and LECS moving toward MetroDWDM. The pressure these new CLECs exert on incumbents to improve their networks, as well as the opportunity they themselves present, could drive WDM into the cities where competition is most heated. In fact, because CLECs' business accounts are more city-dwelling and their infrastructure decisions are free from legacy equipment considerations, Wong says they'll be the first to move to metropolitan ring WDM configurations. Many industry watchers believe these architectures will define the look and feel of the urban public network of the early 21st century. For now, it is hard to see whether or not any LECs are catching on to metro WDM. Late this summer, many big name carriers were still evaluating metro products. Bell Atlantic, at this writing, was the only LEC to have made public an investment in metro WDM. However, even this commitment was fairly small, and although Bell Atlantic has not detailed its plans, sources outside the company say the carrier's initial deployments will target only long-haul, point-to-point applications. "Right now, they're trying to figure out if the metro market makes sense for them," says Szelag. No major CLEC contracts had been made public either, and some of the smaller CLECs may need to see the cost of WDM-based networking in metro applications drop further still before they make commitments, say Dana Hartgraves, director of marketing and business development at Alcatel. Its difficult management nature and inability to restore itself, like Sonet, once hampered WDM's entry into the metro market. However, optical ring protection solves that problem, says Wong. "With that optical level protection, carriers won't need traditional Sonet network elements," says Rosalind Genin, vice president of optical networks at Ericsson. "They will be able to build and expand their networks by interconnecting WDM rings." Interoffice applications are another segment of the metro market. Using WDM between central offices or from a central office out to remote offices can save carriers money and allow them to better meet the needs of their biggest high-bandwidth customers. For CLECs, interoffice WDM can save them the cost of termination fees paid to their incumbent LECs. In addition to rings and interoffice approaches, Lucent is looking into the viability of WDM in the customer enterprise for large business users. Szelag says the vendor has hired a consulting firm to size up this market's potential. U S West currently manages such a WDM enterprise on Microsoft's sprawling corporate campus in Redmond, Wash. Vendors seem certain the metro market will develop rapidly. When deployments become common, the price will drop further. Meanwhile, it seems likely that the war between vendors to escalate channel capabilities may become less intense. Cambrian's Wong criticizes the ongoing single-mindedness increasing WDM channels toward and past 100 wavelengths. "Some carriers don't need more waves. What they need is better management capabilities," says Wong. "It could be a case of forcing too many channels through at the wrong time." Szelag adds, "Capacity needs aren't the primary reason to have WDM anymore. It's the applications you can use it for." If vendors can convince carriers that they will be able to control metro WDM cost and management, deployment will accelerate. As that happens, especially with metro ring deployment, the industry will come closer to seeing operation of full optical layers. "When you talk about having an all-optical layer, metro restoration is part of what gets you there," says Hartgraves. Wong adds, "A metro ring can be like an optical subnetwork. It is the first step toward all-optical networking." Frank, it will be the more aggressive CLECS that use MetroDWDM,and cable companies like TCOMA interfacing with T. Tim