Friday night finds:
November 20, 1998
Dow Jones Newswires
Sutro & Co. Starts Newbridge Networks With Buy Rating
No further information is available at this time.
Clips from WSJ's Tech Review which I share for the sheer joy of seeing the RBOCs appropriately chided:
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RealNetworks' streaming-media software has long been a teaser for what the Internet would be like if people at home had Internet connections worth having. There are plenty of teasers for that Never-Never Land, of course, so it made sense that this week brought two more.
First came AT&T Corp., which opened fire on its telecommunications-industry rivals, warning the Federal Communications Commission that its $32 billion acquisition of Tele-Communications Inc. would be "severely jeopardized" if it was forced to give other companies equal access to the joint entity's upgraded cable line.
That's what the Bell companies want, since they continue to view giving consumers high-speed access as more of a chore than a business opportunity, and have done their best to make sure they don't have to perform said chore by rolling out high-speed access at the approximate pace of continental drift and looking to financially disembowel any customer foolish enough to ask for it.
Of course, the Baby Bells don't want anyone else to offer high-speed services either, so they continue to dog-pile regulators and courts in an effort to stop the likes of AT&T. America Online Inc. has taken the Baby Bells' side in an effort to protect itself, but odds are the always-pragmatic Steve Case and company will get tired of holding their noses and cut a deal.
AOL is worried that TCI's AtHome service will (among other things) limit customers" access to AOL, but if there's one lesson AOL should have learned this decade, it's that big companies always think it's easy to make a consumer online service and are always wrong.
MCI WorldCom Inc. is also hoping to offer high-speed access: The company said at Comdex that it will roll out digital subscriber line in 25 major metropolitan areas by March, selling the service to small businesses and Internet-service providers, which will in turn sell it to consumers. Of course, MCI will have to reach small businesses by leasing a lot of copper lines from the Baby Bells, so don't start calling around just yet. . . .
Cable & Wireless PLC unveiled a five-year, $1 billion investment plan to offer high-speed data service in 40 European cities.
Telecommunications Williams Cos. said it will sell part of its Williams Communications Group Inc. unit to the public next spring, with the hope of raising $500 million to $750 million.
Dutch phone carrier Royal KPN NV has teamed up with U.S. fiber-optic provider Qwest Communciations International Inc. to build a high-speed telecommunications network spanning Europe and connecting to the U.S.
PanAmSat Corp. disclosed that battery problems have caused temporary service disruptions at a second of its satellites and acknowledged that possible future interruptions could prompt some customers to terminate agreements with the company.
Licensing and interconnection issues continue to hamper new entrants to Europe's telecommunication services market, according to the European commission.
France Telecom SA plans to spend roughly $1.77 billion from the proceeds of a coming public offering to expand its presence outside France, company executives said. . . .
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And from Monday's IBD, JC spreads the gospel:
<<<Cisco Becomes World Lobbyist For New Nets
Date: 11/23/98
Author: Michele Hostetler
''Convergence'' comes up often in tech talk. The word's used to describe the coming together of the PC and consumer electronics worlds. And it does the same for the joining of data networks and voice, or phone, networks.
But Cisco Systems Inc., which became one of the decade's most successful stocks on its leadership in data networking, doesn't like convergence - the word, not the concept.
Chief Executive John Chambers says it's not really convergence. It's voice tagging along with the ''better'' data networks. Which, of course, is quite fortunate for Cisco.
Chambers is taking his message for ''data-voice-video'' networks to Washington and overseas. Since networking's still in the early stages of the transition, there are plenty of stops for him to make.
Chambers recently spoke with IBD about convergence.
IBD:
How is Cisco evolving from just a data networking player to one that also offers voice and video networking gear?
Chambers:
In terms of the evolution of our market, I think there's a realization by almost all the customers and, candidly, the equipment manufacturers, that instead of a separate data market, voice market and video market, they're going to come together.
It's not a convergence. They're (voice, video and data) going to come together on data infrastructure. So we (Cisco) got very lucky on that. I wish I could tell you I saw that coming. We just happened to be in the right spot at the right time, and now we're trying to take advantage of that, obviously.
In this new market, we represent well under 10% market share. That's the combined total of data, voice and video, which is how I think many people will start to break that market out over the next 12 months.
IBD:
How far along is the data-voice-video network?
Chambers:
We're at the early stages. Enterprise customers (big businesses) are looking to do it first. Using Cisco as an example, we already throw our voice in the back of our data lines, o when) we (connect) with Asia we get huge savings, as you can imagine ince sending data packets is cheaper than sending voice circuits).
But you're also seeing service providers realize there's not a reason to build out a circuit infrastructure (based on existing voice technology). They're interested in building a network that has major price-competitive advantages, which an IP (Internet Protocol) network provides. But also there's the realization that their core infrastructure, which is voice, is going to commoditize. The position that we're taking is that (voice) will be given away for free as the majority of the load on the network becomes data- and video-based.
When I first said that six months ago to service providers, I thought they'd hang me. Now they actually understand it's going to happen. Most of them are (mulling) how they will transition from a market where 98% of their profit is voice to a market where their primary revenue stream (voice) will, at best, become a commodity and, at worst, become free.
Then they're looking at how they'll add value-added services and how they'll move from where they are today to where they need to be.
IBD:
Cisco is expanding its presence in Washington, D.C. What role would you like to play?
Chambers:
Surprisingly enough to a lot of people, me included . . . we have the same objectives that governments around the world do. We're very interested in strong economies, and competitive businesses in each of those economies.
When you look at it, whether you're in the U.K., Washington or Beijing, the interests all are the same. We're beginning to spend time educating government leaders. Candidly, we've found them, worldwide, very receptive to that education - to understanding how this (data-voice-video networking) technology creates a new level playing field not just between small companies and big companies but between countries as well.
If you look at it as a second industrial revolution and understand the opportunities that it offers countries, you begin to get an idea of some of the implications that some of these government leaders are beginning to understand.
In my last two trips to Asia, in every single country I went to, the top government officials spent a minimum of an hour and a half with us talking about what (networking technology) means to his country, to the competitiveness of businesses, to how it (levels) the playing field and (helps) them be more effective . . . on a global basis.
IBD:
How would you like to see Washington help Cisco achieve some of its goals?
Chambers:
The major issue is to let business lead on this (network conversion). If government tries to apply old-world, industrial-type regulations to the market, they'll slow it down, perhaps dramatically.
For example, on Internet taxation, I think D.C. did an excellent job of leading with a moratorium on taxation, not only in this country but trying to get it on a worldwide basis. You're seeing both sides - Democrats and Republicans - take a lot of time to really understand this issue. I think the more they understand it, the more they realize that if they try to apply old-world standards . . . (that) could be a huge problem.
At the same time, they're beginning to realize that if you create competition, you could create not only a more effective infrastructure for a business -therefore job creation and preservation - but you could also get issues such as voice for free or at a commodity price. (That's) of interest to every politician in the world. I think it goes back to a two-way education process, and both sides seeing major advantages by working together.
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