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


To: Eric Jacobson who wrote (2653)3/2/1999 10:37:00 AM
From: Hiram Walker  Respond to of 4134
 
Eric et all, a good article about 21st Century in
internettelephony.com

Star/ring role

That design incorporates network ideas Brouse installed in his former post as network engineer for Jones Intercable in Arlington, Va., and Broward County, Fla. In a topology he calls a distributed ring/star, data and voice leave the NOC and travel over Sonet via OC-48 (2.5 Gb/s) lines that follow the transit right of way. Eight transport hubs jump off that backbone, split the streams into OC-12 (622 Mb/s) lines and send them out to four "campus hubs" per ring (Figure 2). Video signals leave the NOC on different fiber and travel two redundant paths to the hubs.

The architecture is distributed because each campus hub does its own signal processing. "Think of it as a central office in a traditional telco system or as a headend in a traditional cable system," Brouse says. "It's where we do both the integration and segregation of the signals."

In the campus hub, the Sonet signal is broken down to voice on one side, data on the other. Data goes in through an asynchronous transfer mode switch, then is converted to and combined with video on another wavelength using wavelength division multiplexing. The signal goes through 24 to 36 system nodes located no more than three-quarters of a mile away and travels on coax into the building. For buildings with more than 100 units, 21st Century puts the access node in the building itself.

In the Loop, that 120-block section of downtown that is home to most of the city's businesses and financial institutions, the carrier planned to ring the area with OC-48s just like the residential areas. But the thought of having to change those out for higher capacities as business grew made it clear that nothing but OC-192 (10 Gb/s) would do. Beefier fiber also permits traffic management; if 21st Century needs more capacity out of one of its Loop hubs, it can shift bandwidth to supply it.

On the ring level, Brouse swapped another star configuration from each campus hub for a "hybrid mesh" that links every point on the grid to multiple others, though not all. This confers most of the speed and management advantages of a mesh without the capital outlay a true mesh would require.

To reduce the total cost as they lay their Loop fiber, 21st Century crews will put in the manholes and conduits only for contracted clients but will prepare the network to build out to all the other prospective customers they pass on the way.

"Some might say it's inefficient to move your people around all over the place," Brouse says. "But I think we get much better efficiency from dollars spent. And since we're fully funded, we have that luxury."

Cable phone blues

Cable telephony posed the biggest networking problem. The company was certified as a competitive local exchange carrier in March 1998 and installed a Nortel Networks switch on its premises last summer; by September 1998, trunking with Ameritech was complete.

Originally, Brouse intended to take fiber all the way to every phone customer. But problems with equipment costs, system power, access nodes in every building and hauling fiber that last mile consumed time and burned money. "When you go into a 600-unit building and get 30 phone customers initially, you have to ask yourself, 'Is this a good way to use these dollars?'" he says.

So 21st Century has changed telephone strategy, co-locating in Ameritech's Area 1 COs and using the regional Bell operating company's copper for the last mile. This involves paying some of the lowest co-location expenses in the country--$2.59 per loop per month.

"In return, we can get out ahead of the actual video/data network build," says Howard Kitchen, director of telephony implementation. "That gives us instantaneous access to all our subscribers in Area 1 and allows us to lead with telephony in those areas where we don't have subscribers yet." 21st Century expects to co-locate in five Area 1 COs by the second quarter and in all 10 by the middle of the third quarter.

The service provider will still install access nodes in large multiple dwelling units and feed them with fiber directly off the backbone. One 41-story condominium project now under construction will get its phone service directly from 21st Century, along with cable TV and high-speed Internet access.

Looking to the future, Brouse believes 21st Century will eventually supply phone service all the way to the single-family home--not cable phone, but Internet protocol or wireless. "IP telephony is ramping up, millions of homes have computers, and the costs are coming down," he says. "Put an uninterruptible power supply into your computer, and that will run your computer and your phone for some time."

As for selling the products that fill these pipes, 21st Century now leads with cable television. More than 100 analog video channels are available in five packages, from basic at $29.45 a month up to the Gold Coast package with nine premium channels for $70.45 a month. Cable service also includes pay-per-view with remote ordering, 24 audio channels and several virtual channels--text-based Web pages accessible through the customer's TV with news, weather, financial information, local restaurant menus and airline schedules out of Chicago's O'Hare International Airport.

The video does not require a set-top box and is all analog, at least for now. Because of the HFC network's bandwidth capacity, the picture quality is still superior to that of an analog picture from TCI, says Kitchen. "[TCI] can offer digital service in this market, but that really just gives them the opportunity to compress channels and add some," he says. "We can offer more channels now, so there's no need for us to go digital yet."

In Internet service, 21st Century is the only company in Chicago offering cable modem speeds of up to 4 Mb/s. Residential customers who don't get its cable pay $55 a month to hook up one PC or Macintosh, along with a $125 installation fee. Cable subscribers adding high-speed access pay $100 for installation and $45 a month; commercial customers will pay $125 per line per month. 21st Century includes free e-mail and personal Web pages and caches the 250 most popular Web pages for faster access by end users.

The company is selecting a new cable modem provider--it has been using a product from Zenith, a local manufacturer, but intends to move to a DOCSIS-compliant modem from an as-yet unnamed supplier. Miller believes high-speed access will find a fertile market among small office/home office users, replacing their second phone lines with always-on cable Internet.

No one really cares right now about reality or ability of managements,but HLIT is kicking some ass.

Hiram



To: Eric Jacobson who wrote (2653)3/6/1999 4:44:00 PM
From: Hiram Walker  Read Replies (1) | Respond to of 4134
 
Eric et all, some comments from VP Dahlquist about the next 6-7 years,should be killer for HLIT.

cedmagazine.com

In the meantime, however, the fiber business is expected to
continually re-invent and re-distribute itself to new businesses such as high-speed data and Internet. "Much depends on voice, video, IP and the Internet. They can really drive the need for bandwidth in the return path," says John Dahlquist, vice president of broadband marketing for Harmonic Lightwaves Inc., a designer and manufacturer of lightwave and digitally-based HFC networks.
The insatiable thirst for more bandwidth, Dahlquist says, will drive fiber deeper into domestic cable networks for several years to come. "More operators are building out to 500 homes per node or less. And because of the traffic models generated by each MSO, like new services, new transmitters will need to be installed."

He is also cognizant of the potential domestic fiber downturn. "The domestic market will remain strong for five to six years. Our product development strategy takes us outside the traditional lightwave business because the competition for a finite market will get even more intense," Dahlquist says.

In Harmonic Lightwave's case, the non-traditional market means international. "We will increase our focus internationally. That market has a good chance of growing larger than our domestic market," Dahlquist adds.
In seven years, however, the fiber business is likely to look very different, and very foreign. Says Dahlquist: "There's a tremendous amount of business out there, and we'll start to see a comeback in the year 2000. It will eventually grow faster than the domestic market."

Yet most fiber component manufacturers expect the next seven years to produce impressive revenues on the domestic side, along with providing a road map to new services that will require a substantial number of fiber miles in the U.S. Beyond the magical seven-year mark, however, the fiber business "over there" is likely to take hold.
Tim