Telecommunications and Networking Report
Length: 4420 words (12.6 double-spaced pages)
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
1.“Free Web Services Challenge AOL’s Dominance” - Internet business analysts generally are not yet convinced of the viability of the free web service business model for bring profitable. None-the-less, most agree that the free access will probably take a significant chunk of AOL’s market share before running out of investor’s money.
2.“Visitalk.com Builds White Pages for Web Phone Calls” - Visitalk.com has unveiled plans to simplify the routing of phone calls over the Internet. They will provide a directory service which will provide subscribers with a unique 12 digit Internet phone number. The directory will capture user’s current IP address and update their database, serving as a switchboard for Internet phone calls which are routed over IP. This solves a major problem with the fact that IP addresses change for users as they move from computer to computer.
3.“Cisco to But Software Maker for $325 Million” – Cisco Systems agreed to acquire WebLine Communications, a software maker producing e-mail routing and collaborating software. WebLine is to be assimilated into Cisco’s Applications Technology Group. This was Cisco’s 12th acquisition this year.
4.“Firm Agrees to Purchase Cable-Modem Technology” – Intel agreed to purchase the cable modem technology of Stanford Telecommunications, Inc. The deal puts Intel face to face in the marketplace with Broadcom Corp., which currently holds the majority market share for cable modem chips.
5.“Qualcomm Pact Targets Wireless Network Products” – Lucent Technologies signed a development agreement with Qualcomm to product wireless networking equipment. Qualcomm will give its CDMA technology, including chips and software to Lucent. Lucent plans to have trial systems utilizing the technology in place next year.
6.“MCI Worldcom, Sprint Ponder Merger” – The world’s second and third largest long-distance carriers are in talks are in talks over a possible merger. The deal would give MCI it’s only nationwide wireless network. An obvious stumbling block over such a large telcom merger would be close scrutiny by regulators. It is also expected that regional Bell companies may soon have permission to compete in the long distance market as well.
7.“Earthlink and MindSpring to Merge, Forming No. 2 Internet Access Firm” – This deal makes the new Internet Provider second only to AOL. The combined company will have 3 million subscribers, still a far cry from AOL’s 18 million, but none-the-less a viable competitor.
8. “Teledesic ‘Sky Internet’ May Start Sooner” – Teledesic chief Craig McCaw is attempting to raise funds for his planned ‘Sky Internet.
’ However, McCaw has also been exploring partnerships with other wireless providers including Motorola, Spaceway, and Hughes electronics, to implement a smaller scale version of their planned system to prove viability.
9.“Microsoft Corp. Agrees to Invest In Net Start-Up” – Microsoft agreed to invest $15 million in Akamai Technologies Inc. Akamai provides services which focus on speeding the downloading of web pages. As part of this agreement, Akamai will develop a version of it’s software to run on Windows NT, as opposed to it’s current Unix based versions.
10. “Maker of Voice Software for the Web Is Acquired” – Mpath Interactive Inc. acquired Resounding Technology to strengthen its position as a provider of Internet voice software. Resounding Technologies’ Roger Wilco software had been very successful in providing Internet voice chat.
11. “BellSouth Makes Bid to Acquire Sprint” – BellSouth made a bid to purchase wireless provider Sprint as Sprint & WorldCom came closer to closing their deal. Spring is expected to go with the WorldCom offer, even though the BellSouth offer if more lucrative. Regardless, either acquisition would face regulatory issues.
12. “Paul Allen is Investing $1.65 Billion In Telecommunications Firm RCN Corp.” – RCN is planning to use the investment to speed development of its high-speed fiber optic network. RCN is one of several companies known as competitive local exchange carriers (CLEC’s) trying to take a share of the local telephone business.
13. “Big Landlords Are Joining Telecom Fray” – Eight of the largest office space landlords are joining venture capitalist Kleiner Perkins Caufield & Bryers to form a new company, Broadband Office. The company is to provide high speed Internet access to it tenants.
14. “Novell Plans to Create Repository for Information on Internet Users” – Novell brought online its new service called Digitalme, aimed at providing a personal data repository. This was a move to compete with Microsoft’s recently unveiled Passport service. This was Novell’s first venture into Internet based services, as the company is known for network management software.
15. “AT&T’s Top Cable Executive Resigns Amid Internet-Access Fracas” – After making public statements denying that AT&T had been in secret talks with AOL, Leo Hindery resigned as AT&T’s top cable & Internet executive. This was in response to the fact that AT&T had, in fact, been talking privately with AOL, and had not told Hindery.
16. “That’s a WAP; How the Cell Phone and Web Contracted an Arranged Marriage” – A new technology known as Wireless Application Protocol (WAP) is spreading fast. The technology allows web based components to be brought to cell phones. Motorola estimates that half of the estimated 200 million cell phones manufactured next year will be shipped with WAP enabled browsers.
17. “Global Crossing Strikes Deal With Racal” – Global Crossing added another company to its portfolio to strengthen its international undersea & land-based networks to handle growing Internet traffic. This is an indication that Europe will be the site of the next major telco rivalries, as acquisition gives Global Crossing an additional 7,300 kilometers of fiber-optic networks in Europe.
18. “AT&T, BT to Accelerate Expansion of Global Venture” – AT&T & British Telecom’s joint venture, Concert, has announced plans to expand its frame relay service by 50-60% by early next year. This venture is structured differently than previously failed joint telecom ventures. Concert will own nearly all the switching and networking hardware, as opposed to relying on alliances for managing customer service.
19. “Norfolk Southern Forms Unit to Aid Telecom Ventures” – Norfolk Southern Corp. announced it has formed a unit to develop fiber-optic and microwave systems. The company said it will market it’s 21,600 miles of right-of ways for use by telecom companies. This would relieve the telecom developers of the high cost of easements required for network development.
20. “Five Firms Seek to Develop Security Standard for PC’s” – Compaq, Hewlett-Packard, IBM, Intel & Microsoft have announced plans to form a group to standardize security for PC’s. The new group will be called Trusted Computed Platform Alliance, and will embrace input from other companies. They plan to have a proposal for a security specification by late 2000 to be licensed openly.
21. “Dragging Bill Payers Onto the Internet Envelope by Envelope” – Paytrust, an Internet startup, is trying to transform the way consumers pay bills. The Yankee Group, a technology consumer group estimates that 4.5% of households paid bills online last year.
22. “In a Race to the Web, Phone Upstarts Grab Turf” – Covad Communications Group has announced plans to provide local telephone service in addition to DSL service. The regional bells now dwarf new entrants into the local phone service market by 80%.
23. “Nortel Networks to Acquire Clarify in $2.1 Billion Stock Transaction” – Nortel Networks, seeking to expand its customer management business bought software make Clarify. Nortel, who primarily provides equipment & software for networks, says the move was designed to allow businesses to increase personalized transactions on the Internet.
24. “Double Trouble: AT&T Corp. Might Want to Think About Setting Its Fight With ISP’s” – George W. Bush stated that if he is elected, he would urge AT&T to open its cable plants openly. Bush’s stated choice for his Secretary of State, Colin Powell, is on AOL’s board, and a close friend of AOL’s chief Steve Case.
25. “Intuit to Integrate Web Links Into Small Business Software” – Intuit said it will be paid fees by web sites providing business-to-business services to be included in its QuickBooks product. This move was to consolidate small business services as part of it’s offering. Intuit currently dominates the market for small-business financial software.
26. “IBeam’s Desnoes is Betting on Use of Satellites To Transmit Audio and Video Over the Internet” – IBeam is building a $250 million network that bundles media traffic & feeds it to a satellite link to ISP’s. This method allows faster population of ISP servers when a high demand event such as a concert or breaking news story. It will allow IBeam to cut the prices charged to media companies by half and improving the quality of audio & video delivered over the Internet.
27. “AT&T’s Plans for Cable Deals Suffer Setbacks” – Since AT&T announced negotiations with Time-Warner, plans for deals with other major cable players have slowed, as the other companies wait to see the terms of the Time-Warner deal. AT&T is betting that it will once again provide local phone service along with high-speed Internet access. AT&T has also already began talks with AOL & Mindspring for providing Internet content.
28. “Europe is Next Frontier for U.S. Telecom Deals” – As the major players become consolidated in the U.S., the next telecom deals are likely to be in the European arena in the form of major acquisitions. Major telecom players want to be able to provide “one-stop shopping” for their major corporate customers and their global telecommunications needs. Major targets in Europe include Mannesmann AG, and Deutsche Telekom.
29. “Nortel Tops Forecasts as Net Rises 61%, Raises Revenue Expectations for 2000” – Fueled by sales to telephone and Internet service providers, Nortel Networks Corp. topped analysts estimates, with a 61% increase in earnings over last quarter. Nortel said it growth of fiber-optic networks was particularly strong.
30. “Microsoft Says Its Windows 2000 System Won’t Reach Customers Until Next Year” – Microsoft formally announced the release date for it’s high end business computing environment, Windows 2000, has slipped to Feb. 17, 2000. Windows 2000 is intended to compete head-to-head with large Unix based Internet servers. Microsoft’s competitors, most notably Sun Microsystems, says Windows 2000 won’t come close to the capabilities of Unix.
31. “McCaw to Invest As Much As $1.2 Billion To Get ICO Global Out of Bankruptcy” – Cellular phone magnate Craig McCaw will invest as much as $1.2 billion in ICO Global Communications Ltd. to rescue the satellite phone system vendor out of bankruptcy. This is one of several recent investments in satellite based networks by McCaw. The company hopes to emerge from bankruptcy and begin providing phone service by mid 2001.
32. “Nextel Eager to Buy NextWave Spectrum” – Nextel has announced that it will pay $6 billion for radio spectrum that was bought by auction from the government in 1996 for $4.7 billion by NextWave Personal Communications. The deal is at a stand-still, though, as NextWave is currently in Chapter 11 bankruptcy proceedings. Furthermore, the sale would require the FCC to rule on several related regulatory issues.
33. “AT&T Is Blocked In Plan to Raise Monthly Fee 50%” – The FCC temporarily halted AT&T’s plan to raise its monthly fee charged to residential consumers by 50%, as it investigates the carrier’s pricing policies. Sprint raised its fees recently by 18%, while MCI stated it plans to keep its rate constant.
34. “Tellabs Inc. Buys Software Assets” – Tellabs agreed to pay $35 million for some specific proprietary digital signal processing software from DSP Software Engineering, Inc. Tellabs, a maker of telecommunications hardware, plans to integrate the software into its next generation switching system.
35. “Simon to Sell Net Services to Link Mall Tenants” – Simon Property Group, the largest owner of shopping malls in the U.S. announced plans to provide high speed Internet access to its mall tenants. This is the second such move by mall landlords to provide telecom services. The company has created a subsidiary called TennantConnect.Net.
36. “Web Access Via Cell Phones Is Expected To Be Introduced” – Bell Atlantic Corp. announced plans to introduce web access for cell phones and other wireless devices. Users will need a special wireless phone which starts at $120. Bell Atlantic’s move was in the wake of similar recent announcements by Sprint & Vodafone Airtouch PLC.
37. “Arch Sets Stock Deal for Larger PageNet As Firms Seek to Turn Page on Debt Woes” – Arch Communications Group, the second largest paging service, agreed to purchase PageNet. The paging industry has faced troubles lately from wireless telephone players, which can easily provide paging services in addition to telephony services.
38. “Information Appliances to Nudge PC’s at Comdex Show” – Information appliance makers including Motorola, Cidco & Boundless will be introducing numerous information appliances at the Comdex show. Boundless will be presenting a tablet device with the sole purpose is accessing the Internet & e-mail. Motorola will be unveiling a pager with Internet & e-mail access, while Cidco offers a device for handling e-mails only at a very low cost of $99.
39. “RCN Investment Casts Paul Allen As Industry Turncoat” – Paul Allen recently invested in “RCN Corp., a company which specializes in building competing cable and communications networks. RCN enraged Cablevision by teaming up with a local electric utility to avoid the expense of constructing a competing cable network. Allen currently owns stakes in cable, Internet and phone service providers, poising himself as a communications Tycoon.
40. “Telecom Start-Up Sees Gold in Copper Lines” – Advanced Switching Communications (ASC) plans to build a low-cost product to harness the existing infrastructure of copper lines in providing a single set of equipment to link to access technologies. ASC has developed a box which will convert data from DSL, T-1 and traditional twisted pair wires and move it onto the Internet. The product is fully scalable as additional bandwidth is needed, adding to its potential as a viable alternative for consumer data access.
41. “Sony and 3Com to Jointly Develop New Palm Products” – Sony & 3Com struck a deal where Sony will be able to use Palm’s operating system, while Palm will use Sony’s flash-memory technology. The move represents a move by Sony to take a stake in the rapidly expanding information appliance industry, which connect to the Internet more easily than a PC. Sony has already introduced two products for downloading music & video from the Internet and play on a personal device, within the licensing and copyright laws of the industry.
42. “AT&T Corp.” – AT&T is expanding its wireless service to Los Angeles, filling a large gap in its coverage. Along with this move, AT&T launched PocketNet, a wireless-data service which provides web services to cell phones. Also, AT&T launched a separate agreement with OmniSky to offer nationwide Internet & e-mail services to 3Com’s Pilot handheld device.
43. “Comcast To Buy Cable-TV Firm Lenfest” – After Comcast was outbid for MediaOne by AT&T, AT&T, aimed at making peace with Comcast, agreed to sell Lenfest. The move will firmly establish Comcast as the 3rd cable TV operator.
44. “The Search Continues for a Single Wireless Standard” – There are currently a half-dozen standards in place for wireless service from Global System for Mobile Communications to Time Division Multiple Access. Right now the force seems to be a convergence between GSM & TDMA, creating a dominant standard. None-the-less, giants like Sprint & Bell Atlantic favor Code Division Multiple Access.
45. “Privacy Concerns Rise As Plans for Tracking Cell Phone Users Unfold” – The FCC has mandated that all wireless providers be able to pinpoint the location of a wireless 911 call within 100 feet by October 2001. Also, recently the agency mandated that wireless providers be able to provide the beginning and ending location of a phone call to law enforcement officials.
46. “Deal Would Give Vodafone a Leg Up in A Heated Race” – Vodafone announced a bid for Mannesmann AG, in an attempt to build the first pan-European wireless network. This would be a major benefit for Vodafone in being able to offer flat rate plan over the entire European coverage area.
47. “Cabletron to Sell Unit for Stock of $860 Million” – In an effort to regain focus on high-end networking hardware, Cabletron has agreed to sell an Internet equipment business to Efficient Networks. Cabletron is shedding non-core businesses in an attempt to make itself a viable takeover target. Efficient Networks, which makes DSL modems, bought FlowPoint, which makes DSL routers.
48. “AT&T Expects Delays In Closing MediaOne Deal” – AT&T and MediaOne most likely will not finalize their proposed deal until the second quarter of 2000. The delay is largely due to a lengthy regulatory review by the Department of Justice. The deal, which is none-the-less expected to go through, will make AT&T into the nations’ largest cable TV service provider.
49. “Nextel Sets a Deal to Buy Phones from Kyocera” – In a move marking the first time Nextel has bought phones from a third party other than Motorola, Kyocera has agreed to provide the next generation of phones for Nextel. Kyocera has been a leader in wireless technology, and recently unveiled a phone designed to receive streaming video.
50. “Court Overturns Ruling on NextWave, Spelling Good News for FCC’s Valuation” – An appeals court overturned a bankruptcy ruling that valued NextWave Personal Communications at $1.02 billion, less than a quarter the price it had bid. The ruling marked a victory for the FCC which is hoping to reclaim billions of dollars for spectrum licenses. The move also spelled good news for Nextel, which is hoping to buy the troubled NextWave for $6 billion.
The Future of Telecommuters
The Future of Telecommuters
As the our global network known as the Internet increases its size and speed, the future of telecommuting becomes more and more promising. Generally speaking, telecommuting is defined as spending at least one day out of a five day work week working in one’s home. In a growing number of companies, traditional office space is giving way to home offices, living rooms and even kitchens as employees work from home, from their cars or virtually anywhere. Until recently, technology was the main barrier to telecommuting. Now the biggest hurdles are cultural, organizational and managerial. Those organizations that have introduced well designed and supported home-working schemes have benefited from lower costs, higher productivity, greater flexibility and a more motivated workforce.
Both companies and employees are discovering the benefits of virtual workspaces. Businesses that successfully incorporate them will be able to significantly cut their overhead costs. It would cost much less to have a few people answering phones at home at 3 o'clock in the morning than running a skeleton crew in a heated/air-conditioned, lighted, and such office building. The employer can offer telecommuting as an option for prospective employees to improve recruitment. As an added bonus, companies heighten their public image as environmentally conscious by saving some ozone by curtailing traffic and commuters. They’re also finding that by being flexible, they’re more responsive to customers, while retaining key personnel whom otherwise might be lost to a spouse’s transfer or a new child. Left to generally work on their own terms, employees most often are happier, as well as more creative and productive.
How are employees likely to benefit? That depends mostly to which particular employee we are referring. Telecommuting allows someone with a physical handicap that could not actually commute to the workplace to still function as a valuable employee. It would allow someone who has small children and feels a great need to be home for them to still work and have a career. The distance an employee must travel daily to work is a factor that can induce great amounts of frustration and expense in one’s life. Telecommuting can alleviate this stress. And, employees who successfully embrace the concept are better able to manage their work and personal lives. Allowing greater freedom and bestowing greater responsibility can enhance job satisfaction. However, employees should be aware of some of the pitfalls of telecommuting as well as the benefits. It is estimated that telecommuters earn less overall then office workers.
Managers often fear that employees will not get enough work done if they can’t see them. Most veterans of the virtual office, however, maintain that the exact opposite is true. All too often, employees wind up fielding phone calls in the evening or stacking an extra hour or two on top of an eight-hour day. Not surprisingly, that can create an array of problems, including burnout, errors and marital conflict. Another potential problem with which virtual employees must deal is handling all the distractions that can occur at home. As a result, many firms will provide workers with specific guidelines for handling work at home. The majority of workers will adjust and become highly productive in an alternative office environment. The most important thing for a company to do is to give suggestions that will help workers adapt.
This new work environment is designed around the concept that one’s best thinking isn’t necessarily done at a desk or in an office. Sometimes, it’s done in a conference room with several people. Other times it’s done on a ski slope or driving to a client’s office. The idea is to eliminate the boundaries about where people are supposed to think, to create an environment that is stimulating and rich in resources. Employees decide on their own where they will work each day, and are judged on work produced rather than on hours put in at the office. Because workers aren’t in the same place every day, they may be exposed to a wider range of people and situations. And that can open their eyes and minds to new ideas and concepts.
Technology is obviously the driving force behind the shift to telecommuting. Technology can be relatively straightforward - a good PC with licensed office software and a modem or DSL connection to the central systems. These must in turn be designed to enable remote working - for example database applications should use client-server techniques to minimize workstation bandwidth requirements. For many home-workers a combination of email, file-transfer and intranet/internet access is sufficient. Some Internet service providers are offering secure gateway services into corporate systems, an advantage being national and international access for the price of a local call
A broad range of information and communications technologies is beginning to enable better organizational effectiveness, efficiency and customer service:
High speed computer and phone system networking allows staff to use any standard desktop, independently of location - main office, other office, home or on-the-move
Intranets (high speed internal internets) are easy to implement and maintain and can offer simple, standard interfaces to most corporate applications including legacy mainframe and client-server systems
Integrated desktop applications, such as Microsoft Office, can streamline and automate a wide variety of office tasks with minimal programming effort
With computer-telephony integration (CTI) the IT and phone systems (fixed and portable) can work in harmony to deliver advanced messaging and call-center solutions
The Internet is already widely used in the technology sector for customer service and support - use will extend to other sectors as networks improve and consumer and business usage grows, especially with the advent of Internet-enabled televisions
Document image processing (DIP) and optical character recognition (OCR) support the elimination of paper and streamline associated processes, for example by scanning incoming mail and other documents.
Companies maintain links with the mobile work force in a variety of ways. Employees access their E-mail and voicemail daily; important messages and policy updates are broadcast regularly into the mailboxes of thousands of workers. When the need for teleconferencing arises, it can put hundreds of employees on the line simultaneously. Typically, the organization’s mobile workers link from cars, home offices, hotels, even airplanes. Virtual workers are only a phone call away. Certainly, telephony has become, and will continue to be a powerful driver in the virtual-office boom. Satellites and high-tech telephone systems, such as DSL lines, allow companies to zoom data from one location to another at light speed. Organizations will link to their work force and hold virtual meetings using tools such as video-conferencing.
The trend is being bolstered by growing corporate acceptance of the workstyle and a recognition by employers that it is mutually beneficial for them and their employees. The strong economy coupled with high employment rates has created a positive environment for alternative workstyles and has prompted employers to use the telecommuting option to lure highly sought-after, skilled employees.
Joanne Pratt, president of Joanne H. Pratt Associates cited three factors that are driving the growth of telecommuting:
The Internet has created a demand for PCs and provided an incentive to set up a home office.
Technology has reached a critical mass
Cell phones, notebook computers and other technologies have resulted in the workforce that is equipped to work anywhere.
Employees are paying attention to work/life choices and even conditioning their acceptance of new jobs on pre-approval to telecommuting.
In its first major study of telecommuting in two years, FIND/SVP reports 11 million Americans now telecommute to the office. That's a 30% jump from two years ago and a 175% leap from 1990. FIND/SVP expects U.S. telecommuting to swell another 3 million by the year 2001. Another research company, The Yankee Group, agrees the telecommuting workforce is growing at a brisk clip (18% per year). The American Management Association forecasts a 171% growth in telecommuting over the next five years. The rapid technology adoption was also noticed by the FIND/SVP survey, which discovered that an estimated 31 percent of telecommuters use the Internet, more than double the average rate for home users, and 75 percent of telecommuters use personal computers.
Looking ahead, it's just a simple matter of mathematics. Computer and networking equipment is getting better and cheaper. Office space is getting more expensive. Highway traffic is becoming more congested. It's only a matter of time until home workers become as numerous as office workers. Eventually, this will mean that IT departments have to become as adept at supporting these remote workers as they are at supporting LAN-based users in company offices. Keeping a fleet of temperamental laptop computers up and running is part of the headache. Keeping the connection to the Internet up 24-by-7 will also loom large, as will volume purchases of personal fax machines and printers.
Society is on the frontier of a fundamental change in the way the workplace is viewed and how work is handled. In the future, it will become increasingly difficult for traditional companies to compete against those embracing the virtual office. Clearly, many considerations must factor into a decision by a company to implement a telecommuting program. However, companies that embrace the concept are sending out a loud message. They’re making it clear that they’re interested in their employees’ welfare, that they’re seeking a competitive edge, and that they aren’t afraid to rethink their work force for changing conditions. Those are the ingredients for future success.