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News Briefs (December 01, 2002)

Ericsson CEO, analyst at odds over what the future holdsThe telecommunications landscape may be littered with layoff notices, but that hasn't stopped the president and CEO of wireless giant LM Ericsso...

December 1, 2002  

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Ericsson CEO, analyst at odds over what the future holds

The telecommunications landscape may be littered with layoff notices, but that hasn’t stopped the president and CEO of wireless giant LM Ericsson from making a bullish prediction about this sector’s future.

Speaking at the Expo Comm Canada conference in Toronto last month, Kurt Hellstrom predicted that the introduction of mobile services based on third-generation (3G) wideband code-division multiple access (WCDMA) networks will kick-start the industry.

In spite of the current state of the industry, we should not jump to conclusions,” he said. “This is a growth industry and the growth will come back. Communication is a basic human need and we have only seen the beginning of what lies ahead.”

The telco industry, he said, is moving to a phase where through 3G, voice, data and images will be able to be sent across wireless networks.

“With 3G we are cutting the wires to broadband, but the wires will still grow in importance,” said Hellstrom. “This may sound like a contradiction, but it is actually quite logical. Basically, users want their information wherever they are. At home or in the office, they want a fast connection on their PC, the TV sets or other devices. On the move they want the same information on their mobile phone.”

Because of that, the network architecture will change, evolving from a vertically integrated single service to being open and horizontally layered, he said.

In order for 3G network-based services to become pervasive, they must be developed locally and adapted to specific markets, said Hellstrom.

He predicted that by the end of 2007, the number of mobile phone subscriptions worldwide will total 1.8 billion.

Following his presentation at Expo Comm, however, Ian Angus, president of Angus Telemanagement Group Inc. in Ajax, Ont., described telecom trade shows as being in the same slump as the industry and possibly more so. He also predicted little economic change for at least the next 12 months. “The problem here is that a telecom recovery does not stand alone. Without a general economic upturn and improvement in capital markets, we’re just not going to see it recover. Right now, we’re seeing an even greater reluctance to spend on behalf of the carriers and also enterprise and business customers.”

Angus said in an interview that while there are some “bright spots” in the darkness, the cutting of capital spending has been remarkable. One example of a bright spot, he said, is the rapid emergence in the last two years of “third-tier” carriers, who provide regional or local data communications services.

“Our view is that the demand and need for telecom services remains strong, but the huge problem right now is that the nature of the business is such that the prices aren’t covering costs,” said Angus.

Study concludes Cat 6 cabling provides less network downtime

A survey by Avaya Inc. has revealed 82 per cent of enterprise network decision-makers surveyed will specify Category 6 high-performance cabling in their next installation.

Ratified in June 2002 and September 2002 respectively, the Telecommunications Industry Association (TIA) and ISO/IEC Category 6/Class E cabling standards establish a benchmark for network performance in Local Area Networks (LANs).

The report entitled, Cabling Infrastructure: Ready for Tomorrow’s Network Traffic or Heading for Congestion, surveyed more than 2,000 organizations in 38 countries.

In findings that contradict what others in the industry are predicting (see cover story), the report found that 28 per cent of the completed sample have already installed high-performance Category 6 cabling.

The research shows that 19 per cent of respondents were already using video conferencing and 27 per cent intend to increase their use of multimedia video applications, including video conferencing.

The study also noted that network downtime, together with moves, adds and changes (MACs), are costing businesses millions of dollars in lost productivity. From research data, it is estimated, for example, that downtime is costing companies with more than 7,500 network users an average of US$5.5 million annually in lost employee productivity alone. The significance of these losses is widely recognized by respondents.

Downtime was cited as the issue of greatest concern more often than any other. Unprompted, 26 per cent of respondents said downtime was the most likely network issue to keep them awake at night and a further 15 per cent said degraded network performance was their biggest worry.

Network downtime experienced by users of Category 6 cabling was less than among users of Category 5 and 5e solutions.

Among the global sample, only eight per cent of Category 6 users experience more than five hours a month downtime compared with 11 per cent among users of Category 5 and 5e.

“Respondents who said downtime had a major impact on productivity were the most likely to be deploying fast networking technology, but their deployment of Category 6 cabling was only marginally above the average for all respondents,” said Dennis Curtis, vice-president and general manager, Avaya Connectivity Solutions. “As a result, when traffic levels grow, some of these organizations may find their cabling has too little headroom to avoid long wait times and poor streaming media quality when traffic peaks.”

The importance of quality in selecting a cabling infrastructure was, however, widely recognized. Thirty eight-per cent put product quality at the top of their list of priorities, twice as many as the next most commonly named criterion, technical performance.


360networks Corp., a provider of wholesale and data telecommunications services and a company that recently emerged from creditor protection, will acquire Group Telecom, a facilities-based telecommunications provider that is also in financial difficulty.

Terms of the cash acquisition were not disclosed, but will be included in Group Telecom’s plan of reorganization.

“This agreement will achieve the best possible result for our customers, employees, and creditors,” said Greg Maffei, 360networks’ CEO. The transaction will allow our customers to continue to receive leading high-quality, reliable telecommunications services.


Adding a new definition to the term “air mail,” Lufthansa and Boeing Corp. have announced that the first e-mail sent via a broadband Internet connection from onboard a scheduled commercial airline, successfully reached its recipient.

Members of the Lufthansa and Connexion by Boeing project team, a mobile information service provider, simultaneously activated the onboard system and the satellite network for the first time and sent the historic transmission aboard the Lufthansa 747-400, “Sachsen-Anhalt.”

The long-haul aircraft was cruising over the North Atlantic south of Greenland at an altitude of 35,000 feet (10,668 meters). With a speed of 910 km/h, flight LH 418 was on its regular route from Frankfurt to Washington, D.C.


Fitel USA Corp., the parent company of OFS, designer, manufacturer, and supplier of fiber optic products, has filed suit against Sterlite Optical Technologies, Inc. in a U.S. District Court in Georgia.

The suit charges infringement of patents covering a number of optical fiber technologies, including technologies that are fundamental to manufacturing optical fiber that exhibits low levels of polarization mode dispersion. The lawsuit seeks an injunction barring further use of the patented technologies, as well as damages for past infringement.


With the advancement of the Internet, the proliferation of laptops and the emergence of wireless access, the definition of the work force has expanded to include remote work environments.

According to a recent In-Stat/MDR survey, on average, companies are fairly evenly split between those that allow r
emote access to the corporate LAN and those that do not, with larger companies more likely to allow remote access compared to smaller ones.

A lack of need and security concerns were the key reasons stated for not allowing remote access.

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