Nokia Siemens Networks

Alcatel-Lucent awaits wireline outsourcing

Dan O'Shea — Mon, 17 Nov 2008 08:47:55 -0500

We recently tried to stir the pot a little by suggesting the outsourcing of some elements of wireline operations might be a good next step for AT&T and Verizon, two old-school telcos re-defining themselves as wireless juggernauts. Embarq and BT have pursued such a wireline outsourcing strategy, so it's not a completely shocking idea. We're not sure anyone noticed what we said, but we were happy to see a Telephony interview with an Alcatel-Lucent official who thinks there will be more of these wireline outsourcing deals to come. Of course, with a massive services business and a pressing need to recover from financial letdowns, Alca-Lu certainly should hope there are more to come.

Wireline outsourcing by nature could be a more complex, higher-stakes commitment, considering the legacy of network quality on which many telcos stake their reputations (though that reputation certainly hasn't stopped people from cutting the cord). Telcos may still want to keep a strong hand managing the vendor partners that they hire to manage their networks. Embarq's technology team, for example, works closely with the Nokia Siemens Network team to whom it outsourced voice operations earlier this year. It can be done, and now may be the time.

For more:
- Telephony has this story

NSN cutting more jobs, near completion of restructuring

Dan O'Shea — Wed, 12 Nov 2008 00:39:40 -0500

Nokia Siemens Networks is taking steps to cut about 1,250 jobs in Finland and Germany as its nears the conclusion of an ongoing restructuring program that ultimately will result in a workforce reduction of 10 percent to 15 percent. NSN said it is intent on putting this chapter of corporate challenges behind it. However, some might say that the telecom industry's vendor giants have not even yet begun to feel carrier capex reductions that could extend into 2009.

For more:
- The Wall Street Journal reports

Related articles
Samsung replaced NSN in Xohm's Dallas launch

Vendor financing unlikely to return

Dan O'Shea — Sun, 19 Oct 2008 14:51:24 -0400

We're almost a decade removed from an era in which start-up carriers often were coaxed along in their ambitious network expansions by attractive vendor financing deals for gear and services. Those practices became even more prevalent as the young carriers sank under piles of debt and needed even more help to survive. When some of those carriers went belly up, vendors paid the price for providing essentially free equipment or agreeing to long-term bills that they could no longer collect.

Economic realities are again applying pressure across the telecom industry, but Light Reading Europe suggests that vendors such as Nokia and Alcatel-Lucent are in no mood to help carriers out again with vendor financing deals. That's no real surprise, but in some ways, managed network and service deals in which vendors take over management responsibility for carrier networks or services seem to hold a similar risk. These deals often result in vendors hiring hundreds of carrier employees. Will the long-term pay-off be worth it, or will the long-term costs involved remind vendors of a previous era they would rather forget?

For more:
- see this story at Light Reading Europe

NSN revenues down, hit by exchange rates

Dan O'Shea — Thu, 16 Oct 2008 09:12:35 -0400

Nokia Siemens Networks unveiled its third quarter earnings as part of its parent company's report, stating that revenue for the quarter dropped about 5 percent from the same quarter last year to about $4.76 billion. However, the company said that the dollar-euro exchange rate differences between this year and last year were largely responsible for the difference.

NSN also said that fall-offs in capital spending by European and Chinese carriers contributed to the slide. Spending in China, in particular, was down partly due to the nation's ongoing restructuring of its telecom industry players.

For more:
- see this story at Light Reading Europe

BT to outsource some global ops to Alca-Lu

Dan O'Shea — Sun, 12 Oct 2008 21:16:48 -0400

First, mobile network operators around the world warmed up to the idea of outsourcing network operations to their vendors, and now, wireline telcos are experimenting with the concept. It looks as if BT is at least the second major telco this year, after Embarq, to outsource some network operations to a vendor partner. Embarq off-loaded voice management to Nokia Siemens Networks. Now, BT reportedly is planning to outsource some international market network operations to Alcatel-Lucent, in an effort to focus its own organization on its 21st Century Network project and other issues.

The arrangement is a seven-year deal that also will involve the transfer of about 500 employees from BT Global Services to Alcatel-Lucent, according to the U.K.'s The Register. Along with Ericsson and NSN, Alca-Lu has aggressively pursued managed network and managed services contracts from its carrier customers in recent years.

For more:
- see this story at The Register
- read this report at Light Reading

Verizon, Level 3: We need 100G

Doug Mohney — Mon, 06 Oct 2008 21:37:14 -0400

Both Verizon and Level 3 say they need 100 Gigabit optical networks, and the sooner, the better.

Speaking at Optical Expo 2008 in Dallas, Verizon's backbone network design director said the company is currently meeting traffic needs with multiple 10G wavelengths, but managing multiple wavelengths across fiber is a pain; Level 3 is in the same boat.

At the conference Verizon announced the results of a 100G trial with Nortel; Verizon also has run 100G trials with Nokia Siemens Networks and Alcatel-Lucent. Bringing up 100G would pull costs out of the network (simplified management, more capacity on existing fiber), a benefit that works across the board from enterprise metro Ethernet services to Verizon's FiOS fiber-to-the-home network.

Nortel's optical gear comes out strong in the Verizon announcement. Nortel's optical gear performed with better tolerance for signal distortion than what's typically found in today's standard 10G wavelengths. Tests were run over 73 kilometers of field fiber in Texas at 92 Gbps, so no special fiber or "extensive" re-engineering is necessary for faster speeds.

For more:
- Light Reading reports on 100G lust at Optical Expo 2008.

NSN: VDSL2 rivals GPON

Dan O'Shea — Sun, 05 Oct 2008 22:40:42 -0400

Nokia Siemens Networks decided to exit the market for gigabit-passive optical network fiber-to-the-home architectures earlier this year, so it may not come as a surprise that the company is claiming VDSL2 can deliver 100 Mbps, and that GPON will be an outdated technology within the next four to five years. NSN CTO Stephan Scholz made the comments at the Broadband World Forum Europe.

NSN seems to believe that VDSL2 not only can match GPON in the current market, but also that wave division multiplexing-passive optical networking probably will supercede GPON in a few years. Though GPON has been successful in the U.S. in particular, WDM-PON developments have indeed been picking up steam of late.

For more:
- see this coverage at Light Reading Europe

Samsung replaces NSN in Xohm Dallas launch

Dan O'Shea — Wed, 01 Oct 2008 22:45:00 -0400

Sprint's Xohm WiMAX network launched this week in Baltimore, but the lesser-known Xohm-related story out of WiMAX World in Chicago is that Samsung has replaced Nokia Siemens Networks as the vendor for the Xohm network in Dallas. Telephony reports that Sprint chose to move forward with Samsung--its vendor for East Coast markets--in Dallas because doing so will allow it to accelerate its market launch.

Sprint and NSN both are saying that NSN is still a key Xohm vendor. NSN's WiMAX gear is still undergoing production. NSN came in as thir surprise third vendor choice for Xohm well after Samsung and Motorola were already part of the team.

For more:
- check out this coverage at Telephony

Verizon tests GMPLS, reports on 100G trial

Dan O'Shea — Thu, 25 Sep 2008 23:26:09 -0400

At the European Conference on Optical Communications, Verizon Communication announced that it had tested interoperability of generalized multiprotocol label switching gear over its Verizon Business network with Ciena, Fujitsu and Tellabs. The telco claimed that it was the first time GMPLS had been tested over a commercial network. The test experience ultimately could help Verizon develop an external network-to-network interface to set up an optical path through another carrier's network feature package," says Bill Uliasz, Verizon's director of video systems integration.

As expected, Verizon also presented a paper with Nokia Siemens Networks on its 111 Gbps trial in Richardson, Texas, which set a distance record for that level of transmission. News of the trial first emerged earlier this month.

For more:
- read this story at Light Reading

Verizon completes multi-vendor control plane test

Dan O'Shea — Tue, 23 Sep 2008 09:07:35 -0400

Verizon Business announced it has completed a field trial of near real-time circuit provisioning across a multi-vendor optical control plane environment on its commercial network. The trial sent test traffic through optical circuits on the telco's core network from Chicago to Atlanta, using in its course the Ciena CoreDirector, the Fujitsu FLASHWAVE 4500 MSPP and Tellabs 7100 Optical Transport System.

Each supplier collaborated with Verizon engineers during the test to interoperate using industry standards and to jointly reach agreement in areas where standards left gaps. Verizon has led interoperability trials in the past through its own interoperability lab, and the company also has participated in lab demonstrations of optical control plane technology. But this is the first multi-vendor field trial implementation across a commercial network, Verizon said.

"Control plane technology is a critical next step in the evolution of optical technology, because it supports the immediacy of service delivery our customers require as they respond to changing business demands," said Mark Wegleitner, senior vice president of technology for Verizon, in a press release. "Multisupplier interoperability for this emerging capability is critical to Verizon's strategy of building a network as flexible and diverse as possible."

The announcement comes as Verizon, along with partner Nokia Siemens Networks, also was due to present a paper at the European Conference on Optical Communications in Brussels, Belgium, this week, reporting the carriers' latest advances on extending the distance of 100 Gbps transmissions.

For more:
- see this Verizon press release

Nokia Siemens shuffles executives

Doug Mohney — Thu, 11 Sep 2008 15:48:16 -0400

As Nokia Siemens Networks (NSN) finishes its consolidation efforts, the company has added a new CFO and a head of Strategy and Business Development.

Luca Maestri, formerly CFO of General Motors Europe, assumes the CFO position. He replaces outgoing CFO Eric Simonsen. With all the integration and restructuring done from the merger of divisions between Nokia and Siemens, Simonsen's specialized M&A skills are apparently no longer needed.

NSN also named Michael Matthews as the new Head of Strategy and Business Development. Matthews, former Chief Marketing Officer at Amdocs, replaces current Head of Strategy and Business Development Pekka Soini. Mr. Soini will move to the Corporate Development Office, handing quality, process development and IT; he will also retain his seat on NSN's executive board.

The changes in executive leadership appear to be relatively standard personnel moves, as NSN is on target to reach around 2 billion Euros in annual "cost synergies" by the end of this year.

For more:
- New executives release from Nokia Siemens

Related articles
Nokia Siemens Networks posts 18% revenue growth
After Embarq deal, NSN eying North America

Verizon extends 100G-plus transmission distance

Dan O'Shea — Wed, 03 Sep 2008 18:12:52 -0400

Verizon Communications, AT&T, Comcast and other network operators have become very interested in 100 Gbps network transport capabilities within the last year or so. At the upcoming European Conference and Exhibition on Optical Communications, Verizon reportedly will discuss how its much-publicized 100G trials have demonstrated new levels of speed and reach with the success test of a 111-Gbps channel over 1,040 km.

Verizon previously tested 100 Gbps capabilities late last fall, and has been exploring the feasibility of 100 Gbps systems overlaying existing 10 Gbps and 40 Gbps systems at distances greater than 1,000 km, according to Light Reading Europe. The telco's supplier for its trial was Nokia Siemens Networks. ECOC will be held in Brussels September 21-25.

For more:
- see this story at Light Reading Europe

Embarq to eliminate up to 1,000 jobs

Dan O'Shea — Mon, 25 Aug 2008 08:06:27 -0400

Independent telco Embarq will shed between 500 and 700 full-time jobs and about 300 contract positions as it looks to eliminate costs in light of continued loss of access lines. The company will ask managers in many markets to accept voluntary buyouts and will then move onto rank and file workers, but it will resort to pay-offs if not enough employees accept the buyout offers.

The Overland Park, Kan.-based carrier has 17,000 employees, and the cuts will come within its network services division. Embarq also recently unloaded more than 250 jobs when it outsourced management of its voice network to Nokia Siemens Networks.

Many telcos are in the same boat, as far as access line decline is concerned, and the trend could be particularly difficult to overcome for Tier 2 and Tier 3 telcos. Industry analysts have been considering consolidation for such carriers a likelihood, though it is not clear who might buy or merge with Embarq, the largest of the independent telcos.

For more:
- see this Associated Press story at The Wall Street Journal

Related articles:
Embarq outsourced voice operations to NSN in June. Embarq report
Embarq saw 7.8 percent access line loss in Q2. Embarq report

Tech Mahindra still enjoying BT benefits

Dan O'Shea — Wed, 23 Jul 2008 00:27:36 -0400

Telecom companies of all types are increasingly turning to outsourcing firms that can handle everything from product engineering and service creation to network management. Tech Mahindra is one of the major outsourcing provider names that often comes up, and the company has shown how a deep relationship with one major telco can pay big dividends. U.K. telco BT accounts for 62 percent of Tech Mahindra's revenue, and also owns a minority stake in the Indian outsourcing firm, which used to be known under the joint venture name Mahindra-British Telecom.

The company just reported 52 percent growth in net profit for its fiscal first quarter, and also is starting to turn the corner in working with other telcos, such as AT&T, as well as non-telco clients.

For more:
- read this story at Light Reading

Related article:
Embarq outsourced voice network management to Nokia Siemens Networks. Embarq report

NSN cools on FTTH, drops GPON

Dan O'Shea — Sun, 20 Jul 2008 22:49:17 -0400

Nokia Siemens Networks confirmed that it is exiting the market for gigabit passive optical network systems for fiber-to-the-home networks. The vendor's move comes after some speculation, and NSN essentially believes that alternative fiber architectures, such as fiber-to-the-curb, will drive the market for now, rather than FTTH. The decision also comes a few months after Tellabs exited GPON activities at Verizon Communications. Tellabs still offers GPON capabilities, though the GPON market has become increasingly competitive, with Adtran also entering the space.

NSN has been making some interesting moves lately. The vendor also seemed to cool on provider backbone transport technology after BT back-burnered the controversial technology. More recently, the vendor won a major voice network management deal from U.S. telco Embarq, and expressed plans to get more involved in the North American market.

With GPON in the rearview mirror, NSN now plans to focus on DSL and development of next-generation optical access (NGOA) technologies. Some carriers are sticking with DSL and FTTC-like architectures for now, or only pursuing FTTH in greenfield deployment scenarios. BT was one carrier that recently committed to that sort of plan.

For more:
- see this story at Light Reading

Related articles:
BT announced its fiber network plans last week. BT report
NSN also recently became less excited about PBT. NSN report
NSN posted strong revenue growth last week. NSN report

Nokia Siemens Networks posts 18% revenue growth

Dan O'Shea — Thu, 17 Jul 2008 09:12:59 -0400

Nokia Siemens Networks, the network equipment and software joint venture, finished a quarter full of positive news by reporting surprisingly strong revenue growth of 18 percent to $6.45 billion over the second quarter of 2007, which was the first reporting quarter for the company. Since last year, the company has overcome very public struggles, including Siemens' initial disappointment with the venture, to nearly reach an operating profit. NSN reported an operating loss of $74.5 million for the second quarter of 2008, but without ongoing integration costs related to the merger, it would have crossed over into profit.

NSN had a busy second quarter in terms of deal announcements, including an broadly significant agreement to take over management of Embarq's voice network operations. The company also landed deals with Chunghwa Telecom and China Mobile, and announced an intriguing optical platform that integrates core and metro capabilities rather than leaving them in separate boxes. Overall, the Q2 numbers give a sense that NSN has turned a corner after an ambitious but challenging merger. Followers of the vendor merger beat will next want to watch for Alcatel-Lucent's quarterly report, due July 29.

For more:
- check out this report at Light Reading

Related articles:
NSN is looking for more success in North America. NSN report
NSN recently announced a hosted IPTV solution. NSN report

After Embarq deal, NSN eyeing North America

Dan O'Shea — Sun, 06 Jul 2008 22:32:55 -0400

Nokia Siemens Networks recently pulled off a fairly stunning deal when it won a contract to take over network management of U.S. telco Embarq's voice operations. Why "fairly stunning"? Because wireline telcos in general have not been buying into the network outsourcing trend; because U.S. network operators specifically have not been buying into the trend; because it had none of its own gear installed in Embarq's network; and because NSN, though making progress in the market for managed networks and services, seemed to lag a bit behind Ericsson and Alcatel-Lucent in terms of market activity.

Now, NSN is hoping to use the Embarq deal as a springboard toward more business with network operators in North America. Are North American carriers ready to play ball?

For more:
- read this story at Telephony

Related articles:
Embarq and NSN announced the outsourcing deal last month Embarq report
NSN hasn't always seen happy times since the firm was created via merger NSN report

NEC to buy NetCracker for $300 million

Dan O'Shea — Sun, 29 Jun 2008 22:49:05 -0400

Japanese vendor NEC already has enjoyed a pretty high profile worldwide as a network equipment vendor, but in the age of M&A-fed mega-vendors, that profile might have slipped a little. Now, NEC is looking to grow internationally, and has announced the $300 million acquisition of operations support system vendor NetCracker. The deal will help NEC build some scale, reach, partnerships and customers on the increasingly important software side of things, just as mega-vendors like Alcatel-Lucent, Nokia Siemens Networks and Ericsson are looking to do the same. The acquisition will also help NetCracker build a larger profile as the OSS market itself has become a playground for big M&A-fed companies like Oracle and Amdocs.

For more:
- check out this coverage at Light Reading

Related articles:
Amdocs acquired JacobsRimell earlier this year Amdocs report
Huawei Technologies also is becoming an OSS contender Huawei report

NSN announces multi-talented WDM platform

Dan O'Shea — Tue, 24 Jun 2008 23:41:24 -0400

It has been assumed for years that having fewer boxes in their networks is a high priority for carriers. Yet, that probably has not stopped them from deploying new, additional gear with additional capabilities if and when they felt they could not wait for a more integrated version. Nokia Siemens Networks just announced a wavelength division multiplexing platform capable of metro, regional, long-haul and ultra-long-haul transmission, dense WDM and coarse WDM and a multitude of other features. Will carriers go for such an integrated platform?

The most notable feature is ULH transmission, a capability for which carrier demand has been increasing, but one that usually is not packaged in the same platform as the other distance capabilities.

For more:
- check out this coverage at Light Reading Europe

Related articles:
WDM sales recently leapt past SONET WDM report
WDM vendor Xtera acquired Meriton earlier this year WDM report

Don't NOC it: Embarq off-loads voice management

Dan O'Shea — Thu, 12 Jun 2008 22:52:01 -0400

The Chicago Cubs have the best record in baseball, and now a major U.S. telco is outsourcing management of its voice network operations. All we need is for pigs to fly, and you can pack your bags for Judgment Day.

That is just how unbelievable it seems for Embarq to be outsourcing voice network operations center (NOC) functions to Nokia Siemens Networks. Not that it is a bad idea. In fact, it is a great idea whose time has come. Embarq has just carved a nice place in history for itself as the first major U.S. telco--or at least the first one with a network older than that Miley Cyrus kid--to make such a move, putting all of its faith and all of its reputation for voice quality and reliability (that's "five nines" to you and me) in the hands of a network equipment supplier.

Managed network outsourcing is nothing new itself. Technology companies outsource everything now--IT, manufacturing, product development. Communications networks are just the latest part of that trend, though for the most part, the concept of infrastructure suppliers taking over management of public networks has been limited to the international wireless market. It is a big business, drawing all the big vendor names--not only NSN, but Ericsson, Alcatel-Lucent and others. These deals can vary by size and scope and level of responsibility, but whether you call them managed network projects, managed services project or prime network integrator projects, they represent a growing business opportunity that has galvanized many vendors and changed the way they operate.

For carriers, the benefits include network management cost savings, freedom to focus resources on rapidly-changing core business areas, and the ability to place accountability in the hands of a trusted vendor partner. Perhaps the idea of a telco putting aside responsibility for voice--the original core business--is still a bit shocking, but what is a telco to do when it has to report quarter after quarter that its landline voice business is continuing to decline? Embarq is not getting out of the voice business, but it realizes that innovative measures need to be taken for it to stay competitive in the broader telecom business.

Outsourcing voice management functions is not necessarily a sure thing, not yet. Managed network deals pose challenges for vendors, who often take on carrier employees in the process (NSN is hiring 265 Embarq employees as part of this deal). It makes sense, but it also presents an additional cost for the vendors involved. As for carriers, they still do run the risk of losing their identities a little if they do not make a smooth transition. They need to be energetic about marketing themselves as different kinds of companies, while not looking like they are kicking voice out the door. If either party fails to hold up its end of the proposition, NOC outsourcing could prove to be a fad. Right now, it looks like the future.

-Dan

For more:
- see this story at Telephony

Related articles:
Embarq saw Q1 landline decline of 7.3 percent Embarq report
The telecom industry's voice is changing Voice report