IP Capsule E-newsletter, August 24, 2006

Thu, 08/24/2006 - 6:32am  |  CED Broadband Direct  |  Current Issue  |  Subscriptions
August 24, 2006
Brian Santo

IPso Facto...

I have had it with these
m*%#@f%^& fees on my m*%#@f%^& phone bill!

For years, phone companies have been slamming the MSOs for raising their prices on cable TV. They churn out press releases nattering about monopoly, take out ads pointing out how much cable prices have risen, pump money into ostensibly independent "grassroots" groups to complain to whoever will listen about cable prices.

And it's not as if the charge is unfair either. Cable rates have gone up. But at least when a cable company raises its rates, the action is tied directly to actual costs that cable companies can actually identify.

Verizon just confirmed it will impose a new "supplier surcharge," and there's no interpretation of the company's mealy-mouthed explanation of the charge that is flattering to Verizon.

A Verizon spokesman said the fees cover "new costs that we've developed over the past year as we've been developing and delivering this standalone DSL service. That service doesn't have the benefit of the revenue that was coming in from voice."

So is this an admission that Verizon has been losing money on DSL in the bundle? If naked DSL costs more than DSL when bundled with voice, why didn't they start charging what it's worth from the beginning? Was Verizon really spending its time developing new costs, or is that just particularly inept phrasing?

And can it possibly be coincidence the new fees match almost exactly the Universal Service Fund (USF) charges that DSL providers are no longer subject to, and which Verizon has said it will no longer collect?

The USF fee for customers with service up to 768 kbps was $1.25 a month, and was $2.83 a month for customers with service up to 3 Mbps. The new supplier surcharge will be $1.20 a month for customers with service up to 768 kbps and $2.70 a month for customers with faster DSL service.

A recent report argues the USF has become a boondoggle (see story), while harsher critics claim its a slush fund for telcos.

Verizon insisted the imposition of the new supplier fee has nothing to do with the loss of the old USF fee.

BellSouth will continue to collect what it always called a "regulatory cost recovery fee." Fair enough - some cable companies levy the same fee.

BellSouth has always been the biggest whiner about government regulation. So it's interesting to see that instead of reducing its "regulatory cost recovery fee" by the amount it no longer has to pay into the USF, BellSouth is apparently going to continue to collect enough extra money to cover a fee it supposedly doesn't want to collect because that fee is imposed by the government even though the government isn't collecting that fee anymore. There's probably a principle in there somewhere.

I guess nobody worries about hints of impropriety anymore. Heck, what's a hint? A hint ain't proof. Prove it or get out of my face, right? That attitude works for politicians accused of corruption; it works for athletes accused of doping; it should work for a telephone company.

Still, I would love to see someone take out some ads asking Verizon to provide an explanation, comprehensible to the average consumer, for its new DSL "supplier surcharge," and asking BellSouth exactly what it's doing with the phantom fees it's collecting.

TANDBERG TV to help Latin telcos launch IPTV
IPTV Americas will upgrade to an MPEG-4 IPTV solution, this one relying on TANDBERG Television's compression technologies. By the third quarter of this year, IPTV Americas' centralized digital headend in Miami will enable its telco customers in Latin America to add video to their service bundles.

TANDBERG TV will provide its MPEG-4 AVC compression system using TANDBERG EN5930 encoders to IPTV Americas' headend, enabling telcos to deliver more high-quality content to subscribers.

By handling the delivery of MPEG-4 AVC content through regional fiber optic networks and providing affordable set-top boxes, middleware solutions and conditional access services, IPTV Americas provides an affordable solution to telcos looking to expand their subscriber offerings over DSL networks. Telcos will initially have the opportunity to offer 60 basic and premium video signals to their customers along with additional video-on-demand and pay-per-view services.

BT unit allies with Entriq on downloadable media service
BT Media & Broadcast is allying with Entriq. BT Media & Broadcast, which designs and builds entire communications systems for other service providers, will use Entriq products, which are used to manage, protect and sell multimedia content to broadband, mobile and IPTV devices.

BT M&B and Entriq said they will work together to provide an end-to-end digital content delivery system including a digital store, that allows customers to sell high value content via the web and mobile platforms to consumers.

The pair were selected in a competitive bid process by BT Vision to enable consumers to download video entertainment to their PCs and portable media players from the BT Vision website, launched in July 2006. The service currently offers 150 titles from NBC Universal.

Harmonic powers Spanish IPTV service; intros new encoder
Harmonic is supplying its DiviCom Electra 5000 MPEG-4 AVC (H.264) encoder for Jazztel's digital headend, which was integrated by Harmonic's local partner, TelIndus.

The Spanish service provider introduced its Jazztelia TV service in March 2006, providing standard definition broadcast television channels delivered via an ADSL2+ network. Jazztel is taking advantage of local loop unbundling to implement a competitive broadband service by co-locating DSLAMs at the incumbent telecom provider's central offices.

Jazztel operates a network of DSLAMs, overlaying an area encompassing nearly 60% of Spain's lines, all connected to an extensive fiber network. By owning the access and metro interconnect, Jazztel can deliver more bandwidth to the home and thus offer a full range of IP-based voice, data and video services. Jazztel claims over 250,000 residential and business customers.

Separately, Harmonic introduced a third generation MPEG-4 AVC standard definition (SD) encoder called the DiviCom Electra 5400, which the company says is particularly appropriate for deployments of telco/IPTV, satellite and DVB-T services.

The Electra 5400 is capable of delivering up to four full resolution SD channels in a one rack-unit package. The encoder can simultaneously transmit low resolution content for picture-in-picture (PiP), mobile video services or other applications.

The company claims its SD H.264 bit-rates are more than 30 percent lower than H.264 encoders now deployed. First customer shipments are scheduled to begin in September.

Report: Voice, data will drive DSL IC technology through 2010
Data and VoIP will continue to drive the DSL IC chipset market through 2010, accounting for the bulk of port shipments. It won't be until 2011 that delivering IPTV becomes the key factor pushing DSL chipset technology, according to In-Stat.

In 2005 there were 153.1 million total ports of DSL shipped worldwide, including CO and CPE for ADSL, VDSL, and SHDSL. Carriers worldwide are relying most heavily on ADSL2+ and VDSL2 as they upgrade their networks to deliver video.

The number of ports shipped is expected to grow to 185.5 million in 2010, In-Stat projects, but revenues are expected to decline as carriers continue to pressure vendors on DSLAM prices.

"With applications like video phone service, uploading of photos and video in addition to music, online applications from Google and others, the demand for upstream traffic is likely to increase over the next few years," said Norm Bogen, In-Stat analyst. "This means the technology able to deliver upstream bandwidth will have the advantage going forward."

QoSmetrics IPTV test product recognized for innovation
QoSmetrics' V-Factor has been awarded Frost & Sullivan's annual Award for Product Differentiation Innovation for 2006. The award is presented each year to the company that has best demonstrated the ability to develop and / or advance products with more innovative capabilities than competing vendors and products.

Frost & Sullivan research analyst Sankara Jambuligam called V-Factor "the first product suitable for large-scale deployment of IPTV," and said the product's introduction eliminated one of the major stumbling blocks for successful deployment.

The V-Factor product involves a combination of an algorithm developed by QoSmetrics and a new methodology for implementing metrics-based measurement of streaming digitized video and audio. Previously, users had to rely on network transport indicators and other methods that inferred video quality, relying on metrics that QoSmetrics says do not correlate well with viewer perceptions of video quality.

V-Factor not only can actually account for network impairments such as delay variation and packet loss episodes that impact the video buffer used to restitute a video image but also can account for video impairments coming from the source.

Falcon is hiring for its upcoming IPTV system rollout
Falcon Communications, gearing up to help rural telecom providers roll out IPTV, said it is looking for more additions to its sales group and is also now looking to hire engineers and service technicians.

Falcon plans to make its IPTV system, called IP Complete, available in the fall. Falcon said it has created a custom design for an IPTV network suitable for Tier 2 and Tier 3 telcos that starts with equipment and advances all the way through installation, to signal management and delivery to a set-top box installed within the subscriber's home.

IP Complete combines technology from a number of IP equipment manufacturers including Entone, Latens, and Minerva.

Falcon is wrapping up a test implementation of IP Complete at BPS Telephone in Bernie, Mo.

Verizon Business adds corporate VoIP features
Verizon Business introduced new Internet protocol-based capabilities for its Contact Center Services and VoIP portfolio. They are: IP Tollfree Service; IP IVR, an interactive voice- response system for contact center services; and new IP Trunking options.

Verizon IP Tollfree routes incoming toll-free calls over IP to enable greater efficiency and support multiple-contact media, such as phone calls, e-mail or instant messaging from around the globe.

Verizon IP IVR provides call processing in a pure IP environment over a carrier-grade, global network infrastructure, enabling customers to benefit from network efficiencies such as voice compression and dynamic bandwidth allocation.

Verizon Business said these new features are interoperable with Avaya enterprise communications software.

Verizon Business' IP Trunking delivers VoIP access and essential telephony features to locations with as few as 200 and as many as 1,000 or more end- users. It enables companies that have already invested in Avaya IP phones to now connect on a single, converged access line for both internal and external traffic.

YFonGlobal offers turnkey hosted IP services
Startup YFonGlobal said it will provide IP services - including VoIP - that third-parties can private label. The service, called mYFonBrand, allows a telecommunications reseller to rapidly deploy and offer their own brand of services, customized to meet their needs, in terms of pricing, networking, and feature-functionality.

YFonGlobal's carrier class 5-level IP network services include: world-wide PC-to-PC and PC-to-phone; traditional phone-to-phone; calling card telephony services under private brand programs; and secure IP network for communications and file exchange.

The company said clients can be up and selling their own branded end-to-end VoIP services in as little as 10 working days.

Report: Softswitch sales pick up in Q2
Sales of softswitches and media gateways grew 8 percent to $742 million in the second quarter of 2006, following declining sales during the first quarter, according to the Dell'Oro Group.

The market was generally strong, but a surge in shipments into Europe paced the quarter.

The company said softswitch sales for Voice-over-Broadband subscriber services were particularly strong this quarter, climbing 66 percent over year ago levels, driven by both cable and phone companies bundling VoIP with data services.

The report also indicates shipments of media gateways were especially strong in North America where carriers expanded their core trunk networks. In contrast, shipments into Asia Pacific were weaker during the quarter in large part because of declining trunk network transformations and PHS wireless sales in China.

Vonage, EarthLink pushing VoIP thru electronics retail
Vonage America, aiming to expand its VoIP service through the consumer electronics retail channel, has cut a deal with D-Link to bundle its service with a new D-Link router. EarthLink, meanwhile, is offering its trueVoice product through Circuit City.

Vonage and D-Link have combined to make available VoIP kits before. The two are now co-branding the latter's VWR Wireless-B/G Broadband Router. It is available at for $59.99, after a $40 instant rebate.

The VWR, based on Texas Instruments' TNETV1060 VoIP gateway chipset, includes a Wireless-B/G Access Point; a built-in 4-port switch to connect wired Ethernet devices; a router function so the entire network can securely share a single cable or DSL Internet connection, and two standard telephone jacks.

Circuit City, meanwhile, is offering EarthLink's trueVoice VoIP in a package that includes EarthLink's Internet phone service and a Linksys Phone Adapter (SPA2002-ER) or a Wireless-G Router with 2 phone ports (WRT54GP2-ER). Customers can sign up for EarthLink trueVoice(SM) online Circuit City's Web site.

Minacom self-testing for self-install VoIP subscribers
Minacom introduced its Zoey interactive VoIP test agent that makes it easier for service providers to let new customers self-install VoIP service. Zoey is an automated Interactive Voice Response (IVR) agent customers can call to test their own service quality; subscribers interact with Zoey to check their caller ID, and to evaluate noise, echo, speech quality, DTMF and fax transmission quality. To access the agent, VoIP subscribers dial a toll-free 1-800 number.

Skype licenses Global IP Sound's phone technology
Skype is licensing Global IP Sound's GIPS Voice Engine Embedded technology, which allows manufacturers to make Skype- compatible IP phones. Skype previously licensed the GIPS VoiceEngine PC for its PC-to-PC VoIP deployment.

For New Product Information, visit CED’s Product Showcase Today!
Click Here.

Malone & others invest $350M in WildBlue
WildBlue Communications received $350 million from a group of investors led by John Malone's Liberty Media and Tennenbaum Capital Partners LLC.

The $350 million of secured financing will allow the company to refinance some debt. Of the total, $170 million will be available to fund the continuing growth of WildBlue's broadband business. In June, WildBlue cut a deal to wholesale broadband services to both DirecTV and EchoStar's DISH Network.

WildBlue now claims over 85,000 customers, most of them in rural areas where broadband data services are otherwise unavailable. The company says it is adding over 10,000 new subscribers per month.

WildBlue said it plans to launch a second satellite to expand capacity.

Hughes satellite broadband works in initial testing
Hughes Network Systems is ready to move ahead with a commercial rollout of its Spaceway satellite-based broadband service in mid- to late 2007, after wrapping up a month's worth of successful tests.

The Spaceway 3 satellite, owned by Hughes, will be used to deliver a range of broadband IP services to enterprise, government, and consumer/small business customers.

The Ka-band broadband satellite system employs on-board switching and routing capability, has an overall capacity of 10 Gbps, and can form spot beams to focus on specific customers.

The Spaceway architecture can scale up to two million terminals per satellite and will provide coverage with multiple spot beams across the U.S. including Alaska, Hawaii and Puerto Rico, as well as in selected areas in Canada, Mexico, and major cities in South America.

Report: 2M new U.S. broadband subs in Q2
The twenty-one largest cable and DSL providers in the U.S. - representing about 94% of the market - added nearly 2.1 million subscribers in the second quarter of 2006, according to figures from Leichtman Research Group (LRG). Together, these providers total about 48.3 million broadband subscribers.

Cable still has the overall lead, with 26.9 million broadband subscribers. The telcos now tally 21.3 million DSL subscribers. The latter group accounted for slightly more than half of all new additions (1.16 million) however, for the seventh quarter in a row.

Total broadband additions in the quarter were about a million fewer than in the first quarter of 2006, but were greater than in any previous second quarter, LRG reports.

Broadband Internet Subscribers at end of  2Q 2006 Net Adds in 2Q 2006
Comcast* 9,344,000 305,000
Time Warner 5,398,000 230,000
Charter 2,375,100 52,700
Cablevision 1,891,442 84,819
Adelphia** 1,856,009 48,005
Insight 534,500 19,700
Mediacom 516,000 12,000
Cable One 261,262 8,203
RCN 257,000 8,000
Major private cable companies*** 4,500,000 150,000
Total Top Cable 26,933,313 918,427
AT&T 7,774,000 342,000
Verizon^ 6,125,000 440,000
Bell South 3,273,000 128,000
Qwest 1,798,000 120,000
Embarq (formerly Sprint) 849,000 72,000
Covad 547,989 (8,961)
All Tel^^ 481,684 40,209
CenturyTel 312,853 27,062
Cincinnati Bell 176,500 5,500
Total Top DSL 21,338,026 1,165,810
Total Broadband 48,271,339 2,084,237
Sources: The Companies and Leichtman Research Group, Inc.

* Comcast’s total is adjusted from last quarter to reflect the closing of the acquisition of Susquehanna Communications
** Totals were prior to the completion of the sale of Adelphia to Time Warner and Comcast
*** Includes estimates for Cox, Bright House and Suddenlink (Suddenlink was not included in prior releases)
^ Total includes FiOS wireline broadband connections along with DSL
^^ All Tel’s broadband subscribers became part of Windstream Communications in July
Top cable and DSL providers represent approximately 94% of all subscribers
Company subscriber counts may not represent solely residential households

Qualcomm to buy IMS specialist Qualphone
Qualcomm will lay out $18 million in cash for Qualphone. Qualphone specializes in IP multimedia subsystems (IMS) embedded client software for mobile devices and interoperability testing services. Operators and handset manufacturers can tailor Qualphone's 3G/IP multimedia embedded client framework to their specific needs.

Qualcomm expects the acquisition of Qualphone will help it enable its customers launch new 3G products and services, particularly in Europe.

CopperGate Communications
Tel Aviv, Israel; Newark, Calif.
CEO: Gabi Hilevitz

Claim to Fame: CopperGate technology provides a basis for the HomePNA version 3, a high-speed networking standard that includes provisions for quality of service.

Recent news of note: The company has been beefing up its executive ranks of late. William (Bill) Simmelink, formerly with Texas Instruments, was just hired as president, North American Operations. AT&T is looking into using HomePNA, and the technology has proved interesting enough for Motorola to invest in earlier this year.


Video On The Net Conference
Sept. 12-14, 2006
Boston, Mass.
More information: Click Here

CTAM Blue Ribbon Breakfast
Sept. 13, 2006
Grand Hyatt
New York, N.Y.
More information: Click Here

FTTH Growth Forum and Networking Event
Irving, Texas
Sept. 13, 2006
More information: Click Here

IPComm 2006
Sept. 25-27, 2006
Nashville, Tenn.
More information: Click Here

2006 FTTH Conference & Expo
Oct. 2-5, 2006
The Venetian Resort
Las Vegas, Nev.
More information: Click Here

The Cable Center Key Issue Series: "Confronting Cable's Technological Frontier"
Oct. 10, 2006
The Cable Center
Denver, Colo.
More information: Jana Henthorn

9th Annual Cable Television Hall of Fame Celebration
Oct. 11, 2006
Denver, Colo.
The Cable Center
More information: Click Here

SCTE Business Services Symposium
Oct. 17-18, 2006
Chicago, Ill.
More information: Click Here

CTHRA Fall Symposium
Oct. 18, 2006
Philadelphia, Pa.
Park Hyatt Hotel
More information: Click Here

TelcoTV 2006
Nov. 6-8, 2006
Dallas, Texas
More information: Click Here

Parks Associates
Berlin, Germany
Nov. 14-16, 2006
More information: Click Here

Fixed Mobile
Convergence Congress

Barcelona, Spain
Nov. 21-23, 2006
More information: Click Here

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