Entries Tagged 'Telecom' ↓

Nortel Networks Corp has sought legal advice to study a bankruptcy protection scenario in the event that its restructuring plan fails and has also been exploring potential assistance from the Canadian government, the Wall Street Journal reported. On the subject of legal advice for studying a bankruptcy scenario, the WSJ cited people familiar with the situation, while on the potential government aid scenario, it cited a person familiar with the situation. Nortel’s spokesperson said no bankruptcy filing was imminent though the Toronto-based company has engaged several advisors to plan ahead, the newspaper reported. Nortel could not be immediately reached for comment by media. Nortel, North America’s biggest maker of telephone equipment has lost billions of dollars and cut tens of thousands of jobs since the technology bubble burst at the beginning of this decade. The company has been unable to recover since then, with its problems exacerbated by the global economic slowdown. RBC Capital Markets analyst Mark Sue said in November the company faced significant liquidity concerns, with bankruptcy a distinct possibility before 2011.

Mobile operator messaging revenues are under threat. Operators are rolling out flat rate data packages to encourage mobile Internet usage and uptake, which is in turn enabling the availability of free, ad-funded online messaging on the mobile handset. Mobile application development is by nature technically challenging. However, the carriers have not helped. Mobile technologies are making mission-critical data (voice, data, video, maps) available on-demand and on-site through mobile networks and devices. Many organizations are planning remote access to their production-level enterprise applications.

Existing Internet Protocol (IP) broadband links (such as DSL or cable) are leveraged to back haul the mobile voice, video, SMS, and data traffic from the home and integrate with an existing 3G Wireless Core Network.

Base Stations are the link between wireless devices and the rest of the world. While many people would recognize the large cellular towers on the roadside as base stations, there are also smaller, lower power base stations for indoor wireless applications.

Base station manufacturers also want to evaluate the new standard. TI partnered with system developers MCS and STx to offer ATCA/AMC-based development platforms that can reduce the OEMs’ time to market. Basestations will require flexible, low cost integrated solutions that are capable of supporting several-standards.

For example, let’s analyze Powerwave Technologies:

Powerwave Technologies, Inc., is a global supplier of end-to-end wireless solutions for wireless communications networks. Powerwave designs, manufactures and markets antennas, boosters, combiners, filters, repeaters, multi-carrier RF power amplifiers and tower-mounted amplifiers and advanced coverage solutions, all for use in cellular, PCS, 3G and WiMAX networks throughout the world.

They have 3 product lines: (1) Antenna systems (2) Base station systems (3) Coverage systemsBase station systems contribute about 67% of the revenue, while Antenna systems and Coverage systems share the remaining.

Powerwave is in a challenging position. The industry has long-term strength, but the short-term is not easy.

Powerwave has two types of customers:
(1) OEM Accounts, contributing about 67% sales and
(2) Direct/Operator Accounts, contributing about 33% sales.

Powerwave has done four acquisitions in the last few years, and in their words: “Notwithstanding our acquisitions, our business remains largely dependent upon a limited number of customers within the wireless communications market and we cannot guarantee that we will continue to be successful in attracting new customers or retaining or increasing business with our existing customers.”

The 67% sales from OEM Accounts creates earning risk because of developments in the OEM side, given that 50% of total sales come from just two OEMs: Nokia Siemens and Alcatel-Lucent. They need to do a couple of things successfully if they are to move into profitability.

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