Ring! Ring! Hot News, 4th August 2008
In Today's Issue: Moto splits again, makes actual money; CDMA - the edge of darkness; Nortel loses customer, 15% off shares, gains WiMAX obsession, 13% back on shares; most pointless network tech announcement?; the LTE voice problem; FCC KOs TCP RST DPI; good news shock at FT, NTT; Indian WiMAX speccy shocker; IKEA is a mobile operator; BT shareholders panic; free N810s
We've been following the crisis at Motorola for some time. The latest reorganisation is here. As well as selling off the failing handset division, they're now planning to split up the rump of the firm into several chunks. The set-top box and related business goes in one, the cellular business in another, and the WiMAX operation in yet a third. (Motorola's declared tech strategy assumes that WLAN, UMTS, and WiMAX are the default radio network technologies, and these roughly map on to this structure.)
To general surprise, Moto squeaked into profit in the second quarter, by a massive $4m; don't be too cheerful, though, as revenue fell 7.4 per cent. As usual, the networks operation, the set-top boxes, and the cashcow government/security radio operation contributed and the mobile handsets operation lost money.
In other North American vendor news, Nortel Networks saw a frantic see-saw as first of all, it announced that a major CDMA customer had essentially stopped capital investment altogether. Everyone assumes this is a reference to Sprint Nextel, but one can't rule out Verizon entirely, as they have committed to LTE. The CDMA business is about to get very uncomfortable indeed; Nortel shares fell 15 per cent. Then, as Nortel announced it was concentrating on WiMAX and signing a deal to work with Alvarion, back up they went, rising by 13 per cent. (But why does Nortel need Alvarion? Nortel has been pushing WiMAX products since 2005.)
It makes you wonder why Alcatel-Lucent and Airvana bothered to develop a CDMA EV-DO femtocell that claims to be integrated with IMS. It's a BOGOF -- two zombie technologies for the price of one!
Douglas Adams (of Hitchhikers Guide to the Galaxy fame) had a journalist character who remarked that "Continued Dolphin Absence" wasn't
much of a headline, but the continuing absence of IMS deployments or applications inspires Martin's Mobile Blog to ask what LTE engineers are going to do about voice. The standardisers have so far assumed that IMS would provide the voice switching element of an LTE network, with circuit switching being abolished. But nobody's installing IMS, and as he points out, there are some problems with pure OTT SIP. Dean Bubley goes through some answers; none of which are entirely satisfactory. It may turn out that the answer is to backport SS7 voice into the NGN environment -- as long as they remember the APIs. Meanwhile, we're fully in agreement with his suggestion that the operators should let as many VoIP implementations as possible try different solutions to this problem.
One major possible application for IMS - using it to annoy your subscribers, because you're the Big Expensive Phone Company -- has been ruled out by the FCC, or at least the specific practice of forging TCP RST packets has. Interestingly, despite their beating by the FCC, Comcast actually managed to increase their revenue from Internet services.
Having stepped away from the ticking merger-bomb, France Telecom announced profits up 3.9 per cent and promised to pay out some capital to shareholders. That's sense, as they say. Meanwhile, NTT DoCoMo saw a surprising jump in operating profit after they succeeded in not paying quite so much cash out in handset subsidies.
In India, the Government is under fire for bringing 2.5GHz spectrum back into the main 3G auction, after it was originally allocated to smaller players with a view to WiMAX. Details of the national 3G auction are in the FT.
Ikea, meanwhile, becomes the UK's latest mobile operator; it's a discount/flatrate PAYG offering. No word on whether you have to install your own base station starting with a flat pack, though.
No matter what we say, they still sold BT stock after a dip in margins at Global Services. Going by our estimates of how much they might save through fibre deployment, that's probably an even better giveaway than free Nokia N810s.