The broadband market has seen its fair share of doom and gloom over the
past year or so. Erstwhile high-flying broadband service providers
Excite@Home, Rhythms, Northpoint, and Covad can certainly attest to that.
Nor has the overall malaise affecting the telecom industry spared anyones
objectivity. At first glance one might assume that all the news coming from
the telecom market would occasion a duck and cover mentality, but once
every so often there are the rare and special nuggets of hope that appear in
my inbox. For example, a recent report from Salomon
Smith Barney shows that globally, broadband access trends are now, and
have been for some time rather healthy. So while everyones bad-mouthing
the broadband industry and jettisoning any remaining broadband providers
from their portfolios, it make sense to take a closer look at the Salomon
Smith Barney report and try to decipher just whats happening in the world
In my July 2001
Publishers Outlook, I spoke of broadband as an amazingly underserved
market. In fact heres what I had to say in July: Regardless of the
well-publicized problems that plagued the likes of Northpoint, Rhythms,
Covad, et al, the fact remains that many people do not have ready access to
broadband. They want it, and theyre willing to pay for it. Now, if they
could only get it.
Regardless of the fact that this market may have been over-hyped at
first, and regardless of the fact that broadband may in fact be the
proverbial baby being tossed out with the telecom market bathwater, the
truth of the matter is (as it was in July) that people are willing to pay
for broadband, either cable or DSL, if they can only get access to it. And
as access to broadband technology becomes increasingly available, people are
jumping at the opportunity. The Salomon Smith Barney report bears this out
in its findings.
The report claims that internationally, the cable modem subscriber base
grew from about 6.7 million to approximately 12.6 million subscribers last
year, representing an 89-percent growth spurt. At the same time, the global
ADSL market showed port-shipment growth to the tune of 165 percent, with the
numbers going from nearly 5.5 million to over 14.4 million ports shipped.
Combined, these number represent a very healthy 123-percent growth rate for
the past 12 months (see Table 1). Quite a different story
than what weve been reading in the doom-and-gloom headlines lately.
|Table 1. Source:
Salomon Smith Barney
Modem + DSL
The prospects for next year, while perhaps not as heady as the 2001
numbers, still show a healthy growth trend. Salomon Smith Barney predicts
cable modem subscriber numbers escalating by 56 percent next year, and ADSL
port shipments to maintain triple-digit growth, somewhere in the
neighborhood of 126 percent.
In the absence, however, of the aforementioned service providers (Covad,
Northpoint et al), the incumbents, such as SBC, Verizon, and others, have
little in the way of competition and thus motivation to build out
their broadband offerings at a fast clip. Still, broadband connectivity is
indeed a source of revenue for these service providers, and in this economy,
anything that adds to the bottom line cannot be simply overlooked.
Furthermore, rather than let the cable providers run away with the U.S.
market, the incumbents providing DSL will have to promote their solutions as
well. The Salomon Smith Barney report makes no bones about it: They estimate
that, cable modems are currently winning about 70 percent of all new
broadband subscribers in North America.
So while cable is enjoying significant growth here in the U.S., at the
same time the European and Asian markets tend to favor DSL deployments. Last
year, the Europeans saw a tremendous increase in DSL growing over 650
percent in just 12 months!
Overall, the global trend toward increased deployment of broadband
(either cable or DSL) is clear. As people gain access to this technology
they will increasingly choose to deploy broadband in their homes and
businesses. The applications that we will start seeing as a result of wider
broadband usage will be awesome. Countless people will be able to work
remotely, without the loss in connectivity speed that currently plagues many
would-be teleworkers and prevents them from setting up shop away from the
shop. Web-based conferencing, increased quality of service, clearer VoIP
calling All of these, and scores of other productivity enhancing
applications will be the fruit born of increased broadband availability.
About six months ago, I had the opportunity to share some of my thoughts
on the media server market. Essentially, the media server counts among its
responsibilities the carrying out of tasks like signal processing, voice
recognition, text to speech, and other media processing services.
Essentially, I theorized on the future of enhanced services and the role of
the media server both as an element of next-generation network
architecture and its role in delivering the enhanced services that will
drive the increased revenue and profits that carriers hope will grow their
Cognitronics, located in
Danbury, CT, has been around forever, at least when you think in terms of
next-generation network elements. Cognitronics was founded in 1961 to
produce automatic number announcers for Western Electric. If you have ever
heard the message, The number you have called has been changed. The new
number is chances are a Cognitronics system has just informed you that
its time to update your Rolodex.
The company has recently released a new generation of products, the
Cognitronics Exchange (CX) Series of media servers. The CX Series is
designed to operate in both circuit-switched networks as well as
next-generation packet-based networks, delivering voice announcements and
other media services, such as IVR, conferencing, and media streaming, in
either setting. The clear benefit here is that a service provider can move
ahead with plans to deploy next-generation network elements while leveraging
their existing investments in circuit-switching gear.
Even while we constantly look ahead to the future and showcase
next-generation communications technologies in the pages of INTERNET
TELEPHONY, its important to point out that legacy switches the
Lucent and Nortel Class 5s, for example are still being deployed. And
with the demise of so many CLECs over the course of the past 12 months,
these circuit switches are appearing on the used equipment (previously
owned?) market for literally pennies on the dollar. Its meaningful when
companies such as Cognitronics produce solutions that can interoperate with
equipment from the old guard as well as with newer network offerings such as
softswitches, media gateways, and the like.
The most recent addition to the CX family is the CX4000 Network Media
server. This compact (5U) box is NEBS compliant and is designed using
industry standard hardware and software. The CX4000 can accommodate up to
six network interface boards, including a media interface board for VoIP
network interface operations; a VoIP interface board with extra IVR/DTMF
processing capabilities; an ATM interface board; and a quad T1/E1/ISDN
interface board featuring capacity of 96 to 120 channels.
ALL THE BEST!
As this issue marks the start of another year, I thought I would take
advantage of this opportunity to wish you all good luck in your personal and
professional lives. I believe that 2002 will see our industry lift itself
out of its economic morass its my feeling that better days are indeed
just round the corner. 2002 marks a banner year of sorts for Technology
Marketing Corporation. Thirty years ago, our firm laid down its roots as
a publisher of high-tech magazines. Twenty years ago, we launched a magazine
titled Telemarketing, which has since evolved into Customer Inter@ction
Solutions magazine, a magazine that has since its inception commanded
the respect of a whole industry. And five years ago, we set off on our
journey into the world of next-generation telecommunications with an
exciting and vibrant magazine called INTERNET TELEPHONY. Weve
truly enjoyed watching this industry evolve from a hobbyists plaything to
a major force in the telecommunications arena, and we look forward to
bringing you more of the same high-quality, cutting edge editorial coverage
in the years to come.
To The January 2002 Table Of Contents ]