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Rich Tehrani
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Mitel/Inter-Tel Finally Merge

August 2, 2007

Mitel's proposal to acquire and merge with Inter-Tel has been approved by Inter-Tel stockholders. Here are the details:  
  • US$723 million merger
  • Creates a market leader in SMB IP communications industry with the scale to strengthen and extend its reach in the enterprise market
  • Anticipated revenues of over US$800 million
  • Once the transaction is completed, Mitel will have approximately 3,400 employees in the Americas, Europe, Middle East and Africa and Asia, and count an active worldwide distribution channel some 1,500 value-added resellers, distributors and systems integrators covering over 90 countries.
  My take on this is the deal is good for shareholders and customers as they will get the benefit of two strong technology-focused communications companies working synergistically. This does not mean the integration will be smooth as lately we have seen a number of larger telecom acquisitions causing indigestion and poor earnings.   In this case however, the deal size is not so big and the corporate cultures are very similar so I don’t see “M&A indigestion” as a major challenge.

IP communications Earnings Strong

August 2, 2007

Let’s give a round of applause to 8x8, the parent company of Packet8 VoIP service. They have just announced a profitable quarter. For the first time since the Company launched its Packet8 VoIP service in November 2002, 8x8 posted GAAP net income of $508,000, or $0.01 per share, compared to a net loss of $2.9 million, or ($0.05) per share for the previous quarter and $1.8 million, or ($0.03) per share for the same period of fiscal 2007.   This news is important as the company had far fewer dollars to spend on marketing their service when compared to many others in the market; they still beat many others to this important milestone.   The company has focused on a methodical system of results-driven marketing and moreover recognized early that the hosted SMB space has plenty of promise.   This news is a great counterbalance to the management problems at SunRocket which caused their demise. The fact that SunRocket didn’t sell its company is somewhat mind-boggling actually.

ShoreTel/Mitel Patent Lawsuit

July 31, 2007

Aastra Intecom/BroadSoft

July 30, 2007

The IP communications market gets more and more exciting by the day and if you aren’t paying attention it even may get confusing. Today’s big news comes in the form of a partnership between two companies who you may not think would work together.   Broadsoft is a company providing applications platforms enabling such services as IP Centrex to be provided. The company typically targets service providers who in turn target businesses.   AAstra Intecom sells call center and PBX systems to large enterprises that typically have 2,500-3,000 seats.   One would imagine these companies have little in common but the two have just come together to provide large enterprises with an IP communications phone system with the power of BroadSoft and Aastra Intecom in a single solution. Service provider solutions are always more reliable and robust than their counterparts in the enterprise so I can only imagine combining the best products from these two companies means an even better solution than either can provide by itself.   Other products which will be sold as part of this solution are IBM blade servers, EdgeWater Networks for remote access solutions, AudioCodes gateways, Extreme Networks for LAN infrastructure and Covergence for SBCs.   Aastra’s all IP solution is called Clearspan and if you want a hybrid solution you can go with their Pointspan product line.   Aastra Intecom now has a broad range of solutions for virtually every large enterprise need.

ActionTec

July 29, 2007

Many of us are familiar with VoSky Technologies the company behind the business class Skype gateways allowing a company to leverage the myriad benefits of Skype within their corporate communications infrastructure. If you need to catch up, I invite you to read an article written on the topic of Skype trunking by yours truly about a month ago.   So while Skype and VoSky are likely familiar names, most people are likely not aware of the fact that the company is a wholly owned subsidiary of Actiontec Electronics, a leading provider of broadband connectivity solutions for consumers and broadband service providers.   In a recent meeting with Lesley Kirchman Director of Marketing and Brian Henrichs VP of Business Development for the company I became aware the company’s tagline is “Solutions For a Digital Life.”   The company has been around since 1993 when it was in the analog modem business. Over time they evolved to do what a few companies have been successful at… Listening to telco needs, delivering on them and actually having the telcos buy.   The company has sold over five million devices and has roughly 300 people in their Sunnyvale, CA headquarters in the US. I think of the company as the Linksys of the service provider world as they sell gateways in countless DSL varieties, IPTV solutions and even FiOS solutions for Verizon.   Some of the more recent products allow you to transport data and entertainment within a house via wireless, HomePlug and numerous other technologies.   Another area of focus is technologies such as TR69 and WT140 which help can enhance the consumer experience.

Ixia

July 29, 2007

As Ethernet gets more complicated, so must the test systems needed to accurately ensure carriers are providing the best quality of experience for their metro Ethernet solutions. A few weeks back I had a chance to sit down with the team at Ixia and discuss their Carrier Ethernet solutions based on Provider Backbone Transport (PBT) and Provider Backbone Bridge (PBB). The company’s Ixia’s test products for PBT/PBB, along with those for Ethernet OAM/CFM provide network equipment manufacturers and carriers with all the tools needed to test the latest Carrier Ethernet solutions.   Ixia announced the above functionality as well as Bidirectional Forwarding Detection (BFD) as part of it’s IxNetwork 5.30 release, which is part of its Aptixia test framework.   Many of the largest service providers have adopted PBT/PBB as it reduces the cost and complexity of Ethernet transport while providing mechanisms for enhanced QoS.   “PBT/PBB is an important new part of the Carrier Ethernet solution over switched Ethernet,” said Michael Howard, principal at Infonetics Research. “Many service providers are evaluating PBT/PBB as a cost effective mechanism to leverage their switched metro Ethernet network and offer back haul for access networks, extend L2/L3 VPNs, and point-to-point (ELINE) services.

Spirent’s Testing 2.0

July 29, 2007

There seems to be an evolution in the testing market as these companies focus on delivering products and services enabling network equipment providers and carriers to test more services in less time. As networks become more commoditized and the competition to provide services continues to increase, quality of service is becoming more important than ever.   In a recent conversation with the new President and COO of Spirent, Rob Piconi, I had a chance to get Rob’s take on the future of testing and moreover learn about the company’s new testing offerings.   Rob’s message to customers is you need to deliver products and services as rapidly as possible and his company is best positioned to allow you to test these products and services before they are rolled out. Spirent he says has the deepest and broadest [testing] portfolio.   He points out how critical it is to work with the leading testing company when deploying FMC. And he has a point as in the world of fixed mobile convergence; you are dealing with wireless, wireline and potentially IMS.

Joseph Nacchio

July 29, 2007

Ex-Qwest Chief Nacchio Gets 6 Years for Inside Trades   In case you missed it, Joseph Nacchio, former chief executive officer of Qwest Communications International Inc., was sentenced to six years in prison for trading $52 million in company shares based on inside information about falling revenue.   As you may recall, in a post titled SEC vs. Nacchio over two years ago I said the following:   The WSJ reports civil charges are about to be filed against Quest’s Joe Nacchio the former CEO. The charges are expected to be cooking the books otherwise known as fraud. The area of interest is “capacity sales,” that Nacchio has said in the past are legit while the SEC says they were “Sham transactions.” We’ll have to see who wins.   This case is actually a different one and Nacchio still faces a lawsuit from the U.S.

Lease a Phone for $2,917.20

July 29, 2007

This story is just too good not to share and it is far from unique. A man has been leasing a phone from AT&T since 1952 and has been paying $4.42 per month for it. Now I am not sure if this price has stayed the same over the years and I would imagine there is some additional tax on this figure. But for simplicities sake let’s do the basic math on this keeping the cost constant.   55 years = 660 months 660 months * $4.42 = $2,917.20   This is a pretty staggering amount.

Accela Inc.

July 28, 2007

The hosting and VoIP services market continues to do well. Providing VoIP service to companies is a much easier proposition than the residential space as the pure-play market leader Vonage charges so little, even they struggle to make money.   Thankfully Vonage has not decided to aggressively pursue the business market with unsustainable prices. By not doing this, they have allowed a slew of companies to focus on the mom and pop business space by providing reasonable pricing and excellent service levels.   8x8’s Packet8 service is an example of a company having great success on the low end of the SMB space. More recently I met with Tom Keffer CEO of Accela Inc. whose company is targeting larger companies and call centers with a hosted IP communications solution.
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