NEP result watch

Note 1: Quarter results for AMJ 2009

Note 2: No quarter results announced by Huawei & ZTE on their websites

NEP	Net Sales	Sales Q on Q	Net Income	Income Q on Q	EPS	EPS Q on Q	Acquisition/Divestment/JV info	Major customer wins	Quote
Alcatel Lucent	EURO 3.905 billion	0.09	EURO 1.393 billion	0.14	0.01		JV with Bharti Airtel for services. Developed Co-sourcing strategy along with HP – unified GTM approach. Completed Thales stake sale.	Mobile backhaul for NTT DoCoMo, EVDO and CDMA rollout in China,	Ben Verwaayen, CEO:“Operationally, we are seeing positive trends in our top-line, gross margin and operating expenses. Looking forward, market conditions remain difficult and operators continue to be selective about their investments. We reiterate our view that our addressable market should be down between 8% and 12% at constant currency in 2009. As we look forward to the second half, we expect to achieve our target of an adjusted operating income around breakeven through further improvement in our margins and expense structure.”
Cisco	USD 8.5 billion	-18%	USD 1.1 billion	-0.46	USD 0.19	-0.42	Cisco completed its acquisition of Pure Digital Technologies, Inc., the creator of the Flip VideoTM brand and a pioneer in developing consumer-friendly video solutions with mass-market appeal. Cisco completed its acquisition of Tidal Software, Inc., a developer of intelligent application management and automation solutions.	NFL Dallas Cowboys and and MLB Toronto Jays deployed Cisco connected sports solution; Starwood hotels and Tata Communications for telepresence; Univ of Queensland, Australia for WLAN network; JSC Kazakh telecom for national broadband development.	“Cisco delivered very solid quarterly and annual results in a challenging economic environment, as we continued our focus on disciplined execution and our customers’ success,” said John Chambers, chairman and CEO, Cisco. “We are confident in our strategic position in both existing and thirty adjacent markets. We saw a number of positive signs this quarter in the economy and in our business, especially comparing our sequential quarter-over-quarter order trends. If we continue to see these positive order trends for the next one to two quarters, we believe there is a good chance we will look back and see that the tipping point occurred in our business in Q4.” Chambers continued, “Cisco’s goal is transformational: to become a next-generation company and continue to enhance our market position by executing on our growth opportunities. We see the network truly becoming the platform for innovation and new business models which are enabled by collaboration technologies.”
Ericsson	SEK 52.1 billion	0.11	SEK 6.9 billion (without JVs)	0.49	0.26	-0.56	Acquired Elcoteq’s manufacturing operations in Tallinn in June. Acquired Biziteq – Turkish system integration company in May. JV Sony Ericsson running at a loss.	Prof serv is the main growth engine (increase is 28% yoy): A groundbreaking 7-year services agreement has been made with Sprint in the US at a total value of USD 4.5 – 5 b. The contract includes the transfer of approximately 6,000 employees. Also contracted with Zain Nigeria for prof. Serv. Important networks deals include Vodafone Essar, India for GSM and Telecom Italia for mobile broadband.	“There are different trends in the current market environment. The effects of the global economic climate on the mobile infrastructure market are now more notable, especially in markets with currencies under pressure and tougher credit environment,” said Carl-Henric Svanberg, President and CEO of Ericsson (NASDAQ:ERIC). “At the same time the consumer demand for new services and broadband capabilities are quickly accelerating and rollout of new technologies is ongoing in the world’s leading economies. There is also an increasing demand for professional services from operators across the world.
Motorola	USD 5.5 billion	-32%	USD 26 million	5.5	0.01	0			Greg Brown, co-CEO of Motorola and CEO of Broadband Mobility Solutions, said, “In Broadband Mobility Solutions, we continued to lead in our key markets and delivered solid results in a very challenging economic environment. We further reduced our cost structure, improved our operating margins and decreased inventory on a sequential basis. We also continued to focus our R&D efforts on innovation in areas such as next-generation public safety, enterprise mobile computing, enhanced broadband video and 4G wireless.”
Nokia Siemens Networks	EURO 3199 million	0.07	EURO 2 million	-	0.15	0.5	-	Services led wins: Oi in Brazil, Telenor in Pakistan, Digi in Malaysia. Networks wins: M1 in Singapore for network modernization, Elisa in Finland for HSPA, TWC in US for IMS

Nortel – more deals

There are now 2 more deals announced on Nortel assets -

Avaya is to buy their enterprise solutions assets: Avaya announces agreeement to purchase Nortel’s enterprise solutions business, Avaya welcome page for Nortel employees, Nortel to sell enterprise solutions business

Ericsson takes on their wireless assets: Ericsson to acquire majority of Nortel’s NA wireless business, Nortel selects Ericsson as successful bidder for CDMA & LTE assets

Meanwhile, there are reports of Bridgescale (a VC) bidding for parts Nortel.

NEP contract watch

Date	NEP	Product	Customer	Comments
9 Jul 09	Alcatel Lucent	1678 Metro Core Connect (MCC) and Optical Multi-Service Node (OMSN) systems.	Samart Telcoms, Thailand	Intelligent optical network for TOT Public Company Limited’s IP broadband project
9 Jul 09	Alcatel Lucent	7342 ISAM FTTU, 5520 AMS, 5529 OAD, Home Device Management, Cellpipe 7130 RG, MDU O4841 V, I-241B	R-KOM, Germany	Vendor selection to be its sole supplier, in a multi-year frame agreement, for the deployment of a fiber-based access network in eastern Bavaria.
15 Jul 09	Alcatel Lucent	Network Integration	Telenet, Belgium	7 year frame agreement for integration services for MVNO operations
15 Jul 09	Alcatel Lucent	OmniGenesys contact center solution	Postal Savings Bank of China	Installation complete
21 Jul 09	Alcatel Lucent	TD-SCDMA solution	China Mobile	Alcatel-Lucent Shanghai Bell, and Datang Mobile consortium has been selected by China Mobile for deployment of its phase III TD-SCDMA mobile networks in 11 provinces
22 Jul 09	Alcatel Lucent	7750 Service Router, 7705 Service Aggregation Router (SAR), 7210 Service Aware Switch (SAS) and 5620 Service Aware Manager (SAM) platform	Turkcell, Turkey	IP/MPLS solution to transform Turkcell’s nation-wide network to an “All IP” 3G transmission network
2 Jul 09	Cisco	NexusTM 7000 Series Switch	True Internet, Thailand	Deployment towards next gen cloud services
7 Jul 09	Cisco	ONS 15454, 7600 Series, Catalyst 3750 metro Series	Energotel, Bratislava, Slovakia	Deployed a next-generation optical transport network based on a nationwide dense wavelength division-multiplexing (DWDM) infrastructure.
14 Jul 09	Cisco	Connected Hotel Platform	Le Meridien, Bangkok	WLAN, security and unified communications solution
21 Jul 09	Cisco	Unified contact centre	Infosys BPO,Manila, Philippines	New BPO centre based on Cisco contact centre product – may be largest installation in the year
7 Jul 09	Ericsson	GSM/WCDMA/HSPA packet core-data network, including the Service Aware Charging and Control solution	SMART, Philippines	Providing broadband technology based on WCDMA/HSPA to upgrade the operator’s nationwide GSM network.
8 Jul 09	Ericsson	2G/3G mobile communication equipment and related services	China Mobile & China Unicom	Frame agreements for 2009 valued at USD 1 billion and USD 0.7 billion respectively
9 Jul 09	Ericsson	Network Services agreement	Sprint, USA	Wireless & wireline network services agreement valued at between $4.5 billion and $5 billion (USD) over the seven-year term of the contract
14 Jul 09	Ericsson	Upgrade to GSM radio site, layered architecture circuit core including mobile packet back bone (MPBN) and microwave transmission equipment.	Vodafone Essar, India	Replaced more than 10,500 of the operator’s GSM radio sites, reaching a peak rate of one site every minute. Network modernization project completed 2 months ahead of schedule.
16 Jul 09	Ericsson	multi-year managed services agreement	Telefonica O2 UK	Field maintenance services for radio and switch sites, spare parts management logistics support as well as optimisation and drive services and facilities engineering services
8 Jul 09	Huawei	access and core WiMAX network in the lab	KACST, Riyadh, Saudi Arabia	Showcase for WiMAX solutions
14 Jul 09	Huawei	Expansion of 3G and 2G Edge network	Vodafone, Czech Republic	Vendor selection complete
21 Jul 09	Huawei	Broadband modems	Telenor Group, Norway	Global master agreement for 1.2 million mobile broadband modems
21 Jul 09	Motorola	WiMAX infrastructure	Clearwire	Service launch at Las Vegas
23 Jul 09	Motorola	BSR 64000 CMTS & TX32 downstream module	Massillon Cable, Ohio, US	Infrastructure upgrade for faster internet services
7 Jul 09	Nokia Siemens Networks	Flexi Base Station	SFR, France	All IP backhaul migration
20 Jul 09	Nokia Siemens Networks	LTE-compliant Flexi Multimode Base Station, Radio Network Controller, and Network Management and Service Assurance Operating Support Systems, along with a range of services including turnkey site acquisition and construction, network integration and implementation, optimization and managed services.	Globalive Wireless, Canada	Greenfield 3G network
21 Jul 09	Nokia Siemens Networks	3G radio network infrastructure	Viettel, Hanoi, Vietnam	First 3g network in Vietnam
14 Jul 09	ZTE	GSM/UMTS network	Ucell, Uzbekistan	Network upgrade
16 Jul 09	ZTE	CDMA 2000 1X/EVDO networks	Madamobil, Madagascar	Contract for launch of all-IP mobile broadband network

NEP contract watch

NSN Nortel deal

As discussed here earlier, the press releases from Nortel and NSN are out this weekend. A “stalking horse” Sale Agreement has been initiated for the CDMA and LTE business of Nortel valued at US $650 million. This means that it is an open bid process, and others are allowed to better the bid, but it is safely assumed that it is only a remote possibility. NSN’s press release quotes many of Nortel’s American customers welcoming the deal, probably one of the main reasons why NSN is getting into this deal. Both corporate blogs have also started talking about the deal with NSN discussing a wireless centre of excellence in Canada and a welcome page for Nortel employees coming in via the deal. While the Nortel blog is a bit terse on the subject, there is another post that includes a message from Mike Z clearly indicating that there are more sales to come.

NEP contract watch

Date	NEP	Product	Customer	Comments
2 Jun 09	Alcatel Lucent	7342 Intelligent Services Access Manager Fiber-to-the-User (ISAM FTTU) and 5520 Access Management System for element management, as well as ONTs	Portugal Telecom	Vendor selection for GPON network
2 Jun 09	Alcatel Lucent	IP/MPLS solution	Claro Panama	Vendr selection for IP/MPLS (bachaul for mobile)
3 Jun 09	Alcatel Lucent	7302 Intelligent Services Access Manager (ISAM)	Guangdong Telecom (south China)	Vendor selection for VDSL2 network
8 Jun 09	Alcatel Lucent	Alcatel Hotel Link, military grade encryption, Omnitouch UC and contact centre	Resorts world at Sentosa (Singapore)	Selection as strategic partner for IP telephony network for deployment in 2Q 09
8 Jun 09	Alcatel Lucent	7342 Intelligent Services Access Manager Fiber-to-the-User (ISAM FTTU), 5520 AMS	China Telecom	40% of China Telecom’s FTTH trial projects secured by Alcatel Lucent
10 Jun 09	Alcatel Lucent	1850 Transport Service Switch (TSS)	FPL FiberNet, Florida	Deploying packet optical transport for mobile backhaul
12 Jun 09	Alcatel Lucent	Blackberry services	M-tel, Bosnia & Herzegovina	Launch of Blackberry services in Bosnia & Herzegovina (ALU has distribution agreement with RIM)
11 Jun 09	Cisco	CRS-1	du, UAE	Deployment of 40G network to improve business services
5 Jun 09	Ericsson	3G mobile infrastructure, managed services	3 Italia	The agreement combines extensive technology modernization and network upgrade with operational process improvements and managed services
8 Jun 09	Ericsson	Managed services	Zain Nigeria	Network operations, field operations including optimization, third-party vendor management for Zain’s GSM/WCDMA networks, and business support systems.
16 Jun 09	Ericsson	HSPA RAN, IP core updates	T-Mobile, Macedonia	Plan, design and deploy the radio access network, and design, adapt and integrate the packet-core network
8 Jun 09	Nokia Siemens Networks	Flexi Base Station, RNC 2600 & related transport solutions	Elisa, Finland	Selected as supplier for network expansion
15 Jun 09	Nokia Siemens Networks	I-HSPA infrastructure	3, Ireland	Deployment done and demonstrated
9 Jun 09	ZTE	SDR solutions	Viettel, Vietnam	Part of UMTS solution to be deployed by Sep 2009

NEP contract watch

Date	NEP	Product	Customer	Comments
29 May 09	Alcatel Lucent	WCDMA network infrastructure	Telecom New Zealand	Launch of mobile internet services. ALU responsible for design, supply and implementation of the network
28 May 09	Alcatel Lucent	IMS: RCS application servers, IMS session control, HSS servers, border gateway, and service/network management	Bouygues Telecom, France	Pilot network to initiate rich applications to mobile customers.
27 May 09	Alcatel Lucent	7342 Intelligent Services Access Manager Fiber to the User (ISAM FTTU)	Nayatel, Pakistan	GPON network installation to form a basis for triple play services
25 May 09	Alcatel Lucent	7750 SR	Orange, France	Deployment of IP/MPLS routers completed to enhance Orange business services in France
28 May 09	Cisco	Cisco XR 12410 Routers and the Cisco CRS-1Carrier Routing System	Mobinil, Egypt	Deployment of IP NGN to deliver voice, video and data over a single network
28 May 09	Cisco	Aironet® 1520 and 1140 Series 802.11n WLAN Aps; TelePresence	University of Queensland, Australia	Largest university WLAN network in the world
27 May 09	Cisco	CRS-1	Free, France	Deploying IpoDWDM for Core network
27 May 09	Cisco	CRS-1	MegaFon, Russia	Deployment of IP NGN core
26 May 09	Cisco	Cisco 7600 Series intelligent edge services router and the Circuit Emulation over Packet shared port adapter module	PTC ERA, Poland	Deploying Mobile Transport over Packet (MTOP) for mobile broadband solution
26 May 09	Ericsson	Personal Pod Advertising (part of Ericsson Mobile TV suite)	Telia Sonera, Sweden	Agreement signed to deploy personalized advertisement service – implementation in progress.
25 May 09	Ericsson	LTE RAN Infrastructure	Telia Sonera, Sweden	First commercial LTE site – full deployment by 2010
18 May 09	Ericsson	WCDMA/HSPA RAN infrastructure	Faroese Telecom, Faroe Islands	Expand Faroese Telecom’s GSM network, upgrade its software and deliver a range of professional services, including design, network deployment, core network systems integration and support service
25 May 09	Huawei	MA5600T platform	Portugal Telecom	Vendor selection for GPON network
18 May 09	Huawei	ASON network	VNPT, Vietnam	Deployment complete on backbone upgrade for VNPT
28 May 09	Nokia Siemens Networks	Flexi Base Station	DiGi, Malaysia	Upgrade to 2G network to complete in Nov 2009
26 May 09	Nokia Siemens Networks	Flexi Base Station	M1, Singapore	Installation, network optimization and related maintenance services
20 May 09	Nokia Siemens Networks	Softswitch (hiE9200), Media Gateway, Multi Service Access Nodes (MSAN) along with the network management system	BH Telecom, Bosnia & Herzegovina	Support for all-IP triple play services

What is BGP?

Border Gateway Protocol is the network protocol used for exchange of reachability information across networks. In its original definition, a router implementing BGP sits at the gateway of an autonomous system (An AS is a network that is independently managed or an autonomous entity). The BGP router exchanges routes with its peers indicating which AS is directly connected to it and which are its neighbour networks. This information is propagated across the internet and all BGP routers have information on routes to all AS – when a BGP router comes up, its neighbour hands it all its routes (prepended with the neighbour id to indicate that the neighbour can reach the destinations via the routes specified) – there is no discovery mechanism. There are computations and optimizations done to avoid routing loops as well as to avoid instabilities caused by specific routers going down.

A suitable analogy would be the standard snail mail system where postal mail is sorted in a heirarchical manner – at an international level, it is only the name or code of the country that is required for sorting, the rest of the address is irrelevant. Similarly, at a network level, reachability at AS level is the only information required.

As BGP is implemented at the border of the network, it became a good instrument to implement network wide policies and as such is a very important tool in the IP world. This allows prioritization of routes to specific networks. An analogy would be two alternative bus routes available for the same destination and the traveller can make a choice based on his requirements – whether he wants the fastest or cheapest or most picturesque route.

Over time, several complications have crept into BGP usage and deployment:

- CIDR (Classless Inter-Domain Routing) was introduced in the mid-nineties as a solution to the depleting IP address problem which were previously class based and hierarchically setup to allow easy routing. CIDR allows routes to be made more specific to a smaller network than that identified as an AS – it allows “prefix” based routing and the larger the IP prefix, the more specific the network. Getting back to the snail mail analogy this means that sometimes the mail has to be sorted city-wise or even post-office wise depending on information currently available with the sorter. Obviously, this necessitates storage of more destination information as well as more complex search techniques. This has led to a proliferation of routes and is primarily responsible for the inflating IP route table size. There are several projects that track and analyze BGP route information – for example the RouteViews project or BGP table growth.

- The number of AS has grown and increasing the size of the field used to store AS numbers is a concept being worked on. However, this would mean a fundamental change in all BGP routers deployed world-wide as the basic packet structure of the protocol would require modification and is consequently a long term migration process.

- Multi-homing – referring to the concept of one device being reachable via multiple networks, mainly used for purposes of redundancy to always have a way to connect – has necessitated additional support within BGP.

- A big usage problem is the accidental propagation of routes that a network does not control – depending on the circumstances, one network could effectively cut off portions of the internet by advertising different routes. BGP peers have the added responsibility of ensuring that the source of the routes they receive via BGP advertisements are legitimate.

Monitoring and managing BGP is an important job for network administrators and several tools (including freeware) are available for this purpose. A list of tools can be found here.

The definitive source of information on BGP is RFC 4271. The Wikipedia reference is here, however, in this case, wikipedia is not your friend for a non-technical explanation – as this is an important network protocol, it delves into the details of the protocol packet information as well as the exchange of information and state machine for BGP.

NEP Contract watch

Date	NEP	Product	Customer	Comments
15 May 09	Alcatel Lucent	Mobile NGN solution (GSM/EDGE)	MTNL, India	Multi year agreement includes project management, consulting and design, installation and deployment, network operations, maintenance and integration and testing
14 May 09	Alcatel Lucent	GSM/EDGE RAN	Unitech, India	Design, deploy and manage RAN as well as comprehensive management services.
12 May 09	Alcatel Lucent	8690 Open Service Platform (OSP), enhanced with a Service Creation Environment; 8610 Instant Convergent Charging Suite (ICC)	Partner communications, Israel	IN solution deployment complete – ability to offer converged services over both fixed and wireless access
11 May 09	Alcatel Lucent	7705 Service Aggregation Router (SAR)	Banverket, Swedish rail administration	Network update – SAR used for end to end synchronous ethernet capability as part of migrating Banverket from multiple legacy voice and data networks to a single converged network
15 May 09	Ericsson	EDA 1200 fiber-access switches and metro aggregation, as well as SmartEdge Multi-Service Edge Routers and core network products	Hudiksvall Municipality in Sweden	Develop and manage operator neutral city network for high speed broadband services including last mile fibre. Ericsson will manage the network for Zitius, the open-access network operator, until 2016.
6 May 09	Ericsson	End-to-end fiber access solution including EDA 1500 GPON system	Radius Synergies (Indian in-building management solution company) for a 3000-unit project in Delhi	Deployment complete for a contract covering implementation, systems integration, consulting, training and support services. The GPON network enables converged services for consumers, allowing for a range of operator offerings – including voice, data and video, as well as services such as connected-home activation, security and lighting control – delivered over Ericsson’s deep fiber access network.
15 May 09	Huawei	IMS-based EV-DO video telephony (VT) solution	China Telecom	Huawei is the sole supplier of VT for China Telecom’s mobile video phone services for 40 million subscribers nationwide over its CDMA network. Deployment will be city-wise and launch planned for May 17.
11 May 09	Huawei	SingleRAN	America Movil (AMX), Latin America	SDR based GSM/UMTS network launch. Huawei has end to end responsibility – planning, deployment, management.
7 May 09	Huawei	4th Generation NodeB and SingleRAN solution	Telecom Srpske, Bosnia and Herzegovina	Vendor selection for deploymentof UMTS/HSPA network and packet switch (PS) core network in Bosnia and Herzegovina
14 May 09	Nokia Siemens Networks	Security solution for mobile networks	MTS (Russia & CIS)	Contract signed for consultancy and security solutions for mobile broadband network

NEP result watch

JFM 2009	(Note:	Huawei	is FY2008	- no data	available	Q-wise)
NEP	Net Sales	Sales Q on Q	Net Income	Income Q on Q	EPS	EPS Q on Q	Acquisition/Divestment/JV info	Major customer wins	Quote
Alcatel Lucent	Euro 3.598 billion	-6.90%	Euro (181 million)	-122%	-0.08	-125%	Sale of stake in Thales to Dassault Aviation to complete in next quarter	IP/MPLS service routers in EMEA, LTE in China and N America (includes Verizon shortlist), IMS in FT/Orange. Decline in access and switching (DSL/ATM)	Ben Verwaayen, CEO: “As we discussed before, 2009 will be a year of transition. We are reshaping the company and aggressively pursuing our product portfolio rationalization, co-sourcing, working capital management and SG&A reduction programs”
Cisco	$8.2 billion	-16.60%	$1.3 billion	-24.00%	0.23	-20.70%	Pure Digital Technologies (Flip Video) for in home video, Richards-Zeta Building Intelligence for IP enabled surveillance monitoring, Tidal Software for application monitoring in the data center	BAE for telepresence (via ATT), Yahoo! Japan for Nexus data centre switches, Asia Bell (Kazakh service provider) for mobile WiMAX	John Chambers, chairman and CEO, Cisco: “These results demonstrate our ability to drive operational excellence and manage profitability across varying economic cycles. We will use this period of market transition to align and optimize resources, make strategic investments, move into market adjacencies and enhance relationships with our customers.”
Ericsson	SEK 49.6 billion	12%	SEK 1.8 billion	-30%	SEK 0.54	-35%	New JV with ST Micro for Ericsson Mobile Phones, divestment of TEMS products (tools for air interface monitoring) to Ascom to close next quarter	3G for China Unicom, 4G for Verizon Wireless and managed services for Vodafone UK	Carl-Henric Svanberg, President and CEO of Ericsson: “We have started the year with good growth ahead of the market and a positive margin trend but with a weaker cash flow. Sales of network infrastructure are stable and the demand for professional services is growing.”
Huawei	$18239 million		$1151 million				None	Telia Sonera – LTE/SAE, TransTelecom Russia – DWDM.
Nokia Siemens Networks	EURO 2900 million	-31.10%	EURO (122 million)		0.1	-61.50%	None	Managed Services at Orange, IMS vendor selection at Verizon.
Motorola	$5371 million		$-231 million		$.1		Completed sale of biometrics business to Safran	GSM network expansion with Mobily Saudi Arabia and MTN Ghana	Greg Brown, President and co-CEO:”Our Broadband Mobility Solutions businesses performed well in a challenging environment, by delivering value for our customers and adding to an already impressive portfolio of products. We will continue to manage our costs to ensure alignment with current market conditions. We are executing with operational and financial discipline while we make targeted investments for our future.”
ZTE	RMB 11.61 billion	35%	RMB 78.66 million	29,17	0,06			3G and GSM in China