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Today's report from Web Editor
Susan Rush
• Nortel Fails To Reassure Investors
• Chip Market Tops $200B
• Japan Mulls Internet For Everyone
• Charter Charts Q3 Results
• Broadband Briefs
Nortel Fails To Reassure Investors Nortel
Networks is doing everything possible to rally its stock, but the
optical networking giant is not having any luck. Last week Nortel shares
tumbled $17 after its third-quarter results fell below analysts'
expectations, and as of today, the stock is down another $3 to $43.25
despite the company's declaration that it will meet expectations for
Q4.
Nortel expects revenue and earnings per share from operations
in the fourth quarter to reach $8.5 billion to $8.8 billion. The company is
also forecasting growth in the optical, Internet, wireless Internet and
eBusiness areas of it business. Looking into 2001, the company expects
revenue and earnings per share from operations to grow between 30 and 35
percent.
Despite the upbeat mood of Nortel officials, the industry at
large is concerned about next year's sales growth potential. Nortel customer
WorldCom, for example, is showing signs of slower spending on equipment, and
even Nortel has decreased its sales projections into the "low 30s"
in upcoming quarters, down from the "high 40s" that were reported
earlier this year. It remains to be seen whether or not Nortel will be able
to meet its projected $10 billion in optical sales this year. For this
reason, investors are watching with a close eye. Investment banking firm SG
Cowen has downgraded NT's stock to a buy.
Nortel shares fell 3.5 percent today, trading at $42.44
during the afternoon hours.
Related Stories:
Nortel
Takes A Hit On Wall Street, BroadbandWeek Direct,
10/25/00
Nortel
Inks $1.4B Deal, BroadbandWeek Direct, 10/2/00
Chip Market Tops $200B
The semiconductor market just keeps getting stronger. Chip
sales grew to $18.19 billion during the month of August, a 52.7 percent
increase over sales a year ago, and now the Semiconductor
Industry Association is predicting that yearly sales totals will exceed
$200 billion for the first time.
Demand for broadband, data networking, wireless and
optoelectronics technologies is igniting chip sales. The SIA does not expect
the growth to slow any time soon; the industry should see a 22 percent
growth rate in 2001 to $249 billion, and by 2003 sales figures should
skyrocket to $319 billion. SIA says the goal is to become a trillion dollar
industry during the next decade.
The North American market will remain at the top of the chip
consumption market, growing to a $96 billion market by 2003, but the
Asia-Pacific and Japanese markets will continue to gain momentum over the
next three years, with the two regions growing to $85 billion and $72
billion markets respectively.
Related Story:
Chip
Sales Jump 53%, BroadbandWeek Direct, 10/3/00
Japan Mulls Internet For Everyone
Japan's Prime Minister Yoshiro Mori has embraced the Internet
wholeheartedly, and is considering a plan to make every Japanese home
broadband-connected within the next five years, according to a report
in a Japanese national newspaper.
Japan's decision to provide high-speed connections to its
citizens is partly motivated by a desire to gain some ground in the
e-commerce arena. Cable
& Wireless is investing $1.4 billion in Japan's high-speed future.
The money, which represents the largest investment in Japan by a U.K.-based
company, will be used to create a national fiber optic network in Japan by
2005.
A similar "Internet For All" initiative is underway
in Norway, where the government plans to fork over $37.7 million to bridge
the digital divide among their citizens. The Norwegian government's goal is
to provide broadband Internet access to all businesses and households by
2004.
Related Stories:
C&W
Supports New Fiber Network, BroadbandWeek Direct, 10/30/00
And
Internet For All, BroadbandWeek Direct, 10/12/00
Charter Charts Q3 Results
Charter Communications reports $842.9 million in pro forma
revenues for the third quarter, a 13.9 percent increase over the $740.1
million reported during the same quarter a year ago. Revenues from its
Digital Cable service totaled $25.6 million, up from $1.4 million during Q3
1999.
The company added an additional 279,000 digital cable
subscribers bringing Charter's digital subscriber numbers to 653,800.
According to company president Jerry Kent, Charter is on pace to reach
900,000 digital customers by year's end. Video-on-demand services were
launched in about 167,000 California homes during the quarter.
Related Stories:
Charter
Lights Up VOD In Pasadena, Multichannel News, 10/23/00
Charter
Picks Diva For VOD Rollout, Multichannel News, 5/8/00
Broadband Briefs:
- congruency Inc.
and Orckit Communications Ltd. complete
interoperability testing and will co-market a Voice-over IP over DSL solution
to Orckit's DSL customers.
- AT&T
Broadband teams with ACTV Inc. to test
interactive TV advertising service on currently deployed AT&T DCT-1000 and
DCT-2000 digital set-top boxes in Colorado. The SpotOn
advertising service incorporates interactive capabilities with full-motion
video.
- Wireless accessories supplier TESSCO
Technologies wins a distribution contract from RC
Networks Inc. Under the terms of the agreement, TESSCO will sale RC
Networks high-speed Internet access products, as well as handle customer
service and fulfillment.
- Winstar
Communications invests $9.16 million to build a high-speed network in
Thailand within the next five years.
- Motorola
introduces a gallium arsenide (GaA) transistor for broadband wireless access
infrastructure applications in the S-band frequency range.
- Cornet Technology
Inc. completes interoperability testing of its SwitchEdge DSL
test access switch with Teradyne's
Celerity DSL test system. The duo believes the combined systems provide an
integrated approach to remote testing and loop management.
- PNV launches PNV
Anywhere TV in an effort to capture the mobile entertainment market. The
system provides programming from the four major networks, sports, news,
weather, 13 premium movie channels from HBO and Showtime.
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