Broadband Week Direct

Today's report from Web Editor Susan Rush

• TVN joins Charter's VOD roster

• PacketVideo, NMS team for two-way wireless video

• Zhone acquires Vpacket

• Gemstar loses another battle

• 2002 tough on telecoms

• Inter.net launches service in two TWC markets

• Ex-WorldCom Boss takes the fifth

• Broadband briefs

TVN joins Charter's VOD roster

After signing two video-on-demand server deals in the wake of Diva Systems’ bankruptcy, Charter Communications Inc. said it will answer the content side of the VOD equation via a deal with TVN Entertainment Corp.

Under terms of the deal, TVN will encode on-demand content for the MSO from its Digital Network Operations Center and transport VOD titles and subscription-VOD content via TVN’s Secure Satellite Transmission (SST) system. Further, Charter will be able to view and manipulate those on-demand assets remotely via the combination of TVN’s Automated Digital On-Line Network Interactive Scheduling System (ADONISS) and Affiliate Remote Interface (ARI).

Charter also will tap TVN to aggregate on-demand content including movies and specialty programming, although Charter is also free to negotiate deals directly with content owners, said Jim Riley, TVN’s senior vice president, business development.

“We’ll give [Charter] the opportunity to do the deal that makes the most sense,” he added, noting that Charter, for example, could forge SVOD deals directly with premium networks such as HBO, Showtime and StarzEncore if it so wishes.

The deal with TVN will give Charter “the flexibility to customize content on individual servers to better match system demographics and customer interests,” said Charter Vice President of Programming and Pay-Per-View Patty McCaskill, in a press release.

TVN is the latest company to join Charter’s VOD roster following the demise of its former primary VOD server vendor, Diva Systems, which filed for bankruptcy on May 29 and sold off its assets to Gemstar-TV Guide International. Since then, Charter has inked VOD server/system deals with Concurrent Computer Corp. and nCUBE Corp.

-Jeff Baumgartner

Related stories:
Diva completes death spiral, 5/30/02
On your mark, get set, sports VOD, 5/30/02

PacketVideo, NMS team for two-way wireless video

According to research firm Ovum, the global multimedia messaging market is slated to bring in $1.8 billion this year, and PacketVideo and NMS Communications want their piece of the action.

The companies have formed a partnership to develop two-way wireless video communications systems. The systems will combine PacketVideo's software with NMS' hardware and software. The goal of the partnership is to develop new systems that bring together voice and video for real-time communications, enabling service providers to roll out wireless video capabilities for various services, such as multimedia messaging, financial news downloads and multiplayer games.

The companies believe their systems will enable service providers to more easily attract new customers and generate revenue from next-generation services. "Mobile service providers, especially in Asia and Europe, are looking at the potential of wireless multimedia as an up-and-coming blockbuster attraction to increase revenue," says Clarke Ryan, senior vice president and general manager of NMS.

For its part, NMS will leverage its high-density Convergence Generation 6500 media server platform and its Voice Enhancement Systems business. PacketVideo will bring its experience in video and multimedia technology -- including 3GPP packet-switched streaming and pv2way software for 3G-324M terminals -- to the table. 3G-324 is an approved 3G Partnership Program standard designed to ensure interoperability between landline video systems and video-enabled wireless devices.

Financial terms of the deal were not disclosed.

Several equipment and device manufacturers, including Compaq, Fujitsu, NEC, Mitsubishi, Motorola, Sanyo, Sharp and Siemens, have licensed PacketVideo's software.

Zhone acquires Vpacket

Last-mile technology developer Zhone Technologies Inc. is snatching up another company. The latest: Zhone has made a deal for Vpacket Communications.

Zhone, a provider of voice, data, video and content services, pursued Vpacket to beef up its offering in the IP routing and line-side high-speed Ethernet interfaces sector. Vpacket's IP-based Voice/Data Router 6100-series customer premise equipment provide the ability to combine new voice and data services, broadband access and transport protocols over an IP-based infrastructure.

Vpacket CEO Abe Wei has taken a position as vice president of operations at Zhone. Vpacket is Zhone's seventh acquisition. Financial terms were not disclosed.

Zhone's product line includes the Single Line Multi-Service architecture, Zhone Management System, Broadband Access Node, Multi-Access Line Concentrator and Universal Edge 9000 products, Sechtor universal voice gateway, and Z-Edge access products.

Related story:
World Wide Packets turns to Vpacket, 4/23/02

Gemstar loses another battle

More wind was let out of Gemstar-TV Guide International Inc.'s sails last week, when a U.S. Court ruled against the interactive programming guide developer in its suit against EchoStar Communications Corp.

Gemstar filed the suit as a third-party defendant in March of last year, claiming that EchoStar infringed on SuperGuide's patents -- SuperGuide licensed a patent to Gemstar. U.S. District Court Judge Lacy Thornburg ruled that none of EchoStar's current products infringe on any of the asserted patents.

Gemstar plans to appeal the decision.

Two weeks ago, the International Trade Commission ruled that Gemstar competitors did not engage in unfair trade practices with regards to Gemstar's patented IPGs. EchoStar, as well as Scientific-Atlanta Inc. and Pioneer New Media Technologies Inc., was named in the suit. In his ruling, however, Paul Luckern, the ITC administrative law judge, said that Gemstar failed to establish that any of the respondents has infringed on its patents.

Related story:
ITC decision delivers blow to Gemstar, 6/24/02

2002 tough on telecoms

Reuters

Last year may have been bad for job losses in the U.S. telecommunications industry, but this year is shaping up worse, according to a new study.

The 165,840 job cuts announced in the U.S. telecom sector through June of this year are 27 percent higher than the 130,422 announced in the first half of 2001.

The final tally will likely match or exceed last year's record figure of 317,777, according to Chicago-based Challenger, Gray & Christmas Inc.

"Telecommunications continues to surprise us month after month with significant job-cut numbers," Challenger CEO John Challenger said in a statement released yesterday. "The fact that telecom downsizing is on track to beat last year's total really tells where this industry is headed."

Inter.net launches service in two TWC markets

Inter.net has launched its high-speed Internet access over Time Warner Cable systems in Central Ohio and Minneapolis.

Inter.net's Max.inter.net service enables customers to access the Net at speeds up to 2 Mbps downstream and 384 Kbps upstream. The service includes free installation, free firewall software, 10 e-mail accounts with 10 MB of personal Web space per account, Webmail access, anti-spam and anti-virus protection, access to entertainment coupons and customer support. The company is marketing two service plans starting at $44.95 a month.

In Minnesota, the service is available to residents of Minneapolis, Eden, Prairie, Edina, Bloomington, Carver, Chaska, Hopkins, Minnetonka, Richfield, St. Louis Park, Shakopee, Fridley, Jordon, New Prague and New Ulm.

The service also is available to residents in Central Ohio, including Columbus and 20 other counties.

When the Federal Trade Commission approved the mega-merger of America Online and Time Warner more than a year ago, it required the companies to give customers in major markets the option of using three other ISPs besides AOL. EarthLink Inc. and Big Net Holdings also have been approved to offer their high-speed Internet access service over TWC systems in various markets.

Related stories:
Inter.net launches broadband service in N.C., 6/11/02
FTC Approves AOL Competitor, 2/27/02

Ex-WorldCom Boss takes the fifth;
Refuses to answer any questions in $4B scandal

Invoking his Fifth Amendment constitutional right against self-incrimination, WorldCom's former chief executive refused to answer questions yesterday from a U.S. congressional panel investigating nearly $4 billion U.S. in accounting irregularities at the telecommunications giant.

"I do not believe I have anything to hide in these or any other proceedings," Canadian-born Bernard Ebbers told the House financial services committee.

He said he'd been advised by his Washington lawyer to remain silent.

WorldCom's former chief financial officer, Scott Sullivan, also refused to testify on "advice of counsel."

John Sidgmore, WorldCom's president and CEO, blamed the company's former management -- including Sullivan and Ebbers -- for the accounting problems.

WorldCom chairman Bert Roberts called the accounting improprieties "an outrage," and said auditor Arthur Andersen was responsible.

Melvin Dick, the senior Andersen audit partner for WorldCom, testified that no member of the Andersen team "had any inkling" of the improper accounting.

WorldCom is the latest major corporation to face allegations of executive wrongdoing and accounting irregularities -- driving down public confidence in the stock market.

Congress already is investigating the bankruptcies of Enron Corp. and telecommunications company Global Crossing and the role played by accounting firms. Andersen has been convicted of obstruction of justice for destroying Enron-related documents.

In an attempt to boost sagging investor confidence, U.S. President George W. Bush is proposing tougher penalties -- including jail time -- for corporate officials who lie on financial statements, an administration official said yesterday.

WorldCom, whose interests include No. 2 long-distance telephone company MCI, is battling to avoid bankruptcy after disclosing that it disguised $3.9 billion of expenses as capital expenditures to appear more profitable.

The Securities and Exchange Commission has filed a civil fraud suit against WorldCom, and the Nasdaq stock market plans to delist the company's shares, which have plunged from more than $63 in June 1999 to 22 cents yesterday.

Broadband briefs:

• Ceragon inks multiyear deal with Cellcom

BellSouth Corp.'s Israeli operation Cellcom has selected Ceragon Networks Ltd.'s broadband wireless system to expand its existing transmission network. Ceragon's FibeAir will provide high-capacity connections across Cellcom's cellular network.

• Digital Broadband gets E-Dreamz

Digital Broadband Networks Inc., a Charlotte, N.C., provider of wireless broadband services, announced Monday that its EyStar Media Inc. subsidiary has agreed to acquire cross-town interactive Web site developer E-Dreamz Inc. for $1.4 million in cash and stock.

The acquisition is expected to close in 90 days. EyStar Media, also of Charlotte, offers Internet protocol services as well as office and home automation devices. DBN also owns Malaysia-based Animated Electronic Industries and its wireless subsidiary Perwimas Telecommunications. DBN and E-Dreamz handled the deal in-house.

• The Cable Center hosts cable execs from China

The Cable Center and the University of Denver are kicking off their annual Chinese Executive Media Management Program today. The six-week program includes five weeks of intensive study at The Cable Center and the University of Denver, and is designed to provide Chinese media executives with an understanding of international business standards, management skills and media know-how that can be applied to the development of cable and telecom sectors in China.