SuperComm to Descend on Atlanta
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Next week thousands of communications technology fans will descend upon Atlanta for the annual SuperComm conference (June 4-7) -- an event whose past is rich with new product announcements from the companies who develop infrastructure for the complete range of service providers in the New Economy.
In previewing the event, some analysts from Goldman Sachs (GS) said the amount of new products will not be the event's key because of the slowdown in demand across the high-tech industry. Instead, what some people will be looking for are specific innovations in hot-button issues such as optical switching. Never mind the fact that carrier spending is down and that those with legacy equipment may be left holding out their infrastructure-filled hands to Qwest, Verizon, and other service providers who want the latest equipment that companies like Ciena have to offer. Interest in optical switching is at an all-time high, GS said.
Specifically, Goldman Sachs said interest remains great in the optical-electrical-optical (OEO) layer, which allows for increased functionality at the important electrical layer. GS said Ciena is the runaway leader with 15 customers and myriad shipments. Analysts for the research firm said they will be watching Sycamore's movement in this stark terrain as the company is tweaking its key ASIC for the switching fabric, which would make the company only the second outfit to serve STS-1, or 51.8 megabytes-per-second (Mbps).
In the background for all of this are the larger, more perennial firms, such as France's Alcatel and Canada's Nortel, neither of which can yet compete with Ciena, Sycamore, or even Tellium, but who are clearly interested in making waves in optical switching. GS said it expects Alcatel and Nortel to showcase new products at SuperComm 2001. Still, there are no guarantees that the optical sector will heat up soon -- possibly not until some time in 2002, according to a recent report released by Morgan Stanley Wednesday. Analyst Alkesh Shah dropped JDS Uniphase, Nortel Networks and Sycamore Networks to "neutral" from "outperform." Interestingly, all of those stocks were off Wednesday.
While these larger companies may show off product developments or unveil freshly-inked contracts, there may be other interesting happenings on the periphery of the event. For one, Federal Communications Commission Chairman Michael Powell, recently in the limelight for his comments on antitrust matters among phone carriers, will engage the crowd at 9 a.m. June 5 with an address on communications regulation moving forward -- a grossly important issue what with the status of 2.5G, 3G and other wireless networking standards still up in the air.
A law school graduate, Powell presided as the chief of staff for the antitrust division in the U.S. Department of Justice before joining the FCC. He last made waves May 7 when he vowed to punish potential violators of fair competition laws by inflating fines from $1.2 million to $10 million in situations where phone carriers treat rivals unfairly.
On the technological standard side, the HomeRF Working Group will demonstrate its revamped HomeRF 2.0 wireless standard at SuperComm 2001 on the heels of successful presentations at the Connections 2001 show in Seattle and Networld+Interop in Las Vegas. HomeRF 2.0 runs at 10 mbps.
While Proxim and a few other firms (Compaq Computer, Motorola, Siemens) tout HomeRF, others are not so excited about the wireless standard and opt for a rival protocol known as Wi-Fi, or 802.11b, which runs at 11 mbps. Intel Corp. abandoned HomeRF in March for 802.11b much to the disappointment of HomeRF supporters.
A recent Merrill Lynch study noted that Toshiba, Dell, IBM and Compaq are promoting 802.11b-enabled laptops while Handspring has been talking about including 802.11b wireless capability into its personal digital assistants (PDAs).
What are some of the reasons Merrill Lynch believes Wi-Fi will prevail over HomeRF and Bluetooth? Wi-Fi is currently interoperable, it is already cost-effective and becoming more so, and it is as fast as the majority of desktop connections.
Ultimately, GS said it was unsure of how SuperComm will be received.
"Attendance at SuperComm could be down this year from the overheated peak experienced in 2000, and certainly the tone of most carriers and equipment vendors will be muted versus last year," GS concluded. What the event will do is spell out the challenges that lie ahead for this sector.