" UTStarcom to spin out IPTV business, change leadership"

2012-08-11 17:58:51

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UTStarcom to spin out IPTV business, change leadership
UTStarcom Holdings Corp. (NASDAQ: UTSI) announced that it will shake up its leadership team and spin out its IPTV business into a privately held company.Former board member William Wong will step in as chief operating officer, effective immediately. He’ll ascend to CEO upon completion of the IPTV divestiture, as current CEO Jack Lu will leave UTStarcom to head up the new venture.The moves come at the recommendation of a strategy committee the UTStarcom board of directors created during the first quarter of the year. The committee was tasked with identifying ways to accelerate revenue growth, bolster profit margins, improve operational cash flow, and increase shareholder value. The recommendations aim to concentrate capital and resources on building out value-added services, divesting non-profitable parts of the business, and moving into high-growth areas, such as media operational support services.The IPTV business currently accounts for approximately one-third of UTStarcom’s revenue and is expected to negatively contribute to the overall company results. The company expects the IPTV divestiture to reduce its expenses by $17 million per year. As part of the divestiture, UTStarcom will purchase a US$20 million convertible bond that will be convertible into 33% of the new IPTV business's common stock in five years. The company expects to close the transaction by the end of August."A result of an extensive review of potential options, this transaction offers the best solution for the company to exit a non-strategic business segment and leaves UTStarcom with a dynamic core business well-positioned for future transformational initiatives," said Xiaoping Li, lead independent director and chair of the strategy committee. "Importantly, the divestiture preserves the parts of the revenue base that have higher profitability and stable growth prospects. It also provides excellent continuity for IPTV customers, who can expect the same level of service and commitment from the new company. Lastly, it helps provide clarity for business partners, employees, and shareholders on UTStarcom's priorities and strategic direction."
Infinera scores 10 DTN-X customers
Infinera Corp. (NASDAQ: INFN) revealed today in announcing its fiscal second quarter 2012 numbers that it has secured purchase orders for its new DTN-X platform from 10 customers, three of whom are new to the company. Some of the DTN-X successes have come at the expense of the company’s established DTN platform, which is one reason that revenues for the second quarter came in at the lower end of guidance.The company recorded GAAP revenues for the quarter ended June 30, 2012 of $93.5 million, on the low end of its guidance of $92 million to $100 million. The figure represented a downturn both sequentially (1Q12 revenues came in at $104.7 million) and year-on year (the company garnered $96.0 million in the second quarter of 2011).However, the second quarter did not include revenues from the DTN-X sales, which should begin to appear at significant levels in the third quarter, Tom Fallon, Infinera president and CEO, told participants in an earnings call today. CFO Ita Brennan said on the call that the company should see revenues based on non-GAAP parameters of $106 million to $115 million in the third quarter as a result.Infinera introduced the DTN-X last September (see "Infinera debuts DTN-X packet-optical transport platform with 500G PIC, OTN/MPLS support") and announced Cable&Wireless Worldwide and the European research and education network operator DANTE as customers earlier this year (see "Cable&Wireless Worldwide chooses Infinera's DTN-X for Europe Persia Express Gateway" and "DANTE selects Infinera DTN-X platform for GEANT Research and Education Network"). Now, the platform has proven popular across several customer segments, from Tier 1 carriers to Internet content providers to bandwidth wholesalers, Fallon said. However, some Infinera customers have reduced their DTN purchases in favor of the DTN-X, he admitted. Nevertheless, Fallon stressed that demand for the lower-capacity DTN will continue, citing two new DTN customers during the second quarter as proof.Nevertheless, macroeconomic pressures worldwide have led Infinera management to pull back on their revenue projections for the second half of the year. Brennan told call participants that Infinera now expects revenues in the second half of the year to range between $230 million and $245 million, versus a previously forecasted top end of $260 million.Rounding out the second quarter numbers, GAAP gross margin was 35% versus 39% in the first quarter and 39% in the year-ago quarter. GAAP net loss for the 2012 second quarter was $29.5 million ($0.27 per share), greater than the $20.6 million ($0.19 per share) net loss in the previous quarter and $24.2 million ($0.23 per share) net loss in the same quarter of 2011.
Raman amplification benefits 100G networks in real field environments
Increase in line capacity, minimization of the cost per transported bit, reduction in power and space requirements – these are some of the multiple challenges that the optical transport industry needs to address.While most equipment vendors focus on interface card technology in an attempt to optimize the combination of capacity and reach, there is another dimension that is worth exploring and exploiting: line equipment with enhanced performance in terms of optical bandwidth, noise factor, and control of nonlinear effects inside the line fiber.Evolution of terminal equipment technologies First-generation 100G technology followed the “digital coherent” approach, which combines:Polarization-multiplexing quadrature phase-shift keying (PM-QPSK) Optical coherent detection at the output end resulting from the mixing of the optical transmitted signal with a reference optical signal delivered by a local optical oscillator Powerful digital signal processing (DSP) in the receiver to compensate for chromatic dispersion and polarization-mode dispersion (PMD).Since this first generation became available in 2010, long-haul coherent interface cards have seen such improvements as spectral shaping, pre-compensation, and soft-decision forward error correction (FEC) to increase system reach.However, EDFAs impose an upper limit on the optical bandwidth that restricts the channel count to 88, assuming 50-GHz channel spacing. In this context, the next steps for increasing line capacity beyond 8.8 Tbps must be achieved at the terminal/interface levels. Most vendors are pursuing the following two paths:Increasing the number of bits per symbol by developing higher-order modulation formats to increase the capacity supported by each optical channel. However, higher-order modulation formats, like 16-QAM, suffer from reduced reach due a weaker tolerance to optical noise and nonlinearities.Building superchannels by multiplexing a number of subcarriers with a small channel spacing to maximize the use of the EDFA-constrained optical bandwidth. The typical capacity gain is less than 30%, resulting in a capacity lower than 12 Tbps, assuming 100G subcarriers.Combining a higher-order modulation format and superchannels, 24-Tbps line capacity might be offered in the future by combining 400G waves in a gridless approach. Reach would then be limited to about 600 km because 400G 16-QAM is more sensitive to optical noise and nonlinearities than 100G PM-QPSK. Furthermore, the gridless approach – where the carrier wavelengths are no longer allocated to specific spectral slots – might be applicable to a simple point-to-point link but not to meshed networks.Line equipment, however, is equally crucial to enable high-capacity, long-distance optical networking. From a reach performance perspective, it is of the utmost importance to avoid regeneration for long light paths. Regeneration sites turn into high capex, large power consumption and space requirements, and higher incremental cost when new capacity is put in service (especially when the channel rate is high). In the field, the line equipment must also be able to bridge long spans between intermediate sites where active equipment is, or can, be deployed.Limitations of EDFA-based systems Although effectively enabling multi-channel transmission, EDFA optical bandwidth is intrinsically limited to about 36 nm, corresponding to 88 optical channels spaced 50-GHz apart.Furthermore, EDFA noise performance is not optimal, resulting in a significant noise accumulation along an optical path with multiple in-line amplifiers. This noise accumulation degrades the optical signal-to-noise ratio (OSNR) and limits the [Capacity x Reach] metric.Lastly, the discrete nature of EDF amplification (i.e., the optical amplification happens at discrete “hot” spots along the optical path) is conducive to high nonlinear effects. Similarly to noise accumulation, nonlinear effects can impose an upper limit upon capacity and reach. While DSP circuits effectively compensate for linear distortions, they do not work properly for nonlinear degradations.What does an ideal amplifier look like?Today’s 100G PM-QPSK technology – designed for 50-GHz channel spacing – will further mature within the next few years, leading to significant price erosion. Consequently, line equipment with wider optical bandwidth combined with a 100G wavelength rate is a natural way to increase the line capacity while offering ultra-long reach performance and decreasing cost per bit.Noise performance is a key parameter for optical transport over long distances. Because the OSNR requirements are more stringent when the channel rate and the number of symbols increase, reducing the optical noise generated by a string of optical amplifiers is critical for increasing the unregenerated reach.Another key item on the ideal amplifier wish list is the ability to limit the amount and impact of nonlinearities. As most terrestrial deployments use existing fiber infrastructures, installing less non-linearity-sensitive fibers with, e.g., larger effective core area is not an option. Therefore an amplification technology that avoids “hot points” inside the line fiber is of paramount importance.Benefits of Raman ification  As vendors and operators generally agree, Raman amplification is an effective answer to meet these 100-Gbps requirements. Three factors have led to this realization:Raman-based optical amplifiers with 100-nm bandwidth were deployed in commercial networks as far back as 2004, which means the technology is well established.The superior noise performance of Raman-based optical amplifiers leads to higher OSNR performance at the output end of the optical path.Distributed Raman amplification within the line fiber results in a lower peak-to-peak power excursion along the optical path, reducing the amount of nonlinearities.Practically speaking, Raman amplification enabled the following 100G link implementations in real networks environments during the past year:A 1,300-km all-optical route, including a 250-km/60-dB span; with the common EDFA approach, the channels would have to be terminated at either end of this 250-km, 60-dB span, imposing costly regeneration sites. A 2,500-km all-optical route; this length represents by far the longest 100G all-optical link ever deployed in real field conditions, with practical fiber attenuation, standard margin per span for repair and non-uniform span lengths (up to 227 km). 7-Tbps per fiber pair on a 350-km/65.5-dB unrepeatered link (with 34x100G recently demonstrated on a 436-km link).The way toward longer reach With WDM 100G optical networking resulting into a huge amount of transmitted capacity, the ratio of terminal equipment cost to line equipment cost increases drastically. Consequently, investing more in higher-end line equipment, whose cost is shared among all the wavelengths, can bring real value to the network in terms of reach and capacity. It can also reduce the relative cost of interface cards by relaxing their technical requirements and/or limiting the number required throughout the network -- for example, by the elimination of regeneration sites. In these conditions, the capital expenditure that operators invest in line equipment leads to larger savings at the interface card level, as well as operational expenditure reduction throughout the network’s lifetime.With wide optical bandwidth, low optical noise, and proper handling of optical power inside the line fiber, innovative line equipment can maximize, and not simply optimize, the combination of capacity and reach.Today, Raman amplification offers the unique line capacity of 15 Tbps based on the multiplexing of 150x100G for reach exceeding 3,000 km in real network environments. Avoiding regeneration sites, this all-optical reach capability is crucial not only for ultra-long-haul links, but also for highly meshed network configurations.
The above information is edited by 10GTEK.
10GTEK TRANSCEIVERS CO., LTD (Hereinafter refered to as 10GTEK) is specialized in developing and manufacturing Fiber Optical Transceivers and High Performance Cables which are wildly applied in Datacom, Telecom and CATV, providing customers with top quality and cost effective products. Our High Speed Cables cover Passive SFP+ Cable, Active SFP+ Cable, QSFP+ cables, MiniSAS (SFF-8088) Cables, CX4 Cables, Harness cables, Breakout Cables, Patchcords. We also manufacture Fiber Optic Transceivers like 10G XFP, 10G SFP+, SFP DWDM/ CWDM, GBIC, etc. The prompt response and excellent customer support contribute to clients‘ full satisfaction.Today, 10GTEK has been growing fast in the optical field for its unique and competitve excellence which has got a high attention from datacom and telecom.
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