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Local telecoms hear cell phones ringing

U.S. MARKET EXPECTED TO SURGE IN 2008 AS IPHONES, GOOGLE EXPAND

PETALUMA – Cell phones are ringing in Telecom Valley and equipment makers are listening.

The year 2007 saw unprecedented investment in wireless companies: $356 million in the first quarter alone, according to Celent Research. That surge of capital is expected to continue this year.

Apple’s iPhone was easily the product of the year, opening the floodgates to music-enabled cell phones. Google announced it would join forces with wireless leaders T-Mobile, HTC, Qualcomm and Motorola among others to collaborate on the first open platform for handset applications development.

The movement is expected to give rise to a palette of new cell phone services and drive costs down for the consumer.

“These developments and other wireless initiatives have created a very volatile market,” said Henry Wasik, president and CEO of Turin Networks, which has broadened its focus on carrier Ethernet to include wireless access and data storage.

While large equipment makers have moved slowly, relatively small telecoms can flex along with the market. Turin acquired Carrier Access to give it a stronger position in the wireless and IP network space.

“Wireless access and aggregation is one of the three largest growth areas in the industry. We already have expertise there and we intend to put a portion of our R&D dollars to work building on it,” he said.

Dilithium Networks has been focused on wireless infrastructure from the start, but in the rapidly shifting cellular landscape it finds itself serving markets “we never expected to serve, or even to exist,” said Dilithium President and CEO Paul Zuber.

Following the desires of its customers, for the most part large wireless carriers in Asia and Europe, the company moved from developing algorithms to transport wireless content between networks and mobile devices, to providing a service creation platform for the development of wireless applications, to becoming an end-to-end provider and integrator of video solutions.

“Delays in deployment of new applications are common because carriers and Internet providers are often waiting for the software to catch up,” Mr. Zuber said.

By providing the whole solution – network equipment, a service creation and delivery platform, installation and support – Dilithium lowers the time to market to weeks rather than months, giving the provider a broader spectrum of new services to try out, he said.

Mr. Zuber is bullish on video applications, such as video ring-back with either licensed images or custom-built screens, including avatars that greet callers. Carriers love the service because subscribers like to tailor their ring-back videos to suit individual callers.

Other cell phone applications taking off in Europe and Asia and expected to capture the American market are mobile video surveillance and video blogging.

“The enormous popularity of social networking and user-generated content took everybody by surprise. Now the challenge is to make it mobile. In fact, most of the great interactive features of the Internet can be translated to wireless phones,” said Mr. Zuber.

At Cyan, Mike Hatfield’s still-in-stealth telecom startup, enabling cellular applications is part of the broadband-enhancement the company provides to its carrier, cable and Internet customers.

“We don’t build wireless equipment, but we help service providers carry broadband, and sending content to wireless towers is definitely a part of that, along with IPTV and other broadband services,” said Chief Marketing Officer Eric Clelland.

There’s been an explosion of the size of files providers need to get to their subscribers, especially in the form of real-time streaming video, he said. “What it comes down to is a change in the nature of service. We’re building the next generation of broadband networks,” said Mr. Clelland.

According to Mr. Zuber, mobile video technology is still in its early years.

With real-time video streaming over cellular, “you’ll be able to share the experience of a sporting event or a rock concert while it’s happening. It’s not just the nature of phone communication that will change, but human communication,” he said.