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Welcome to Faulkner's Telecom Daily. We publish Monday through Friday, updating top stories as events warrant. If you would like to receive Telecom Daily emailed daily to your desktop, please click here: TelDailyEmail.

Friday, May 9...

Comcast Considering Bandwidth Limits
Comcast confirmed that it is considering setting an official limit on the amount of data that subscribers can download per month and charging a fee for those who go over the limit. Prior to this, Comcast has refused to reveal any limit on downloads, although it classified some users as abusive to the network. Comcast, in the past, called customers who used considerably more bandwidth than an average customer and asked them to reduce the downloads or have their account canceled. Comcast has been trying to figure out how to handle massive downloads as multimedia files become more popular, including movies, TV shows, and music. Comcast describes excessive users as those who send, for instance, 40 million emails or download 50,000 songs per month. One option being considered is to cap bandwidth usage at 250 GBs per month. If the 250 GBs is allotted for just downloads, it would allow for the download of 50 high-definition movies, 250 standard-definition movies, or more than 6,000 songs every month. If users exceed that cap, they could be charged $15 USD for every 10 GBs over the base amount.

T-Mobile Tops 30 Million Subscribers, Profit Increased in 1st Quarter
T-Mobile USA, the Deutsche Telekom US subsidiary that is the fourth- largest US mobile network operator, added 981,000 new customers in the first quarter. Customer churn rate was reduced from 1.8 percent to 1.7 percent. The subscriber gain coupled with the 1.1 million subscribers gained through the acquisition of SunCom gave T-Mobile a total of 30.8 million subscribers at the end of March. First quarter service revenues increased14.5 percent to $4.57 billion USD from $3.99 billion USD in the same quarter last year. Net income increased 46.7 percent to $462 million from $315 million last year.

Cablevision to Build Wireless Broadband Network in New York
Cablevision Systems announced that it plans to spend $350 million USD to build a wireless broadband network to serve its subscribers in the New York area. COO Tom Rutledge said that the network, which will be completed within the next two years, will be accessible via Wi-Fi-enabled portable devices such as iPhones and laptops. The network will be accessible for free to existing customers but as average customer revenues and cash flows rise, the company would benefit by offering a more comprehensive service for customers, which would help to lure new customers and retain existing ones. Cablevision said it has been testing the service, which will have speeds up to 1.5M bps, comparable to traditional wireless networks, in small areas across its 3.1 million customer base.

Vonage Posts Record Quarterly Revenue, Lower Losses
Vonage reported that first quarter revenue increased 14.6 percent to $224.6 million USD from $195.9 million USD in the same quarter last year. Net loss fell to $8.96 million, or $0.06 per share, compared to a loss of $72.3 million, or $0.47 per share, last year. Vonage said that the revenue was a quarterly record, and it came about due to the addition of 30,000 subscribers and an increase in average monthly revenue per line to $28.85 from $28.31 last year. The subscriber additions was down sharply from the 166,000 that were added in the first quarter last year. Vonage said that it had a total of 2.6 million subscribers at the end of the quarter.

Harris Considering Sale of Company: WSJ
The Wall Street Journal reported that Harris has begun exploring its strategic options, which could lead to an eventual sale of the company. Harris, with a market capitalization of $7.3 billion USD, only recently began the process and could decide against a sale. The company is expected to receive interest from a number of defense and general industrial companies, likely to include Raytheon, BAE Systems, and Northrop Grumman. Harris' stock performance has doubled that of the S&P 500 Index in the past five years, gaining nearly 285 percent since September 11th, primarily benefiting from the wars in Iraq and Afghanistan. Harris may be considering the move because it believes that defense spending is about to decline, but the company could appeal to buyers with its mix of communications and surveillance equipment. Harris employs 16,000 and markets products in about 150 countries.

  .... Russ Drumheller, Faulkner Information Services


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