& cplSiteName &

What's Next for Kestrel?

Light Reading
News Analysis
Light Reading
2/15/2002
50%
50%

Kestrel Solutions Inc. made two announcements this week that typify its "give and take" approach to the market (see Kestrel Adds Features, Cuts Workers).

First, the company announced a fresh series of layoffs, which it says brings the number of total employees to about 100. The reduction is at least the company's third -- following rounds in May, July, and August of 2001 (see Kestrel Announces Layoffs, Kestrel Quietly Reconfigures, and Kestrel Takes Another Turn).

No sooner was the ink dry on the bad news, when Kestrel had good news: Yesterday, it announced the addition of gigabit Ethernet, FICON, and Fibre Channel connectivity to the TalonMX, Kestrel's transport platform that crams multiple streams of data traffic into a single optical wavelength using frequency division multiplexing (FDM). This is in contrast to DWDM (dense wavelength-division multiplexing) technology, which crams multiple wavelengths into a single optical fiber strand.

The two announcements speak to the company's ongoing efforts to forge a path for itself through the optical market. But the company appears to be struggling with internal issues. Now on its fourth CEO (see Kestrel Flocks to New CEO) and with a recently announced new senior VP of sales (see Kestrel Hires Sales Guy), Kestrel's still trying to get its personnel act together.

On the product side, things seems to be going fairly well. The addition of new capabilities aimed at the metro market signal Kestrel's awareness of the opportunities that exist there. Specifically, Kestrel touts its FDM technique as providing lower per-mile data transmission costs for carriers, particularly RBOCs.

Kestrel's already announced an RBOC customer, widely believed to be SBC Communications Inc. (NYSE: SBC), although the company refuses to confirm this or to state the amount of the deal (see Behind Kestrel's RBOC Contract). And spokespeople say other contracts with incumbent carriers have been closed, although they're not giving specifics.

Kestrel also refuses to give details of its funding, which has been estimated at anywhere from $187 million to $300 million -- at either end of the range, an amount that would pretty much guarantee it has sufficient funds to keep going, at least for the immediate future.

But analysts are skeptical about what really lies ahead for Kestrel. "I think the handwriting was on the wall for FDM in the heydey of optical fever," says Mark Lutkowitz, VP of optical networking research at Communications Industry Researchers Inc.

Despite Kestrel's assertions that its product is more attractive than ever to companies looking to save costs, Lutkowitz isn't convinced that carriers have seen its value proposition. If Kestrel and its chief rival, Centerpoint Broadband Technologies Inc., didn't take off when carriers had money to spend, there's no indication they will do so now, he says.

So where's FDM headed? It looks as though things may be reaching a turning point. Centerpoint Broadband appears to be disengaging from its FDM past and is aggressively seeking new funding (see Centerpoint 's Appeal: Sooo 1999?). Even if Kestrel was well backed to start with, its bank balance can't hold out forever.

Kestrel now denies that it's seeking inroads in the subsystem market, even though the company's director of product management, Kristin Foss, had this to say in September: "We are looking at the possibility of developing subsystem relationships with other companies that do not compete with our 10-Gbit/s product."

Barring new markets, is a merger the next step? Rumors have swirled that Ciena Corp. (Nasdaq: CIEN) and Marconi PLC (Nasdaq/London: MONI) may be snooping around, attracted by Kestrel's nascent 40-Gbit/s capabilities, which the vendor says it continues to develop. But when asked, the would-be acquirers seem stumped. "It's the first I've heard of it," says a Ciena spokesman. And, "What do they do?" deadpans Marconi's.

Kestrel's open to the suggestion, though: "[CEO] Woodrow Cannon has stated that we're open to all possibilities," a spokesperson says.

— Mary Jander, Senior Editor, Light Reading
http://www.lightreading.com

(3)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View        ADD A COMMENT
gea
50%
50%
gea,
User Rank: Light Beer
12/4/2012 | 10:56:00 PM
re: What's Next for Kestrel?
"We are looking at the possibility of developing subsystem relationships with other companies that do not compete with our 10-Gbit/s product."

Ah well. I saw Kestrel entering into licensing agreements for its technology as its one avenue out. FDM, in theory, can make a nice access-type muxing solution, certainly cheaper than TDM-based solution.
But now that cheap CWDM (particularly pluggable transceiver modules)seems to be growing slowly, I wonder if FDM has a future...
BlueWater66
50%
50%
BlueWater66,
User Rank: Light Beer
12/4/2012 | 10:55:39 PM
re: What's Next for Kestrel?
As I remember, optical output from an FDM laser is very similar to AM modulation used in cable TV applications. I used to work with a lot of CATV applications. The lasers are pre-distorted and there are a LOT of "out of spec" or "undefined" issues that pop up every couple of months. It is closer to a black art than a science. In my view it does not meet real telecom reliablity. Sooooo, I certainly wouldn't put money on RBOCs signing up for this sort of technology at the core of there metro network. (PS: I understand there are fundamental differences between AM and FDM in the electrical world, but the laser outputs are still basically multi-level analog with similar issues).

If I were a VC, this would have been a fundamental issues raised on day-one. I suspect this issue continues to follow Kestral.
Last_Ark
50%
50%
Last_Ark,
User Rank: Light Beer
12/4/2012 | 10:48:42 PM
re: What's Next for Kestrel?
Good observation, but I disagree with your lack of confidence in the technical performance. There were yield problems for "analog" lasers in the early 90s, but today the technology is well understood and very reliable. The transmitters that Kestrel (and Centerpoint) need are lower performance than those used in CATV, because the signal content is digital (like satellite signals), not analog. Personally, I don't understand the carriers not buying this stuff. Maybe they don't know how successful cable companies have been with "analog" lasers.
From The Founder
Kicking off BCE 2017, Light Reading founder Steve Saunders lays blame for NFV's slow ramp-up and urges telecom to return to old-fashioned standards building and interoperability.
Flash Poll
Live Streaming Video
Charting the CSP's Future
Six different communications service providers join to debate their visions of the future CSP, following a landmark presentation from AT&T on its massive virtualization efforts and a look back on where the telecom industry has been and where it's going from two industry veterans.
LRTV Custom TV
The Overall Objective Is to Win the Game

6|26|17   |     |   (0) comments


SCTE•ISBE's Chris Bastian discusses Energy 2020's success to date and the importance of a flexible approach that allows for changes in specific strategies in order to reach significant milestones.
LRTV Interviews
CenturyLink: Let's Get Past SD-WAN Hype

6|23|17   |   04:02   |   (0) comments


Technology becomes a "shiny object" unless it's properly focused on solving business needs for enterprise customers, says Bill Grubbs, network solutions architect for CenturyLink. He explains to Light Reading why SD-WAN deployments have to be tailored to specific needs – and more.
Women in Comms Introduction Videos
Infinera's Sales Director Paints Tech's Big Picture

6|21|17   |   4:14   |   (1) comment


Shannon Williams, Infinera's director of sales, shares how she achieves work's many balancing acts -- between her role and the broader company, today and tomorrow's tech and more.
LRTV Custom TV
SD-WAN Innovation & Trends

6|20|17   |     |   (0) comments


Versa CEO Kelly Ahuja discusses with Carol Wilson the current status and trends in the SD-WAN market, Versa's innovation around building a software platform with broad contextualization, and the advantages that startups can bring to the SD-WAN market.
LRTV Interviews
Ovum's Dario Talmesio on 5G in Europe

6|20|17   |   02:16   |   (0) comments


At 5G World 2017, Dario Talmesio, principal analyst and practice leader on Ovum's fixed and mobile telecoms European team, explains the emerging trends amongst European operators as they prepare for 5G.
LRTV Custom TV
Putting Power on a Pedestal

6|19|17   |     |   (0) comments


ARRIS's John Ulm says a major accomplishment of SCTE•ISBE's Energy 2020 program is increased focus on power cost and consumption, including inclusion of energy requirements in operators' RFPs and RFIs.
LRTV Custom TV
Gigabit Access: The Last-Mile Pipe for All Future Services

6|19|17   |     |   (0) comments


A Gigabit access platform being deployed today must be able to deliver all types of services to an increasing number of devices. A non-blocking architecture is necessary to support the ever-increasing growth in bandwidth demand. The Huawei Gigabit access solution is based on a distributed design that is fully scalable to deliver a unprecedented performance.
LRTV Custom TV
Key Factors to Successfully Deploy an SD-WAN Service

6|19|17   |     |   (0) comments


As service providers transition their SD-WAN solution from trials and limited deployments into production at large scale, there are important considerations to successfully operationalize these solutions and realize their full potential, without adding complexity, introducing uncertainty or disrupting current business operations. Sunil Khandekar, CEO and Founder ...
LRTV Custom TV
IoT Solutions: Rational Exuberance

6|19|17   |     |   (0) comments


IoT solutions are morphing from hype into viable business opportunities. Huawei has the platform and ecosystem support to help carriers successfully address new business opportunities in the IoT space.
LRTV Custom TV
Realizing ICN as a Network Slice for Mobile Data Distribution

6|19|17   |     |   (1) comment


Network slicing in 5G allows the potential introduction of new network architectures such as Information-centric Networks (ICN) as a slice, managed over a shared pool of compute, storage and bandwidth resource. Services over an ICN slice can benefit from many architectural features such as Name Based Networking, Security, Multicasting, Multi-homing, Mobility, ...
LRTV Interviews
Ovum's Mike Roberts on 5G Uptake

6|19|17   |   04:08   |   (0) comments


Mike Roberts, research director for Ovum's service provider markets group, explains why he has boosted his 5G subscriptions forecast.
LRTV Interviews
AT&T's Hubbard on Intersection of SD-WAN & MPLS

6|15|17   |     |   (0) comments


Rick Hubbard, SVP of Network Product Management for AT&T Business Solutions, discusses how AT&T's approach to SD-WAN fits in with its overall virtualization strategy, explains how SD-WAN can improve enterprise customers' use of the cloud and addresses the intersection of SD-WAN and MPLS.
Upcoming Live Events
October 18, 2017, Colorado Convention Center - Denver, CO
November 1, 2017, The Montcalm Marble Arch
November 1, 2017, The Montcalm Marble Arch
November 30, 2017, The Westin Times Square
All Upcoming Live Events
Infographics
With the mobile ecosystem becoming increasingly vulnerable to security threats, AdaptiveMobile has laid out some of the key considerations for the wireless community.
Hot Topics
No Imagination: UK Chip Biz Goes Up for Sale
Iain Morris, News Editor, 6/22/2017
Does AT&T Deserve Time Warner?
Mari Silbey, Senior Editor, Cable/Video, 6/23/2017
Netflix's Lesson in Culture Expectation Settings
Sarah Thomas, Director, Women in Comms, 6/21/2017
Kalanick Steps Down as Uber CEO
Sarah Thomas, Director, Women in Comms, 6/21/2017
Like Us on Facebook
Twitter Feed
BETWEEN THE CEOs - Executive Interviews
Following a recent board meeting, the New IP Agency (NIA) has a new strategy to help accelerate the adoption of NFV capabilities, explains the Agency's Founder and Secretary, Steve Saunders.
One of the nice bits of my job (other than the teeny tiny salary, obviously) is that I get to pick and choose who I interview for this slot on the Light Reading home ...
Animals with Phones
Live Digital Audio

Playing it safe can only get you so far. Sometimes the biggest bets have the biggest payouts, and that is true in your career as well. For this radio show, Caroline Chan, general manager of the 5G Infrastructure Division of the Network Platform Group at Intel, will share her own personal story of how she successfully took big bets to build a successful career, as well as offer advice on how you can do the same. We’ll cover everything from how to overcome fear and manage risk, how to be prepared for where technology is going in the future and how to structure your career in a way to ensure you keep progressing. Chan, a seasoned telecom veteran and effective risk taker herself, will also leave plenty of time to answer all your questions live on the air.