Adtran, Tellabs Ring Up Qwest RFP

Qwest Communications International Inc. (NYSE: Q) is close to announcing that Tellabs Inc. (Nasdaq: TLAB; Frankfurt: BTLA) and Adtran Inc. (Nasdaq: ADTN) are the winners of its extensive fiber access request for proposal (RFP), Light Reading has learned.

Qwest's fiber RFP, as reported here in December, calls for a wide variety of technologies, including fiber to the premises (FTTP), fiber to the curb (FTTC), fiber to the node (FTTN), and upgrades to areas "currently fed by copper, digital loop carrier systems, and/or fiber multiplexers." (See Qwest Floats Fiber Access RFP.)

Industry sources close to Qwest and its vendors say Tellabs has won the FTTC and FTTP portions of the RFP. Adtran was the winner of the FTTN section, the part of the deal that will likely see the highest volume of activity in the near future.

Adtran and Tellabs had no comment for this article. Qwest had not replied to further requests for comment at the time this article was published.

The vendor selection comes right after Qwest articulated its consumer video strategy. The four-prong approach includes Qwest taking fiber to its remote terminals and upgrading the buried plant in most of its territory. For that job, the biggest part of this RFP, Qwest favored Adtran's Total Access 5000 product, which can go in central offices, remote terminals, or remote nodes. (See Adtran Touts Total Access.)

Judging by Qwest's RFP description, multiservice access devices like Adtran's Total Access 5000 and the Calix Inc. (NYSE: CALX) C7 seemed a shoo-in. According to sources familiar with the carrier's plans, the RFP called for a single next-generation access platform that had IP uplinks and could support all three architectures (FTTP, FTTC, and FTTN).

This would mark an interesting win for Adtran in that its job is usually that of a fast-follower or secondary supplier in networks where Alcatel-Lucent (NYSE: ALU) or one of the other major vendors wins the lion's share of the business. Now sources say Adtran has bested Alcatel-Lucent in this RFP, as well as several others, including Motorola Inc. (NYSE: MOT), whose fiber-access gear is slated to be replaced.

For that Motorola (Next Level Communications) replacement business, and for its greenfield FTTP business, Qwest gave the nod to the Tellabs 1150 Multi-Service Access System. Tellabs already has a customer for that product family in the BellSouth territory of the new AT&T Inc. (NYSE: T), so having another big RBOC supporting it is probably welcome news. (See Tellabs Upgrades Access.) The Tellabs product team, in the past, has said that when its 1150 unit is deployed up to 500 feet from the end customer, in an FTTC network, it can enable speeds from 80 Mbit/s to 100 Mbit/s per connected home.

While Qwest is installing FTTP in new neighborhoods, it also believes that DSL will be a big player in its video services plans. Early last week, Qwest's VP of product, Dan Yost, told Light Reading that the carrier's planned Internet video offerings through Microsoft Corp. (Nasdaq: MSFT) Windows Live are one example of a way whereby it can take advantage of increased DSL bandwidth afforded by upgrading its legacy FTTC plant and taking fiber to the node throughout all its territories. (See Qwest's Quest for Video .)

The carrier is evaluating IPTV services but says it won't pull the trigger on a deployment until it feels the technologies are more mature and the service is something that's truly different from what consumers can get from cable operators. "Today it's not as differentiated as I think it will be," Yost told Light Reading.

To date, Qwest hasn't put any hard numbers out regarding how fast and widespread its FTTN updates will be. With its FTTC network, Qwest passes 500,000 consumers, mostly in the Phoenix area. And it's assumed that its FTTP installed base, comprised of mostly new developments, will be small as well.

Analysts feel that because of its debt load, Qwest won't be shaking up the consumer video space or IPTV market in a major way, but its RFP decision can improve the lot for smaller vendors.

"Our sense has been that Qwest has been dipping its toes, rather than assuming the risk that comes with testing someone else's technology," says Morgan Keegan & Company Inc. analyst Simon Leopold. "They're leaving it to Verizon and AT&T to shake out the market, and therefore we don't see Qwest having a material effect on the market.

"However, with regards to Adtran, as a fairly small company, even a fairly small win can have a material effect."

— Phil Harvey, Managing Editor, and Ryan Lawler, Reporter, Light Reading

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net-hed 12/5/2012 | 3:10:36 PM
re: Adtran, Tellabs Ring Up Qwest RFP
What's most amazing to me about stories like these is the fact that companies continue to trust analysts and consultants at Heavy Reading, etc., with confidential information, knowing that confidential information is often leaked "somehow," through anonymous sources, to their co-workers at Light Reading.
net-hed 12/5/2012 | 3:10:35 PM
re: Adtran, Tellabs Ring Up Qwest RFP That's LR's job, okay. But why would I as a company risk working with Heavy Reading people if there's good reason to believe they will leak my confidential information? (And there is good reason, since HeavyR no doubt benefits from increased traffic to the site caused by exclusive stories, and LR frequently attributes information to anonymous sources.)
There are plenty of other analyst/consultant firms out there that don't have a gossip portal operation under the same roof.
light_geeking 12/5/2012 | 3:10:35 PM
re: Adtran, Tellabs Ring Up Qwest RFP Online portals such as LR should in fact bring such inside (legal and factual of course) information to be viable. If LR publishes routine news that is already widely available elsewhere, why would we need LR then? We already have google doing a good job for routine news. Good job LR!

net-hed 12/5/2012 | 3:10:34 PM
re: Adtran, Tellabs Ring Up Qwest RFP >If a company told something exclusively to a HR analyst, bound that person by non-disclosure agreements, and then it ended up on LR, it'd be pretty easy to source the leak.

I don't see how. Say two vendors win contracts with a carrier for the same RFP (hypothetical, of course). Multiple people from all three parties are involved. Analysts and consultants could be brought in by all three parties. But let's make it easy and say only one of the vendors used an HR analyst. Still, the leak could have come from anyone involved among the three parties or the analyst. How would that leak be sourced? It's impossible. (Unless you're saying the HR analyst is the most likely culprit in that scenario, which would be an interesting admission.)

Sorry, Phil, I'm not accusing you of lying; I don't have enough information. But your response reminds me of what Wall Street analysts used to say during the bubble when people asked if they were crossing the "Chinese wall" between analysts and bankers. They'd say, "Oh no, our business depends on us not doing that. If we were ever caught doing that, it would kill our business, which is why we don't do it." We all found out later that they were.

So you tell me what's more likely: Someone at Heavy Reading (or Dark Reading, whatever that is), who benefits from more traffic to the site (because it brings more potential HR customers), gave you the information. Or someone else did it just for the ego rush of being a Phil Harvey source.
light_geeking 12/5/2012 | 3:10:34 PM
re: Adtran, Tellabs Ring Up Qwest RFP net-head,
What you are proposing is something analogous to separation of church and state or separation of CEO/Chairman and Board-of-Directors functions.

There are pros-cons to it, for example, if those LR readers/posters are not HR subscribers, then we (the LR only readers/posters) get some good nuggets of information from LR but since we post some interesting insights back on the LR message board the HR Analysts benefit from those discussions as well (I hope). So it is a fair trade as long as both sides are doing their fair share.

DCITDave 12/5/2012 | 3:10:34 PM
re: Adtran, Tellabs Ring Up Qwest RFP If a company told something exclusively to a HR analyst, bound that person by non-disclosure agreements, and then it ended up on LR, it'd be pretty easy to source the leak.

And that's precisely why you don't see that kind of thing happening at LR or HR.


light_geeking 12/5/2012 | 3:10:34 PM
re: Adtran, Tellabs Ring Up Qwest RFP net-hed,
Even though your last post was for Phil, may I ask what is your beef with the current situation? (philosophically I understand your point and it has some merit). Would you be willing to disclose that you are not associated with Adtran or Tellabs (wink-wink)?

DCITDave 12/5/2012 | 3:10:33 PM
re: Adtran, Tellabs Ring Up Qwest RFP I think you're getting worked into a shoot. My sources are a varied lot and they all have their own reasons for talking to me.

I don't rely on Heavy Reading for scoops and I always double-check my sources.

Some analyst houses are owned by tech publishers (CMP owns HR and LR; IDG owns IDC and Network World). If you don't trust an analyst, or his or her employer, then don't use them. If you don't think the information we publish is good enough, then don't read Network World.

(If just one person gets that last sentence and laughs it was worth it.)

Sterling Perrin 12/5/2012 | 3:10:32 PM
re: Adtran, Tellabs Ring Up Qwest RFP This is an interesting thread because this issue is raised from time to time. Personally, as an analyst, I will say that I do not convey this type of confidential information to LR or to any other publication. There are issues of ethics and of personal reputation - which endures (or suffers) long after affiliation with a single employer.
All that aside though, the business motive is not clear at all. It benefits LR to have a scoop, for sure, but industry thrive on having their name and company in print. It reinforces influence, which brings in $$$. Being anonymous conveys nothing. Personally, I'll never understand why anyone is the anonymous source ...
DCITDave 12/5/2012 | 3:10:31 PM
re: Adtran, Tellabs Ring Up Qwest RFP re: "Being anonymous conveys nothing. Personally, I'll never understand why anyone is the anonymous source ..."

I can appreciate an analyst taking that stance. For analysts, it really does come down to whether they truly want to help or just want to be quoted.

Folks who work at vendors or carriers might view trade hacks with a bit differently, though. They don't always get credit for their work and sometimes -- prepare to be shocked -- big companies don't always put the whole truth out in their press releases.

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