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Optical/IP

Tiscali to Double US Efforts

Citing a 300 percent jump in traffic over its North American network in the last 12 months, Tiscali International Network is announcing a major ramp in spending. (See Tiscali Ramps Up US Capex.)

Tiscali will be making a "considerable investment of millions of dollars" that will go towards North American network upgrades, including more POPs in new cities and the doubling of its U.S. sales team.

The company generates 30 percent of its revenues from U.S. traffic and is looking to further compete with some of its larger competitors, such as Level 3 Communications Inc. (NYSE: LVLT).

Tiscali will be focusing much of its U.S. efforts in Miami, which is the main gateway to Latin America and the large growth of traffic coming from there.

Tiscali will be using Juniper Networks Inc. (NYSE: JNPR)'s MX960 platform to beef up its traffic capabilities on the network edge.

As with many players in the industry, the explosion of video on the Internet has proven lucrative for Tiscali. It provides wholesale IP services to customers including Akamai Technologies Inc. (Nasdaq: AKAM) and Limelight Networks Inc. (Nasdaq: LLNW), the two largest content delivery networks.

With the huge traffic needs of its customers, Tiscali's 10-Gbit/s ports are getting filled up faster than ever, and the company says that the current trends could lead to an upgrade to 40-Gbit/s as soon as next year. Tiscali claims it was one of the first to the market with 10-Gbit/s, and it's testing new 40-Gbit/s hardware.

Financially, Tiscali has been free-cashflow positive since 2001 and is expecting to become profitable within the next year. With Telefónica SA (NYSE: TEF) purchasing a 10 percent stake in Telecom Italia (TIM) , Tiscali remains one of the few Italian corporations with a market cap of at least €1 billion (US$1.33 billion).

— Raymond McConville, Reporter, Light Reading

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