Sycamore: Good News in the Offing?
Sycamore Networks Inc. (Nasdaq: SCMR) is working on a big deal with Japan’s NTT Corp. that could come to fruition in the next few weeks.
This information comes from a previously reliable source, although at press time it wasn't clear whether the source is a Sycamore shareholder or not. Sycamore itself declines to comment.
If the rumor proves to be true, it would give Sycamore a much needed boost. Some of its other contracts, notably with Williams Communications Group (NYSE: WCG) and 360networks Inc. (Nasdaq: TSIX; Toronto: TSX.TO), appear to be going sour (see Sycamore Drops a Bomb).
Industry observers are skeptical about the rumor, pointing out that Sycamore has had more success selling equipment to startup carriers laying new fiber and not using Sonet/SDH, like Sweden's Utfors. NTT is likely to be at the opposite end of the scale, with massive amounts of older fiber and existing SDH infrastructure.
-- Peter Heywood, International Editor, Light Reading http://www.lightreading.com
NTT hasn't announced details of the new FTTH service that starts in July. But from what's been known, the "last-mile" technology is their own and access and core switching are external - very likely SCMR if the news source is a company insider. :)
But I doubt NTT is willing to disclose tech suppliers before launching a new service. Note NTT spends $3B annually on next-gen R&D (a large portion on optical) and is struggling with declining phone revenues (lost $750M this year - group companies, like DoCoMo, excluded -) and excess workforce.
Thus, my estimate - the deal will be handled quietly and the figure would be modest - upward of $50M.
Of course, those in the know won't talk.