Prepaid phone cards, cheap calling cards online

Our online shop offers you phone cards for long distance calls. You can find the best rate to the international call and save many money. Buy only cheapest phone cards online in our shop.

Main Page Telecom News Enter Your Account / Register Buy Phone Card Best Rates FAQ and Help
International calls
call from
call to

OFC: Analyst blames Cisco for unprofitable optics


ANAHEIM--“This is an era of profitless prosperity,” Andrew Schmitt, general partner of Niquist Capital, told a crowd at the Optical Fiber Communications conference.

Revenues are climbing in the optical component market, he said, but profits are not. And a “major contributor” to the problem is Cisco Systems.

Cisco buys 70% of all the optical modules in the market, Schmitt said. It then resells those modules for a hefty profit--90% gross margins--with “negligible value added,” he said. Because competing modules are not as interoperable with Cisco gear as its own modules, customer choice is limited, he said. “Cisco is forcing customers to buy modules from them at inflated prices.”

The practice has worked well for Cisco. The vendor sells 60% of the world’s Ethernet ports and 70% of all non-copper gigabit Ethernet ports. Module sales contributed about $2.1 billion to Cisco last year, Schmitt estimated—more than that reported by a handful of top component vendors combined.

Consolidation among component vendors could change the situation, giving those suppliers more pricing power to leverage against the router giant. And Schmitt believes such consolidation is in Cisco’s interest as well.

“More consolidation is needed to keep Cisco honest,” he said.

However, because investors see component vendors’ top lines climbing, and because some vendors still have a fair amount of liquidity left over from the bubble years, consolidation may take a while to occur. Ovum-RHK expects the global optical telecom component market to grow 11% year to $5.1 billion in 2011.

Cisco was not immediately available for comment.


Related News

Analyst: Nortel eyeing Force10
Nortel Networks might be considering an acquisition of Ethernet switch vendor Force10 Networks, according to Susquehanna Financial Group analyst Joe Chiasson.Chiasson based his assertion on conversations with industry contacts, adding the caveat that his confidence in...
Cisco beefs up CRS-1 with IPoDWDM
Cisco Systems today announced the introduction of support for Internet Protocol over Dense Wavelength Division Multiplexing (IPoDWDM) on its CRS-1 Carrier Routing System. Additionally, the company has confirmed that Comcast is now using the largest of the vendor’s...
Cisco may replace Symbol as WLAN switch leader
Symbol Technologies, the first vendor to launch a wireless LAN switch, faces an increased threat to its dominance of that market from router giant Cisco Systems, according to data released today by Infonetics Research.With 28% of the market, Symbol held onto its top...
Debt exchange boosts analyst rating
A debt exchange completed by Level 3 Communications this week has given the company more runway and Wall Street more optimism in it.The debt exchange, completed on Wednesday, left Level 3 with $692 million in debt that matures in 2010 and another $600 million due in...
Calling Cards © 2008