Worldwide Mobile Phone Sales in First Quarter are Indicative of Another Strong Year in 2006

Gartner: worldwide mobile phone sales totaled 224 million units in the first quarter of 2006, a 23.8 percent increase from the same period last year,. These strong results for the quarter have resulted in Gartner increasing its mobile phone sales forecast to 960 million units. As mobile phone replacements in mature markets such as Western Europe and North America gave little sign of slowing down, strong sales in regions such as Asia/Pacific and Japan contributed to such a positive start in 2006. This strong start to 2006 is indicative of another strong year. The top two vendors, Nokia and Motorola, accounted for 54.3 percent of worldwide mobile phone sales in the first quarter of 2006 (see Table 1). Nokia was the favored brand in Western Europe, Central Eastern Europe, the Middle East and Africa combined and Asia whilst second preferred brand in the Americas. Wideband code division multiple access (WCDMA) sales played an important role in overall Nokia sales in the first quarter, which favorably impacted Nokia's average selling price for the quarter. Motorola achieved a market share of 20.3 percent, its highest worldwide market share since Gartner started to track the market on a quarterly basis in 2001 As other vendors embrace thinner phones, Motorola needs to continue to be a leader in new designs and focus on timely market launches to maintain its growth. Samsung recorded a year on year drop in market share of -1.0 percentage point. Across the regions, Samsung only grew its share in Western Europe and Latin America falling further behind Motorola at a worldwide level. Although LG, the number four player, has almost half of its market share, Samsung needs to react and work on building a more varied portfolio that includes lower end devices. Table 1 worldwide Mobile Terminal Sales to End-Users in 1Q06 (Thousands of Units)

Company	1Q06 Sales	1Q06 Market Share (%)	1Q05 Sales	1Q05 Market Share (%)
Nokia	76,088.4	34.0	54,960.1	30.4
Motorola	45,518.6	20.3	30,143.3	16.7
Samsung	28,080.5	12.5	24,479.8	13.5
LG	14,508.5	6.5	11,464.2	6.3
Sony Ericsson	13,599.6	6.1	9,905.8	5.5
BenQMobile	7,867.6	3.5	10,209.5	5.7
Others	38,378.2	17.1	39,829.5	21.9
TOTAL	224,041.4	100.0	180,992.2	100.0

Note: This table includes integrated digital enhanced network (iDEN) terminals. It excludes shipments from original design manufacturers to original equipment manufacturer. * 2004 BenQ Mobile volume refer to Siemens and BenQ sales combined. Source: Gartner Dataquest (May 2006) Regional Analysis In Western Europe, sales in the first quarter of 2006 reached 41.1 million units, a 12 percent increase from the same period in 2005. While consumers continued to be drawn into shops by new models and New Year's bargains, mobile operators were still able to sign up new subscribers to their networks. In Eastern Europe, the Middle East and Africa, sales of mobile phones to end users grew 30 percent over the same quarter in 2005 reaching 41.3 million units. Growth in this region was driven by strong new subscriber additions in countries such as Nigeria, Russia and Ukraine while countries such as Poland, South Africa and Turkey saw strong replacement sales. In the first quarter of 2006, the North American mobile handset market recorded sales just under 40 million units, up almost 16 percent from the same period last year. This was a record setting first quarter, and the second strongest quarter ever in North America since Gartner started tracking the market on a quarterly basis in 2001. The prepaid market continued to be a key area of strength as the tier two and three operators have started to pull a greater share of the new subscribers than they had in the past. Another contributing factor to the volume of sales was a continued strong upgrade rate as operators are offering attractive devices to encourage users to replace their dated devices. Sales of mobile terminals to end-users in Latin America were 24.6 million units for the first quarter of 2006, a 31 percent increase from the same period last year. Despite strong competition, operators did not add as many connections as they expected - slightly less than 14 million compared to more than 11.6 million the same quarter last year. Factors such as churn, upgrade and replacement partially offset the decline in net additions. In Asia/Pacific, a surge in demand from emerging markets such as China and India, as well as increasing replacement in mature markets, contributed to higher-than-expected growth in the first quarter of 2006. Total handsets sales totaled 64.4 million units in the first quarter of this year, up 36 percent from the first quarter of 2005. Low and ultra-low tier phones were a key driving factor for growth. In Japan, mobile terminals sales surpassed 12.6 million units in the first quarter of 2006, a six percent increase from the same period last year. Net new additions hit 1.5 million units for the first time in the past two years, supported by aggressive discount packages for air time charges and special terminals targeted at senior users and children. worldwide mobile phone sales

Publ 20060531

MySpace Music Community Activity Far Outpaces Online Music Sites

JupiterResearch: Sites such as MySpace generate more community-related music activity than Yahoo! Music, AOL Music or MTV.com. 48 percent of music discoverers find out about music from friends.

Music discoverers continue to use a broad variety of means to find out about music, 53 percent discover music through videos and 87 percent through radio, but word of mouth is a powerful way to expose and influence musical tastes. Sites that incorporate virtual friends are influential music marketing platforms.

Music marketers should leverage community sites, such as MySpace, to recreate the feel of personal recommendations of friends. Not only are these sites free, but they can be effective music discovery tools.

The new report studies how much activity related to the popular music group The Black Eyed Peas occurred on MySpace, Yahoo! Music, AOL Music and MTV.com. MySpace generated hundreds of thousands of friends of the band, and profile views and song plays in the millions. In contrast, mainstream music media sites counted artist community members in the hundreds, at best.

Using community sites as a marketing platform is inexpensive, but it requires a do-it-yourself approach . MySpace, for example, does the Flash encoding for music streaming and enables e-mailing, but not much more. Promoters should market actively on these sites and push new songs, albums, videos, or tours. Music and Community: Low Cost, Authentic Promotion

Publ 20060531

Telco Triple Play is Stalled by Destructive Obsession with Voice

Pyramid: For most telcos, traditional voice is a key obstacle facing triple play uptake and subscriber RGUs (Revenue Generation Units) Play . Many incumbent telco triple-play bundles are built to prop up voice revenues, rather than build adoption of other applications and customers are not biting.

Telcos own destructive obsession to protect their legacy voice services has been detrimental to the development of attractive triple play services, . Their reluctance to push VoIP is neutering the potential of their triple play offering. Fixed operators and cablecos that have previously offered fixed line telephony are setting VoIP pricing closer to PSTN prices and substantially higher than third-party VoIP equivalents, a symptom of the reluctance to speed up the inevitable demise of PSTN services. This is an industry-wide conundrum; fixed operators must tread a fine line between cannibalizing fixed line services with overcompelling VoIP pricing and offering unattractive VoIP services, adds Zibi.

In the context of accelerating VoIP adoption, supporting PSTN with triple play is out of step with market dynamics. Some telcos (e.g. KPN) have understood as much, most (e.g. Verizon, France Telecom, BT) have moved slowly for a variety of reasons. Indeed, competitors are sensing vulnerability on this front, with many emphasizing the VoIP element of their packages to create obvious differentiation to accelerate incumbent telco churn.

Many incumbent telcos are fiddling while Rome is burning concludes Zibi.

About Transforming Triple Play: Key Lessons and Best Practices for Winning RGU Strategies

Publ 20060531

Core Banking Solutions for Large Banks

Celent: Increased pressure on old core systems has many banks exploring alternatives to keep their core running smoothly and gain competitive advantage.

Core banking systems are the heart of a bank. All transactions move through core systems, which, at an absolute minimum, must remain running and responsive during business hours. Increasingly, these systems are running 24x7 to support Internet banking, global operations, and real time transactions via ATM, Internet, phone, and debit card.

Many core systems are old and suffering from the equivalent of high cholesterol, with old technology slowing the flow of communications between the core and other systems, making new product development cumbersome. Some of the older solutions are using a Services Oriented Architecture (SOA) wrapper to clear the lines of communication.

Many banks that have not previously considered external solutions will begin to do to so. While many of the largest banks are running homegrown solutions, they are taking another look at solutions from vendors as their old systems show the strain of many years of maintenance. Modern systems are promising the flexibility and agility that come with youth. The report examines the solutions for large banks, that are either looking to maximize use of old solutions or considering new core systems. The solutions analyzed include: Accenture Alnova, CSC Hogan Systems, FIS KORDOBA, FIS Profile, FIS Systematics, Fiserv CBS, SAP for Banking, TCS BANCS, TietoEnator CBS, and TriSyn Infopoint.

US banks will not be making any significant moves in core banking. Growth in Eastern Europe is strong as banks modernize their systems. The growth of the economies of India and China are placing increasing demands on the banks and therefore the banks’ core systems .

A table of contents is available online.

Core Banking Solutions for Large Banks

Publ 20060531

Hello, Big Spender: Mobile Operators' 3G CAPEX Rising Sharply

ABI: Two years ago, announcements of capital spending on 3G deployments were mainly made by the largest operators in the most developed nations, but today many smaller and incumbent operators in developing and less saturated markets are also increasing CAPEX as they roll out 3G networks. Because 3G signals travel shorter distances than 2G's, particularly in the case of W-CDMA, more cell sites are needed: 3G can require four to five times as many base stations to obtain the same coverage as 2G networks. In spite of falling prices for 3G infrastructure, building a 3G network with good coverage is expensive and time-consuming. For a mobile operator, 3G network CAPEX spending depends on the reusability of its existing 2G equipment and infrastructure. Existing coverage also determines the requirements for complementary wireless technologies such as GPRS, EDGE, Wi-Fi and WiMAX. If the existing core/backhaul network is IP-based then additional costs are lower than those associated with a circuit-switched network, whether the shift is to W-CDMA or CDMA2000. Most operators with GSM networks prefer to introduce a GPRS platform first to increase usage of data services, and then migrate to 3G networks later. Operators' motivations for network spending have changed over the years, especially in mature markets. Once, network capacity requirements and market share growth through subscriber acquisition were the key motivators for CAPEX investments in mobile networks. But in an increasingly competitive and complex marketplace, high saturation levels, rapid technological changes and falling voice ARPUs are all affecting mobile operators' profitability. The needs for higher ARPU and reduced OPEX (operational expenses) are prompting them to invest in 3G and 3G-based technologies, and to support advanced data services by adding network infrastructure. ABI Research expects that the majority of operators worldwide will invest in W-CDMA networks in the next five years. However in North America, CDMA2000 will continue to be the dominant technology in terms of CAPEX investments, and operators will continue to deploy 1xEV-DO networks although investment in W-CDMA will roll out as well. Mobile Operator Capital Expenditures Analysis

Publ 20060531

Worldwide Mobile Phone Sales in First Quarter are Indicative of Another Strong Year in 2006

Gartner: worldwide mobile phone sales totaled 224 million units in the first quarter of 2006, a 23.8 percent increase from the same period last year,. These strong results for the quarter have resulted in Gartner increasing its mobile phone sales forecast to 960 million units.

As mobile phone replacements in mature markets such as Western Europe and North America gave little sign of slowing down, strong sales in regions such as Asia/Pacific and Japan contributed to such a positive start in 2006. This strong start to 2006 is indicative of another strong year. The top two vendors, Nokia and Motorola, accounted for 54.3 percent of worldwide mobile phone sales in the first quarter of 2006 (see Table 1). Nokia was the favored brand in Western Europe, Central Eastern Europe, the Middle East and Africa combined and Asia whilst second preferred brand in the Americas. Wideband code division multiple access (WCDMA) sales played an important role in overall Nokia sales in the first quarter, which favorably impacted Nokia's average selling price for the quarter. Motorola achieved a market share of 20.3 percent, its highest worldwide market share since Gartner started to track the market on a quarterly basis in 2001 As other vendors embrace thinner phones, Motorola needs to continue to be a leader in new designs and focus on timely market launches to maintain its growth. Samsung recorded a year on year drop in market share of -1.0 percentage point. Across the regions, Samsung only grew its share in Western Europe and Latin America falling further behind Motorola at a worldwide level. Although LG, the number four player, has almost half of its market share, Samsung needs to react and work on building a more varied portfolio that includes lower end devices. Table 1 worldwide Mobile Terminal Sales to End-Users in 1Q06 (Thousands of Units)

Company	1Q06 Sales	1Q06 Market Share (%)	1Q05 Sales	1Q05 Market Share (%)
Nokia	76,088.4	34.0	54,960.1	30.4
Motorola	45,518.6	20.3	30,143.3	16.7
Samsung	28,080.5	12.5	24,479.8	13.5
LG	14,508.5	6.5	11,464.2	6.3
Sony Ericsson	13,599.6	6.1	9,905.8	5.5
BenQMobile	7,867.6	3.5	10,209.5	5.7
Others	38,378.2	17.1	39,829.5	21.9
TOTAL	224,041.4	100.0	180,992.2	100.0

Note: This table includes integrated digital enhanced network (iDEN) terminals. It excludes shipments from original design manufacturers to original equipment manufacturer. * 2004 BenQ Mobile volume refer to Siemens and BenQ sales combined. Source: Gartner Dataquest (May 2006) Regional Analysis In Western Europe, sales in the first quarter of 2006 reached 41.1 million units, a 12 percent increase from the same period in 2005. While consumers continued to be drawn into shops by new models and New Year's bargains, mobile operators were still able to sign up new subscribers to their networks. In Eastern Europe, the Middle East and Africa, sales of mobile phones to end users grew 30 percent over the same quarter in 2005 reaching 41.3 million units. Growth in this region was driven by strong new subscriber additions in countries such as Nigeria, Russia and Ukraine while countries such as Poland, South Africa and Turkey saw strong replacement sales. In the first quarter of 2006, the North American mobile handset market recorded sales just under 40 million units, up almost 16 percent from the same period last year. This was a record setting first quarter, and the second strongest quarter ever in North America since Gartner started tracking the market on a quarterly basis in 2001. The prepaid market continued to be a key area of strength as the tier two and three operators have started to pull a greater share of the new subscribers than they had in the past. Another contributing factor to the volume of sales was a continued strong upgrade rate as operators are offering attractive devices to encourage users to replace their dated devices. Sales of mobile terminals to end-users in Latin America were 24.6 million units for the first quarter of 2006, a 31 percent increase from the same period last year. Despite strong competition, operators did not add as many connections as they expected - slightly less than 14 million compared to more than 11.6 million the same quarter last year. Factors such as churn, upgrade and replacement partially offset the decline in net additions. In Asia/Pacific, a surge in demand from emerging markets such as China and India, as well as increasing replacement in mature markets, contributed to higher-than-expected growth in the first quarter of 2006. Total handsets sales totaled 64.4 million units in the first quarter of this year, up 36 percent from the first quarter of 2005. Low and ultra-low tier phones were a key driving factor for growth. In Japan, mobile terminals sales surpassed 12.6 million units in the first quarter of 2006, a six percent increase from the same period last year. Net new additions hit 1.5 million units for the first time in the past two years, supported by aggressive discount packages for air time charges and special terminals targeted at senior users and children. worldwide mobile phone sales

Publ 20060531

Broadband Accounts for 60% of Online Households

LRG: Household Income a Factor in Choice Between Cable and DSL 69% of all US households now subscribe to an online service at home, and high-speed Internet services now account for about 60% of all online subscribers. Overall, cable remains the most common source for residential broadband – driven by its strength among higher income households, but DSL now has a greater market share than cable among middle-income households.

• Thirty-seven percent of all households with annual household incomes over $75,000 subscribe to cable broadband and 27% subscribe to DSL
• Among all households earning $30,000-$75,000 per year, 21% subscribe to DSL and 18% to cable

Broadband Access and Services in the Home 2006 Publ 20060531

Microsoft Ripe to Enter Portable Gaming Market in Late 2007/Early 2008 and Nintendo in the $3 Billion Portable Game Console Market

TDG: Microsoft will likely leverage its Xbox franchise to enter the portable game console (PGC) market in late 2007 or early 2008. Microsoft is expected to embed a portable multimedia player in a handheld gaming platform similar in many respects to Sony's PSP.

Microsoft has been waiting on the sidelines until its gaming console and software business reached sustainability, all the while watching closely how Nintendo and consumers in general would respond to Sony's PSP,. With global PGC revenues expected to reach $3 billion annually by 2008, and with only Sony and Nintendo active in the PGC space, Microsoft has before it an incredible opportunity. It has a critical brand presence in the console space, the breadth and depth of gaming titles, and the marketing clout necessary to enter this space and win decent market share.

Microsoft has been evaluating two options regarding its portable gaming strategy: licensing a version of its Xbox OS for others to build portable hardware designs upon, or introducing its own branded PGC. While licensing the software is consistent with Microsoft's larger strategy, and no doubt Microsoft has endured many failures in regard to hardware plays, the success of the Xbox presents Microsoft with a unique opportunity. Microsoft owns an established and highly-regarded hardware brand, meaning that they can enter the PGC market from a position of strength, a privilege not enjoyed by any other player except those already active in the PGC space.

On the Future of Portable Game Consoles: Analysis & Forecasts,

Publ 20060530

Companies Underutilize ERP Systems

Ventana: Failure to take advantage of systems’ capabilities costs companies money and blunts strategic effectiveness . Large corporations invest tens of millions of dollars in this type of software, which does their accounting, manages inventories and handles their human resources records. Yet most companies fail to use well-established capabilities of these systems in ways that will reduce their costs, improve customer satisfaction and support strategic initiatives, the study finds. A CFO would demand to know why their company was running a factory only one shift when it could be operated profitably for two or three, but that’s exactly what most of them are doing with their ERP systems without even realizing it,observed Robert Kugel, who directs . Benchmarking data shows that in the 1990s, companies cut the cost of their finance operations significantly. Ventana Research’s work points to ERP systems as the source of much of this efficiency. However, little progress has been made recently. Ventana Research estimates the Fortune 500® is currently saving $60 billion annually because of these investments. Finance executives often are unaware of the impact ERP has had on efficiency, so they have been overlooking opportunities to use the full capabilities of the software to generate further savings.

• A majority of respondents believe ERP can drive and support innovation in 11 of 12 key functional process areas such as financial and managerial reporting, purchasing and compliance and risk management.

• Process automation and integration are a proven ways to cut operating expense, increase cash flow and reduce error and fraud. Yet only half of the study’s participants have implemented an order-to-cashsystem that can accelerate cash collections. Only 30% are using image capture which can improve customer satisfaction by cutting the time to respond to inquiries and reducing costs by eliminating unnecessary paperwork.

• Enhancing company performance requires companies use both financial and non-financial metrics to set objectives. Most modern ERP systems are capable of tracking much more than just accounting data but only 11 percent thought their ERP system captured all or most of the non-financial information they need to monitor employees’ key performance indicators.

Ventana Research’s Financial Performance Management practice

Publ 20060530

Mobile IM can replicate SMS if positioned correctly

Visionagain: As mobile operators across Europe and Asia look to deploy customised (operator owned and branded) mobile IM services by the end of 2006, warns that incorrect pricing seriously throws open the possibility of MIM cannibalising SMS service revenues.

Deploying successful mobile IM services, argues that operators must carefully evaluate how MIM services will fit into their overall service portfolio and adopt the appropriate pricing strategies. While some SMS erosion will inevitably occur in the process, the right bundling and positioning of MIM with complementary services will boost overall ARPU, especially if combined with community features.

If mobile operators play their cards right with respect to pricing and marketing strategies, MIM holds significant potential worldwide. In Europe alone, visiongain estimates that compelling MIM services will generate almost $1.5 billion in service revenues by 2009.

The interest in mobile IM is being driven by perceived benefits such as increasing data ARPU, service differentiation, churn reduction and building customer loyalty. The announcement in February 2006 that a group of 15 mobile operators worldwide – including Tier 1 players such as Vodafone, Orange and T-Mobile - plans to roll out interoperable mobile IM services shows that MIM is seen as a significant potential revenue generator by the operator community.

One challenge for operators in offering comprehensive MIM services is identifying the right business model. Attracted by fee-based services in the mobile space, fixed IM service providers such as Yahoo, Microsoft, AOL, Google and ICQ are eagerly expanding into the mobile domain and trying to gain a dominant position in the MIM market.

The tug of war between operators and the fixed line IM service providers is becoming complex. Would consumers prefer a white label operator offering to more trusted brands such as MSN? Operator-centric MIM services offer a wide range of benefits but may not be the best choice for operators in the long term. Instead, a cooperative model where operators leverage the brand strength of fixed-line IM service providers will enhance the value proposition to end-users, and help operators tap into the existing fixed IM customer base more easily. Interoperability here is key. Mobile Instant Messaging Report 2006-2011

Publ 20060530

WiMAX - the Catalyst for Broadband Wireless Access in Asia-Pac

Frost: Worldwide interoperability for microwave access (WiMAX) has invigorated broadband wireless access (BWA) as a viable solution to address the increasing digital connectivity needs in the Asia Pacific region. At the same time, disparate economic, geographical and regulatory conditions across the region has led to the contrasting pace and development of WiMAX in these diverse markets.

Revenue in the WiMAX services market - covering 12 major Asia Pacific economies - is forecasted to total USD165.3 million by end-2006, and could reach USD5.4 billion in 2010.

An evolution of BWA, WiMAX is a technology that is poised to cause a major upheaval in the telecommunications industry. The added mobility and farther range it offers over its predecessor Wi-Fi (wireless fidelity), and greater bandwidth over 3G (third generation) networks further strengthens its appeal as the next evolutionary data-voice enabler.

The increased activities surrounding BWA spectrum allocation in Asia Pacific in 2005 and 2006 has brought about the resurgence of WiMAX. The low broadband subscriber penetration and tele-density in the region are major thrusts for the deployment of WiMAX. In comparison to Europe and North America, the Asia Pacific region is expected to be a more suitable test bed for WiMAX, given the lack of telecommunications infrastructure, low broadband penetration, and geographically dispersed population.

Certain countries in Asia Pacific however still face challenges in WiMAX deployment, partly due to the uncertain regulatory conditions and the strong commitment to 3G investments. In addition, most incumbent service providers in the region are adopting a cautious approach to avoid duplication of broadband access infrastructure, while anticipating the availability and maturity of WiMAX products.

Although major hurdles in introducing WiMAX Forum Certified products-to-market have been overcome, certain product release milestones need to be achieved. With the large resource commitment in 3G networks and the head start it enjoys, service providers are likely to be hesitant in allocating more resources into a new network until they see some financial returns from the existing ones.

In order for telecommunication companies to capitalize on the growth potential of WiMAX, it is important to understand how the development and use of WiMAX is affected by the economic disparity, market saturation, and geographical and regulatory conditions of each individual Asia Pacific country. A detailed analysis of these factors, along with the appropriate solutions is likely to heighten the booming growth and revenue potential for WiMAX in the region.

WiMAX Growth Opportunities in Asia Pacific

Publ 20060530

Telco TV Franchise Battles Herald Faster IPTV Rollouts

ABI: The four-way battles now raging in the United States around the question of municipal, state, or national franchise agreements for Telco TV video services will see the telcos ultimately prevail over cable operators and local governments. That will mean an accelerated deployment of IPTV video services to customers, and increased sales of set-top boxes. We are at the cusp of a strong run-up in IPTV subscriber bases over the next year or twon. The telcos have sympathy at the higher levels of government, and in general the principles of encouraging competition and preventing monopoly mean that the telcos will be victorious in this battle. It's just a question of when. Under FCC regulations, local governments can require video operators active in their areas to conclude franchise agreements and pay fees. Cable companies have had to complete agreements with every small municipality. Telcos, arguing that their offerings are not video services but broadband services that happen to have video features, have tried to avoid that arduous process. Now, they are increasingly getting relief in the form of initiatives in several states to grant statewide franchises. Texas, Colorado, Louisiana, South Carolina and New Jersey, among others, have passed or are considering legislation setting up statewide franchises, and a proposal for a federal version has been put forward. Local governments and cable operators oppose these moves. Their reasons include the obvious-revenue lost to the municipalities and greater competition for the cable companies-but both groups cite an apparently altruistic fear as well. They allege that the telcos will cherry pick the most affluent neighborhoods for their IPTV, where customers would be more likely to buy premium channels, video-on-demand, network PVR, and other high-priced services, leaving less prosperous communities further disadvantaged. Such selectivity is not permitted under equal access provisions of the law, and telcos deny any such intention. However, notes Arden, when AT&T was initially planning its IPTV deployments, it based much of its market selection strategy on which markets would generate the highest ARPU. Telco TV Market Update: Operators' Aggressive Rollouts Prepare Market for Wide Telco TV Adoption

Publ 20060530

Fixed Mobile Convergence in the Enterprise Starts at the IP PBX

IDC: Enterprise telecom managers believe 28% of their employees are using their mobile phone as their primary work phone. These employees are managing multiple messaging pools and are outside the reach of policy and security control. This reality has enterprises searching for solutions that extend enterprise PBX and desktop phone functionality out to mobile devices, further enabling employees to work everywhere and anywhere while the enterprise retains control over phone numbers and other calling policies.

Against this backdrop, enterprises can now buy off-the-shelf products that grant more desktop phone functionality to the mobile device. These solutions also provide the initial steps towards the enterprise's ability to regain control of wireless voice usage, as well as promote employee productivity by enabling single number contacts to eliminate multiple communication channels.

The adoption of mobile PBX extensions provides users with a remote control to their desktop phone. Features such as single number dialing, corporate directory access, and a common voicemail box for mobile and desktop phones are just some examples of how these solutions empower knowledge workers and increase productivity from their mobile device of choice.

Although services from mobile and fixed-line service providers that provide similar functions are being trialed, the adoption of these services will be hampered by the looming battle between enterprise communication networks and wireless carriers to determine where the line of demarcation should exist so that seamless handoffs between networks can occur.

Mobile operators will offer new enterprise services in the future; however, enterprises can use mobile PBX extension solutions to empower users and improve productivity today.

Extending the Enterprise PBX to Mobile Communications: Single Number Dialing

Publ 20060530

Over 289 Million UWB Chipsets to Ship in 2010

In-Stat: Manufacturers will begin shipping Ultrawideband (UWB) chipsets in 2H06 and shipments are expected to ramp up with a total of 289 million chipsets shipping in the year 2010. PCs will be the initial and largest volume market for UWB wireless chipsets, with PC vendors shipping over 125 million desktop and laptop PCs with UWB capability by 2010,. The Personal Area Network (PAN) has been waiting for a wireless solution to complement the established wired applications. This nascent technology is necessary to transmit large data files found in computers or in consumer electronics applications. UWB allows consumers to get rid of their rats’ nests of wires in the living room or near their PC.

• UWB chipsets will first start appearing in wireless USB dongles in late 2006.

• From there, the usage will start to show up as PCMCIA cards that go into the PC motherboard.

• The last form factor to see widespread adoption of UWB will be cell phones.

Ultrawideband: The Calm Before the Norm

Publ 20060530

Optical network hardware revenue down 12% in 1Q06;Alcatel down 43%

Infonetics: worldwide optical network hardware revenue dropped 12% to $2.6 billion between 4Q05 and 1Q06 as a direct result of the 43% revenue hit market leader Alcatel took.

Alcatel’s optical revenue was down in the first quarter, as it usually is, but their overall growth continues: revenue is up 10% in 1Q06 over 1Q05, while worldwide optical hardware is up only 8% in same period.

Annual optical network hardware revenue is forecast to increase 14% to $12.3 billion between 2005 and 2009, with the strongest growth coming from metro WDM optical equipment. While most categories within the optical network hardware market were down in the first quarter, metro WDM ROADMs bucked the trend with a big 28% gain, as more manufacturers have rolled out ROADM-enabled gear.

The optical market is more cyclical than most, and Alcatel’s optical sales are more cyclical than any other company I’ve seen; a big fourth quarter followed by a low first quarter is the usual pattern here.

We upgraded our long haul WDM forecast because growth has picked up steam (27% gain between 1Q05 and 1Q06),Howard continued. A lot of carriers haven’t invested much in long haul since before the telecom bubble burst. Now that their equipment is old and the new equipment is vastly improved, the business case to invest again is compelling. The new long haul WDM equipment offers more automation using less space and less power. Everything about it is more efficient. So with network traffic growing unabated and many routes already at capacity, carriers are looking to upgrade with new gear that offers operational savings. This will drive strong growth in long haul WDM through 2009, when it will reach $2.1 billion.

1Q06 Highlights

• Metro makes up 69% of all optical network hardware revenue; long haul makes up 31%

• Healthy metro spending will continue due to increased corporate network traffic, storage networking, consumer broadband demands for services such as IPTV, and service provider wireless network backhaul investments

• WDM hardware makes up 32% of total optical revenue; WDM ROADM switch hardware makes up 26% of total WDM revenue, and will increase significantly over the next few years

• Alcatel continues its strong lead in worldwide optical network hardware revenue share, followed by Nortel, Lucent, and Huawei

• While many manufacturers had down quarters, some had up quarters, including Adva, ECI, Ericsson (by acquiring Marconi), Fujitsu, Lucent, and Tellabs

Optical Network Hardware

Publ 20060530

Carrier VoIP/IMS market down 7% in 1Q06, up 48% since 1Q05

Infonetics: Worldwide service provider next gen voice and IMS equipment revenue dropped 7% to $722 million in the first quarter of 2006, but is up 48% from the first quarter of 2005.

Strong annual growth will continue over the next few years, driven by media gateways and softswitches, with the total next gen voice market hitting new highs each year until it reaches $6.2 billion in 2009.

Phenomenal growth in residential and SOHO VoIP subscribers is forecast as well. worldwide, the number of subscribers is expected to nearly double between 2005 and 2006 to 47.3 million, and will continue to skyrocket through 2009. In 2006, there will be:

• 21.3 million subscribers in Asia Pacific, up 50% from 2005

• 13.6 million subscribers in EMEA, up 151% from 2005

• 12.3 million subscribers in North America, up 184% from 2005

As usual, the first quarter for next gen voice was weak, but year over year, it continues to grow well. We’re keeping our eyes on three emerging trends. First, session border controllers could be used as the traffic cop ensuring VoIP security, and as the security gateway in IMS acting as a P-CSCF. Second, media servers are evolving to become the MRF (Media Resource Function) in IMS architecture. And third, while s oftswitches are still growing, the pace of IMS deployments—along with service providers’ willingness to find alternatives—may lead to a diminishing role of softswitches.

Market Highlights

• A total of $21.6 billion will be spent on service provider next gen voice and IMS equipment worldwide during the five-year period between 2005 and 2009

• Although softswitch revenue was flat in 1Q06 and will remain flat in 2006, it is expected to grow to $2.6 billion in 2009, as they are the core of next gen voice networks

• The session border controller segment is growing fast, up 29% sequentially and 99% from a year ago in 1Q05

• In 1Q06, media gateways and softswitches made up 86% of total service provider next gen voice and IMS equipment revenue; as more traffic becomes IP, softswitches will increase their share at the expense of media gateways

• Sonus leads the trunk media gateway segment, Nortel leads the softswitch segment, Acme Packet leads the SBC segment, Cantata leads the media server segment, and Broadsoft leads the voice application server segment

• In 1Q06, Nortel continued its lead in the combination media gateway/softswitch market, Siemens takes second place, and Huawei emerges in third

Service Provider Next Gen Voice and IMS Equipment

Publ 20060530

PBX/KTS revenue down 2%, IP PBX up 1% in 1Q06

Infonetics: Despite a seasonally down quarter for the overall enterprise telephony market, the slow and steady move from circuit switching technology to packet switching technology remains evident, with worldwide TDM system revenue falling 11% and IP PBX revenue inching up 1% between 4Q05 and 1Q06t.

Combined, worldwide TDM and IP PBX systems revenue dipped 2% to $2.1 billion in 1Q06, but is 15% higher than a year ago. Annual revenue is forecast to grow to $11.4 billion in 2009, driven by strong IP PBX sales worldwide as more organizations move to voice over IP. Between 2005 and 2009, IP PBX revenue is forecast to jump 82% while TDM revenue plunges 88%.

The overall enterprise telephony market was not immune to the first quarter blues, but the IP PBX category managed to eek out a small quarterly gain. We recently talked with 450 companies in North America about their voice infrastructure plans, and the results clearly indicate a steady move to VoIP, which will put this market on a nice steady growth trajectory over the next few years.”

1Q06 Highlights

• In EMEA, the top IP PBX system line shipment vendors are Alcatel, Siemens, and Nortel

• The top IP PBX system vendors in North America are Cisco, Avaya, and Nortel in a very close race: Cisco was just in 3rd position the previous quarter, and the difference in 1Q06 market share from 1st to 3rd is less than 2 points

• Cisco leads the IP phone market, with 39% unit market share; the next closest competitors are 3Com and NEC, who are tied for 2nd

• Hybrid PBXs account for 63% of PBX line shipments; by 2009, they will account for 78%, up from 61% in 2005

• 45% of PBX/KTS systems revenue comes from EMEA, 30% from North America, 19% from Asia Pacific, and 7% from CALA Publ 20060530

Enterprise Telephony

Publ 20060530

CMTS market up 30% in 1Q06 as VoIP and high speed Internet access customers increase

Infonetics: Worldwide CMTS revenue jumped 30% to $257 million in 1Q06 after a 6% drop in 4Q05, with annual revenue forecast to reach $1.2 billion in 2009.

The surge in the CMTS market, particularly in North America, is being fueled by the rapid success MSOs are having in signing up new VoIP subscribers, along with their desire to deliver more bandwidth to existing subscribers to support new voice, data, and video services.

Cable operators are feeling the heat from Verizon’s and AT&T’s fiber and higher-bandwidth DSL offerings, so they’re investing in more CMTS units and ports to increase bandwidth to their subscribers,. New DOCSIS 3.0-compliant CMTSs are now beginning to ship that will allow cable operators to double and triple the bandwidth to their subscribers. To counter the telcos’ triple play offerings, cable operators are going for a quadruple play offering through new services like video over DOCSIS and integration with wireless offerings.

The number of worldwide cable broadband subscribers totaled 46.4 million in 2005, a 14% jump from 2004, and is expected to increase another 50% between 2005 and 2009, when it will reach 69.6 million. North America continues to be the regional stronghold of cable broadband subscribers, with 56% of the world total in 2005.

1Q06 Highlights

• Cisco, Arris, and Motorola capture 95% of worldwide CMTS market revenue

• Cisco’s worldwide CMTS revenue share is up 10 points to 61%, Arris’ share is down 4 points, Motorola’s is down 8 points, while BigBand’s doubled

• Cisco nearly doubled its North American CMTS revenue as cable operators here are seeing significant uptake in VoIP subscribers, and Cisco is largely filling the resulting port demand

• Downstream port shipments jumped 46% and upstream ports jumped 44% from 4Q05; 81% of worldwide CMTS ports were upstream, and 19% downstream

• 62% of CMTS revenue came from North America, 18% from EMEA, 16% from Asia Pacific, and 4% from CALA

CMTS Hardware

Publ 20060530

Motorola records consistent growth in America

RNCOS: world #2 mobile handset manufacturer, Motorola, seems to be ruling the mobile handset market in America. Known for innovation in wireless & broadband communication, Motorola Inc declared 24% hike in the sales in the Q1 of 2006 and also announced that the company has recorded 5% increase from the Q1 in the previous year in America. The company is said to have secured a market share of 22% as of now.

Although Nokia is ranked as number one in the mobile handset market in the world, Motorola appears to be gradually snatching a large portion of the total market share from it. In Latin America, Motorola is dominating the mobile handset market, with 34% of the market share.

• In Latin America, the market share of Motorola has risen to 11% during the year 2005, whereas it was just 7% in the year 2003.

• On the geographical basis, the sales distribution for Motorola in United States was 44% while it was 11% in Latin America during the FY05.

• America-May2006.htm"> American Mobile Handset Market Analysis (2006-2009) Publ 200600529

Eceptional growth has been witnessed in the use of GSM mobiles in Latin America, which is expected to exceed 52 percent by the end of 2006.

RNCOS: Makeover in the standard of living & increased spending power of people in Latin America has thrust an exceptional spurt in the overall mobile phone demand. Growth of 41%, as compared to the preceding year, was registered in the subscriber base towards the end of the first quarter of 2006. During the same period, GSM represented more than half of the mobile users in Latin American region. The growth in the mobile market in Latin America is mainly supported by the booming financial power of its natives. With over 145Mn users, GSM is the most popular technology in almost the entire Latin America. Brazil is ranked as number one, with a subscriber base of 93Mn users, followed by Mexico with 49.5Mn users. GSM subscriber base grew up to 43% in US/Canada during 2004-05, whereas the growth was of 87.5% in Latin America during the same time period. However, there was 69% growth registered in the overall mobile market in America . The GSM mobile market in Latin America grew by 21% in 2005, however the market shall increase by 52% towards the end of the year 2006 . The report is of paramount importance for both foreign investors as well as corporates.

World.com/article11698.html">American Mobile Handset Market Analysis (2006-2009

Publ 20060527

China B2C E-Commerce Market Size Reached RMB 854 Million in Q1 2006

Analysys International: that China's B2C (business to customer) E-commerce market reached RMB 854 million in the first quarter of 2006, increasing 12.79% quarter-over-quarter, which is lower than the growth rate of 19.92% for the fourth quarter of 2005. In the first quarter of 2006, B2C users in China reached 68.53 million. China's e-commerce market is developing very well. The manufacturers are pushing up their efforts in Internet-based sales & marketing campaigns. Notably, the building of sales channel logistic systems and offline stores have taken shape.

Major B2C e-commerce vendors such as DangDang.com and Joyo.com haven't occupied the dominant share in Chinese marketplace. A great deal of emerging vendors decreased the market concentration. In the first quarter of 2006, major B2C vendors focused on improving market share by taking the low price strategy. The category and range of products are also expanding from the incipient books and audio & video products to other fields. High-end products including digital products and jewelries are gaining their popularity in the B2C market. China B2C E-Commerce Market Size Reached RMB 854 Million in Q1 2006"> China B2C E-Commerce Market Quarterly Tracker Q1 2006

Publ 20060526

Consumers Reveal Personal Health Records (PHRs) Are Barely on Their Radar

IDC: US. A survey of 1,095 consumers, reveals the majority of respondents (83%) have never used personal health records (PHRs) in either electronic or paper form. The primary reason for not using a PHR, is lack of awareness. Fifty-two percent (52%) of respondents indicate they are simply unaware of the concept, with nearly one in five (18%) noting they would consider using PHRs if recommended by a physician. When asked of their plans for future use of a PHR, consumers are decidedly ambivalent, with 82% uncertain; another 8% stating never.

Consumers' access to their personal health data, whether supplied by their health plans or healthcare providers, is an important step to helping them mak e better care decisions the report. PHR software is a high-potential market, but, for it to truly flourish, the industry needs to do a better job of educating consumers about what these products are and how they can be used to improve the quality of the healthcare services they receive. PHRs also have to become easier to create and maintain.

Of the small percentage (17%) of respondents who do use PHRs, a significant majority (90%) use either paper-based PHRs or common PC tools, such as a word processor, rather than specific PHR products. What's intriguing here is that respondents of this survey are found to be generally computer literate and frequent users of the Internet. Yet, even the few who use PHRs overwhelmingly rely on paper or generic PC software. Consumers who do use PHRs cite their health history (42%), a physician's recommendation (21%), and a health plan's recommendation (11%) as the top three reasons. Health Industry Insights’ Report

Publ 20060526