Telecom Update #561 (Can

#561, January 5, 2006

Our New Look Quake Highlights Internet Vulnerabilities RIM Adds 875,000 Blackberry Users BlackBerry to Offer Push-to-Talk Bermuda Seeks Bids for Submarine Cable Videotron Tests 100 Mbps Broadband Ottawa Invests in Telecom Projects U.S. Company Buys Saskatchewan Equipment Maker MTS Sells Winnipeg Buildings DBRS Raises Rogers Rating AT&T Completes Bellsouth Purchase Cisco Buying Web Security Firm

OUR NEW LOOK: Beginning with this issue, the e-mail edition of Telecom Update will be published in HTML instead of plain text. We will fine-tune the design over the next few weeks, to make Canada's most-widely-read telecom publication even more readable and usable. We welcome your comments and suggestions: please email them to snipped-for-privacy@angustel.ca.

QUAKE HIGHLIGHTS INTERNET VULNERABILITIES: On December 26, a magnitude

7.1 earthquake off Taiwan ruptured six undersea telecom cables, interrupting international telecom services across much of East Asia. Voice services from Taiwan were down by 60%-90%. Internet services were affected as far away as Sri Lanka.

Partial service has been restored, using satellite links and fibre overcapacity built during the dot-com boom, but Internet service is still impaired. Repairs will not be completed until later this month.

Even some supposedly landline links were affected. For example Hong Kong's connection to China's Wikipedia went down because it passes through a South Korean server.

Some ISPs have come under fire for offering to sell businesses extra bandwidth to compensate for their reduced service.

Chinese state media reports that more than 9,000 Chinese domain names vanished from Internet registries, many of them then 'snatched by overseas investors.'

RIM ADDS 875,000 BLACKBERRY USERS: Research In Motion says it added

875,000 Blackberry subscribers in the three months ended December 2, bringing the total to about 7 million. Revenue for the quarter was up 49% from a year ago to US$835.1 million, and profit was $176 million, up from $120 million in the same period a year earlier.

BLACKBERRY TO OFFER PUSH-TO-TALK: California-based Kodiak Networks says it has signed a global licensing agreement allowing Research In Motion to add Push-To-Talk capability on the BlackBerry Pearl and other RIM handsets. U.S. carrier Cingular Wireless will be the first wireless operator to offer the feature.

BERMUDA SEEKS BIDS FOR SUBMARINE CABLE: The Bermuda Ministry of Telecommunications and E-Commerce is seeking proposals to install and manage a new submarine cable linking Bermuda to the mainland. The Ministry hopes to issue a formal invitation to tender by January 31, and to choose a supplier by July.

VIDEOTRON TESTS 100 Mbps BROADBAND: Videotron says it has begun beta tests of new technology that would allow it to offer Internet access at up to 100 Mbps throughout its serving area. About 150 trial modems will be installed for consumer and business users this month, and testing will continue over a three- to four-month period.

OTTAWA INVESTS IN TELECOM PROJECTS: In late December, Industry Canada announced repayable R&D investments, through Technology Partnerships Canada, in two wireless communications projects.

$1.8 million to Consilient Technologies Corporation of St. John's, Newfoundland, part of a $5.5 million software development project to increase data and messaging functions for mobile phones and devices.

$9.3 million to ViXS Systems of Toronto, part of a $27.7 million project to capture, store, and wirelessly distribute high-definition content to electronic and communications devices in the home.

U.S. COMPANY BUYS SASKATCHEWAN EQUIPMENT MAKER: Regina-based Noran Tel, a privately owned maker of power distribution, network transmission, and remote monitoring equipment, has been acquired by Illinois-based Westell Technologies for an undisclosed amount. Westell, which makes broadband access products, says Noran Tel will remain in Regina, operating as a Westell subsidiary.

MTS SELLS WINNIPEG BUILDINGS: MTS Allstream has sold two office buildings in Winnipeg, including its head office, to Crown Realty for $51.1 million, and signed a 15-year lease on the space it occupies in those buildings. Proceeds of the sale will be used to buy back common shares.

DBRS RAISES ROGERS RATING: Dominion Bond Rating Service has upgraded the financial ratings for three Rogers Companies. Rogers Communications is now rated BB, while Rogers Cable and Rogers Wireless are both BB (high).

AT&T COMPLETES BELLSOUTH PURCHASE: Following approval by the Federal Communications Commission in late December, AT&T Inc. has completed its US$85 billion purchase of Bell South Corp (see Telecom Update #550) in the largest U.S. telecom merger ever. The new AT&T combines six formerly separate telecom giants: AT&T, Bell South, Southwestern Bell, Pacific Telesis, Ameritech, and Cingular Wireless.

CISCO BUYING WEB SECURITY FIRM: Cisco has acquired IronPort Systems, an email filtering and Web security firm based in San Bruno, California, for US$830 million in cash and stock. The deal is expected to close by the end of April.