Speeding ahead DSL deals propel the market

Digital subscriber line technology is hot, hot, hot. Service providers, vendors and customers are anxious to get their hands on commercial, high-bit-rate copper solutions. Two deals made last week will likely heighten the anticipation and shorten the wait.

Northern Telecom and Westell formed a strategic alliance to link Westell's asymmetrical digital subscriber line modems and D-SLAM equipment with Nortel's comprehensive broadband network in a first-of-its-kind formal deal.

"To date, all companies have focused on access only, not billing, network management and provisioning services, and that's what Nortel really brings to the table," said Kieran Taylor, broadband consultant for TeleChoice, Verona, N.J.

End-to-end solutions that include not only ADSL modems but the support network are important to customers, said Scott Schauer, Nortel's director of ADSL products.

"As we were talking together over the last year with customers, we've learned that by the 1997 time frame, end-to-end solutions will be their focus," he said.

David Corey, Westell vice president of global marketing, said his company has already been working on projects with Nortel. The strategic alliance now lets them "look at all areas of potential collaboration."

Questions about a Nortel takeover of Westell were fielded with a "no comment" from Nortel. Westell's stock price is too high for a buyout, although Nortel probably considered the buyout possibility, Taylor said.

In a second DSL deal last week, Amati Communications Corp. and NEC Corp. agreed to jointly develop, manufacture and exchange technologies for products based on very-high-speed DSL (VDSL) technology. Amati benefits from NEC's size, experience and close relationships with carriers, and NEC gains Amati's leadership experience in DSL. The VDSL IS transceiver will be based on Amati's discrete multitone technology and built at NEC's silicon fabrication plant.

Taylor also applauded the second deal. "A lot of industry hype is surrounding ADSL, but I think VDSL will be the end winner in the form of hybrid fiber copper. VDSL will be the solution to full service networks incorporating voice, video and data."

Hybrid fiber/coax is a coax link to the last 100 feet, where copper takes over to the customer. VDSL is specifically suited for super-high rates over short distances.

The Amati/NEC deal will also probably speed the development of VDSL transceivers, Taylor said. The general market prediction had been that chips would be available in early to mid-1998. That time frame could move up by about six months, he said.

Product shipments should start before the end of 1997, said Jim Steenbergen, Amati president and chief executive officer.