Newsletter

Global Stats
Cellular connections will grow to 3 billion by the end of 2007, up by half a billion from September 2006. Source: Wireless Intelligence

Mobile WiMAX equipment which utilize beam-forming and MIMO technologies will become available towards the end of this year. Source: Pioneer Consulting

Throughout the developed parts of the world technologies such as 3GPP LTE and HSPA are expected to make a huge impact. HSPA operators will begin upgrading to LTE in 2009/2010 with subscribers exceeding 250 million by the year 2015. Source: Pioneer Consulting

Packet microwave products are ready for deployment in advanced 3G networks such as HSPA, which support Ethernet/IP as their backhaul transport technology. Source: Pioneer Consulting

Despite innovations, the current market for packet microwave is being primarily driven by backhaul demand in WiMAX networks, enterprise links and fiber extensions. Cellular backhaul has yet to see any significant use of packet microwave, but this is expected to change beyond 2008 with advanced 3G networks becoming increasingly established in Europe, followed by North America, Asia Pacific and Middle East/Africa. Source: Pioneer Consulting

Latin America
The future development of business mobility in Latin America will depend on the products and services that telecoms operators and equipment providers deliver. Over 80% of companies surveyed have 30% of their workforce out in the field. Source: IDC

75% of Latin American companies with more than 250 employees will be using IP telephony by the end of 2007 compared to 66% at present. Source: BNAmericas

49% of Latin America companies believe IP telephony is expected to be the fastest-growing technology within the telecoms sector in Latin America in 2007. Source: BNamericas

Although 52% of Latin American companies said they did not intend to purchase managed services, 23% said they already do and 18% said they expect to purchase these services in 2007. Source: IDC

24% of Mexican firms predicted mobile telephony would lead the way, while 28% of Chilean companies said the leader would be Wi-Fi. Source: BNAmericas

Mexico has the highest level of readiness in Latin America's business mobility market. Source: IDC

Chile is showing the highest level of adoption of IP solutions followed by Mexico, Brazil and Argentina. Source: IDC

While almost all companies surveyed in Chile and Mexico want to migrate all legacy traffic to IP VPNs, Argentina is more cautious. The survey showed that 80% of Argentine companies intend to migrate only some legacy traffic to IP VPNs. Source: IDC

Asia Pacific
Around the world Internet household penetration levels are reaching 50%, but Australia is still below 20%. By 2006 there will be at least 2.5 million broadband users. The lack of competition has seen a much lower take-up in the residential markets, prices and usage caps have been blamed. Source: Paul Budde Communications

The number of mobile enterprise email subscribers will increase in Asia/Pacific (excluding Japan) region from 0.74 million in 2006 to 2.72 million in 2010 at a compound annual growth rate (CAGR) of 38.2%. Significant growth will come when mobile email proliferates within the ranks of the middle management and the frontline staff and offer cost efficiencies for the enterprise. Source: IDC

Asia-Pacific would account for most of the increase, with India, Pakistan and Bangladesh seeing the fastest growth rate. Source: Wireless Intelligence

Cambodia's healthy mobile market has passed the 1.5 million subscriber milestone and was continuing to grow at an annual rate of around 35% coming into 2007. Source: Paul Budde Communications

Sales of handsets in China increased sequentially by 10.4% and over the year by 64.8% to 36.89 million units in Q1 2007. Source: Analysys International

Sales of GSM handsets in China increased sequentially by 11.3% and over the year by 66.3% to 34.80 million units in Q1 2007. Source: Analysys International

EMEA
Internet penetration is 3.6% in Africa while 19.2% in the rest of the world. Source: NICI

Israel's very high broadband penetration rate provides great potential for triple play and digital media market developments. Source: Paul Budde Communications

North African GSM subscribers' number is estimated to soar above 81 million by the end of 2010. Source: Informa Telecoms & Media

Nigeria will become the largest market in Africa by the end of 2007 with nearly 40 million subscriptions. Source: Informa Telecoms & Media

There were 14 million cellular and UMTS customers in Greece at the end of 2006, up from 12.4 million in 2005. Source: ITI

There were 235 operators licensed to install and operate telecommunications networks in Slovakia as of April 2007, up from 176 a year earlier. Source: ITI

North America
Annual shipments of business IP phones in the United States and Canada will exceed 11 million in 2009. Revenue will grow throughout the forecast period, to $1.3 billion in 2009. Source: Gartner Group

The addition for the CDMA family of technologies is fairly constant growth of 20 million subscribers per quarter in the U.S. and Canada. Source: Wireless Intelligence

If government agencies at all levels started making voice calls over the Internet by using voice-over-IP technology, they could save around $4.5 billion a year. Research of 300 federal, state, and local agencies shows those agencies could save between 25% and 60% by switching to VoIP. Source: Alexis de Tocqueville Institution

Internet telephony is giving traditional phone service a run for its money, and is expected to be used by 32.6 million U.S. households in 2010. 40% of US households with a high-speed Internet connection will be using VoIP by 2010. VoIP calling services average $20-40 a month, while the average residential phone bill in the US is $51. Source: eMarketer

Letter from the CEO

Last quarter was a busy one of growth and reorganization at Verso. In April, with the ink scarcely dry from our iMarc acquisition, we then acquired sentitO Networks of Acton, Massachusetts. Founded in 2003, sentitO is a global provider of VoIP gateway solutions for service providers. This is a strategic acquisition for Verso and represents the last remaining piece of a carefully designed end-to-end NGN strategy. The acquisition brings us new price points for an integral part of our hardware solutions, makes us highly competitive in high density deployments and brings top notch engineering talent and business processes to the company. The synergies to NetPerformer are very interesting and open the door to some very creative and exciting new product development opportunities. The integration of the new sentitO high density gateway with our products should be complete by the end of the year.

What's New at Verso

New 4-Wire Product for International Market
Last quarter, we announced the general availability of the Verso Verilink WANsuite® 6450AE 4-wire (4W) G.SHDSL. This is a product developed specifically for our international customers, a new access device that replaces E1 technology primarily in international markets. The new offering complements the Verso Verilink 2-wire G.SHDSL, a well-established product that serves as the design basis for the 4-wire. With 4-wire G.SHDSL technology, those same service providers can extend their reach of their phone services. The new offering reduces their transport costs and enables the ability, geographically speaking, to reach more customers efficiently and quickly. This is an ideal solution for international customers in remote areas of the world.

NASA Selects Verso
The United States National Aeronautics and Space Administration (NASA), recently selected Verso to optimize its communication platform. Along with our partner Telenor, we are providing digital voice and data satellite communications equipment and service to all of NASA's Trans Atlantic Landing Sites. The Trans Atlantic Landing Sites are used as emergency landing locations for the Space Shuttle during launch. Specifically, NASA is using Verso's NetPerformer SDM-9230 products. The project will leverage the NetPerformer's ability to support radio tone keying for communications between the ground stations and the space shuttle. Overall, Verso ensures that communications are not lost during the launch process. NASA only selected the most reliable and cost-effective methods of communicating and sending data to and from locations in the U.S.

WiMAX Strides at Verso
WiMAX is already one of the fastest growing sectors in the telecommunications market. Wireless broadband data networks will be the primary method of deploying Internet access in the world because there is no comparable technology that even gets close to the economics that it delivers.

Last quarter, Verso made strides in our efforts to bring WiMAX compatible solutions to various regions in the world. Specifically, MyTel of Pakistan selected a Verso solution for their WiMAX network. For this deployment, we worked with regional partner Al-Futtaim Technologies (AFTECH) and local partner Northtech (Pvt) Ltd, to provide MyTel of Pakistan our Verso MetroNet VoIP Overlay solution which provided the voice overlay to the WiMAX infrastructure. The solution will bring phone services to 10,000 customers in Pakistan and has the potential to accommodate thousands of new subscribers that MyTel expects to acquire in the near future. Our solution integrates and packages a standard set of VoIP features and capabilities which includes Verso Clarent® Class-5 and Class-4 switching technologies, as well as other core capabilities and services including an optional VBO component that supports in the management of the solution.

Verso Joins WiMAX Forum
As part of our WiMAX strategy, Verso has joined the WiMAX Forum, an international, industry-led, not-for-profit corporation of more than 420 industry members. The Forum works to promote global WiMAX deployments and to make WiMAX the platform of choice for broadband wireless. As members of the WiMAX Forum, several Verso employees will participate in the Networking Working Group and the Marketing Networking Group, in alliance with several other telecom leaders, to promote the platform.

In related news, Verso attended Trendsmedia's WiMAX World Asia 2007 in Beijing (Booth 214), April 18-20 and WiMAX World Europe 2007 in Vienna (Booth 201), May 29-31. At both of these events, Verso reps shared the value of the VoIP Overlay for the WiMAX sector. Additionally, Verso executives Art Cederberg and Daniel Kwan spoke on value-added applications for WiMAX networks at May's WiMAX World Europe and April's WiMAX World Asia, respectively.

iMarc Update
At this time, iMarc products are fully integrated into the Verso portfolio. Additionally, we are actively engaged with our iMarc customer AT&T in designing the next generation of iMarc to AT&T's specifications. As the incumbent supplier of AT&T's CPE products, Verso is excited about this collaboration and we now have a defined timeline to deployment. We expect delivery of these products by year's end, which will have a very meaningful order volume from AT&T. We also expect next generation iMarc products to have applications with other Tier-1 operators.

Superonline of Turkey
Superonline, one of Turkey's largest ISPs, has selected Verso's Class 5 Softswitch solution for VoIP wholesale termination services. The solution will also provide residential and enterprise VoBB service, which will be launched under the Alo!DECT and SuperTALK brands. The Verso Class 5 Call Manager provides feature-rich VoBB to enterprise and residential markets over any broadband medium including cable, xDSL, wireless, fiber, satellite, microwave, and power-line networks. It helps create true satellite offices with the same access and dialing plan capabilities as corporate PBX stations by combining the VoBB and enterprise managed services features.

View at Verso

Preparing for the IMS Future: Easing Sticker Shock
By Chris Brazdziunas
Chief Architect, Verso Technologies
chris.brazdziunas@verso.com

IP Multimedia Subsystem, or IMS, is the hottest topic in the industry today and promises significant long-term benefits to a wide range of carriers. Most carriers have an IMS roadmap at this time, but a cautious few still hesitate, most likely due to sticker shock. There is no doubt the cost of implementing an IMS standard architecture is high, and the lead time on ROI is admittedly quite long. Other concerns include complexity from a platform count perspective, integration of components composing the IMS solution, and deployment time. The high cost is the major reason carriers delay in implementing IMS.