News and Research on UTStarcom, Inc. (UTSI)
Business Description
UTStarcom, Inc. engages in the design, manufacture and sale of telecommunications infrastructure, handsets and customer premise equipment and provide services associated with their installation, operation, and maintenance. The Company's products are sold primarily to telecommunications service providers or operators. The Company sells a range of products that are designed to enable voice, data and video services for its operator customers and consumers Worldwide.
Segments
The Company operates in five key business segments: Wireless Infrastructure; Broadband Infrastructure; Personal Communications Division; Handsets; and Services.
Wireless Infrastructure Segment
The Company's Wireless Infrastructure segment designs, builds and sells software and hardware products that enable end users, or subscribers, to send and receive voice and data communication in either a fixed or mobile environment by using wireless devices.
The products in the Company’s Wireless Infrastructure segment are based on various worldwide mobile interface standards, including: Personal Handyphone System, CDMA, and TD-CDMA. The Company's wireless products are designed to offer a suite of integrated, customizable, voice and value-added services, including short-message services, web browsing, e-mail, voice mail, and Internet access.
Personal Access System
The Company's Personal Access System family of wireless core infrastructure equipment, based on the Personal Handyphone System standards developed by The Association of Radio Industries and Telecommunication Technology Committee in Japan, is designed to help its customers.
The Company's PAS wireless access system employs micro-cellular radio technology that is designed to enable service providers to offer subscribers both mobile and fixed access to telephone services. In China, the PAS architecture is designed to allow service providers to transition their network capabilities from wireline to wireless, allowing them to offer both mobile wireless voice and data services within a city or community. Using the Company’s products, service providers can offer new wireless services, including citywide mobility, e-mail, mobile Internet access, and short message services.
CDMA 2000 Wireless Voice and Data Products
CDMA stands for Coded Division Multiple Access and is the main technology used in digital wireless communications networks. CDMA 2000 is referred to as a third generation (3G) technology. Additionally, CDMA 2000 technology enables a range of new features, including broadband Internet access, music downloads, push-to-talk communications, streaming video and remote corporate access.
In 2004, the Company introduced MovingMedia 2000, the IP-based infrastructure product for CDMA 2000. The Company's MovingMedia 2000 wireless infrastructure product family includes IP base stations, intelligent media gateways, signaling gateways, and packet data server nodes (PDSN).
TDCDMA Wireless Data Product
TDCDMA is a Time Division Duplexing variation of Coded Division Multiple Access. TDCDMA uses the same frequency to both send and receive information. Frequencies are usually licensed to service providers by governments. Additionally, certain frequencies have specifically been reserved for TDCDMA technologies.
In 2004, the Company introduced its MovingMedia 6000 TDCDMA product. It has a relationship with IPWireless, Inc., which provides the core technology for its product. The Company's MovingMedia 6000 turns a range of licensed frequency bands—1900-1920MHz, 2010-2025MHz, 2500-2700MHz, and 3400-3600MHz—into valuable assets. Its product family includes central office, base station and end-user equipment.
The Company's MovingMedia 6000 system provides broadband data speeds of up to 3 megabits per second per subscriber enabling subscribers to access the network from home, work, or any other location.
Markets and Customers
In 2005, the Company’s major market for Wireless Infrastructure products was China. Outside of China, key markets it was targeting for Wireless Infrastructure include India, Japan, Latin America, Europe and the United States. The Company offers its PAS, MovingMedia 2000 and MovingMedia 6000 products and services in each of these markets.
The Company has established an office for sales and services operations to support various countries in Southeastern Asia, including Vietnam, Thailand and Taiwan. As of December 31, 2005, the Company’s customers had approximately one million PAS subscribers in Vietnam and Taiwan utilizing the Company’s network infrastructure. Key customers in the region include FITEL and Chunghwa Telecom Co., Ltd. in Taiwan, and Vietnam Post and Telecommunications Corporation in Vietnam.
Competition
The Company's competitors in the Wireless Infrastructure market include: Alcatel, LM Ericsson Telephone Company, Huawei Technology Co., Ltd., InterDigital Communications Corp, Lucent Technologies, Inc., Motorola, Inc., Nokia Corporation, Nortel Networks Corporation, Samsung Electronics Co. Ltd., Siemens AG and Zhongxing Telecommunications Equipment Corporation.
Broadband Infrastructure
The Company's Broadband Infrastructure segment designs, builds and sells software and hardware products that enable end users to access high-speed fixed data, voice and media communication.
This segment includes digital subscriber line products, multi-service access node products, fiber optics products and IP-based television.
Digital Subscriber Line Products
Digital subscriber line (DSL) technology allows high-speed data and content transfer while providing simultaneous telephone communications over the same fixed copper line. The Company's IP-based DSL Access Multiplexers (IP-DSLAMs) incorporate the DSL technologies combined with a range of form factors to enable high-speed access and deliver services to residential and commercial subscribers using broadband networks.
The Company's AN-2000 product is suited for telecommunications providers with existing copper telephone system seeking to expand into offering broadband data to their customers. An all-IP network allows the Company’s customers to add features, such as video streaming, IP multicast and IP Quality of Service in addition to traditional broadband services. As of December 321, 2005, the Company had deployed approximately seven million IP-DSLAM lines globally.
The Company's DSL products include customer premise equipment (CPE), such as various single and multi-port DSL modems, set-top boxes and voice over the internet devices that allow residential and business customers to access voice, data and video services.
Multi-Service Access Node
A Multi-Service Access Node is a single device which delivers a mix of broadband, traditional voice and data services, and media gateway functionality via copper or fiber. The Company's iAN-8000 Multi-Service Access Node (iAN-8000) is a solution for a telecommunications provider who is replacing an old network or building a new network. The iAN-8000 platform integrates the functionality of the Company’s AN-2000 product with a voice over Internet Media Gateway product and a traditional digital loop carrier.
Service providers can deploy the iAN-8000 throughout their networks, which allows them to bring new voice over the Internet (VoIP) and broadband applications to the possible service area. The iAN-8000 is designed to enable providers to offer multiple services from one platform, including traditional voice, VoIP, and high-speed data access using the latest DSL technologies. The platform incorporates digital loop carrier functionality so service providers can also deploy it in remote locations to extend their voice service reach beyond the area served by the central office.
Optical Products
The Company's optical products include transport products and access products. The Company's products convert and translate data, video, voice, or other traffic into an optical signal which is transmitted over glass fiber. The product platform includes a multi-service management system which simultaneously processes multiple speeds ranging from 155 Megabits per second for traditional voice to 10 Gigabits per second for data intensive services.
In 2004, the Company introduced its Gigabit Ethernet Passive Optical Network (GEPON) product. A passive optical network (PON) is a system configuration that brings optical fiber the way to the end user using unpowered optical splitters that enable a single optical fiber to serve multiple premises.
The Company's GEPON family includes both the telecommunications provider's central office and customer premises equipment which handle speeds of up to one Gigabit per second of bandwidth to residential and business customers.
The Company has NetRing Multi-Service Transport Product (MSTP) optical product line. The Company's NetRing products are designed for the high bandwidth needs of a service area. Its NetRing 600 products provide voice and data services for multi-tenant buildings, office buildings, and enterprise campus applications. Its mid-range NetRing 2500 products offer voice and data transport when more bandwidth and capacity is required. The Company's high-end NetRing 10000 products provide service for regional transport applications, when maximum bandwidth and capacity is required. NetRing provides a range of functions for carriers to manage voice, data and video traffic with network management functions previously offered on multiple independent platforms.
IP-based Television
The Company's IPTV system, RollingStream includes both central office and customer premises equipment for delivering television and multimedia over carrier networks based on IP technology. Its RollingStream products and services enable a service provider to deliver broadcast television and on-demand video services to residential and commercial premises over a switched network architecture. It is a carrier-class product that is designed to scale to support various users and content hours.
The RollingStream product family includes a storage and streaming device (MediaSwitch); a device for combining different video signals onto a unified distribution system (Content Engine); a device residing at the user's home or place of business; and a network management system that enables non-stop, system-wide operation. The current version of the RollingStream products has been designed to function over standard copper telephone lines.
RollingStream is designed to allow carriers to offer new television and multi-media services. The system is also designed to help providers attract customers of cable and satellite operators by offering an interactive suite of services. The Company has announced key customer deployments at DSSI in North America, Softbank in Japan and China Telecom in China and approximately 40 trial networks deployed globally.
Markets and Customers
The Company's Broadband Infrastructure segment also targets various markets and customers worldwide. In 2005, its major broadband infrastructure customer was Softbank Corp. and affiliates in Japan (SBB). SBB is a parent company to the Company’s key service provider customers in Japan, including Yahoo! BB and Japan Telecom. Yahoo! BB and UTStarcom officially launched the UTStarcom RollingStream IPTV products in July of 2005.
In addition to the Japanese market, the Company has targeted other key markets such as China, India, Europe, the Middle East, Africa, Central America and Latin America for the deployment of its Broadband Infrastructure products.
The Company offers its AN-2000 and NetRing products and services in India. The Company implements and deploys its products and conduct trials with various operators, including Reliance Infocomm, Ltd. and Bharat Sanchar Nigam, Ltd.
The Company's target markets in Central and Latin America include countries like Brazil, Mexico, Panama, Haiti, Honduras and Guatemala. In 2005, key customers in Central and Latin America included Telefonos de Mexico, S.A. in Mexico, Brazil Telecom in Brazil and Telefonica del Sur in Chile.
Competition
The Company's competitors in the Broadband Infrastructure market include Alcatel, Datang Telecom Technology Co., Ltd, Huawei Technology Co., Ltd., Lucent Technologies, Inc., Tellabs, Inc., and Zhongxing Telecommunications Equipment Corporation.
Personal Communications Division
The Company's Personal Communications Division markets, sells and supports handsets other than PAS handsets for markets other than China. The Company's Personal Communications Division (PCD) was acquired from Audiovox Corporation in November 2004. The PCD segment markets wireless handsets and accessories, through international wireless carriers and their agents, independent distributors and retailers. The Company sells an array of digital handsets, hand-held computing devices and accessories in various technologies, principally CDMA. The Company generally markets its wireless products under the UTStarcom brand name or co-brand its products with its carrier customers. In addition to handsets, the Company sells a line of accessories that includes batteries, hands-free kits, battery eliminators, cases and data cables.
Product Development, Warranty and Customer Service
The PCD segment works with both customers and suppliers in feature design, development and testing of products. In particular, PCD: with its wireless customers, determines future market feature requirements; works with its suppliers to develop products containing those features; participates in the design of the features and aesthetics of its wireless products; tests products in its own facilities to ensure compliance with PCD standards; and supervises testing of the products in its carrier markets to ensure compliance with carrier specifications.
The Company provides a warranty on its wireless products for periods ranging from twelve to fifteen months. To support its warranties, the Company has approximately 2,700 independent warranty centers throughout the United States and Canada.
Joint Venture
The company has entered into a joint venture with Bharat Sanchar Nigam Ltd. The enterprise would set up 1.3 million broadband lines in 900 cities.
Suppliers
The Company's PCD segment purchases its wireless products from various manufacturers located in Pacific rim countries, including Japan, China, South Korea and Taiwan.
Markets and Customers
The Company sells its wireless handsets and accessories to wireless carriers and the carrier's respective agents, distributors and retailers. The Company's major market for the PCD segment is North America. The Company's five major wireless customers in 2005 were Alltel Communications Products, Sprint Spectrum, T-Mobile USA, Verizon Wireless and Virgin Mobile USA.
The Company assists wireless carriers with their marketing campaigns by scripting telemarketing presentations, funding co-operative advertising campaigns, developing and printing custom sales literature, logistic services, conducting in-house training programs for wireless carriers and their agents and providing assistance in market development.
The Company operates six retail facilities for end-user devices under the name Quintex and licenses the trade name Quintex to ten outlets in selected markets in the United States. Quintex also serves as an agent (in activating cell phone numbers) for the following carriers in selected areas: Boost, Cingular, Nextel, NTelos, Sprint, Suncom and T-Mobile.
Competition
The Company's primary competitors for wireless handsets include LG, Motorola, Samsung, Kyocera, Nokia and Sanyo.
Handsets
The Company's Handsets segment designs, builds and sells consumer devices that allow customers to access wireless services. The products range from basic units to high-functionality models. The Company features single, dual and multimode handsets with cameras, video recorders and players, high-resolution color displays, multiple ring tones, short message service and high speed Internet access and email capability.
PAS Handsets
The Company offers various PAS handset models. The Company markets PAS handsets in China. The Company shipped approximately 10 million PAS handsets in 2005.
CDMA, WiFi and Multi-Mode Handsets
In 2004, the Company has entered into the CDMA and Wireless Fidelity (WiFi) handset markets. The Company offers carriers a selection of handset features by providing a range of models supporting each of these technologies. In 2005 Vonage Holdings Corporation announced a new voice over the Internet service with one of the Company’s WiFi Handsets. The Company's products include dual-mode and multi-mode models and it intends to introduce TDCDMA handsets in the future.
Markets and Customers
In 2005, the Company's primary market for the Handsets segment was China. In 2005, majority of sales were in the Jiangsu Province, the Zhejiang Province and in the Guangdong Province.
Competition
The Handset business segment faces significant competition from various global competitors, including China PTIC Information Industry Corporation; Zhongxing Telecommunications Equipment Corporation; Lucent Technologies, Inc.; Amoi Electronics Company, Ltd.; Huawei Technologies Co, Ltd; Kyocera Corporation; Nippon Electric Corporation and Sanyo Electric Company, Ltd.
Significant Events
The company and Globecomm Systems Inc. have formed a technology partnership to demonstrate the power of a hosted satellite solution to meet the need for enterprise campus mobile connectivity. The two companies have created a nationwide demonstration network linking multiple picocells serving their office buildings, with all backhaul and call control provided via satellite through a flexible, cost-effective hosted solution.
Professional Services
In addition to its product offerings, the Company provides a range of service offerings, including technical support services. The Company's service offerings complement its products with a range of planning, deployment, consulting, technical, project, quality and maintenance support-level services including support through technical assistance centers.
Markets and Customers
The Company primarily provides its services in China. It also sells its products in various other established and emerging growth markets, which include North America, Japan, India, Central and Latin America, Europe, the Middle East, Africa and Southeast and North Asia. The Company has field sales offices in these regions.
Global Customers
The Company's customers, telecommunications service providers, enable delivery of wireless and broadband access services including data, voice, and/or video to their subscribers. They include local, regional, national and international telecommunications carriers, including broadband, cable, Internet, wireline and wireless providers.
Sales Offices
The Company maintains 43 sales and customer support offices in 25 countries covering the U.S., Canada, Latin America, the Caribbean, Europe, the Middle East, Africa, India, and the Asia-Pacific regions.
History
UTStarcom, Inc. was incorporated in 1991.
