We are a leading global supplier of broadband network equipment, software and
systems integration services that enable communications service providers to deliver
high-speed Internet, data, video and voice services to consumers and businesses
worldwide. Telephone companies, cable television operators, Internet and data
service providers, wireless service providers and other communications service
providers are building and upgrading the broadband network infrastructure required
to offer high-speed Internet access as well as data, video, telephony and other
interactive multimedia services. Our product offerings and development efforts
are focused on increasing the speed and efficiency of the last mile/kilometer
portion of broadband communications networks, and our product and service offerings
help connect communications service providers' offices to businesses and end users'
homes as well as to wireless communications devices. Our customers include local
and long-distance telephone companies, cable television operators, wireless service
providers, new competitive service providers, broadcasters, governments, businesses,
system integrators and communications equipment manufacturers and distributors.
We offer broadband connectivity components and systems, broadband access and network
equipment, software and systems integration services to our customers through
the following two segments of product and service offerings:
Broadband Infrastructure and Access; and
Professional Services.
Our Broadband Infrastructure and Access business provides network infrastructure
products for wireline, cable and wireless communications network applications;
Digital Subscriber Line (DSL) offerings for the telecommunications industry;
and Internet Protocol (IP)-based offerings for the cable industry. These products
consist of:
connectivity systems and components that provide the infrastructure to wireline,
cable and wireless service providers to connect Internet, data, video and voice
services to the network over copper, coaxial and fiber-optic cables, and
access systems used by wireline, cable and wireless service providers to deliver
high-speed Internet, data and voice services to consumers and businesses in
the last mile/kilometer of communications networks.
Professional Services
Professional services consist of systems integration services for broadband,
multiservice communications over wireline, wireless, cable and enterprise networks.
Professional services are used to plan, deploy and maintain communications networks
that deliver Internet, data, video and voice services to consumers and businesses.
Our professional services are offered in North America and Europe and provide
integration solutions for customers that deliver Internet, data, video and voice
services over networks. Our professional services support both the multi-vendor
and multi-service delivery requirements of our customers. These services support
customers throughout the technology life-cycle, from network design, build-out,
turn-up and testing to ongoing maintenance and training, and are utilized by
our customers in creating and maintaining intra-office, inter-office, or coast-to-coast
networks.
Manufacturing and Suppliers
We manufacture a variety of products that are fabricated, assembled and tested
in our own facilities around the world. In an effort to reduce costs and improve
customer service, we attempt to manufacture our products in the region of the
world where they will be deployed. Our global sourcing team uses vendors from
around the world to procure key components and raw material at advantageous
prices and lead times. The manufacturing process for our electronic products
consists primarily of assembly and testing of electronic systems built from
fabricated parts, printed circuit boards and electronic components. The manufacturing
process for our connectivity products is completely vertically integrated and
consists primarily of the fabrication of jacks, plugs, cables and other basic
components from raw materials as well as the assembly of components and the
testing of products. Our sheet metal, plastic molding, stamping and machining
capabilities permit us to configure components to customer specifications, provide
competitive lead times and control production costs. We also utilize several
outsourced manufacturing companies to manufacture, assemble and test certain
of our products within our Broadband Infrastructure and Access segment.
We purchase raw materials and component parts from many suppliers. These purchases
consist primarily of copper wire, optical fiber, steel, brass, nickel-steel
alloys, gold, plastics, printed circuit boards, solid state components, discrete
electronic components and similar items. Although many of these items are single-sourced,
we have experienced no significant difficulties to date in obtaining adequate
quantities. At this time, we are noticing some increase in the prices for some
raw materials we use to make products. Such increases we believe are caused
primarily by heightened demand for materials in developing markets such as China.
To date, we have been able to mitigate most of such increases through greater
purchasing power we now have following our acquisition of KRONE. These circumstances
could change, however, and we cannot guarantee that sufficient quantities or
quality of raw materials and component parts will be as readily available in
the future or, if available, that we will be able to obtain them at favorable
prices.
Competition
Competition in the communications equipment industry is intense, particularly
in light of reduced spending levels by our customers. Many of our competitors
have more extensive engineering, manufacturing, marketing, financial and personnel
resources than we have. In addition, rapid technological developments within
the communications industry have resulted in frequent changes among our group
of competitors. Currently, our primary competitors include: For Broadband Infrastructure
and Access products: 3M, ADTRAN, Andrew, CommScope, Corning, Furukawa, Nexans,
Powerwave, Schmitt, Telect, and Tyco.
For Professional Services: Butler, Graniou, Greenwoods, Lucent Technologies,
NEC, SAG, and SPIE.
We believe that our success in competing with other communications product
manufacturers depends primarily on the following factors:
maintaining our brand recognition and reputation as a financially sound long-term
supplier to our customers;
our engineering (research and development), manufacturing, sales and marketing
skills;
the price, quality and reliability of our products; and
our delivery and service capabilities.
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