Monday, December 24, 2007

Cache & Packets

Telecoms tap slow-growing biz south of border

By Efrain Viscarolasaga

The battle between phone companies and cable companies, as well as the deployment of advanced communications services, tends to center on three major regions -- Asia, Europe and North America.

But more and more, local companies are finding a growing market for their wares south of the border.

Last week, both Burlington's Integra5 Inc. and Tewksbury's Starent Networks Inc. announced new deals in Latin America, joining a number of other local equipment makers that have been slowly gaining a presence in the region.

For Integra5, which makes equipment for the deployment of television-centric services such as TV caller ID, SMS to TV, and voice mail through the TV, the deal (a reseller agreement with American Telecommunication Holdings SA in Chile) marks the second of its kind in the region. Last September, the company announced a similar deal with Solusoft in Panama.

"When it comes to converged services -- beyond the voice, video and data of the triple play -- the Latin American market really has an appetite," said Integra5 CEO Meredith Flynn-Ripley. "It may lag a year or two (behind North America), but we're very bullish on it."

Flynn-Ripley expects to announce two sales to Latin American service providers early in 2008, but declined to name the customers.

In Starent's most recent deal, it will provide its multimedia services delivery platform to Mexican mobile operator Iusacell, Mexico's first 3G operator.

Starent and Integra5 are not the only local players making trips south. Slowly but surely, local equipment makers such as Burlington's Acme Packet Inc.; Derry, N.H.'s Cedar Point Communications Inc.; Wakefield's Comverse (a division of New York-based Comverse Technologies Inc.); and Maynard's SeaChange International are making headway in the region.

Executives attribute the activity to a combination of continued deregulation in Latin American countries and heightened competition between telecommunications carriers and cable companies.

That could lead to more activity in 2008. The market may not see the explosion of Asia, but could provide local equipment makers with steady revenue streams as multiservice operators in Latin America try to keep up with the consumer demand of advanced services generated by continued broadband penetration.

Clean energy briefs

• Fresh off launching the operational phase of its first large-scale biodigester at a dairy farm in Texas, New Hampshire-based Microgy Inc. has shifted its attention to a meat-processing facility in Nebraska. The company has begun construction on two 1.2 million gallon digesters at the Grand Island, Neb., processing plant of JBS Swift & Co. As part of the agreement with JBS Swift, Microgy plans to build, own and operate the digesters, estimated to produce 235 billion Btus per year, equivalent to about 1.7 million gallons of heating oil.

JBS Swift has agreed to purchase the biogas generated from the facility for a 15-year period.

• As Maine wraps up the test of what could be the state's first tidal turbine, being constructed by Fall River-based Ocean Renewable Power Co. LLC, the state of Rhode Island has begun its own research into ocean-generated power.

The Ocean State has entered into a memorandum of understanding with Australia's Oceanlinx Ltd. to install a wave power unit off the state's coast. The deal includes a provision to add new units if the pilot is successful, with the aim of eventually generating 15 megawatts to 20 megawatts of power.

Rhode Island will give grant funding for the first 1.5 megawatt unit, according to a statement from Oceanlinx.

• Last week, Danbury, Conn.-based Electro Energy Inc., a publicly traded maker of advanced battery technologies, recapitalized with an $18 million private placement from the Quercus Trust of California.

The recapitalization included the sale of senior secured convertible notes, as well as the issuance of preferred stock and warrants. The gross proceeds of the sale totaled $8.1 million to Electro Energy.

The news funds will help the company begin shipping its rechargeable lithium-ion cylindrical cells to military and consumer electronics customers in 2008, according to a company statement.