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Leading analyst and top management from six sector firms examine the techno sector in this special 27-page Softswitch Technology issue from The Wall Street Transcript, available at (212/952-7433) or http://www.twst.com/info/info445.htm

TWST: At what point would we be talking about the ongoing servicing of these OSS components and the follow-on upgrades and products — or is that just too far down the pike to review at this point?

Mr. Pyykkonen: All that OSS stuff that's in the background and the big bowl of spaghetti at each RBOC is not something that any of these vendors will address as far as product. In fact, most of that stuff is home grown. Basically these RBOCs have put them on smarter platforms and downsized them and made them more efficient and so forth over the years, but still the problem is that there are so many of them and they're so intertwined that there is really no vendor that can go in and offer a product. It's more either in-house software development and maintenance and change, or maybe a consultant is involved who comes in and does a refresher or a restarter on a system or two. It’s really something that they just have to figure out — how to tie in this new platform, including softswitch, and its other tentacles that kind of hang off for applications, and make sure that everything is coherent between that platform and the OSS. They know how to do it with the big old 5Es and the DMS100, but how do they make sure that's all coherent on the other side? There isn't any one milestone or any one system; it's a plodding transition that they have to address. This is not, however, a major issue. In any big corporate environment with a lot of background IS and IT functionality, you've got to have a path to get from A to B and past that. So it will be a barrier and a hindrance to some extent on the deployment speed. However, if the economics prove to be incredibly viable and the world is really moving to IP infrastructure platforms more quickly, these guys will be forced to make that case. They'll see that the net present value, the way they always look at things on a project basis, is just so overwhelming that they'll force the IT issues to be resolved more quickly. If the economics of it are borderline, they're not going to have a lot of incentive to push the OSS/IT things they need to do.

TWST: Sonus seems to have potential dominance compared with its competitors.

Mr. Pyykkonen: Yes. Sonus (AMEX:SSN) isn’t a big company; from a revenue standpoint, it’s a tenth of Juniper’s size. The Tekelec (Nasdaq:TKLC) story fits in as complementary to everything. It’s basically a signaling company. Part of the infrastructure backbone is SS7 signaling and what are known as STPs (signal transport points) and SCPs (signal control points) that Tekelec delivers. The more usage there is on the network and the more signaling set-up and tear-down that you have, the better their story becomes — and when you look at IP infrastructure, there is a lot of signal set-up and signal tear-down that occurs. Right now, Tekelec is actually getting its main benefit from the wireless business. If the world signs up 10 times the number of subscribers but they don’t use their cell phones, if they just sit dormant, then Tekelec doesn’t benefit at all. If the world signs up just 1.5 times what it has in subscribers but they all use it 50% more than the average today, meaning more calls and more set-up and tear-down, then Tekelec benefits because the service providers will need that signaling equipment in a greater quantity to handle all of that set-up and tear-down functionality. So Tekelec is complementary to everything that’s going on in the softswitch-IP side, where you’ve got more call set-up and functionality — plus, they’re doing more directly in softswitch, working with some of the players in the industry.

This special issue includes:

1) Outlook for Softswitch Technology - In an in-depth (5,600 words) Analyst Martin Pyykkonen, Leading Networking Equipment Analyst at C.E. Unterberg, examines the outlook for the sector and shares specific stock recommendations.

2) CEO interviews (average 2,500 words). Top management of six sector firms examine the outlook for their firm and the sector.