2 thoughts on “AT&T, Alcatel’s Stealth Take Over of 2Wire?”

  1. Om,

    I cannot agree with your comment regarding Alcatel selling their DSL CPE business to Thomson. I am not sure what Alcatel’s motivations were at this time – although servicing/reducing their debt in the face of a sagging telecom equipment market certainly required raising some cash.

    However I feel that this deal made perfect strategic sense for Alcatel. Indeed this happened right at the time where DSL became standardized, value migrated to the DSL modem chips, and DSL CPE became commoditized. This would have happened regardless of what Alcatel did. The business was turning into a consumer electronics activity – certainly Thomson was much better equipped to run it. And the Chinese suppliers were gearing up and starting to put pressure on prices.

    I might add that the price Alcatel got for that business was quite nice in my opinion.



  2. This raises other interesting questions: could the Alcatel/2Wire partnership really be a quiet hedge against Microsoft TV-enabled MOT and SFA STBs? If an Alcatel/2Wire IPTV STB is in the offing, whose IPTV middleware client would run in it? Microsoft’s or Alcatel’s supposedly-retired Open Media Platform? Why would they do this, though, if Alcatel could just as well support SA and MOT in porting the Alcatel middleware client to their boxes?

    In any case, 2Wire’s is a strong product, with PVR and home media server capabilities, including the ability to access it from a mobile device. Alcatel’s having an Alcatel-branded TV CPE device is a good answer to Siemens, given that Siemens is also touting a converged entertainment platform (SURPASS, with Myrio middleware) and has its own STB line.

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