Tag - Airv

Consumers are cutting the cord, severing the tether to the landlines that once were mandated to talk to the world. No longer are they feeling beholdin’ to AT&T Inc. (NYSE:T), Verizon Communications Inc. (NYSE:VZ) or any of the other traditional providers of Plain Old Telephone Service.

Viva la revolution cellular.

Admittedly, wireless services are not without shortcomings. Dropped calls are not completely a thing of the past, but recent technology developments, combined with a network buildout by the carriers, are making strides in minimizing callus interruptus.

One of the hotter technologies under development is known as “femtocell,” and an 8-year-old Massachusetts company, Airvana Inc. (Nasdaq:AIRV), is working to help take it mainstream. Think of it as something akin to a cell tower of your very own: rather than depending on an outside signal that might fade inside a building, the femtocell is a small base station that delivers cellular communication over a broadband Internet connection. Adding range in the home to the home on the range — or in the condo complex — could help popularize 3G wireless services in the important U.S. market.

Airvana has a portfolio of network infrastructure products based on Internet Protocol technology, which provides the missing link between wireless service . . .

Understanding the promise of the two companies profiled in this week’s column requires a little context on the way communications has evolved over the past several decades.

Before the Internet, telephones were the best way for long-distance communication (meaning, of course, any distance beyond ear shot), and the same basic group of companies such as Nortel Networks Corp. (NYSE: NT). and Lucent Technologies Inc. did a great business selling the same basic telephone equipment to service providers year after year.

The rise of the Internet then gave rise to companies like Cisco Systems Inc. (Nasdaq: CSCO), which makes gear that connects and enables communications between computers.

Internet and telecom might have remained two distinct industries, except that telecommunications started evolving too. Cell phones gave way to mobile communications and improving phone and Internet technology made it possible to do more than just talk over phones.

Today, talking over phones, particularly cell phones, is going out of style as more and more people prefer to send text messages or use their smart phones to play games, download music and watch video.

All of the old telecom equipment providers like Nortel and Lucent, today a part of Alcatel Lucent (NYSE: ALU), are trying to compete in this market for new networking gear to enable better mobile and broadband communications. This equipment, though, is so different from the so-called legacy gear they traditionally sold that they are often regarded as dinosaurs challenged to compete with a crowd of startups that more fully understand modern communications.

Case in point: Alcatel Lucent, a company formed last year through the merger of two of the world’s largest telecom gear makers, earlier this month issued its third revenue warning in less than a year and said its business was struggling.

Shares of Airvana, Inc. (Nasdaq: AIRV) are trading higher following news that the provider of network infrastructure products used by wireless carriers has joined with Nokia Corp. (NYSE: NOK) to jointly provide cell products to mobile operators.

Chelmsford, Mass.-based Airvana and Finland’s Nokia will provide femto cells, which are small boxes that use a broadband Internet connection to provide mobile cellular coverage at home. The home-based stations will allow third generation (3G) mobile operators to compete with home access solutions such as Wi-Fi or WiMax. While standard mobile phones are relatively cheap and widely available, dual mode handsets with Wi-Fi capabilities are rarer and more expensive.

“We believe that femto cells will transform the experience of using mobile devices indoors,” said Randy Battat, Airvana President and CEO, in a press release.

Airvana and Nokia said that they will cooperate in the marketing and sales of the technology. The companies did not release financial details.

At 12:52 p.m. ET, Airvana, Inc. (Nasdaq: AIRV) was up $0.45, or 7%, to $6.69.

Shares of Airvana Inc. (Nasdaq: AIRV) have lost altitude following news that the provider of network infrastructure products used by wireless carriers reported a decline in second-quarter profit and revenue.

The net income for the three months ended July 1 was $86.1 million, a drop of 28.5%, compared with $120.5 million a year earlier, the Chelmsford, Ma.-based company announced before the opening bell. Analyst estimates were not available.

Revenues declined less steeply, falling 6.56% to $156.3 million, from $167.3 million in the second quarter of 2006.