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  THE FRIDAY LETTER 

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 | http://www.gilder.com/ | Issue 255.0/July 14, 2006

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HEADLINES:

The Week / EPON Superiority
Friday Feature / Tax Cuts, Budget Deficits and the Economy
Friday Blogger Bonus / The Best in Innovation
Readings /

Gilder/Forbes TELECOSM Conference
October 4 – October 6, 2006
The Resort at Squaw Creek | Lake Tahoe

Don’t miss:
- STEVE FORBES, Editor in Chief, Forbes magazine
- GEORGE GILDER, Editor in Chief, Gilder Technology Report
- PETER HUBER,
Senior Fellow, Manhattan Institute
- ANDY KESSLER, Wall St. Meat, Running Money, The End of Medicine
- MICHAEL MILKEN,
Chairman, Milken Institute; Chairman, FasterCures
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ROBERT MUNDELL, Nobel Laureate & International Economist
- JOHN RUTLEDGE,
Global Economist, Rutledge Capital
- AND dozens of today’s
top high-tech thought and business leaders

Register BEFORE JULY 31 to SAVE OVER ½- OFF
the Forbes.com Telecosm ’06 Registration Rate

 

The Week / EPON Superiority
‾‾‾‾‾‾‾‾‾‾‾‾‾

Gilder Subscriber (7/11/06):
I have been speaking to a lot of field service guys, some engineers from the old Quantum Bridge, and some visiting engineers from the Far East (mainly China, Romainia, and India).

The first trials in India for FTTP/H (fiber to the premises/home) is scheduled this year. The chosen path is EPON (Ethernet passive optical network). Do you know about this deployment? All have indicated that GEPON (gigabit Ethernet passive optical network) is where things will eventually end up in the Far East. What does it take to migrate from EPON to GEPON?

 

Gilder Tech Analyst Charlie Burger (7/11/06): EPON and GEPON are one and the same. In the Far East it is generally called “GEPON” because it is symmetrical gig. Perhaps you are thinking of the 10GEPON (10-gigabit EPON) currently proposed by Teknovus and I believe PMC-Sierra/Passave (PMCS). Or you may be confusing it with GPON (gigabit PON).

I have not heard of the report about India, but am not surprised they have taken the same EPON route as their neighbors to the east. You may recall from my Gilder Technology Report piece this past spring, after the Optical Fiber Conference (OFC), on what I think is the superiority of EPON over BPON (broadband passive optical network) and the emerging GPON.

According to Linley, last December, they expected that essentially the whole world except the Far East (Japan, Korea, maybe China) would migrate to GPON, as the U.S. and Europe are doing. I was surprised, but that was before the announcement of 10GEPON or of a 2.5gig EPON version announced by Teknovus.

At OFC, there was some buzz that the big carriers were still considering EPON instead of GPON (probably because of the possibility to migrate to 10GigE), but I think the chance was always slim. HERE'S WHY: Neither 2.5GEPON nor 10GEPON is symmetrical, as proposed. They are both 1 Gig up, as is EPON. In order to get a symmetrical system they would have to impose stricter burst-mode laser standards and other standards and would lessen the advantage over GPON (which is symmetrical 2.5gig in its full implementation)--though it still would not have the complexity of multiple standards. Symmetrical is paradigmatic in a peer-to-peer world.

What will eventually happen in the GPON v. 10GEPON race worldwide over the next half decade, I don't know. Passave was working hard on GPON when bought by PMC-Sierra and my feeling is that PMCS will greatly improve their chances to deploy it because of the telco legacy they gain. So they may have a chance during the current round in this country, if they are far enough along. More likely they will first win GPON abroad, if indeed Linley is right about its global emergence.


Excerpted from posts on the www.Gildertech.com subscriber-only message board. Visit the board and share your thoughts by logging in with your GTR subscriber ID.


The End of Medicine, by Andy Kessler

Trapped: When Acting Ethically is Against the Law, by John Hasnas

Receive FREE COPIES of The End of Medicine and Trapped and meet Andy Kessler and John Hasnas at the Gilder/Forbes Telecosm 2006 speaker book signing, October 4, at the Resort at Squaw Creek in Lake Tahoe, California.
(Learn More)

Purchase these books and other featured favorites in the Gildertech bookstore:
http://www.gildertech.com/bookstore.html


Friday Feature
/ Wesbury: Tax Cuts, Budget Deficits and the Economy
‾‾‾‾‾‾‾‾‾‾‾‾‾‾‾‾‾‾
This week, the White House will revise its fiscal year 2006 budget deficit estimate to roughly $300 billion, a significant reduction from its January forecast of $423 billion.  This will continue the White House's pattern of very conservative estimates.

Our calculations suggest that the federal budget deficit this year will be approximately $260 billion.  This is down from $318 billion in FY-05 and $413 billion in FY-04.

Strong gains in tax receipts have overwhelmed increased federal spending.  Congressional Budget Office (CBO) data show that federal tax receipts during the nine months ending in June were 12.8% above the same period in FY-05.  Withheld income taxes increased 9% in June from last year; non-withheld income tax payments surged by 20%, while corporate tax receipts grew by 17%.

Read Brian Wesbury’s Complete Article:
http://www.ftportfolios.com/Retail/research/viewresearcharticle.aspx?id=110


Related Reading

It’s Tax-Cut Time Again

http://article.nationalreview.com/?q=NTlhN2ZiOGQwYWJjMTBiNzUyM2IyNWQyMTcwNTQ0MGU=

 

It’s The Productivity, Stupid
http://www.tcsdaily.com/article.aspx?id=071306A

 

A N N O U N C I N G :  The Gildertech Blog
Logon to
http://blog.gildertech.com/ to see what’s new.


Friday Blogger Bonus / The Best in Innovation
‾‾‾‾‾‾‾‾‾‾‾‾‾‾‾‾‾‾‾‾‾‾‾‾‾‾‾‾

This week AlwaysOn announced the AO100 Top Private Companies for 2006. The fourth-annual elite AO100 list was compiled by the AlwaysOn editorial panel. In order to make the AO100 list, companies had to be peer-nominated, with AlwaysOn receiving more than 1,000 nominations from venture investors, investment bankers and other industry experts.

Read the Complete List of Honorees:
http://alwayson.goingon.com/permalink/post/2575

Hear George Gilder Speak at the AO2006 Innovation Summit, July 25 – 27, at Stanford:

http://alwayson.goingon.com/permalink/post/866

Check Out the AlwaysOn Blog Site:
 http://www.alwayson.goingon.com/

____________________________________________

Readings /
‾‾‾‾‾‾‾‾‾‾‾‾

South Korea's RFID market to reach $500M, says report
http://www.eet.com/news/latest/showArticle.jhtml?articleID=189800040
 

 

Our Off-the-Books Fiscal Problem
http://article.nationalreview.com/?q=OTg0MTM1NGY1NzMxNzI0ZGMwNTU2OWViYjgxMTFkZDk= 

 

What Billions Can Buy

http://www.cato.org/pub_display.php?pub_id=6515

 

Minimum Wage Socialism
http://www.cato.org/pub_display.php?pub_id=6484

 

Karlgaard: The Scandinavian Model
http://www.forbes.com/columnists/forbes/2006/0724/039.html

What Chip Glut
http://www.forbes.com/technology/2006/07/11/chip-glut-equipment_cx_ck_0711chips.html

 

Turn Down The Heat…Please
http://www.reed-electronics.com/electronicnews/article/CA6350202?nid=2019&rid=2052959400

 

Intel, TI Lead China Chip Market
http://www.reed-electronics.com/electronicnews/article/CA6351496?nid=2019&rid=2052959400

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