Trillium Digital Systems - Market History

Market History

There were a number of regulatory, financial and technology events that drove the telecommunications industry, and subsequently drove Trillium's growth and development.

• General network infrastructure moved from time division multiplexing to statistical multiplexing and from character based communications to packet based communications.

• Work on the OSI reference model was initiated in 1977. The OSI reference model is an abstract description for layered communications and computer network protocol design.

• Telephone network infrastructure moved from In-band signalling to out-of-band signalling.

• Computing and communications moved from closed and proprietary mainframe based systems to open systems.

• Equipment manufacturers moved from in-house technology development to buying or licensing hardware and software technology from other technology providers.

• Different voice, data and video networking technologies converged.

• Equipment manufacturers moved from using proprietary software solutions to open source software solutions.

• The break up of AT&T was initiated in 1974 by the U.S. Department of Justice antitrust suit against the telephone company's monopoly. In 1982, AT&T agreed to break itself up into several firms in 1984. The breakup of the AT&T's monopoly led to a surge of competition in the long distance telecommunications market as new carriers came into existence. It also improved the ability of other companies to sell their equipment to the regional Bell operating companies.

• The first TCP/IP based wide area network became operational in 1983. The Internet was opened to commercial interests in 1988 and was initially used for e-mail, file transfer and other applications.

• The first release of the Mosaic Web browser was in late 1994.

• The stock market crashed in 1987. A recession followed, starting in mid-1990 and ending in 1991.

• Software bugs in the switching systems of the core network caused massive failures in the telephone networks of AT&T in 1990 and Bell Atlantic and Pacific Bell in 1991. These network crashes shutdown telephone service for large portions of the United States and prompted Congressional investigations into the reliability of the telephone network.

• The U.S. Federal Communications Commission (FCC) started competitive wireless spectrum auctions in 1994.

• The Telecommunications Act of 1996 was signed into law in early-1996. It deregulated portions of the telecommunications industry and led to a surge of competition in the in local access, wireless and other markets. Other countries also started deregulating their telecommunications industries.

• The Asian financial crisis erupted in mid-1997 as poor fundamentals, structural weaknesses and a shift in investor sentiments caused liquidity problems in the financial systems of a number of Asian countries. The crisis stabilized by the beginning of 1999.

• The dot com bubble started growing in the mid to late 1990s and burst in 2000. The bubble was driven by a large increase in Internet access, large increase in wireless handset availability, and a belief that data intensive applications were going to drive the next generation network. The network was moving from being voice centric to data centric, from narrowband technologies to broadband technologies and from 2nd generation wireless to 3rd generation wireless technologies to accommodate real and perceived demand. Data bandwidth needs were doubling every 3 – 4 months. As the bubble burst, network operators, service providers, equipment manufacturers and others suffered huge losses. Over $2 trillion in market capitalization evaporated in less than 12 months and over 500,000 jobs were lost. Over 60 telecommunications carriers in the U.S. filed for bankruptcy between 2000 and 2002. By the end of 2000, it was difficult for companies to raise money through private equity funding or initial public offerings.