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Facebook IPO round-up; video in the Cloud; backhaul for Telefonica’s LTE trial - Telco 2.0 News Review

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It was the week Facebook floated. Dealbook has a neat roundup, making the critical points: Facebook finished the day on $38 a share for a market capitalisation of $105bn, or to put it another way, a price-earnings ratio of 108 compared to Google’s 18 or Apple’s 13, or to put it another way, a valuation per user of $130. It was toppy, to say the least, and the response from the market was no day-one bounce, and heavy intervention by the banks underwriting the IPO to keep it from going under the offer price. Joe Wiesenthal notes the existence of a huge and consistent bid at 38. And eventually, when the market opened today, the IPO floor gave way.

More than 566 million shares changed hands, a record, in a somewhat fraught day on the NASDAQ as the market’s computer systems struggled to keep up, leaving some investors guessing whether their trades had in fact been executed.

Zynga, meanwhile, fell 13 per cent before the circuit breaker kicked in. General Motors (whose return to Wall Street in November 2010 was the previous volume record), for their part, chose IPO week to pull their Facebook advertising account, on the grounds that the conversion rate was pathetic. The story includes feedback from more disappointed advertisers.

So what is Facebook going to do with the IPO money? Well first up, it’s decided it wants its own European fibre network linking its main data centre in Sweden with other nodes around the continent, and it’s apparently gone to TeliaSonera’s carrier services division for it.

What the Internet was like the year Facebook launched.

RJMetrics, meanwhile, reports that Facebook may not have much to fear from Google +, as their measurements of user engagement for Google’s social network are uniformly horrible, probably because so many users were roped in by GMail rather than actively seeking it out.

Google, meanwhile, launched a major enhancement to Google Search. Knowledge Graph builds on their acquisition of Freebase, the semantic-web database, and is meant to understand your query and pull in results directly into the search page. Like every Semantic Web project we’ve ever seen, this is easier to demonstrate than explain, but the big question is whether, unlike every other Semantic Web project we’ve seen, it works.

Interestingly, ReadWriteWeb points out, the official demo has the “Search plus Your World” personalisation set to OFF.

Microsoft has a new social network product, So.cl, which seems to be “Google + for academics”. Some of us thought that was Google +.

Yahoo! has agreed to sell half its stake in Alibaba.com back to Jack Ma, ending a long-running dispute, raising a substantial amount of cash, and permitting Ma to plan for an IPO of the huge B2B marketplace in Hong Kong. This certainly suits Ma, but it’s less clear how it serves Yahoo!’s purposes as Alibaba was one of the few obviously great businesses there.

Tencent, owners of QQ, are reorganising.

In other advertising news, Comcast has filed a patent on displaying a different advert when a viewer hits “fast forward” on their DVR to skip the ads. DISH, meanwhile, has added a feature to its DVR that automatically hops over the ads, to the TV networks’ litigious horror. And O2 is tweaking Priority Moments to be a little more like Groupon.

Speaking of DISH, they also have some interesting plans for the future. One of those is the integrated fixed-wireless/satellite TV “cantenna” product with Verizon Wireless. Another is their plan for their own LTE-Advanced network in the 40MHz of 2GHz spectrum they own. The Verge reports that they are arguing with the FCC over the exact terms of refarming the spectrum from satellite to land-mobile use, with DISH offering population coverage of 60 million in four years and the FCC wanting 90 million in three. Anyway, it’s no move before 2013 as the 3GPP hasn’t finished the LTE-A specification yet.

IntoMobile points out that other operators are lobbying for the spectrum to be taken away from DISH, and that delay will only help their cause.

Teresa Cottam has something like a manifesto for operators and the small business market, containing the winner of this week’s Chart of the Week (a tough challenge this time out). We heartily agree.


In other Teresa-related news, Teresa Mastrangelo at The Voice of Broadband has the Q1 North American broadband subscriber update.

Verizon Wireless clarified its position regarding the end of unlimited data plans. It looks like users will face a choice between handset subsidy and open-slather data, so if you’re willing to provide your own gadget you get to keep your uncapped data plan.

TIM Brasil is about to roll out VDSL to the mass market, having decided to steer away from FTTH on grounds of cost relative to typical Brazilian ARPU of $35/month. They’ve also decided to partner with Sky Brasil rather than build an IPTV service. RevK points out that FTTC/VDSL can be pretty good, really.

Meanwhile, the Brazilian ICT sector grew 11% last year, and the biggest single chunk is telecoms.

Since pressing the button in mid-January, Free Mobile has gone from zero to 2.6 million subscribers or 3.7% of the French mobile market. Cross-selling drove 191,000 net adds to their fixed ISP operation in Q1, the company’s record and 50% of the industry’s total. Revenues in the first quarter were up 29% at $834m, with the mobile operation making up $124 million of that.

Vodacom’s Q1s are out, with earnings up 8%, weighed down by a large tax bill and heavy CAPEX, while data revenues were up 23.7%. The big story, however, was a dispute over its operation in the Congo, where Vodacom wants to sell its interest. A local partner is trying to seize part of Vodacom’s stake, claiming it hasn’t been paid a $21m “consultancy fee”.

Elsewhere, TeliaSonera is being criticised after its far-flung opcos in the former Soviet Union were spotted helping various dictators spy on the citizenry.

The Register reviews UK mobile operators’ data services.

Business model of the week: meet Todd, who helps schools recoup money overcharged by AT&T and takes a cut.

Vodafone-Hutchison Australia shares its experience of supporting two major video streaming events. First up, they streamed the Aussie version of Big Brother to a mobile app. The popularity took them by surprise and hammered the network, but most of all, the web servers. When they came to stream live cricket, they had the further challenge of coping with a massive and spiking video wave over the five days of a Test match, and then nothing for a couple of weeks until the next. The solution: move it into the cloud and use Amazon Web Services.

Netflix’s director of engineering says their API handled 42 billion requests in January, growing 70-fold in two years. Interestingly, a big change has been that connected devices have hugely overtaken the Web API as drivers of traffic. As usual with Netflix people, there’s a great presentation.

High Scalability reports on Amazon’s new SSD-based cloud database, DynamoDB, and remarks that it’s not very “cloudy”.

Microsoft Azure is becoming more “infrastructure-as-a-service” and less “platform-as-a-service”. OpenStack is “growing faster than Linux”.

And in a candidate for Chart of the Week that didn’t quite get in, Oracle-Google lawsuit has taken some steps forward. Specifically, Oracle has agreed to drop some of its claims, making the key issue whether or not the judge holds that APIs can be subject to copyright at all. If he does, Oracle has a case, if he doesn’t, it’s over, or at least the maximum damages will be about $3m. Interestingly enough, the judge disclosed that he’s been learning Java in order to be better informed about the issues.

Another federal judge has summoned Apple CEO Tim Cook and Choi Gee-sung of Samsung to meet him at the courthouse for a session of mediation, in an effort to settle the patent disputes. Nobody is optimistic.

The ITC has banned imports of Motorola phones into the US for 60 days over a Microsoft patent which appears to claim rights over any online calendaring app at all.

Giving some context to all this, Horace reckons Google TAC payments account for 3% of Apple’s operating margins. Windows Phone 7 is ahead of iOS in China, not surprisingly as even the Nokia Lumia 900 appears dramatically cheaper.

Will Nokia burn €2.5bn this year? Nokia’s latest cheap devices come with 5 SIM card slots and a web browser that talks to an optimising proxy in the cloud.

Baidu’s latest forkdroid, with 100GB of cloud storage. Intel thinks it understands telcos.

Interesting experience providing backhaul for Telefonica’s London LTE trial. From the same source, Qualcomm on voice futures.

Softbank is experimenting with base stations mounted on a blimp. Virgin Atlantic wants a femto or two in its aircraft.

IPv6 and better customer premises routers. Renesys analysis of a major DDOS and routing incident affecting the Pirate Bay. Blocking BitTorrent traffic. Bandwidth trading is back!

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