The Telco 2.0 Transformation Index, launched today, gives an overall comparative benchmark and in-depth analysis of the progress of five leading telcos (AT&T, Verizon, Telefonica, SingTel and Ooredoo) in terms of transforming their operations and building new ‘Telco 2.0’ business models. Overall, it shows that SingTel and Telefonica have made more progress than AT&T, Verizon and Ooredoo, but that all are still at a relatively early stage of maturity and have much still to do. Click the image for more details:
Testing the Post-PSTN; how 706 changes US regulation on voice; Charter-TWC deal; AT&T Q4s; Sprin-T-Mo, no dealio
The FCC has issued a call for proposals on how to test the future IP-based replacement for the PSTN. The tests will be carried about in defined geographic areas, and participation will be voluntary, something net neutrality activists were vocal about.
Proposals are to be filed before the 20th of February, after which point the regulators will publish them and invite public comment up to the 31st of March, before making a final decision. The commission also declared the following principles:
- Public safety communications must be available no matter the technology
- All Americans must have access to affordable communications services
- Competition in the marketplace provides choice for consumers and businesses
- Consumer protection is paramount
Harold Feld explains the complicated interaction between the PSTN transition and that from the Open Internet Order to Section 706. Increasingly, voice services that are traditionally subject to common carrier requirements are provided over IP, and therefore escape from regulation. This is a serious problem for rural operators, who sometimes have trouble getting the majors to complete calls. Another issue is the “carrier of last resort” requirement, which means that regulated telcos have to offer service to anyone who will pay for it - something like Comcast’s cable VoIP service isn’t covered by this, for example.
On the other hand, Feld argues, 706 makes the various state laws that prevent municipal broadband rollouts unworkable and grants substantial new powers to the state-level regulators, the PUCs. An example of one such is in Kansas, where the cable lobby that wanted it is now displeased with the final text. Feld’s colleague John Bergmayer says that the problem with the Open Internet Order was that it was too subtle, too complicated, and too lawyerly, compared to, say, re-classifying under Title II. Who could disagree?
Meanwhile, Charter’s bid for Time Warner Cable has gone hostile, and Charter has a deal with Comcast, which will take about 3 million of the 15 million TWC subscribers off their hands, thus making regulators happy and immediately repaying some of the debt involved.
AT&T announced a solid Q4, mostly on the basis of mobile data revenues and U-Verse TV sales. Mobile net-adds are down quite sharply from the corresponding quarter a year ago, thanks to the emerging price war with T-Mobile.
In the price war, the latest move from AT&T is a $100 gimme for anyone who takes out another SIM on their account - the thinking is that the more SIMs on an account, the more hassle it will be to churn. Family plan customers with four lines can now get unlimited voice and messaging, plus 10GB of monthly data for $160. Ars Technica works through the details.
The Wall Street Journal hears that a Sprin-T-Mobile deal would probably run into regulatory trouble, interestingly not so much with the FCC as with the anti-trust regulators at the US Department of Justice. At the same time, T-CEO John Legere gave the strong impression that he sees the future of T-Mobile USA as one of organic growth as an independent operator.
Third time lucky - Indian 2G; SFR/Bouygues numbers; Belgian 4G
The Indian 2G spectrum re-auction has kicked off, despite a last-minute legal challenge by Vodafone and Bharti Airtel, who argued that the terms of their licences meant that they should simply be allowed to keep the contested licences in the key circles of Mumbai and New Delhi.
SFR reckons that the network-sharing agreement with Bouygues will save SFR €200 million a year and Bouygues €100 million a year, but the savings will only start to flow from 2017-2018 - until then, more CAPEX will be needed to pay for the decommissioning of the spare cell sites.
The owners, Vivendi, hope to list SFR on the stock market in July.
Deutsche Telekom has denied wanting to acquire more shares in OTE beyond the 40 per cent it holds already.
Telekom Austria, meanwhile, has put up its activation fee by 40 per cent, supposedly because “the smartphones have become more complicated”.
Belgacom turns on 4G for all its customers, while offering speed-based service tiers.
BT and BSkyB; Vodafone versus Liberty Global, Virgin Media speed boost
In the UK, BT has its Q3 results out this week. The carrier added 150,000 new broadband subscribers, and claims that 4.5 million people have “access” to its BT Sport channel, although this includes wholesale and even people who have the STB but not the channel. This got BT Retail’s revenues to £1.87bn, up 4% year on year, but on the other hand, Wholesale and Openreach did poorly. Openreach was subject to a regulatory price cut, while Wholesale is losing traditional voice and also broadband lines as local-loop unbundling presses on. Overall, revenue was up 2% at £4.6bn and pre-tax profits up 8% at £722m.
Arch-rival BSkyB reported revenues up 7.6% at £3.75bn for H2 2013. Operating-level profits were £895m, down 8% due to higher costs for Premier League football rights (themselves due to the bidding war launched by BT). The telecoms operation reported 110,000 broadband net-adds in Q4 - it’s worth noting that BT’s number includes upgrades of existing customers.
Elsewhere, it looks like Liberty Global is also bidding for Spanish cableco Ono, which Vodafone is after. The Daily Telegraph discusses the emerging rivalry between Liberty Global and Vodafone, and looks into the possibility of a Vodafone offer for the whole cable company.
Back in the UK, Virgin Media is about to up the speeds on its cable network, with the current top 120Mbps package rising to 152Mbps and the entry level 30Mbps to 50Mbps. Vodafone, meanwhile, has finally achieved the mobile broadband coverage requirement in its 3G licence.
EE and 3UK, of course, live on the same shared network infrastructure through their MBNL joint venture. They have just agreed to invest £1bn in the JV, although apparently this will result in a greater degree of separation between the networks.
ICUK has joined the SuperConnected Cities scheme, which offers vouchers for small businesses to pay the one-off costs of getting “super-fast broadband”.
And the videos from this year’s UKNOF event are online. Here we have an interesting discussion of deploying FTTH “for the last 5%”.
Google Q4s - leaving Motorola to Lenovo, sliding ad prices; Yahoo! getting back into search; Lenovo buys the world
Google Q4s were mildly disappointing, but the real news was Motorola, which had another poor quarter despite the launch of the Moto X. As a result, Google is getting out, selling the division to Lenovo, having already got rid of the factories and kept the patent portfolio. Lenovo pays $2.91bn, of which $1.5bn is a loan from Google and only $660m is cash. Google is therefore sitting on a loss of $5bn-plus, perhaps as high as $7bn depending on how charitable you are about the patents. And they apparently consider NEST worth more than Motorola Mobility.
Things aren’t perfect in the core business, either - average cost-per-click is down 11% year-on-year. Paid clicks were up 31% year-on-year, which saves the day in terms of revenue but only confirms that the price of advertising is falling. The problem is well known - Marissa Mayer, meanwhile, claimed that mobile was a major driver of growth at Yahoo!, but without contributing material revenue. They’re also looking at getting out of the deal under which Microsoft does their search and building their own new search product.
Lenovo’s CEO, interviewed by Fortune, says that they considered breaking up Motorola with Google back in 2012 and taking the hardware business. He claims that their aim is to ship 100 million smartphones and “surpass” Apple and Samsung. A sceptical take is here.
Here’s a good discussion of last week’s Lenovo acquisition of the IBM x86 server business. Over the weekend, it was rumoured that Lenovo is also interested in acquiring Sony’s VAIO PC business. Sony denied it, but admitted that it was considering all options.
Lenovo seems to have had nothing to do with COS, or China Operating System, a government-backed effort to develop China’s own OS. And wisely so, as it’s been a flop, and seems to be a thinly disguised version of Android.
Apple Q4 - flat profits, strong Macs; Samsung steps away from the software; Microsoft joins Open Compute
Apple’s Q4 set a record for revenue, $57.6bn, but profits were flat year-on-year. Gross margin was 37.9%. Out of their four main product categories, iPhones, iPads, and Macs all increased sales strongly, while iPods were down dramatically, although they only account for 1.7% of revenue these days. By contrast, 56% of revenue comes from iPhones. Interestingly, the Mac was the best growth product, up 19% year-on-year.
Elsewhere in phones, Samsung has been persuaded to de-emphasise its own-brand Android apps, and possibly to drop the whole Magazine UX Android shell, in favour of stock. As a Samsung user, we can’t disagree with this.
Reddit asks its redditors which apps they use that aren’t on the Google Play Store.
Microsoft, meanwhile, has joined the Open Compute Project, and as a result, it’s open-sourced the servers it uses inside Microsoft Azure, Bing, and Office 365.
Intel’s app store is closing down. Fairphone is a fairtrade Android.
Apple sacks Akamai, starts building CDN; L(3) clutches TV industry close; LTE Broadcast for stadiums; two-sided Roku
Apple has to move a lot of content, and even more software patches, all the time. So far, they’ve done this by paying Akamai Technologies about $100m a year and Level(3) a further undisclosed sum. Akamai recently said they were negotiating with their “largest client” about pricing, and it looks like Apple has decided to walk, setting up their own CDN capability. Apparently, Apple has been hiring networking experts for some months as a skunkworks is staffed up. This is horrible news for Akamai specifically, but not so bad for L(3) as Apple will still want backbone connectivity to reach the CDN nodes. It does look as if all the big consumer IT brands will eventually see CDN as part of their integrated hardware/software/content platforms.
L(3) ran the video streaming for this year’s Super Bowl, using their VenueNet stadium system to serve all the cameras, studios, and mixers, and their compression solution to JPEG-encode it all, before delivering it to the TV infrastructure. It also has to provide some special voice services.
L(3) also had a related product announcement, its Cloud Content Exchange, which delivers very large video files for the media industry.
Telstra, meanwhile, is trialling LTE Broadcast at the Sydney Cricket Ground in a partnership with Ericsson. The handsets have to have a special Samsung firmware build installed.
Here’s a good piece on Roku, whose business model is becoming increasingly two-sided, getting content providers to pay to be pre-loaded on the menus, as it competes with the Apple TV and Google’s Chromecast. They also want to licence the software to smart-TV makers like Samsung, but so far they want to build their software in-house.
And requests for content from the BBC iPlayer are up by a third.
WebRTC and virtualisation - it’s awkward; monetising IM; drivers of HD voice deployment
VoIP expert Tsahi Levent-Levi advises you not to rely on Amazon Web Services for your WebRTC hosting, due to the magic inherent in cloud-scale virtualisation not playing well with the requirement for voice and videoconferencing latency to be both low and predictably low.
Here’s a survey of how you can monetise an IM app. A lot of the options are a bit…embarrassing. (Stickers!)
Here’s an interesting conference session at ITEXPO - “Smart Voice”, defined as “any service that treats voice as information, rather than a separate function.” This blogger argues voice interaction is “the God particle”. A lot of that is Siri/Google Voice Search stuff, but we know Siri tunnels queries back over the network, so the art and science of telephony is very much to the point.
So who likes Fraunhofer’s new site devoted to promoting not just HD voice as in AMR-WB, but even higher quality voice?
You’ve got a Google Hangout. If you make it a Hangout On Air, you can stream the whole conference to a YouTube URI, so nonparticipants can watch it live and you can refer to it later. But if you do that, you can no longer have people dial in from the PSTN. How can you do both? MGraves explains. It’s complicated, and apparently copyright is at the bottom of it.
DTAG: NSA embarrassment is our opportunity; Shape obfuscates your website; huge Orange leak
Deutsche Telekom argues that the Snowden disclosures are a major opportunity, and says that it’s turned up A5/3 encryption across its mobile networks and deployed START-TLS on all its e-mail servers. Meanwhile, Secusmart, a German company that produces a security-optimised BlackBerry, claims it’s sold more than 2,000 devices to the German government, including Angela Merkel’s new phone. Interestingly, it’s a BlackBerry - which means your data probably passes through either the UK or Canada, on our radioactive fibres.
The Guardian has published the video of the celebrated moment when it destroyed three MacBooks on the orders of GCHQ. One of the paper’s executives, Sheila Fitzsimons, is shown applying an angle grinder to a hard disk in an image that will surely become iconic.
In an entirely unrelated event, the director of GCHQ has resigned. One of his predecessors, Andrew France, has just scored the top job with security startup Darktrace.
Another security startup, Shape Security, is being heavily backed by Silicon Valley white-iPad VC money. It promises to protect big Web sites by obfuscating their code, in the hope that attackers won’t be able to understand it.
Orange leaks 800,000 clients’ information.
Should we eliminate passwords?
The British government, having pestered the ISP industry into a default-on filter, is now repenting at leisure as more and more cases of overblocking come to light. That said, it’s better than the Scottish police’s “cyber tsar” and his unique approach to encouraging people to encrypt their WLAN: suggest/threaten that they might end up being raided as suspected terrorists/paedophiles/music downloaders.
And did you know DuckDuckGo can generate strong passwords, produce cryptographic hashes, identify hash algorithms, and look for hashes in leaked data?
You’ve heard of those Google Internet balloons. The US Army is thinking more of Internet beachballs, as a quick way to deploy VSATs. Danah Boyd’s book on online teenagers, It’s Complicated, is out. And here is a surprisingly vicious row about royalties on ZX Spectrum games.
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