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August 27, 2014

Digital Asia 2014: Join Telkom Indonesia, Facebook, Globe, WEF, CitiBank, KT Media and many more for New Ways to Innovate & Grow in the Digital World

The region’s leading TMT players will be converging on Bali at the beginning of December for this year’s ground breaking Digital Asia 2014 event. Representatives from the world of telecoms, technology, the internet, advertising, financial services, content and entertainment will gather to exchange breakthrough ideas, case studies, methodologies and tools to grow significant new revenues for all parties in the next 12-18 months.

Taking place at the outstanding Ayana Resort and Spa on the 2-4 December, Digital Asia, run by STL Partners in collaboration with Telkom Indonesia, is focused on catalysing exciting innovations in communications, enterprise services, entertainment and digital commerce that leverage mobile, cloud and big data technologies.

Confirmed participants (at August 27th) from ABS-CBN, Carlsberg, CitiBank, Deutsche Telekom, Etisalat, Facebook, Globe Telecom, Google, Indosat, KT Media Hub, MapR, Orange, PCCW Global, Shinetown, SingTel, Telekom Malaysia, Telkom Indonesia, and World Economic Forum.
Register Now to Secure Your Place.


With a captivating line up of topics to explore across the digital ecosystem, we’re excited to announce our detailed agendas are now live.

Some Agenda Highlights from the 3-day event:

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Register Now to Secure Your Place.

Key speakers include:

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Key Sponsors include:

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We have a limited number of Sponsor and Speaker opportunities left for Digital Asia. If you would like to get involved, email contact@stlpartners.com or call +44 (0) 207 2475003.

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August 26, 2014

US price wars; Comcast-TWC; Nexmo; Amazon Ads: Telco 2.0 News Review

‘Digital Asia 2014’ Executive Brainstorm and Innovation Forum, run by STL Partners in collaboration with Telkom Indonesia, is designed to equip 250 specially-invited business leaders from across the region’s telecoms, enterprise and technology sectors with new, breakthrough ideas, methods and tools on how to grow significant new revenues in the next 12-18 months leveraging Mobile, Cloud and Big Data.

Wave of US price-cutting - price war has begun, if it hadn’t already

With the Sprin-T deal in pieces, the FT reckons price war is inevitable in the US. We, of course, think it’s already started, as the Disruptive Strategy: VZW, AT&T, and Free.fr EB argues. ARPU and margins are falling for everyone except Verizon Wireless, and subscriber growth is unexpectedly strong, far more than could be explained by losses from Sprint. The pattern is surprisingly similar to that in France post-Free Mobile.

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But the thing about a price war is that it can always get worse.

Sprint has announced a new unlimited $60/mo tariff, as long as you provide a phone or pay for one, and has also doubled data allowances at its current price points. T-Mobile will give you a year’s unlimited data if you sign up an ex-Sprint subscriber. AT&T is edging into the game, too; although the mainline brand is still trying to pretend that it’s not getting involved, the discount MVNO Cricket is offering $100 to anyone who switches from T-Mobile. T-Mobile, meanwhile, is offering an extra 2GB of data for $5.

Comcast-TWC deadline; big consequences for the metro-fibre market; Sprint optimism

Meanwhile, it’s deadline day for anyone with an opinion about Comcast-TWC. Not surprisingly, Public Knowledge doesn’t like it. More significantly, perhaps, Vertical Systems’s scoreboard in the business Ethernet market points to the fact that the Comcast-TWC and Level(3)-TWTelecom mergers are moving this market in the direction of consolidation. As that includes almost everyone’s mobile backhaul, it offers an extreme degree of vertical integration.

And Comcast is overbuilding Verizon in some areas, specifically to deploy fibre to small businesses and enterprise Ethernet customers - that at least is definitely a move towards competition. In the consumer market, VZ’s response is moving towards symmetrical broadband at unchanged prices.

That said, Comcast has plenty of enemies; it turns out that even its tech support staff have a sales target, and then there was the massive leak of unlisted phone numbers.

Cincinnati Bell is promising 1Gbps, responding to the possibility of a Google Fibre rollout.

Sprint, meanwhile, is playing a happy tune about its wholesale wireline operation, which is offering unified comms in Europe.

And here’s a successful community mesh network.

Telefonica is Nexmo’s “SMS partner”

Nexmo, the Voice 2.0 platform company used by Viber, Line, and KakaoTalk, is working with Telefonica as of this week. Telefonica says they will be a “top 10 SMS partner”, which sounds rather as if Telefonica is now Nexmo’s preferred bulk SMS provider.

Of course VoLTE works better; it’s LTE.

Using Twilio and Splunk, and searching for phone numbers.

Is this the first WebRTC fraud?

Amazon Elastic Advertising Service? Salesforce results; Rocket IPO; VMWare; exit Tobin at Telecity

Amazon Web Services is apparently developing its own advertising platform. It’s meant for their in-house use, but that’s what they always say - every AWS cloud product started off like that. This is obviously a huge gun pointing at Google’s core business if it works, which is of course a big question.

Elsewhere in the cloud, Salesforce reported strong results, with profits, revenue, and forward indicators of sales all up.

Rocket Internet, the Berlin-based VC firm famous for copycat startups, is undergoing change. First, the owner of 1&1 Internet swapped its minority stakes in several of the startups for shares in Rocket. Now, Holtzbrinck Ventures, which already invests in Rocket as well as directly in its projects, has done much the same. The reason is that Rocket seems to be planning an IPO, aimed for sometime next month, on the Frankfurt stock exchange, around €800m. This may allow a profitable exit for some big investors.

VMWare has announced some more features in its vCloud, notably object storage and a service tier based on SSDs. Telefonica, meanwhile, is trialling Brocade’s virtualised switches and routers.

Nokia’s HERE location services wing has lost its boss, Michael Halbherr, who wants to pursue his own entrepreneurial opportunities. It’s more original than spending more time with your family.

Tumblr is growing, but it’s not making money.

And after 10 years, Michael Tobin stands down as CEO of Telecity, one of the first data centre companies.

AT&T-DirecTV, done? Amazon Twitch; BT (and all other UK operators) hikes line-rental; News Corp caught losing business

AT&T’s bid for DirecTV may be a done deal, as Reuters thinks the regulatory clearance is now certain after AT&T agreed to “conditions”.

Amazon has acquired Twitch, a web site for streaming your exploits in video games, for some $970m, under the nose of a company called Google you may have heard of.

Netflix has chosen to peer at the other German Internet exchange for its launch in Germany, not the DE-CIX.

BT, meanwhile, has upped its line rental charges by £1/mo and its basic broadband package by 6.49%, while the formerly free answerphone has reached £22.20 a year. Someone’s got to pay for the football rights and it looks like it’s you; a whole swath of fees and charges, like call setup, early termination, the cut-price line rental, and basic billed voice minutes, are going up sharply.

Here’s a chart from Think Broadband that’s packed with information:

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BT is certainly in the lead, but all the UK operators seem to be drawing out a bigger and bigger margin on their standing charge over the wholesale line rental rates. Meanwhile, ISP Review notes how different UK authorities use different definitions of “superfast” broadband as it suits them, and some of them are no better than ADSL2+.

And it turns out that News Corporation’s business in Australia is doing very poorly indeed.

Germany looks at Dutch M2M model; NII goes bust; rebels blitz Zain Iraq

Germany’s regulator has issued a consultation on the possibility of issuing mobile network codes to M2M customers or other big enterprise systems, Dutch-style.

MTN may be about to cut 850 jobs.

How will cross-border mobile banking be regulated?

NII Holdings has indeed missed a bond payment, and is putting Nextel Chile on the market.

And part of Zain’s network in Iraq has been blown up by ISIS rebels. That’s not as bad as Asiacell, though, which reports that although everything is still working, 25-30 per cent of their network is in rebel territory.

This may be bad news for the rebels: the trusted nature of SS7 networks turns out to let anyone who presents themselves as a carrier get a location update on any mobile number.

Apple: smartwatch sapphire order, the only PC subsegment that matters; pricing; Xiaomi mi4; Firefox OS

Here’s the bit you’ve been waiting for: with the Apple iPhone launch day next week, Seeking Alpha notes that GT Advanced Technologies has orders for sapphire screens for both an iPhone and a smartwatch.

The PC market may be stagnating, but the bit Apple dominates is the bit that’s growing.

Horace discusses Apple pricing.

Ars Technica reviews the Xiaomi Mi4, a Chinese Android-based iPhone clone, and finds it “unoriginal but amazing”.

And here’s India’s first Firefox OS device.

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August 19, 2014

Cable Operators are Broadband Operators. And they’re better at it than you are

Leichtman Research recently announced that the US cable operators now have more broadband subscribers than they have TV subscribers. The difference is not much - 49,915,000 broadband subscribers on cable in Q2 versus 49,910,000 TV. A gap of 5,000 subscribers in a 100 million-strong market might seem like a quirk that might well be put down to statistical noise, but this has been coming for some time. The following chart shows customers by product at Comcast since Q1 2011.

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And the real news is in the net-adds numbers.

In Q2 2014, the cable industry net-added 385,000 broadband subscribers, while the telcos managed 2,000. It might be more accurate to say that the telcos’ net-adds were statistically indistinguishable from zero. Although AT&T and Verizon between them signed up 627,000 net adds for either U-Verse or FiOS service, this wasn’t enough to soak up the 636,000 net subscribers who churned away from their DSL products. And the shift is accelerating; the Q2 2014 net gain was higher by one-third than that recorded in Q2 2013.

This shouldn’t be news to anyone, though. The years when cable operators were TV-centric businesses that could be considered separately from telcos are long in the past. Thinking of cable operators as TV networks makes as much sense as thinking of Verizon or AT&T as companies whose core business is telephony. These days, they share a common product: broadband. And they’ve been heading that way for years. This chart, taken from our Triple Play in the USA executive briefing, makes the point. Non-video revenue - i.e. broadband and VoIP - has grown much faster than video for years.

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Broadband is especially important because it is becoming the foundation product in the triple- or quad-play bundle. It is unlikely that anyone will churn their total communications spending in order to get more content. This is especially true in the United States, as the content rightsholders tend to either go for a “distribution first” strategy, breaking the new movie on as many screens as possible, or else to develop a direct-to-consumer relationship. If, however, a customer changes broadband provider, they are much more likely to change phone, mobile, or TV provider. The following chart shows broadband and triple-play customers at Comcast over the past six quarters - the correlation is very close indeed.

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Broadband is also important because it’s a product that an ISP produces in-house, without paying tribute to rightsholders. AT&T says it pays as much as 60% of its TV sales right back to content owners.

We expect broadband net-adds to gravitate to whoever provides the most speed and capacity at typical price points, and this is precisely what is happening in the US market. The following chart, using data from the FCC’s Measuring Broadband America, shows that the cable MSOs and Verizon FiOS tend to under-promise and over-deliver on both uplink and downlink speed, while the DSL operators (including AT&T’s VDSL-based U-Verse) are doing the precise opposite.

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Better performance in the access network also translates into better prices on a per-megabit basis. The following chart illustrates pricing per advertised, downlink megabit, based on AT&T, Verizon, and Comcast’s published offers. Although Verizon’s ultra-fast FiOS plans are better at the very top of the market, the cableco wins on price between 25 and 125Mbps, where most of the customers are.

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The cable triumph is reflected in AT&T’s official filings justifying the bid for DirecTV. Their arguments shed much light on the interdependence between video and broadband. For example, AT&T CSO John Stankey and SVP of Home Solutions Lori Lee admit that nobody takes the video service on its own merits, but only as an upsell if they’ve already taken broadband.

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Because the video service lacks scale, its margins suffer due to its poor negotiating position with Hollywood rightsholders.

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And why does the service lack scale? AT&T argues that it can’t roll out more broadband because it can’t sell enough TV on top to make it worthwhile:

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But they also argue that they can’t roll out more TV because they don’t have the broadband infrastructure to deliver it:

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And despite that, they’ve cancelled further U-verse buildout. This may mean they’ve reconsidered the TV-via-VDSL strategy and they are dropping it in favour of more GigaPower broadband, or it may mean they’re doubling down on TV via the DirecTV deal.

Content is an important part of the bundle. Nobody disagrees with that. But it relies on the broadband infrastructure as much as it finances it, probably even more so. The cable operators seem to have realised that they are in a single ISP market, no matter what the access technology, and that content is an upsell to the core product, broadband. Cable operators have more of it.

In the UK, for example, Virgin Media recently reported that 40% of its net-adds are taking speeds of 100Mbps or higher, and 15% are taking the 152Mbps top whack.

The upshot is that despite all the “superfast broadband” hype and the BDUK funding, OFCOM’s Communications Market Report shows that Virgin Media accounted for 17% of the total growth in “superfast” connections in 2012-2013 just because it doubled the download speeds for existing customers as a customer-retention giveaway. Is that the inflection point in this curve?

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Also, BT may have received all the BDUK money, but that doesn’t mean BT Retail has benefited from it with its content-heavy, football-driven strategy. The following chart, also from the CMR, shows that the indie ISPs, more broadband-focused, have increased their market share at BT’s expense while the upgrade money has been flowing and FTTC rolling out. Virgin Media has naturally lost share in “superfast” because it didn’t get any. That said, its success in selling 150Mbps plans will no doubt make it feel better.

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So, our conclusions. Cable operators are benefiting from the recognition that broadband, not TV, is the core product in the triple play, and their commitment to continuous improvement in the technology. Content is a great add-on to the bundle, but it cannot substitute for broadband, not least because both your own content and OTT content is dependent on broadband for delivery. And having pushed the limits of the DOCSIS 3 technology again and again, the cable operators still have a strong roadmap ahead from 150Mbps through 300 and 600 to gigabit speeds with manageable amounts of incremental investment. Watch out.

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Free-T-Mobile: Disruptive Revolution or a Bridge Too Far?


We’ve just published a new research paper ‘Free-T-Mobile: Disruptive Revolution or a Bridge Too Far?’. Free’s shock bid for T-Mobile USA will stretch its finances and management capacity to the limit. Can Free’s package of tactics, technology, and procedures work in the US context?

You can read an excerpt of the report here. We’ll also be exploring the implications at Digital Asia (2-4 December, Bali), and are initiating coverage of a new research programme on Internet-Driven Disruption, and we’d really appreciate your input here. For more on any of these services, please email contact@telco2.net or call +44 207 247 5003


Extract chart from report:

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August 18, 2014

Sprint price war; GVT; NII bust; China Mobile results; Apple tooling up for something - Telco 2.0 News Review

‘Digital Asia 2014’ Executive Brainstorm and Innovation Forum, run by STL Partners in collaboration with Telkom Indonesia, is designed to equip 250 specially-invited business leaders from across the region’s telecoms, enterprise and technology sectors with new, breakthrough ideas, methods and tools on how to grow significant new revenues in the next 12-18 months leveraging Mobile, Cloud and Big Data.

Digital Asia (formerly known as Batic) will take place on the 2nd-4th December at the Ayana Resort & Spa in Bali. Apply to participate now

DISH creeps towards Sprint; Sprint CEO declares more price war; FCC net neutrality consultation nears record

After Sprint pulled out of its bid for T-Mobile, the Satellite Cowboy, Charlie Ergen of DISH, has re-emerged as a player in the story. Bloomberg argues that a DISH-T deal would be palatable to the regulator and would bring more spectrum to the table. It might also be more deliverable than the Free-T option, although it would still leave T-Mobile as the only national operator with no fixed-line assets. Even Sprint, which doesn’t have an fixed access territory, is a major provider of Internet backbone and metro-fibre. Meanwhile, T-Mo acquired some 700MHz spectrum.

Sprint’s new CEO, meanwhile, announced that his first priority is lower prices, and also said that “Apple will become a crucial part of Sprint”. You might think it would be the other way around. It also sounds like job cuts are coming, although RCR Wireless thinks the network upgrade will march on. Softbank, for its part, announced it will raise $3.9bn in bonds, without saying what it needs the capital for.

Verizon is trying to get more customers to take fibre, even if they don’t take FiOS broadband or TV but just PSTN service over glass. The explanation is that once the copper goes, many regulatory requirements go with it. Customers who value the requirement that the PSTN must stay up even if the power is out for days are not happy.

Inevitably, this is going to end up at the FCC. The deadline for comments on net neutrality and the Open Internet Order has been extended to the 15th of September after a volume of comments and responses to comments that was only surpassed when:

The record holder similarly grabbed the US public’s attention for somewhat different reasons - the FCC received 1.4 million complaints following Janet Jackson’s so-called ‘wardrobe malfunction’ during the 2004 SuperBowl.

And Warren Buffett’s company, Berkshire Hathaway, announced that it has taken a $366 million stake in cable operator Charter while selling out of DirecTV entirely.

Meanwhile, a New York state politician wanted so badly to back Comcast’s bid for TWC he plagiarised their own talking points in their entirety.

TI confirms bid for Brazilian GVT, puts off Argentine exit; Nextel bust; Reliance, China Mobile results

Telecom Italia has confirmed it might merge TIM Brasil into GVT, the fixed operator Telefonica is looking to buy from Vivendi, in a deal that would swap Vivendi’s stake in GVT for TI shares. That would mean TI keeps control of TIM and eases out Telefonica, thus making the Brazilian regulators who don’t like the fact Telefonica owns one MNO and indirectly influences another happy once more. There’s more detail here.

At the same time, TI’s sale of its stake in Telecom Argentina has been put on hold. Is that connected? Is TI hoping the buyers for TA would come in on the deal for GVT, perhaps?

NII Holdings, which operates as Nextel in Latin America, is sinking fast, losing money, with ARPU falling, and soaring debts. 123,000 3G customers churned away in Mexico in the last quarter. The company expects to declare Chapter 11 bankruptcy very soon.

Mexico is about to get its first MVNO.

Reliance Comms, India’s fourth-biggest MNO, says its net profits were up 21% in its Q1, although they were down 16 per cent sequentially. Voice pricing has gone up as the price war seems to have eased a tad. However, they also lost 2 million churners.

China Mobile’s full-year results are in, and its subscriber base was up 6.8% at 790 million with service revenue up 4.7%. However, its profitability has suffered, with EBITDA down 4.4% at a still-impressive margin of 36.7%. So far they have 14 million 4G subscribers. Data volumes are up 91% year-on-year and revenues up 51.8%, i.e. the effective price of data has halved or thereabouts.

Qualcomm hires a Chinese economist to write a brief in their defence against a Chinese regulatory inquiry. He also works for a Chinese anti-trust agency. Chinese agency fires him.

Ooredoo has launched 3G in Burma, and some dealers have sold a month’s allocation of SIMs in two days.

And Zain has launched its mobile financial services in Sudan.

The mass adoption phase of smartphones; Apple tools up, so does Google; Microsoft dumps Ashas, immediately relaunches

IDC reckons 300 million smartphones shipped in Q2, mass adoption with a vengeance. Out of those, 96% were either Apple or Android. Although Apple’s shipments were up 12.7%, this wasn’t enough to avoid their market share falling, as the Android ecosystem managed to increase its shipments by 33%.

That said, it’s unlikely Apple worries over much about this, given their huge share of the profit pool. Also, Horace has been looking at Apple CAPEX numbers, and he reckons that we’re heading for the biggest quarter ever for Apple capital investment by some distance. It’s literally off the chart.

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Apple is tooling up for something big. So, it seems, is Google, whose capital investment is approaching the level of Intel’s, while Apple’s splurge might take it briefly to the levels Samsung regularly achieves.

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In comments, someone points out that the mystery at Google might be more telecoms investment.

It looks like Apple is going with China Telecom for data centre space in China, which it needs to support the growing Chinese iPhone fleet.

That IDC forecast doesn’t leave much for Windows Phone. Microsoft recently decided to kill off the Nokia Asha line and the brief Nokia X Androids, in the hope of pushing their customers to adopt WP. However, they have just announced a new €19 gadget that looks very, very like an Asha.

In other post-Nokia news, Jolla’s Sailfish OS gadget is getting a launch with 3 Hong Kong, where £222 will get you one. Some tariffs will provide one free.

IBM Research reckons containers always beat virtual machines for performance.

And have you wondered why Silicon Valley valuations are so high? Perhaps it’s because more and more major tech companies are doing without investment banking advice.

DTAG might buy cable, wants more subsidy; enduring failure of BDUK; Vodafone comes out last in UK call completion; Telekom Austria’s grim H1

Deutsche Telekom is considering buying cablecos, says Reuters quoting the head of T-Germany. They’re also trying to put down a marker about the future of their VDSL build-out, saying they need another €10bn of government money to make it to 90% population coverage.

OFCOM, meanwhile, has issued its annual Communications Market Report. The big news is that although coverage with “NGA broadband” has grown impressively, basically all the growth in either speeds or “superfast” broadband is down to Virgin Media doubling downlink speeds on its cable network. Also, the independent ISPs have done far better than BT in getting subscribers to take the new FTTC service although it’s the same access network. Broken Telephone points out that the UK’s £1.7bn of government money has gone entirely to BT and has been so well spent that the HMRC has allowed firms in ‘remote locations’ to submit their VAT returns by paper rather than online.

OFCOM also has some interesting results on mobile voice, here. There’s not much difference between operators in urban call completion, but the challenge of rural (i.e. cell edge) coverage shows them up.

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It looks like EE’s £300m investment in the 2G network worked, doesn’t it? It’s also interesting, to say the least, that Vodafone is so far behind O2 despite the fact they share their towers under Project Cornerstone. Meanwhile, EE has introduced a new source of two-sided revenue by offering its customers the chance to pay 50p to skip the call-centre queue. We predict a row, if not a riot.

Orange may be about to sell its towers in Spain, for around €1.1bn.

German ISP United Internet, better known for its 1&1 low-cost web hosting, is buying a stake in Rocket Internet, the Berlin-based VC fund famous for copycat startups.

Telekom Austria’s had an ugly H1, with a net loss of €317m. Some of this is down to a €400m writeoff on the value of Mobiltel in Bulgaria, after the banking crisis and recession there, but revenue slid 7.3% group-wide, suggesting the problems are more fundamental.

And Russian mobile operators have been told that they aren’t getting any 700MHz spectrum unless the broadcasters specifically allow it.

GigaPower moves on to a gigabit; Brazilian cable to 500Mbps; Telstra buys a CDN; postmortem on 512k route outages

AT&T’s GigaPower FTTH service, currently available only in Austin, Texas, sounds like it should be delivering a gigabit. Well, at launch, it didn’t, making it to 330Mbps but not all the way. Now, it’s getting an upgrade that will reach the magic number. They also say they will double the number of homes passed in the area after the take-rate beat expectations.

Net Servicos in Brazil is offering 500Mbps service where it has FTTH, but it’s also now trialling those speeds on its cable network, having acquired equipment capable in theory of 640Mbps.

Some people in a new housing estate in the UK are angry that BT’s FTTC infrastructure isn’t present. The killer detail: an independent FTTH deployer is offering 300Mbps speeds. Perhaps the deployer could spring for them to try BT’s service?

Telstra is buying Ooyala, a CDN, for $270m at a very reasonable valuation of 5x revenue. It’s the first deal for their new Global Applications & Platforms division, a sort of Telco 2.0 unit:

This is the first investment for Global Applications and Platforms (GAP). GAP’s strategy is to create long-term global growth in markets that are adjacent to Telstra’s core business, where software disrupts traditional business models.

Elsewhere, SingTel is adding a new WLAN to its 4G network, with integrated tariffs.

In theory, LTE networks should be able to assign radio resources dynamically, out of 12 subcarriers in each 150KHz channel, so you could create a virtual radio network for a customer on demand. Nobody’s done it in practice yet, but now Softbank is trying it out, using an Ericsson policy controller to drive the Mobile Management Entity.

On Wednesday, the Internet routing table passed the mark of 512,000 routes, which caused trouble for networks using the very common combination of the Cisco 6500 router and the Super 720 expansion card, as they have a hard limit at 512k routes. This can be changed, but it requires both chops and a reboot. BGPMon rounds up the damage. One of the biggest victims was the popular password manager, LastPass, which lost a third-party data centre provider when the routing limit was hit.

Cisco is cutting jobs. OpenIX is trying to spread neutral Internet exchanges in North America. And a lot of Western embassies in North Korea run an open guest WLAN, which has caused a housing boom around them.

And the Village Telco team’s mesh-WiFi software has had a major upgrade, adding a SIP-based voice solution and a Jabber instant-messaging server.

Samsung buys M2M startup; 9% growth in UK M2M; Ericsson reads Landis+Gyr’s smart meters

Samsung has bought into the Internet of Things, acquiring a US developer, SmartThings, for $200m. That gives them a connected-home control platform, based on an Android/iOS app, that began two years ago as a Kickstarter project and that sells for $99, plus a $200 developer kit.

The business will move to Sammy’s Palo Alto innovations centre. So far, it claims to have 8000 apps. See our recently published research “Connected Home: Telcos vs Google (Nest, Apple, Samsung, +…)” for more on the connected home.

In the UK, OFCOM reckons there are now 5.6 million M2M devices, growing at a 9% annual rate.

Vodafone, meanwhile, has issued a very optimistic statement about M2M revenue, but if TelecomTV’s reading of it is reliable, it doesn’t actually mention a revenue number. STL research shows it looks like M2M markets tend to mature and slow down as penetration increases, but in fairness, Vodafone and China Mobile, two of the three biggest operators, are managing to beat the trend.

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M2M doesn’t necessarily mean “telco”, though. Landis + Gyr has signed up for an M2M service to read its smart meters in Finland, and the service comes from Ericsson.

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August 11, 2014

Hesse out at Sprint; DTAG Q2; Brazil; Amazon - Telco 2.0 News Review

‘Digital Asia 2014’ Executive Brainstorm and Innovation Forum, run by STL Partners in collaboration with Telkom Indonesia, is designed to equip 250 specially-invited business leaders from across the region’s telecoms, enterprise and technology sectors with new, breakthrough ideas, methods and tools on how to grow significant new revenues in the next 12-18 months leveraging Mobile, Cloud and Big Data.

Sprint walks away from T-Mo, leaves Dan Hesse behind; US service revenue slides; Satellite Cowboy rides again

If last week’s surprise was the Free.fr bid for T-Mobile, this week’s was surely the news that Sprint is walking away from the deal, and incidentally sacking Dan Hesse, the industry’s highest-earning CEO. Marcelo Claure, from Softbank’s distribution wing, Brightstar, takes over and is expected to slash prices.

Clearly, the price war is about to move into a new phase, which will only make the Free-T’s deal’s hyper-leverage more risky. John Legere of T-Mobile says they’ve passed Sprint for pre-paid and hope to pass them for total subscribers later this year.

No surprise, then, that Chetan Sharma reckons that US wireless service revenue fell 2% this year. 55% of the total is data, of which 68% belongs to the dynamic duopoly. Interestingly, he also reckons that the number of companies who make at least $250m a quarter from mobile is up sharply, almost entirely because of apps and adjacent players.

That isn’t cooling the deal fever, though. The Satellite Cowboy Charlie Ergen rides again, threatening to leap in with a bid for T-Mo, or perhaps to join a Free-led bid. DISH would add more cash and especially more spectrum to the mix.

Watch this space for in-depth Telco 2.0 coverage of the Free-T-Mobile bid

After Verizon Wireless began restricting speeds for subscribers who have managed to keep their old unlimited-data plans, Public Knowledge filed complaints under the Open Internet Order against all the US national carriers. It’s going to be interesting to see how the process works, which may be their real aim.

The FCC, meanwhile, has put the kibosh on the idea that Sprint and T-Mobile might bid jointly for 600MHz spectrum without actually merging. And Centurylink, quietly, is beginning to roll out 1Gbps fibre to selected customers.

DTAG results - are they cooling on T-Sale after all? PTel CEO steps down over €893m loss in bust bank; 40% of VMED net adds > 100Mbps

Speaking of T-Mobile, DTAG’s Q2 results are out. The right word is “mixed”; groupwide earnings were up 34% at €711m, but all earnings numbers for Q2 at T-Mo USA or DTAG are heavily affected by a one-off spectrum swap with Verizon which created a $747m non-cash gain, although it drew down T-Mobile’s cash by $2.3bn. Looking through the spectrum deal, it looks like T-Mobile USA swung from a net loss in Q1 to about a $240m net profit, essentially because the loss on equipment sales narrowed (i.e. they didn’t give away quite so many iPhones).

Mobile revenues in Germany were down 2.3%, more worryingly. Earnings across Europe were up 1.7% on an “organic” basis excluding exchange rate movements, but then you can’t pay your bills with “organic” money can you? On the audited basis, they were down 1.7%. In Q2, the carrier increased its capital investment in Germany by 58%, over a billion euros, on both more LTE capacity and more fibre-to-the-node, while overall, CAPEX was up 6.2% year-on-year.

CEO Timotheus Höttgens sounds like he may be going cool on the whole idea of selling T-Mobile USA:

“We do deals that create the greatest value,” he said. “We close deals when the time is right. … We do not allow them to dictate to us.”

At Portugal Telecom, the CEO has resigned. In the News Review for the 8th of July, we reported that the two directors from Brazilian MNO Oi had quit the PT-Oi joint board over €893m of the corporate treasury that had been invested in something called Rioforte without their knowledge. Little did we then know that Rioforte would soon go down in the annals of fraud.

Controlled by Banco Espirito Santo, which also owned a large stake in PTel, it was one of the primary ways the bank’s owners were using to pull cash into the institution that they then pulled out to feed their other businesses. Now, the bank is bust and the Portuguese taxpayer is on the hook, and PTel’s €893m looks lost. As a result, PTel is having to revise the Oi merger and take only 25%, not 39%, of the Brazilian operator because it doesn’t have the cash any more. Not so much Oi as oy vey.

Vimpelcom is also feeling the pain this week; net profits were off 83% after they refinanced the debts of their Italian unit, Wind, which they would like to sell. There are obvious problems selling an Italian MNO at the moment - Telecom Italia’s results, on the 6th of August, showed its net profits for H1 down 7.6% year-on-year as the Italian economy triple-dipped.

In the UK, Virgin Media is expanding the footprint again, adding another 100,000 homes passed in east London. The most interesting detail here is that 15% of their net-adds are on the 152Mbps top tier and 40% on 100Mbps or faster - this fits with our Triple Play in the USA note’s findings about high-speed broadband as a sales driver.

VMED has also unilaterally decided to count only 50Mbps and higher as “super-fast broadband” - the European Union uses 30Mbps as the benchmark, while the UK government has quietly trimmed to 24Mbps. Keen and agile minds will of course remember that good old ADSL2+ tops out at 24Mbps, so much of the UK can therefore be declared “super fast” with strategic use of the “up to” clause.

That said, neither Xavier Niel nor Stéphane Richard will want to remember this speed test.

Vodafone Germany gets a telling off over a seriously embarrassing advertising campaign. And apparently the mobile industry has “failed” and must be nationalised.

Telefonica wants to swap TI for GVT, TI wants GVT, China Unicom H1, MTN goes all in on promising Syrian market

So Telefonica wants to buy GVT (Global Village Telecom), a Brazilian fixed operator, off Vivendi for some €6.7bn. Now, remember that Telefonica has a Brazilian GSM network, Vivo, and an indirect interest in TIM Brasil via its stake in Telecom Italia. The Brazilian regulators do not like this one little bit, and have threatened to force a breakup of Vivo if Telefonica doesn’t get out of TIM Brasil or TI. What is Telefonica up to buying more Brazilian assets, then?

The answer is, in best Facebook style, “it’s complicated”. Telefonica intends to pay Vivendi, in part, in Telecom Italia stock. That would mean Telefonica would have to hand over the whole of their TI stake, thus solving the problem and making Telefonica a converged operator in Brazil via Vivo and GVT. Vivendi, though, is in the process of selling off its mobile and indeed telecoms interests worldwide (like SFR and Maroc Telecom), so why would it want TI shares?

But TI shares are what everyone concerned wants to press on Vivendi. Telecom Italia itself now wants to buy GVT off Vivendi, paying for it with its own stock and sweetening the deal by licencing Vivendi’s content for distribution through TI’s TV assets in Italy. That wouldn’t solve the TIM Brasil issue, far from it, as Telefonica would then be part owner of TIM Brasil, GVT, and Vivo all at once, unless TI issued enough new shares to fund the deal that it diluted Telefonica very substantially, or the prospect scared them into selling up.

Meanwhile, the Brazilian government signed off six rural broadband projects based on LTE in the 450MHz band.

China Unicom’s H1 profits are up 26%, on revenue up 3.6% year on year, chiefly because data revenue grew and (interestingly) interconnect costs fell quite dramatically.

And some operators don’t let anything put them off. South Africa’s MTN is trying to get its licence in Syria extended, partly in the hope of being able to access almost $250m in cash frozen in a Syrian bank, which put like that sounds like one of those dodgy e-mails. CEO Sfiso Mabengwa said:

“It would be a 20-year licence and I guess the reality is that the problems that they [Syrians] are having now would come to an end.”

The problems being a vicious and apparently interminable civil war involving Hezbollah and ISIS, everyone’s new favourite terrorist organisation.

Cloud vs. Mouse: Amazon in fight with Hachette, takes on Disney as well; Netflix UK doubles footprint in a year

Amazon’s dispute with Hachette, over the pricing of e-books, isn’t getting any better. They recently encouraged customers to write to the French publishing house, using talking points that misquote George Orwell (and misrepresent him even more).

That’s amusing, but this is serious: Amazon has put pre-orders of some Disney movies on hold, in pursuit of another dispute. Surely nobody takes on Mickey Mouse and gets away with it?

Liberty Global doesn’t expect to be held back from more acquisitions by its debts. If you can borrow $13bn to buy a carrier with as much debt as T-Mobile, we guess not…

Netflix, meanwhile, has doubled its subscriber base in the UK over the last year, and now reaches one household in 10, far ahead of Amazon’s streaming service. The key element is distribution, of course; Netflix is now integrated on Virgin Media’s STBs, and is expected to arrive on BT and TalkTalk’s YouView boxes later this year. As Keith McMahon taught us, content is king but distribution is King Kong.

Here’s something interesting: an enterprise-focused CDN, based on the idea that major CDNs tend to expire rarely-accessed items from the cache in favour of common ones (what else would you do?), so the YouTube or whatever edges out that odd enterprise app.

Silicon Valley roundup: forkdroids are everywhere, cheap iPhones, YotaPhone leaves Russia, structure of venture capital

Horace links to the news that the fastest-growing mobile OS is AOSP, i.e. the “forkdroid” indie versions of Android, and makes the good point that sticking with the main kernel and your own work helps to manage fragmentation as much as it causes it. And just look at those “others” go!

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Here’s a good discussion of the potential for a cheap iPhone. It would perhaps be worth 15% more gross profit to Apple, but the point would really be capturing more upgrades and hurting the Androidsphere. Also, sensible discussion of whether “featurephones” or the midrange are more at risk.

The YotaPhone crew are moving to Canada, apparently to hire ex-BlackBerry talent.

Interesting product, using WLAN and very dense MIMO antennas to provide a fibre-like backhaul product.

Do “app constellations” work and if so when?

And venture capital funds are getting smaller on average, but the median fund is getting bigger as the distribution gets more fat-tailed. It is argued that the scale needed to get a startup launched is much less, but the scale of funding needed to reach an IPO is much greater.

VodaVoLTE; when WebRTC platforms fail; is decentralisation just too much hassle?

Vodafone is rolling out VoLTE in the UK, and the main case their blog makes for it is improved battery life, although they do mention HD voice a bit.

Chris Kranky notes that a lot of WebRTC platforms have gone bust, merged, or dramatically altered course. This is not exactly what you want from a platform service provider, and he argues that if it’s important to you, perhaps you should run the servers yourself.

Back when WebRTC began, everyone was hoping it would be a pure P2P technology and wouldn’t need no stinkin’ servers. Here’s an interesting essay on the problems of building decentralised and P2P architectures, which ends up by postulating that there is a fundamental tradeoff between efficiency, security, and decentralisation. We thought it sounded like the CAP theorem and in fact the author eventually concluded the same thing.

Skype wants you to update. It wants it very badly, so much so that it refuses to work until you do so.

Telemarketer vs. VoIP engineer.

Google rewards HTTPS deployment; Chinese censorship extends further; O2, Vodafone vie for security clearance

Google is going to weight websites available over HTTPS more heavily in its search results, in an effort to encourage more of them to encrypt their content.

The Chinese government is extending its censorship to include instant-messaging, like WeChat, as well as social networks like QQ etc.

SIM-maker Gemalto has acquired another information security firm.

And both Vodafone and O2 UK are claiming to be double-extra secure. VF has claimed the Government’s Cyber Essentials Plus certificate, while O2 UK claims the status of CESG Assured Service (Telecoms). The second is issued by CESG, i.e. the defensive arm of GCHQ. One up to O2 then.

OneM2M standard is out; get our view on Google-Nest now

The oneM2M standards forum, backed by the ETSI, TIA, and a lot of other alphabet soup, has completed its first release-candidate version.

Here’s a new ambient-connectivity solution that harvests power from WLAN noise, enough to provide a narrowband link. Very narrowband - about 1kbps.

It seems difficult to get real competition in special-purpose and emergency radio networks. Here’s a case study.

And finally, the Telco 2.0 executive briefing on Google, Nest Labs, and the connected home is out now.

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August 6, 2014

Connected Home: Telcos vs Google (Nest, Apple, Samsung, +…)


We’ve just published a new research paper ‘Connected Home: Telcos vs Google (Nest, Apple, Samsung, +…)’. Since Google acquired Nest for $3.2bn, Apple and Samsung have also entered the complex battle for the connected home. We analyse in-depth why Google wanted Nest, the players’ goals and strategies, and what should telcos and others do to stay in the game?

You can read an excerpt of the report here. We’ll also be exploring the implications at Digital Asia (2-4 December, Bali), and are initiating coverage of a new research programme on Internet-Driven Disruption, and we’d really appreciate your input here. For more on any of these services, please email contact@telco2.net or call +44 207 247 5003


Extract chart from report:

Figure 1 - Nest vs Competitors market capitalisation relative to revenue.png

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August 4, 2014

Free vs T-Mobile; Apple Q3s; results roundup - Telco 2.0 News Review

‘Digital Asia 2014’ Executive Brainstorm and Innovation Forum, run by STL Partners in collaboration with Telkom Indonesia, is designed to equip 250 specially-invited business leaders from across the region’s telecoms, enterprise and technology sectors with new, breakthrough ideas, methods and tools on how to grow significant new revenues in the next 12-18 months leveraging Mobile, Cloud and Big Data.

US Disruption - will Iliad really get T-Mobile USA?

No question what the big surprise was this week. There’s a new bidder for T-Mobile USA and the new bidder is Iliad, the Free.fr/Free Mobile parent company and serial disruptor. It’s an audacious move to say the least.

But what’s the story - is it ‘Xavier Niel (majority shareholder in Iliad) does it again’, or is he ‘the dog that finally caught the car?’

T-Mobile’s turnover is $26bn, compared to $5bn for Free. T-Mobile’s market capitalisation is $25bn, plus $15bn of debt, while Free’s is $16bn. Free is offering $15bn in cash for 56.6% of T-Mobile’s stock, implying that they’re hoping to keep substantial existing shareholders on board - that will help with the financing, but requires Xavier Niel and company to play nicely with at least one big shareholder. This will be a new challenge - the combined company won’t be a startup any more.

As for the finances, Free is putting in $2bn in equity, for which it will issue new shares. Niel and the other directors, who own a substantial chunk of Free, have promised that they will personally buy in to the rights issue. But the rest of the cash is good old debt, raised from banks HSBC and BNP Paribas, so Free will be leveraging up hugely.

The obvious answer to “who is the big shareholder who might stick around?” would be Deutsche Telekom. They’re also the seller. Bloomberg reckons that DTAG won’t sell for $33 a share, but might at $37. Obviously, going higher would stretch the finances, but it does sound like there’s a classic bargaining process here and they could agree on something in between.

The big advantage a Free bid has is that there is essentially no reason for the FCC to strike it down, as it would maintain 4 national carriers, and everyone expects Xavier Niel to detonate a price bomb under any business he gets involved with. Strategy Analytics, for example, point out that French operators’ margins and ARPU have been hammered since Free Mobile launched, and argue that if Sprint doesn’t now take out the T-Deal, it will be much the worse off.

The problem, though, is that Free Mobile (and before it, Free.fr) had a genuinely disruptive operating model and technology strategy that let it, in the French regulatory context, run cheaper than its competitors while delivering improvements on a faster software development cycle.

T-Mobile doesn’t have fixed ISP assets, and the US regulatory model doesn’t permit a quick build-out via local loop unbundling or special access, so the synergy between the ISP and the mobile operator and the heavy use of WLAN and small cells that characterise Free Mobile aren’t available. Niel usually has a technical or product rabbit up his sleeve at these moments, but it’s hard to imagine what it might be. He claims that he can achieve $2bn a year in additional operating profits and $10bn in one-offs by running T-Mobile in an “Iliad-like way”, but in context it’s difficult to see what this means. Sprin-T could save, for example, by stripping out duplication and sharing infrastructure, but this isn’t an option. And only Sprint can bring its wedge of 2.5GHz spectrum to the wedding. Also, Free has never been an international business and has never had to integrate a big acquisition. In fact they’ve only ever done one acquisition at all.

Reuters profiles Niel here.

Meanwhile, T-Mo reported Q2 numbers, with very strong net-adds, slightly lower ARPU, and strong revenue growth. The mountain of device receivables from customers is said to be 53% “prime”. Is that good or bad? They also claim to have turned up VoLTE across the whole footprint and to have increased their LTE channel bandwidth to 2x15MHz in 17 cities. They’ve also hired a new lobbyist in an effort to get some more 1.7GHz spectrum out of the Pentagon.

Our recent Executive Briefing Disruptive Strategy: Free, T-Mobile, VZW compares T-Mobile USA’s “uncarrier” strategy and Free Mobile in depth. More Free coverage is here and here (this link is, in fact, free). In more new Telco 2.0 research, our new Google’s Big, Big Data Battle covers the challenges to Google’s business model around Silicon Valley as the great Internet deflator itself faces deflation and commoditisation

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Apple’s big Q3, BRIC iPhones, IBM (Enterprise Mobility) & Epic (Healthcare) partnerships

In the heart of the Valley, Apple has results for Q3 and they are good. Revenue was $37.4bn, up from $35.3bn, and net profit $7.7bn, up from $6.9bn, while gross margin was 39.4% compared with 36.9% a year ago. Crucially, iPhone sales in the so-called BRICs were up 55% year-on-year. The key products were iPhones and Macs, with iPad sales relatively poor.

ZDNet rounds up changes to the Macs, which can be summed up as either a small price cut or some extra goodies at the same price point on the MacBook Pro line. They also review a release-candidate of OS X 10, codename Yosemite, which focuses on iPhone/Mac integration. For example, if the phone is within WiFi range, you can pick up calls on the Mac.

Horace points out that the PC market is just about eking out overall growth, but this is entirely down to Macs. When Apple had problems manufacturing iMacs at the end of 2012, world PC sales went sharply negative. And, as with the mobile industry, Apple is taking up more and more of the total margin pool.

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He also sets out the context for the dramatic announcement that Apple and IBM have formed an alliance to cooperate on enterprise software, presumably bringing IBM systems software to Apple devices and UX design. Meanwhile, the spectacular growth of apps as a revenue category continues, and Ben Evans thinks Apple iTunes Store payouts to developers are tracking a classic Bass curve while Google Play’s are linear.

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But perhaps the most lucrative Apple story is that they’re partnering with the company that provides 40% of America’s healthcare records systems.

Microsoft announced earnings for its Q4, and the stand-out detail is that its cloud business is now doing $4bn a year in revenue. They claim 100%+ annual growth for both Azure and Office 365.

You might think Android patent litigation was finally going out of fashion. But Microsoft this week staged a revival. It’s complicated, but back in 2011 Samsung signed a licencing agreement with Nokia, which was renewed in 2013. Under the deal, Samsung paid Nokia royalties in respect of Android devices. Now, with Samsung shipping vastly more Androids than in 2011, Microsoft thinks it is owed.

Qualcomm, meanwhile, is the target of a Chinese anti-trust investigation.

Facebook Q2 is here and it’s pretty good. Gone are the days when it wasn’t so much pre-profit as pre-revenue. Net profit was $791m in Q2, compared to $333m a year ago. A key point is that mobile daily-active users are now up to 78% of the total. Meanwhile, their subsidised not-quite-the-Internet Internet.org service launched in Zambia. After all the talk about robot solar-powered Internet drones with lasers, it turns out to mean they’re paying Airtel to zero-rate a collection of useful websites and, of course, Facebook.

Amazon’s results are in, and they’re pretty typical - huge growth with margins held down to a tax-loss level. Their newest cloud customer, the CIA, just went live. Twitter is growing its revenues fast, but still losing money hard. Google is going to prise Google+ and Google+ Photos apart, as it continues to back away from the original vision of rolling everything into +. Mozilla’s new CEO is a veteran of Firefox 1.0.

Samsung down, LG and HTC up; Alcatel floats sub (division); IoT radio wars

Samsung seems to have lost 7% of smartphone market share compared to a year ago, as the Galaxy S5 has disappointed a little and the value-smartphone sector (Moto X and E, Xiaomi, Huawei etc) has done so well. It’s not a macro-phenomenon, as Q2 2014 seems to have been the biggest quarter for smartphone shipments ever, at 295 million. It looks very much like a billion gadgets will ship this year.

However, very few of them will be Tizen devices, as Samsung has postponed the launch of the Z phone.

Just down the road, LG had a banner quarter with profits up 165% as the G3 phones proved to be a hit and ultra-HD TVs sold well. HTC, meanwhile, squeaked back into profitability thanks to the M8.

ZDNet reviews the BlackBerry Passport and is impressed.

Alcatel-Lucent didn’t lose nearly as much money in Q2, and claims to have tripled their revenues from small cells. They’re also planning to float the submarine cable business on the stock market, which sounds funny when you put it like that, and keep a substantial stake.

Huawei is investing in a British chip-design startup XMOS. As you may be able to guess from the fact another investor is Robert Bosch’s venture capital wing, they specialise in M2M and connected-car products.

Here’s an M2M developer kit for kids. Nick Hunn’s Creative Connectivity blog has a long and interesting article comparing different radio network solutions for M2M/Internet of Things infrastructure, while French regulator ARCEP has a consultation out about open spectrum for the IoT.

AT&T signs up IBM, Alcatel, Fujitsu for SDN; Verizon upload boost, wireless cap

AT&T is clearly spending heavily on its software-defined network effort. Shannon Labs is working with IBM on ways to set up virtual network interfaces between clouds really fast, and they’re down to 40 seconds. At the same time, they’ve signed up two more vendors, Alcatel and Fujitsu.

Verizon is giving its FiOS customers an upgrade to symmetric broadband. At the same time, the remaining grandfathered-in unlimited data users on VZW are going to be subject to a rate-limit above the 95th percentile of usage, and the FCC is not pleased.

Sprint is still losing customers and becoming more and more wholesale, while cost-cutting saw them squeak into the narrowest of profits ($23m). The wholesale does seem to be getting more sophisticated - Virgin Mobile USA can now provision user-defined tariffs in real time.

Windstream has decided to sell its network to a real-estate investment trust it controls and rent it back. The real-estate trust will pay for this with debt, permitting the company to refinance a big chunk of its debts, and the fact it’s considered real estate provides a big tax break for some reason.

Comcast has finished deploying IPv6 in its core network and reached 30% deployment into the access network.

The FCC is consulting on whether or not to let MVNOs and others acquire spectrum.

Telenor is having a good quarter, with margins up both in Norway and Sweden on one hand and in Thailand on the other. In all cases, it’s selling lots of mobile data to smartphone users. On the other hand, KPN saw its revenue fall 7% and it would have lost money if it hadn’t been for a one-off gain on the pension fund. Orange saw its revenues fall 3.4%.

A fixed-line price war has begun in the UK. Openreach, meanwhile, has another idea that isn’t fibre to the home.

Ooredoo has turned up UMTS900 service in Burma, the first operator to go live. KDDI’s profits have surged, up 67%. KT lost money, having to make a big payment into the pension fund.

Telefonica may be about to buy Mexican operator Iusacell. Ericsson is doing the fixed-wireless and satellite elements of the NBN. Vodacom relaunched M-PESA in South Africa, swapping Nedbank for Bidvest Bank as the financial partner.

Netflix pays AT&T; Apple CDN; media production with EE, Sky, and the BBC

Netflix and AT&T have confirmed that a paid-peering agreement is in place between them.

Meanwhile, an interesting discussion on NANOG reveals that Verizon fixed-line users, who experience congestion between Verizon and Netflix, and Verizon Wireless users, who haven’t reported such, are in a very different position. Compare AS8115, a Verizon fixed-line network, and AS6167, Verizon Wireless - the first depends on Verizon’s company-wide peering relationships, plus Cogent, to reach Netflix, the second has multiple peers and transit providers.

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Is this because Verizon is a monopoly RBOC and Verizon Wireless faces a competitive national cellular market?

Meanwhile, the Apple CDN is up and running, apparently with multiple peers and transits and heavy use of Level(3) infrastructure. Look for the domain name “aaplimg.com” if you’re curious.

Here’s an interesting rundown of how LG is using WebOS for its smart TVs and STBs.

EE demonstrated dynamic LTE broadcast at the Commonwealth Games, and says the technology is “inevitable”.

EE offers really enormous pre-paid data packages (like half a terabyte) for film production, TV news, and similar media applications. The 3G, 4G, and 5G Wireless Blog has an interesting case study of using it for field news gathering with Sky Sports.

Relatedly, here’s a good piece from the BBC R&D Blog about the network they set up to support the Games and their new IP Studio production system.

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Facebook forces users to Messenger; BBM for Windows; secure voice for iOS

Facebook is bored with trying to persuade users to only send messages through the Messenger app, so now they’re going to force you by stripping the messaging functionality out of the main app. Dan York discusses.

How does a Voice 2.0 company run its own tech-support call centre? After Comcast’s embarrassing disaster went viral, Tropo VP of customer experience describes his own experiences in the industry and the four principles they’ve adopted:

The individuals who consistently performed best in the metrics were typically gaming the system, not solving the most problems, even going so far as hanging up on calls to pad their stats….our support team at Tropo follows these four general guidelines:

• Take as much time as needed to resolve an issue
• Work on tickets as a team, not as isolated individuals
• Asking for help, including additional training, is always welcome and encouraged
• Support does not close a ticket without the customer confirming resolution

BlackBerry has made BBM available for Windows Phone. BitTorrent, meanwhile, is beta-testing a new P2P instant messaging system.

Is Mozilla losing its grip on WebRTC? An interesting debate on Apple and VoLTE. WhisperSystems, famous for encrypted IM, now has an open-source encrypted VoIP app for iOS to go with the one they already built for Android.

China busts 24 fake base station factories; ex-NSA chief’s patent hoard

China has arrested 1,350 people in a crackdown on “fake telecoms base stations”, aka IMSI-catchers. The scary bit is that they found 24 sites producing the devices and identified at least 3,540 cases involving them. Apparently the major criminal applications are spam and fraud.

Once there was a man who disclosed the NSA’s secrets out of principle. He was denounced by the NSA director, Keith Alexander, as a traitor. Keith Alexander left the NSA and filed a number of patents within months. He now charges $1m a month as a security consultant on the strength of the patents. Can they seriously not have anything to do with his work at the NSA?

Secusmart made the hardened phone Angela Merkel should have used but didn’t. Now BlackBerry has bought the company.

A US court holds that Microsoft has to hand over e-mail it controls anywhere in the world, regardless of local laws.

SecureKey is teaming up with SIM-maker Oberthur to provide mobile authentication.

EFF is focusing on the security of home routers, notoriously awful.

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