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BT, Alcatel, KPN, Numericable, Oi, Bharti: 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.

BT Q2s focus on football; FiOS and U-Verse net-adds; Amazon stick; a look back at Netflix/Comcast

BT’s Q2 results are out, and all the football seems to be working, up to a point. Although revenues are down 2%, EBITDA was up 1% and pre-tax profits up 13%. ThinkBroadband points out that the key metric here is that out of all the premises passed by BT’s FTTC rollout, 73.5% have taken BT services. Interestingly, they’re also going to start bundling Netflix, so it certainly looks like BT is deeply committed to video as its lead product.

Elsewhere, both Verizon’s FiOS and AT&T’s U-Verse added substantial numbers of IPTV subscribers, with 214k net adds for AT&T and 114k for Verizon in Q3, while Comcast reported a net-loss of 89k video subscribers. That sounds rosy, but the problem is that broadband net-adds were probably the reverse of this picture. Cable operators have been steadily gaining broadband subscribers, and faster than they shed video ones. And once you get the main broadband connection, it’s easier to get the rest of the household comms spend.

Amazon, meanwhile, has launched a Chromecast-like streaming device priced at $39, discounted to $19 to begin with, that has the Fire TV software and substantially more powerful hardware than the parallel Google and Roku products. Dan Rayburn points out that the price erosion doesn’t have far to go before these devices are given away for free, which would be very bad indeed for Roku.

The BBC is withdrawing its RSS feeds of iPlayer content in favour of a new API, apparently in an effort to stop unofficial clients that download and stash their content.

Sky, meanwhile, looks closer and closer to the long-rumoured launch of an MVNO, after it contacted 200,000 customers to sound them out, enough to count as a soft launch in itself.

Polish T-Mobile has signed up with a broadcaster to offer its own TV service.

A study argues that the supposed congestion between Netflix and downstream ISPs only seems to have affected those carriers that didn’t sign up for Netflix Open Connect.

US CapEx slowdown, Alcatel suffers; Bouygues hits the gigabit; KPN, Numericable have to open up NGA networks

Here’s a summary of US carrier CapEx data for Q3. It increasingly looks like Sprint’s numbers, expected later today, will tell us if we really have finished this investment cycle; they are expected to announce that the complete rebuild of their network under Sprint Spark is finished, in which case only T-Mobile is still increasing its CapEx spend among the US operators.

It does look like network spending is slowing down. Alcatel-Lucent reported its revenues were down 3.8% year-on-year. The only good news was that IP routers were up 2.2% and margins were rather better. An example would be CenturyLink deploying their 7950 MPLS routers.

Telenor, meanwhile, signed up for five years of Ericsson consulting and RBS6k base stations.

Bouygues has announced an upgrade to its FTTH speeds, pushing the downlink up to 1Gbps at no extra cost.

KPN will have to keep providing wholesale access to the infrastructure, but on the other hand, it will be allowed to buy another 9% of independent FTTH deployer Reggefiber, giving it a 60% stake. Once the deal closes, the Netherlands will have two shared public broadband networks, the “telco” KPN-Reggefiber one and the “cableco” UPC-Ziggo one.

OFCOM has published its strategy to ensure all UK citizens benefit fully from communications technology, and they seem to think that everything’s all right, roughly speaking.

Which is a pity if you believe the Engineering Employers’ Federation, which has just surveyed its members. 40% of the firms they asked thought the UK’s broadband infrastructure was “poor” or “very poor”, and a majority would put it in their top three infrastructure spending priorities, with 16% putting it in first place.

Spain’s regulator rules that Jazztel (and by extension, other operators) have to provide wholesale access to their “vertical” fibre, i.e. in-building, on the same terms they offer it to their partners.

Numericable’s acquisition of SFR closed this week, and it has interesting consequences in fixed broadband. As a regulatory concession, Numericable has to dispose of its DSL assets, but much more importantly, it also has to offer wholesale access to its cable network both on reseller and on bitstream-style terms. This is a first, and we can see Free jumping right on the opportunity to add a lot more Freeboxes on fast broadband links.

Oi, and Telefonica, and America Movil buying TIM Brasil; Numericable, private funds after PTel; huge Q3 for Bharti Airtel

A very detailed rumour says that Oi, Telefonica, and America Movil are going to bid jointly for TIM Brasil, offering about $13bn and splitting the company up 28%, 32%, and 40% respectively, using Brazilian investment bank BTG Pactual’s services. All parties deny all knowledge. Of course. Telefonica, Telefonica Brasil, America Movil, and Telecom Italia all saw their shares rise on the story.

Meanwhile, Numericable has made its €7bn bid for Portugal Telecom, sort-of merged with Oi, official. This has tempted two private equity funds, Bain Capital and Apax, out of the woodwork.

While America Movil is trying to add more assets in Brazil, it’s trying to get rid of them in Mexico. Softbank is reportedly interested in bidding $10bn for them and Sprint CEO Marcelo Claure has been tasked with initial talks.

In the US, both AT&T and Verizon have added even more data to their bundles, while Sprint is offering a lease option on Samsung Galaxy S5s. T-Mobile announced another massive quarter for net-adds, 2.3m, of which 1.4m are postpaid, and lost money again to the tune of $94m. As T-Mobile supplies smartphones on a hire-purchase basis, it’s progressively building up a mountain of receivables from its customers - this quarter, the total reached $4bn worth.

That took T-Mobile to 52.9m subscribers, just over a million behind Sprint. If Sprint announces a bad quarter today, T-Mo might be the third-biggest carrier in the US. John Legere was uncharacteristically trying to play down the hype, saying that his real competitors were AT&T and Verizon Wireless.

Interestingly, T-Mo has also added a lot of M2M customers, with 222k net-adds in that sector in Q3 compared to 7k a year ago - or to put it another way, a couple of major contracts have landed.

US Cellular, meanwhile, struggles on. In Q3, it gained subscribers for the first time in years, a net gain of 50k. However, it’s still losing money. That said, service ARPU was over $60 - how long before someone buys the company?

Elsewhere, Bharti Airtel’s Q3 profits were up 170 per cent, $229m, as revenue from data rose 74% in India and 57% in Africa, and the Indian price war let up somewhat. Transactions on their mobile-money platform reached $3.3bn, and they added 11,500 node-Bs in India - no slowdown in CapEx there.

Telenor, meanwhile, wants to use its re-acquired 1800MHz spectrum in India for 4G. Globally, 2G/4G working in the 1800 has been one of the best options, and if they get permission from the regulator they could potentially skip paying for more spectrum. Of course, the regulator would probably want to make sure they did.

Telkom has cut its half-year outlook by 70 per cent. Safaricom is going to spend $335m on more 3G capacity and also on some 2G coverage expansion. And Mobily has had to restate its results for the last 18 months, resulting in a 71% drop in their Q3 revenue, after it treated non-recurring promotional revenue as recurring.

Oettinger’s warm words for telcos; FCC’s Wheeler on PSTN shutdown; 600MHz slides right; UK national roaming is back

The new European commissioner, Günther Oettinger, has started his term with some telco-friendly rhetoric, suggesting that regulation has been too consumer-led and needs to be easier on the industry’s profits. TelecomTV points out that Neelie Kroes started off like that, too.

FCC Chairman Wheeler took to the official blog this week to raise several issues around the PSTN shutdown. He’s suggesting that the FCC needs to make sure that, post-PSTN, guarantees for things like emergency service are maintained, that the shutdown doesn’t result in reduced competition, and that voice services don’t disappear.

In another FCC blog post, he argues that the regulations on multi-channel TV, that are intended to make sure cable and satellite providers can all get access to content whether or not it’s owned by a competitor in the broadcasting business, should be extended to cover Internet video services.

The 600MHz auction is sliding right and won’t be until 2016 at the earliest.

AT&T Mobility is in trouble with the FTC about throttling remaining unlimited data plans.

Verizon has denied any interest in paid prioritisation, in a letter to the chair of the Senate judiciary committee.

And the UK national roaming proposal is back.

Q3 mobile shipments; tough quarter for Samsung, new gadgets

Q3 shipments of mobile devices show that growth is slowing down. 459.5m gadgets were shipped in the quarter, up 7.6% year-on-year, compared to 9.4% in Q3 2013. Samsung is still the market leader by volume, but its share is down to 22.1% from 28% a year ago. 70% of mobile shipments, or 320m devices, were smartphones.

That translated into a poor Q3 for Samsung itself. Revenue in the IT & Mobile Communications division was down 32.8% and operating profit 73.9%. The big problem appears to be the mix of smartphones, with the average selling price disappointing again.

Not that they’re giving up or anything - here come two new mid-market phones, the A5 and A3, which get ultra-thin, all-metal form factors and strong specs for their prices.

Sony, meanwhile, had a decent quarter in everything but mobile, after it sold enough PlayStation 4s to lift its gaming revenue 83 per cent. The mobile division, though, dragged the company into a loss, even though sales of mobile device components were up 187%.

ZTE says its revenue from mobile devices was up 40% and average selling price was up 8% but doesn’t say what either number actually was.

Amazon confesses: the Fire was too pricey and disappointing to boot.

Microsoft has launched a fitness/health band device.

Amazon cloud revenues “30x Microsoft’s”; Telstra’s $5bn Asian strategy; IBM cloud in China

Who’s got the biggest cloud? Network World reckons Amazon Web Services is 30 times as big by revenue as Microsoft Azure, if you define “cloud” as publicly-available Infrastructure-as-a-Service.

Amazon is going to spend $1.1bn on a huge data centre in Ohio.

Telstra has $5bn to spend and is looking for more assets in Asia. They’ve recently signed up AppDirect to run their cloud app store for Aussie SMBs, so perhaps there’s a clue there.

IBM is co-operating with Tencent to deploy its public IaaS solutions in China, adding OpenStack to its offerings, and building a new SoftLayer data centre in Mumbai.

Here’s an Aussie company deploying modular data centres.

Alibaba’s first full earnings call is scheduled for tomorrow.

Facebook’s Q3 results have it making net profits of $806m, up 90%, although WhatsApp lost $232m, largely paying out on share options that vested after the merger. You can now reach Facebook via the Tor network, where it has the first hidden service (like a web site, within Tor) to get an SSL certificate.

Google’s advertising unit acts like an internal VC unit, distributing cash to cool projects. This FT interview with Larry Page sounds that way, too:

“One thing we’re doing is providing long-term, patient capital.”

Here’s a useful overview of who supports which codecs in WebRTC. It’s a bit of a mess.

And so many people are dialling 911 when they sit on their phones it’s a major problem, according to the FCC no less.

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