Regulators, Orange, Telefonica, EU, Verizon, Samsung: Telco 2.0 News Review
- Strategy & Finance: Consolidation is go in Germany, but no in France
- BRICs: €897m brawl on the PT/Oi board; more trouble over TIM Brasil
- Content & Commerce: Telefonica buys into Mediaset; Rok Mobile; Soundcloud lets UMG delete everything
- Cloud Computing: Verizon's e-commerce CDN; burstable EC2; Hadoop, above and beyond MapReduce
- Mobile Broadband: EU: 5G "awesome"; VZ denies Ericsson runs their network; Qualcomm buys 802.11ad firm
- Fixed Broadband: Some more money for UK fixed; pub into telco; insanely complex business rates issue
- US Carriers: T-Mobile boasts more LTE, in trouble over dodgy SMS; NSA targets Linux Journal,
- Smartphone Roundup: HTC Q2; Samsung forecasts; BlackBerry Passport; KNOX; Apple; end of SkypeKit
'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.
Consolidation is go in Germany, but no in France
So while the European Commission clears the Telefonica buy of E-Plus, taking Germany down to three operators, the opposite is happening in France - Orange has walked away from the deal with Bouygues. That leaves only the options of a Free-Bouygues deal, or no deal at all.
Orange boss, Stéphane Richard, says that if Orange was to make an acquisition it would be in Spain, bargain-hunting. It's likely that Orange would target one of Spain's independent cable or fibre deployers, possibly Jazztel. That's roughly what Vodafone is doing - this week, their acquisition of Ono got regulatory clearance, while they signed a joint venture with the Irish electricity grid to roll out an open-access FTTH network.
Numericable, meanwhile, bought out Virgin Mobile France.
Elsewhere in Europe, Telekom Austria has had to write off €400m from the value of its Bulgarian network. Siegfried Wolf, the chairman of Austrian state investment company OIAG, the second-biggest shareholder after Carlos Slim, says this leaves the carrier in a "precarious" position. The sudden writeoff is down to:
an increase in the cost of capital of the Bulgarian segment and changed expectations with regard to medium-term macroeconomic developments in Bulgaria, as well as related market effects which affect the valuation of Telekom Austria Group's business plan for the Bulgarian segment
To put it another way, there was a run on the banks in Bulgaria last week, and TA is spooked.
Tele2 has a network in Norway, but no spectrum, while TeliaSonera has spectrum but needs more network. The solution was obvious and Telia bought it for €500m, a price that lets Tele2 exit Norway at a profit.
The Telco 2.0 Transformation Index's detailed coverage on Vodafone is out now. We believe Vodafone, post-Verizon Wireless, is in urgent need of change to restore a growth story
€897m brawl on the PT/Oi board; more trouble over TIM Brasil
Here's a good row. Portugal Telecom, of course, recently acquired Brazilian operator Oi. Now, the two Brazilian directors of the combined company have quit, after PT bought €897m of commercial paper issued by a company called Rioforte, which is owned by Portuguese bank, Espirito Santo. The bank is also a big shareholder in PT.
The Portuguese carrier seems to see this as routine treasury management - the money is lent for two weeks only - while the Brazilians see their money being siphoned into some sort of incestuous arrangement with a peripheral-Euro bank. The quitters say they only learned of the fairly substantial transaction from a press release, while - just to add complexity - one of them is due to resign anyway because he is in a conflict of interest.
Elsewhere, the chairman of Telecom Italia is very clear that he doesn't want to sell TIM Brasil, no, nay, never. This, of course, means a head-on collision with Telefonica, which doesn't want to sell Vivo, and the regulators. But now that the Telco consortium of TI shareholders is breaking up, will TEF go hostile?
Telefonica buys into Mediaset; Rok Mobile; Soundcloud lets UMG delete everything; competing against non-advertising
Telefonica, meanwhile, is buying into TV again. This week, the company has picked up Mediaset Spain's 22% of Canal+ and taken an 11% stake in Mediaset's Italian core business, which is being spun-off into a separate company. Mediaset is struggling with plunging ad rates in Italy and soaring fees for football rights; you can see why Berlusconi would want to sell but not perhaps why TEF would want to buy.
Rok Mobile's music-focused MVNO has launched for invited customers. $50/mo gets you 20 million tracks and unlimited calls, SMS, and data over Sprint's network; we will see how that quote-you-happy offer lasts.
After YouTube, Soundcloud has given Universal Music the keys, letting them unilaterally remove content they don't like whether or not it might be covered by fair-use. Expect a row.
Dailymotion will be live-streaming music festivals, although the list given seems more than a bit B-list.
Horace points out that the example of digital photography shows that it is often the most effective strategy to compete against non-consumption, expanding the market rather than trying to win share off the incumbents. He thinks this applies to mobile advertising.
EE has started distributing Office 365 and a variety of other software, notably Zendesk to its small business customers.
Here's a Twilio HOWTO on how to track, link, and organise incoming SMS messages.
Verizon's e-commerce CDN; burstable EC2; Hadoop, above and beyond MapReduce; Apple MacEnterprise
Verizon is pushing a CDN optimised for e-commerce applications. Transact is a product EdgeCast developed immediately before Verizon bought the company, which deploys your web store to its distributed POPs around the world in order to speed up load times and reduce breakage.
Amazon Web Services is offering "burstable" EC2 instances, which offer low prices on small machines, but permit occasional peak loads. Typical use cases would be build servers, remote desktops, and Web hosting.
The AWS Blog has an interesting post on how to use their Elastic MapReduce to manage a cluster of Hadoop servers. Last week, we heard that Google has moved on from MapReduce to a new distributed big data tool. Data Center Knowledge looks around the Hadoop ecosystem and points out that the open-source clone has far outgrown the functionality of the Google original.
VMWare reckons more and more enterprises are deploying Apple Macs.
Amazon's James Hamilton blogs about how AWS uses formally provable methods to design big systems.
EU: 5G will be awesome; Ericsson mixes demos and cold water; "legacy" WiMAX; Ericsson, Verizon deny Ericsson runs their network; Qualcomm buys 802.11ad firm
The European Union thinks 5G will be awesome. This would be less exciting if the institution had not played such an important role in both GSM and UMTS.
How badly these things can go wrong is shown by this story. Elisa has shut down its WiMAX network with effect from the 1st July, having stopped selling new connections at the end of 2012. Be honest; did you ever expect to hear the phrase "legacy WiMAX"?
Ericsson this week demonstrated "pre-standard 5G", with theoretical speeds of 5Gbps. Those of us who remember the early days of WiMAX will be suitably sceptical (remember 70Mbps at 30km?), and CTO Ulf Ewaldsson took the trouble to advise Mobile World Live to trim their expectations.
Ericsson, meanwhile, denied managing Verizon Wireless's network, as did Verizon. After all, they did run Sprint's ill-starred Network Vision project.
Qualcomm has acquired Wilocity, an Israeli startup that develops 60GHz chips for the 802.11ad WLAN standard. 802.11ad is intended to complement 802.11ac (so-called WiGig) with even faster peer-to-peer or broadcast links.
Some more money for UK fixed; pub into telco; insanely complex business rates issue; more BDUK funny figures
The UK government has announced a pot of funding for so-called "local growth deals" worth £6bn in all, some of which may be available for broadband projects outside the existing Broadband Delivery UK programme. As usual with such things, it's worth wondering how much of the money is "money" (guarantees, soft loans etc) rather than cash, and how much of it is actually new. But anything's better than BDUK.
Brewer and pub chain Marston's started out by deciding to run its own WiFi, both for staff and public use. This has developed into running their own WAN and VoIP and eventually getting an OFCOM licence to be a mini-telco. There's a lot of this "enterprise-plus" stuff about these days, and it would only be sensible to expect it to extend into cellular.
Here's a fascinating blog post on a complicated issue regarding BT and other UK ISPs, regulation, and tax. A large part of BT's regulated costs consist of business rates, a tax set by the Valuation Office Agency. BT's regulated prices charged to independent ISPs include part, but not all, of the rebate BT gets on this tax for having unbundled lines and therefore foregone some of the profit on them. The indies argue BT should pass it all on; BT (and the regulator) argues that most of the profit arises from BT Wholesale (which isn't regulated), but of course this doesn't seem to help the indies much with BTw pricing for backhaul.
Superfast Cymru, yet another BDUK project, is in trouble after a government minister boasted that it provides speeds of "61Mbps". This doesn't sound like any network technology we've heard of, and neither the government nor BT will show their working. It is alleged that the number is an average of "theoretical" tests of 100,000 lines. "Up to" with a vengeance.
Meanwhile, here's a look at the responses to the £10m "innovations" fund that the government recently announced. KA-band satellite is being offered, rather hopefully. And RevK struggles with TalkTalk, or rather, they struggle with his correctly inline-quoted e-mail.
T-Mobile boasts more LTE, in trouble with regulator over dodgy SMS; NSA targets Linux Journal, terrorists
T-Mobile USA trumpets that it has hit its self-imposed target of 230m population coverage with LTE by the middle of 2014. John Legere took the opportunity to pick a fight with Sprint. T-Mo has just started refarming lower-band spectrum and using 700MHz, so expect more announcements.
T-Mobile has also been in trouble lately, for spamming its customers with premium SMS. Specifically, some of its wholesale SMS customers were in the habit of pushing out premium-SMS campaigns without telling the public what they cost. Now, the Federal Trade Commission isn't happy. Neither is Legere, but it's telling that his response is more than a bit of a non-denial:
The T-Mobile chief also pointed out that he did not want the company to have unsettled business, which has led to the recent creation of the Proactive Refund Program.
Legere said he has instructed T-Mobile's marketing and customer care teams to "double down their outreach effort to all potentially affected customers - who believe that they were inappropriately billed and/or paid for one of these Premium SMS services that they did not want or authorise - and provide refunds"
We didn't do it, but in case we did, we're pro-actively calling up customers and offering refunds. Right. T-Mobile has also excluded speed-test apps from its data cap.
LightSquared's rescue plan is final, and it leaves Philip Falcone with a reduced shareholding but still a shareholding, while offering the Satellite Cowboy Charlie Ergen a bag of money to go quietly.
Finally, readers of Linux Journal are among those targeted by the NSA for surveillance. Hit the link and that means you.
HTC Q2; Samsung forecasts; BlackBerry Passport; KNOX; Apple; end of SkypeKit
HTC announced slightly less horrible Q2 results than had been expected after it made a loss in Q1. The company is clinging to the edge of profitability; although it doubled net profits year-on-year, they're still only $75 million. Revenue has risen 4 per cent sequentially.
Part of the problem is that Samsung has so much more money hanging about to spend on marketing and vendor financing. That said, Samsung Electronics reported its third successive decline in quarterly profits, as everyone waits to hear who will succeed the ailing patriach Lee Kun-hee. S5 sales have been good, but down-ticket ones have been wanting. Perhaps the S5 Mini will help, but there's also a more fundamental issue in that Chinese carriers are getting more gadgets from Lenovo and Huawei.
Here's a glowing review of a beta BlackBerry Passport. Admittedly it's from Crackberry.com, who are by definition enthusiastic, but it's truly glowing.
At Google I/O, it was announced that Samsung's KNOX security extensions would be ported into the Android core, rather like SELinux. BlackBerry CEO John Chen is not happy, and is trying to diss it.
MacRumours has a rumour that Tim Cook is enthusiastic about voice messaging for the iPhone 6. Ars Technica reviews the new $1099 iMac and argues that it is only poor value. Support for Android Auto/Apple CarPlay is a mess.
Microsoft is not expecting significant shipments growth from Windows 8 and XP shutdown.