General Telecom News EU travellers to get cheaper mobile phone calls from Wednesday (June 30, 2009) BRUSSELS (AFP) - European travellers will pay less to use their mobile phones while abroad in the EU from Wednesday when new regulated price caps take effect across the 27-nation bloc. Under the new limits, the price of making a call while abroad in the European Union will fall to 43 euro cents per minute, excluding sales tax, from a previous maximum of 46 euro cents. The price of receiving calls abroad will drop to 19 cents from 22 cents. The lower caps are part of an ongoing EU campaign to reduce the cost of using mobile phones across European borders, known as roaming fees, after regulated limits were first imposed in 2007. The regulated prices are also being extended, for the first time, to cover sending text messages and surfing the Internet via phone. "The roaming-rip off is now coming to an end," said EU Telecoms Commissioner Viviane Reding in a statement. Under the new rules, sending a text message from abroad in the EU will cost a maximum 11 cents, excluding sales tax, little more than a third of the previous EU average of 28 cents. In order to reduce the cost of surfing the Internet from hand-held devices, the new rules will also limit the price operators charge each other for transferring a megabyte of data while a user is on the road to a maximum of 1.00 euros. Mobile operators will also have to bill customers by the second from the 30th second of a call in order prevent them from rounding up to the highest minute, a practice which can cost consumers dearly. "I call on the mobile industry to pass these savings on to data roaming customers swiftly," Reding said. "The (European) Commission and national regulators will monitor data roaming charges very carefully and assess next year whether the roaming market is finally becoming competitive." Dell to make iPod touch-like gadget (From PC World, June 30, 2009) - Dell is developing a pocket-sized gadget fashioned after Apple's iPod Touch that will play music, videos, and connect with the Web and is based on the Google Android mobile operating system, according to reports in today's Wall Street Journal. Dell hopes to break a bad streak of luck with consumer gadgets. It wasn't very successful with its DJ Ditty music player line or with the Axim PDAs, which got axed a few years ago. Dell is giving pocket-sized devices one more shot, this time with an iPod Touch-style mobile Internet device (MID). So will it make a difference? WSJ's report says that Dell's upcoming MID is slightly larger than the iPod Touch, and does not have cell phone capabilities. In development since last year, Dell's unnamed gadget will not rely on Dell's in-house software team and instead should benefit from using the Android OS. We've seen earlier this month a fuzzy photo of what it was supposed to be Dell's smartphone project, a Palm Pre look-alike. But we also know that Dell's first mobile phone prototypes have been rejected by wireless networks operators because the designs were too dull. This time around though, Dell has more support from wireless carriers according to the WSJ report. Support from a wireless carrier could help Dell sell the devices and may mean the gadget could be married to a cellular data plan similar to how Verizon is selling a Hewlett-Packard netbook today. Another route for Dell is to sell this iPod Touch-like device with a simcard slot. Dell's sleek Adamo laptops have a simcard slot (for attaching wireless carrier's cellular data card) but there's no word on such capability on the company's MID. Nokia has also had three forays into the pocketable MID market, with what the company calls "Internet Tablets." But these devices have never really got off the ground because besides Wi-Fi, the only other way to connect to the Internet was to tether the device to your mobile phone via Bluetooth. And if you have a BlackBerry, an iPhone or a Palm Pre, having a separate device to browse the Internet can be quite useless. Besides that, Microsoft is also putting out a competitor to the iPod Touch, in the name on Zune HD, which will have strong multimedia capabilities and an Internet browser. So if Dell is working on a nonmultimedia-oriented pocketable MID, without cell phone capabilities, then the whole idea of the device might be a hard sell. With that in mind, the WSJ report mentions that the launch of the Dell MID (later this year) could be delayed, or the project could be scrapped entirely, just like it happened with the company's plans on launching a new music player (targeted at iPod customers, of course). At least the WSJ report reconfirms that Dell is still working on a smartphone, more specifically running Google's Android OS, due to be launched sometime later this year, slotting in with earlier rumors from January. France Telecom may freeze fiber-optic investment, Echos says (June 30, 2009) (Bloomberg) - France Telecom SA is threatening to suspend investment in fiber-optic cables that could bring high-speed Internet access to French households, Les Echos reported, without saying where it got the information. The company is opposed to a decision by the Arcep telecommunications regulator authorizing rivals to demand that France Telecom install fiber optic cabling in households that may use competitor services, the French daily newspaper said. Bringing access to 3 million households represents an investment of 3 billion to 4 billion euros ($4.2 billion to $5.6 billion), the newspaper said. EU steps up offensive on mobile telephone fees (May 7, 2009) BRUSSELS (AFP) - The European Commission stepped up its offensive on mobile phone fees Thursday, calling for a clampdown on rates operators charge to connect to each other's networks. The European Union's executive arm urged national regulators to ensure that such so-called termination rates are based on the real costs an efficient operator incurs for passing on a call from another operator. Such rates vary widely among EU countries, from two euro cents per minute in Cyprus to 15 euro cents in Bulgaria with an average across the 27-nation European Union of 8.55 cents. That works out to about nine times more than what it costs fixed-line operators to pass calls between each other's networks, much to the concern of the commission. EU Telecommunications Commissioner Viviane Reding said the situation benefited operators of big mobile phone networks because they had more incoming calls from fixed-line operators and smaller mobile operators. "High mobile termination rates are ... an indirect subsidy for the larger mobile operators -- a subsidy that has to be paid by all fixed operators, by smaller mobile operators and by all consumers," she told a press conference. "While there may have been a greater tolerance of high mobile termination rates when mobile networks were first being rolled out across Europe, they can no longer be justified today, at this advanced stage of mobile market development." Concretely, the commission move consists of recommending national regulators to follow a set of principles when calculating a fair price for the cost of passing calls between operators. The attack on termination rates is the latest move in a campaign by the commission to bring down the cost of using mobile phones in Europe by regulating prices lower. It has already set caps on the price of international calls on mobile phones and last month pushed through legislation limiting the cost of sending text messages and surfing the Internet with a mobile phone while abroad. Telecom Italia’s first-quarter profit falls 4.5% (May 7, 2009) (Bloomberg) -- Telecom Italia SpA, Italy’s biggest phone company, reported a 4.5 percent drop in first-quarter profit as domestic wireless sales declined and confirmed its full-year targets. Net income fell to 463 million euros ($615 million) from a restated 485 million euros a year earlier, the Milan-based company said in a statement today. Revenue fell 6.7 percent to 6.79 billion euros. Chief Executive Officer Franco Bernabe, who said last month there aren’t “magic wands, miracle solutions” for the company, faces pressure to revive growth and cut debt. Telecom Italia is trimming another 4,000 jobs and may sell as much as 3 billion euros of non-core assets including German broadband unit Hansenet to bolster finances. The company reiterated earnings targets for the wireless division and its Brazilian unit. “The reiteration of the guidance, especially for Brasil, is positive,” said Saverio Papagno, an analyst at AZ Fund Management SA in Luxembourg. “The slowdown of the mobile business” was a disappointment for the market, he said. Sales at the domestic unit fell 4.3 percent to 5.36 billion euros. The mobile unit was affected by a contraction in value- added and traditional services, including text messages, and changes to interconnection pricing imposed by regulators. Telecom Italia fell 1.35 euro cents, or 1.4 percent, to 94.75 cents in Milan, giving the company a market value of 16.7 billion euros. The stock has fallen 18 percent this year. Reiterated Outlook “It was a satisfactory quarter in light of the macroeconomic climate,” Bernabe said in the release. “The recovery of efficiency continues and the group’s commitment to profitability and cash generation is confirmed.” Earnings before interest, tax, depreciation and amortization, excluding currency moves and acquisitions or disposals, or organic Ebitda, fell 2.4 percent to 2.84 billion euros. Telecom Italia said organic Ebitda at the domestic unit will be 9.9 billion euros to 10 billion euros, while the measure at the Brazilian business will be about 3.6 billion reais ($1.7 billion) this year, matching forecasts given in December. The company isn’t considering a capital increase as it has flexibility and there is no need for a “safety net,” Bernabe reiterated on a conference call. Rising Debt The company aims to bring borrowings down to about 2.9 times Ebitda at the end of this year. Telecom Italia’s net debt rose to 34.5 billion euros at the end of March from 34 billion euros at the end of 2008. The company’s debt is “sustainable,” Chairman Gabriele Galateri said on April 8. On May 5, Tim Participacoes SA, the Brazilian unit of Telecom Italia, said its first-quarter loss widened to 144 million reais after a decline in subscribers and lower spending. Telefonica SA and partners Mediobanca SpA, Assicurazioni Generali SpA, Intesa Sanpaolo SpA and Italy’s Benetton family own a 24.5 percent controlling stake in Telecom Italia through holding company Telco SpA. Vodafone, Telecom reach agreement on New Zealand network (May 7, 2009) (Bloomberg) -- Telecom Corp., New Zealand’s biggest telephone company, said its new mobile network will begin operating before the end of the month after it reached an agreement with rival Vodafone Group Plc. Telecom will install more filters on its network to reduce interference affecting Vodafone customers, the Auckland-based company said in a statement. The network will start later than the originally scheduled May 13, spokesman Mark Watts said. Vodafone yesterday sought a court injunction against the May 13 start after saying complaints from customers had surged because of interference on its network caused by Telecom’s new technology. Vodafone has agreed to discontinue the court proceedings, it said today. Telecom is spending NZ$570 million ($323 million) on the network which betters the technology of Vodafone’s existing system, allowing it to compete with global roaming and data download speeds. Telecom brought forward the start date from June as Vodafone completes an upgrade of its network this month. Telecom had previously said government officials had confirmed it was complying with its licenses as part of an investigation into the interference claims. Manila's Globe Telecom to borrow $63 mln for capex (May 6, 2009) MANILA (Reuters) - Globe Telecom Inc, the Philippines' second-largest phone company, plans to borrow 3 billion pesos through loans or debt notes to fund its capital outlay this year, an official said on Wednesday. The company may add more debt later in the year to repay early some of its costly debt, Alberto de Larrazabal, head of treasury at Globe, told reporters. "Our borrowing plan for the year is 12 billion pesos. We already raised 9 billion pesos of the 12 billion so we are looking at 3 billion more," De Larrazabal said. "After that, if there is an opportunity for a little bit more in anticipation for next year then we might opportunistically get back to the market," said Larrazabal, adding a possible notes issue could be denominated in either pesos or US dollars. Globe, owned by Singapore Telecommunications and local conglomerate Ayala Corp, raised 5 billion pesos from the sale of three-year and five-year bonds in February. Another 4 billion pesos worth were raised from bank loans. Larrazabal said the company also plans to prepay 1 billion pesos worth of debt this year, which could increase its borrowings. The telecoms firm, which posted a 17 percent rise in first-quarter net profit, had earmarked $350-$400 million for capital spending this year, down 16 percent from 2008, even as it forecast continued growth in its broadband business despite a slowing economy. Rival Philippine Long Distance Telephone Co said on Tuesday it was looking to borrow 15 billion pesos this year, mostly through peso bonds, to fund its capital spending and the acquisition of a stake in power retailer Manila Electric Co. Greece's OTE telecom says 1Q net profit up 89 pct (May 5, 2009) ATHENS, Greece (AP) -- Greece's dominant telecom operator OTE has said its net profit rose 89 percent in the first quarter of 2009, mainly due to a government share transfer that offset part of the cost of an early retirement program. OTE said its net profit reached euro266.7 million ($355.3 million) in the January-March period, compared to euro141.1 in the first quarter of 2008. The company said profit was boosted by a euro200 million transfer of state-owned OTE shares to a state pension fund, under the provisions of a past OTE voluntary retirement deal. Revenue dropped 5.4 percent to euro1.45 billion, as fixed line sales in Greece and Romania were impacted by competition. Last year, the Greek government and Germany's Deutsche Telekom AG struck a deal on sharing ownership and management control of OTE, formerly a state monopoly. Under the agreement, the government and Deutsche Telekom each gained control of 25 percent plus one share of OTE. France Telecom Q1 sales down 2.6% at $16.4 bln (May 4, 2009) - France Telecom has reported a 2.6% decline in revenue to 12.6bn euros ($16.4bn) compared to 13bn euros ($17bn) in the same quarter last year. EBITDA fell 7.1% to 4.3bn euros ($5.6bn), while EBITDA margin dropped 1.7 points compared to last year. Revenue from personal communication services fell 4.5% to 5.1bn euros ($6.6bn), home communication services revenue grew 6.7% to 4.9bn euros ($6.3bn), and enterprise communication services revenue grew 1.2% to 1.9bn euros ($2.4bn). Geographically, revenue from France grew 1.9% to 5.9bn euros ($7.6bn), while UK revenue fell 17.1% to 1.2bn euros ($1.5bn), Poland revenue fell 24.2% to 960m euros ($1.25bn), and Spain revenue declined 4.1% to 954m euros ($1.24bn). Revenue from the rest of the world rose 5.1% to 2.02bn euros ($2.63bn). Didier Lombard, chairman and chief executive at France Telecom, said: "The group has been able to expand its customer base in the first quarter of the year to more than 183 million customers, with the number of mobile customers increasing more than 9% to almost 123 million and broadband services rising nearly 9% to 13 million ADSL-equipped households." For fiscal 2009, it expects to generate 8bn euros ($10.43bn) in organic cash flow with Capex at 12% of fiscal 2009 revenues. HP and RIM form alliance on BlackBerry (May 4, 2009) (Reuters) - Hewlett-Packard Co and BlackBerry maker Research In Motion Ltd said they have formed an alliance to provide services for the BlackBerry. Among the services are HP CloudPrint for BlackBerry smartphones, which allows users to print e-mails and documents at the nearest printer using the Internet. The services include support for BlackBerry's Enterprise Server 5.0, which was launched on Monday. HP's enterprise customers can also use the PC maker's ProLiant servers to run the BlackBerry Enterprise Server software, the companies said. BlackBerry handsets have become a staple of executives, lawyers, politicians and other professionals who use them to send wireless e-mail securely. Deutsche Telekom posts 1.12-bln-euro first quarter loss (May 4, 2009) FRANKFURT (AFP) – German telecommunications operator Deutsche Telekom suffered a first-quarter loss of 1.12 billion euros (1.49 billion dollars) owing to a devaluation of its British T-Mobile unit, the company said. In the first quarter of 2008, Deutsche Telekom had posted a profit of 924 million euros, a statement said. But the group had to write down the value of its T-Mobile UK division by 1.8 billion euros owing to "the strong economic slowdown and more intense competition in the United Kingdom." The move might renew press speculation over the possible sale of the British mobile division. Deutsche Telekom also confirmed information first released in late April, including a 6.2 percent increase in first-quarter sales to 15.9 billion euros and a 2.7 percent rise in core earnings to 4.8 billion euros. That was explained by the integration of Greek telecom operator OTE into Deutsche Telekom's books as of February 1. When exceptional items were stripped out, quarterly sales were stable at 15 billion euros and core earnings fell by 4.8 percent to 4.5 billion euros, the statement said. Negative foreign exchange effects were partly responsible for the drop, it added. "The figures we are presenting today show a mixed picture," Deutsche Telekom chairman Rene Obermann was quoted as saying. "Despite the difficult environment in some markets, we are in a relatively stable position," he added. For the full year, the group has forecast a fall in core earnings of two-four percent, excluding the integration of OTE. Motorola profit falls on lower handset sales (May 1, 2009) (Bloomberg) - Motorola, the biggest US mobile-phone maker, posted a wider first-quarter loss as handset shipments fell by almost half. The stock declined 7.2 per cent. Revenue dropped 28 per cent to $5.37 billion, slumping for a ninth straight quarter and missing the average analyst estimate of $5.62 billion in a Bloomberg survey. The loss widened to $231 million, or 13 cents a share, Motorola said in a statement. Motorola has cut at least 7000 jobs since October as Apple and Research In Motion won over customers with more attractive devices and the recession hurt overall handset demand. The company boosted its cost-savings target for this year to $1.7 billion as it strives to return to profitability. The handset unit continues its nightmarish descent, said Tero Kuittinen, an analyst at GC Research Capital in New York, with an underweight rating on the stock. Motorola, based in Schaumburg, Illinois, fell 43 cents to $5.53 at 4pm in New York Stock Exchange composite trading. The stock has advanced 25 per cent this year. The net loss expanded from $194 million, or 9 cents, a year earlier. The loss, excluding severance and other costs, was 8 cents, compared with the average analyst estimate of 10 cents. The loss this quarter, excluding some items, will be 3 cents to 5 cents a share, Motorola predicted. Analysts projected a loss of 4 cents. The company boosted its 2009 cost-savings target by $200 million and that may result in more job cuts, co-chief executive Greg Brown said in a phone interview. Motorola is looking across the globe to drive further expense out of the business, and it’s possible it could involve some additional people, Mr Brown said. The company, which said in February that it doesn’t expect to restore profitability this year, posted a 45 percent drop in mobile-phone revenue to $1.8 billion as it narrowed its range of devices. Phone shipments fell to 14.7 million. That compares with the 14 million estimate of Simona Jankowski, an analyst at Goldman Sachs in San Francisco. Motorola remains committed to splitting off its phone unit, co-CEO Sanjay Jha said on a conference call. He wouldn’t give a time frame. Motorola announced the separation in March 2008 and delayed it in October, citing the recession. The phone units loss will narrow significantly this quarter, Mr Jha said. Ericsson posts 35 percent drop in 1Q profit (April 30, 2009) STOCKHOLM (AP) – Wireless equipment maker LM Ericsson on Thursday reported a 35 percent fall in first-quarter net profit due to weak results from its handset unit Sony Ericsson and higher restructuring costs. The Stockholm-based company said net profit in the quarter was 1.7 billion kronor ($210 million) compared with 2.6 billion kronor in the same period a year ago. The world's leading maker of mobile broadband infrastructure said sales increased by 12 percent to 49.6 billion kronor from 44.2 billion kronor. "The effects of the global economic recession on the global mobile network market are so far limited," Ericsson Chief Executive Officer Carl-Henric Svanberg said in a statement. However, he said some operators are more cautious with longer-term investments in fixed networks, and some investments have been postponed in markets where local currencies have weakened. "It remains difficult to more precisely predict how operators will act in the current environment," he said. Svanberg also said Ericsson's joint ventures, Sony Ericsson and wireless technology firm ST-Ericsson, are affected by the economic downturn and the sharp drop in consumer demand for handsets. The company's share in earnings from the joint ventures fell to a loss of 2.2 billion kronor in the first quarter from a profit of 900 million kronor a year ago. Restructuring charges related Ericsson's cost reduction scheme also weighed on the result by around 700 million kronor. Uganda: Orange Telecom invests $150 million (From AllAfrica.com, March 20, 2009) Kampala – President Yoweri Museveni has welcomed the $150m investment by Orange Telecom in Uganda for the year 2008/2009. While the $100m was the initial investment, $50m is invested annually for expanding the network coverage. "The coming of Orange has created direct employment of 180 Ugandans and indirect employment for more than 1,000 others," he said in a speech read by the information and communications technology (ICT) minister, Aggrey Awori, at the launch of the company at the Kampala Serena Hotel. He said ICTs were a powerful tool for participating in the global market, promoting accountability, improving service delivery and enhancement of local development opportunities. "ICTs contribute to fighting poverty, promotion of education, enhancement of gender balance and combating diseases," he said, adding that most Africans lack access to basic ICT services needed to make or receive a simple phone call. Nigeria invites bids for Nitel and mobile unit MTEL (March 20, 2009) LAGOS - Nigeria invited fresh bids on Thursday for a majority stake in its former telecoms monopoly Nitel, eight years after it starting trying to privatise the ailing firm. Nigeria's Bureau for Public Enterprises said in adverts in the local and international press that it was offering a 51 percent stake in fixed line operator Nitel and 100 percent of its wholly owned mobile unit MTEL. Africa's top oil producer first tried to sell the troubled telecoms company in 2001, but the preferred bidders failed to pay the $1.3 billion price by the stipulated deadline. Local company Transcorp bought 51 percent of Nitel for $500 million in August 2006, but the firm's infrastructure had deteriorated so badly due to corruption and mismanagement that Transcorp could not raise the cash to turn it around. "The Federal Government of Nigeria and Transcorp Plc have agreed to select a new core investor who would have the requisite operational, managerial, technical and financial resources to take over NITEL and MTEL," BPE said. It said interested investors must be reputable telecoms operators with 2 million fixed or GSM telephone lines, a track record of expanding a telecoms network and a minimum net worth of at least $500 million. It said the deadline for bids was May 4. Nigeria has overtaken South Africa as Africa's biggest mobile market with more than 62 million subscribers, according to the Nigerian Communications Commission. The Nigerian telecoms market as a whole generated $8.4 billion in service revenue by the end of 2008, up 23 percent year-on-year, industry research group Pyramid Research said. In a report published this month, it forecast that, with a mobile penetration rate of just 42 percent and a population of 150 million people, the strong growth was likely to continue. Such figures have attracted the attention of international telecoms firms seeking to bolster their African presence. Ericsson launches telecom tower for Indian market (From The Business Standard, March 20, 2009) - Swedish telecom equipment major Ericsson unveiled Tower Tube – its latest radio base station site concept – for the Indian telecom market in Hyderabad on Thursday. “The company has set up a prototype of the Tower Tube at Ibrahimpatnam near Hyderabad and would decide about the location of the production facility depending on the customers it would get,” P Balaji, vice-president (marketing and strategy), Ericsson India, told mediapersons. The over $28-billion company has a facility in Jaipur to manufacture about 8,000 base stations a month. Tower Tube is a self-contained fully-encapsulated site with a five-metre diameter room at the base to house all equipment. Ericsson claims that Tower Tube consumes 40 percent less electricity and produces 30 percent less carbon emission when compared with traditional towers. “While traditional towers cost Rs 30 lakh to Rs 40 lakh, Tower Tube will reduce the total cost of ownership and the entire investment can be recovered in two to three years,” Balaji said, adding that over 100,000 towers were expected to come up in the coming few years in the country. “This is a good opportunity to the industry as a whole and for us as a company. We hope to capture a significant share of this.” Speaking on the occasion, Ajay Bhattacharya, administrator of the Universal Services Obligation Fund, which was formed with an aim of providing telecom services in rural and remote areas, said the Fund is currently in the process of laying out 7,800 towers to see mobile coverage in habitations of over 2,000 population across the country at an outlay of over Rs 500 crore. “About Rs 14,000 crore funds are available with us and we are attempting to put up 10,000 more towers in the second phase with an investment of about Rs 5,000 crore in a couple of months that would cover habitations having over 5,000 population,” Bhattacharya said. Telecom Italia debuts Android-powered HTC Dream (From Telecom Paper, March 19, 2009) - Telecom Italia is introducing the Android-powered HTC Dream mobile phone in Italy. The phone will be available in 2,600 outlets in Telecom Italia's commercial network, with different service packages. The Dream has been designed to enable web surfing and has a customisable interface, a touch screen, a full keyboard and instant access to internet services. The phone features access to some of Google's popular services including Google Search, Google Maps, Gmail and YouTube. Another feature of the phone is Android Market, where users can download applications from categories such as entertainment, lifestyle and games. The new phone offers high-speed navigation using HSDPA 7.2 Mbps technology, Bluetooth and Wi-Fi connectivity, built-in GPS for localisation services and a 3.15 megapixel camera with autofocus. The new Dream terminal will be available to contract and prepay customers at an initial cost ranging from free to EUR 199 depending on the price plan selected. All price plans come with at least 1 GB of inclusive internet traffic per month. Prepay customers can purchase the phone for EUR 429 if they buy the Maxxi Dream10 websurfing service card, which offers access to 50 MB of data traffic per day for EUR 10 a month. Customers purchasing Maxxi Dream10 before 30 April can make use of a special offer and get the first month free. Paper: Russian govt. may buy stake in Indian telecom firm (March 18, 2009) NEW DELHI (RIA Novosti) - The Russian government is considering a deal to acquire a stake in an Indian telecom firm that is majority owned by Russia's diversified holding company AFK Sistema, a business daily reported on Wednesday. Russia could pay $690 mln for a 20% stake in Shyam TeleServices as part of India's debt settlement scheme, Kommersant said. Sistema Shyam TeleServices holds licenses to provide mobile phone services in 22 Indian regions and has more than 500,000 subscribers. The Indian firm is already more than 73% controlled by the Sistema group that owns Russia's largest mobile phone operator, MTS. The newspaper suggested Sistema might experience problems implementing its expansion plans without state support due to its crippling debts. Sistema is the largest public diversified corporation in Russia and the CIS, which manages fast growing companies operating in the consumer services sector and has over 80 million customers. It develops and manages market-leading businesses in selected service-based industries, including telecommunications, technology, banking, real estate, retail and media. 3G will dominate Hungary's mobile services market by 2012 (From cellular-news.com, March 18, 2009) Revenue from 3G-based mobile services will grow rapidly over the next four years in Hungary and will overtake 2.5G service revenue by 2012 as more subscribers migrate to broadband mobile data services, according to a new report from Pyramid Research. The telecom market in Hungary generated $5.2 billion in service revenue in 2008 and will be worth $5.6 billion by 2013, notes Sylwia Boguszewska, analyst at Pyramid Research and co-author of the report. "The competition for 3G and mobile broadband is intensifying among the three mobile operators, T-Mobile, Pannon, and Vodafone," she says. "3G accounts will increase to 62.1 percent of subscriptions by 2013 from its current 9.8 percent penetration. Although 2G still dominates the Hungarian market today, it is expected to disappear by 2013 - with 4G to enter the market in 2010 and take around 2.0 percent of subscriptions by 2013." The increase in 3G availability will result in higher revenues from mobile data services, Boguszewska says. "Mobile data's share of the total revenue will double, increasing from 11.4 percent in 2008 to 20.9 percent in 2013 due to the growing share of broadband, as well as a significant increase in data ARPS," she explains. "By 2013 non-messaging services, such as ringtones, games, music, and data cards, will reach 50 percent of all mobile data revenue, up from 25 percent in 2008," she adds. Hungary's operators will face increasing competition in light of consolidation, broadband regulation, and new licensing. "At least two new mobile telephone service providers may appear in the Hungarian market, with five operators acquiring additional frequencies, due to the National Communications Authority of Hungary (NHH) announcement of tenders for a fourth GSM-UMTS license," says Boguszewska. Pyramid anticipates that incumbent operator Magyar Telekom's share of the fixed market will decrease from 62 percent in 2007 to 40 percent in 2013 due to increased competition and the migration to mobile and broadband. "However, given its strategic position as the only integrated operator, Magyar Telekom will remain the dominant player in this market," says Boguszewska. Deutsche Telekom must pay T-Online shareholders (March 13, 2009) FRANKFURT (AP) -- A German court ruled Friday that Deutsche Telekom AG must reimburse some former shareholders of one-time Telekom Internet unit T-Online. The costs for the Bonn-based company could total some euro200 million ($252 million). About 60 former shareholders and shareholder groups brought on the case because they thought the price the company paid for their T-Online shares was too low. After initial success within the company, Telekom launched T-Online on the stock exchange in 2000 and then reabsorbed it at the end of 2004. In 2004, as Telekom was trying to take back T-Online, it paid shareholders euro8.24 a share after they initially rejected an offer of euro8.99 a share. Both prices, shareholders claimed, were too low, as they paid euro27 a share when T-Online initially hit the stock exchange. The court said Deutsche Telekom must now pay the affected shareholders euro1.15 per share plus interest. About 120 million shares could be eligible for the payment, which could total some euro200 million, the court said. Plaintiffs said the figure is too low and would file a complaint with the courts, which could drag the issue out further. The case first went before a judge in February 2008. In 2000, with 5 million customers, Deutsche Telekom listed the unit independently on the stock exchange. Four years later, Telekom thought T-Online was too big to stand alone on the stock market and reabsorbed it. By 2006, T-Online grew to more than 14 million customers, which made it Europe's largest Internet provider at the time. Shares of Telekom closed up 0.4 percent at euro9.46 ($12.18) in Frankfurt. Telenor appeals Russian ruling, says won't pay (March 4, 2009) OSLO (Reuters) - Norwegian telecom group Telenor ASA on Wednesday said it had appealed against a $1.7 billion award by a Siberian court in a lawsuit over Russian mobile group Vimpelcom and said it has "no intention of paying" the damages. Telenor said it had lodged the appeal with a court in Tyumen in West Siberia. Little-known Vimpelcom shareholder Farimex alleged Telenor caused losses to Vimpelcom by delaying its purchase of Ukrainian mobile operator URS, and a court in Omsk last month backed its claim and ruled Telenor should pay Vimpelcom compensation. The Omsk court ruling followed a long struggle by Telenor to protect its nearly 30 percent holding in Russia's No. 2 mobile operator, Vimpelcom, from what it has called a groundless encroachment into its ownership. "The Omsk court's decision contains grave substantive and procedural errors, and we have no intention of paying any claimed damages based on this ruling," Telenor Vice President Jan Edvard Thygesen said in a statement. "We are confident of our position and believe Russia's higher courts will acknowledge the gross violations of law ... the risk of permitting a dangerous precedent to stand, and ... will reverse the decision and dismiss Farimex's claim." By 1203 GMT, shares in Telenor were up 4.2 percent to 35.80 crowns, outpacing a 1.6 percent rise on the Dow Jones Stoxx telecom index .SXKP. Court documents showed British Virgin Islands-based Farimex owned 0.002 percent of Vimpelcom shares when it filed the suit against Telenor in April 2008. Telenor believes Farimex is linked to Russian billionaire Mikhail Fridman's Alfa Group, the other main owner of Vimpelcom whose companies are involved in a number of court cases against Telenor. Alfa Group denies any connection to Farimex. Foreign companies' have been concerned about investing in Russia, and foreign capital has flowed out of the country as the global financial crisis has deepened. Kremlin-backed companies have in recent years strong-armed "strategic" energy projects away from foreign firms. China Unicom in talks to sell Apple iPhone in China (March 3, 2009) BEIJING (Reuters) - China Unicom (Hong Kong) Ltd chairman Chang Xiaobing said on Wednesday the company was in talks with Apple Inc (AAPL.O) to introduce the iPhone to China. "We are in talks with many handset suppliers, including Apple," the chairman told reporters. Rival China Mobile (0941.HK) was negotiating with Apple to sell the iPhone in China, but has so far not announced any agreement. China Mobile chairman Wang Jianzhou also said on Wednesday his company would continue to talk to Apple and he would not comment on the discussions between China Unicom and Apple. "3G users will account for 20 percent of all mobile phone users in China in the next three years," Chang said on the sidelines of a meeting of the parliament's advisory body. Analysts said the possible Apple deal may not necessarily be an earnings catalyst for China Unicom given that the Apple brand is not particularly strong in China and there are various local copies of the product available in the market. "iPhone copies (i.e. the Hi-Phone) are available without (users) having to sign long-term contracts," JP Morgan analysts Jimmy Cheong and Tim Storey said in the note. "iPhone is likely to be highly subsidised and China Unicom may give away large revenue share so earnings upside is possibly limited, in our view. We think this is a reason why China Mobile has refused to sign with Apple to date." Moreover, many people in China already use actual iPhones that have been brought in through private channels even though they have not been formally introduced in the country. D.Telekom, Vodafone combine to expand German VDSL (December 23, 2008) FRANKFURT (Reuters) - Telecom giants Deutsche Telekom and Vodafone will work together to expand high-speed VDSL internet broadband services in Germany, the companies said on Tuesday. "We are also in talks with other competitors and open for further cooperation," a Deutsche Telekom spokesman said. The two companies would begin next year by expanding in two German cities -- Wuerzburg and Heilbronn -- giving about 50,000 households in each city access to the super-fast network. So far, 50 cities in Germany have access to VDSL, a faster version of standard broadband technology with speeds of several tens of megabits per second, enough for high-definition video streaming. Deutsche Telekom has urged its rivals to help build a VDSL network in Germany and warned the country would lose its competitive edge if it did not invest in broadband expansion. Telekom and other fixed-line operators are keen to offer more broadband services to compensate for a declining customer base for traditional landline services as they compete against cable companies' all-in-one packages of video, telephone and Internet services. Deutsche Telekom aims to attract around 500,000 customers this year for its television service via broadband, Internet IPTV. India says 3G entrants to also get 2G spectrum (December 23, 2008) NEW DELHI (Reuters) - Foreign telecom firms who win third-generation radio waves in an auction due next month will also be kept in the queue for second-generation spectrum, a senior government official said on Tuesday. "For a new entrant in 3G who has obtained a license... it will be in the queue for 2G spectrum," R Ashok, member (finance) in India's telecom commission, the apex government body for the sector, told operators at a pre-bid conference. India will conduct a global auction for 3G wireless spectrum starting January 16 and has set a base price of 20.20 billion rupees ($417 million) for spectrum in all the service areas. Firms interested to participate in the auction process are required to submit applications between December 26 and January 5. T.Italia Media says unit stake sale talks abandoned (December 22, 2008) MILAN (Reuters) - Telecom Italia Media plans to put up for auction next year a stake in its digital terrestrial television business, after a private equity fund pulled out, the company said on Monday. The unit of telecommunications group Telecom Italia had been in exclusive talks with the fund after receiving a non-binding expression of interest in acquiring a stake in the business, known as TIMB. "Owing to prevailing market conditions, the private equity fund ... has since withdrawn its interest," it said in a statement on Monday. "It (the board) has received several other non-binding expressions of interest from the market, and will ... proceed with a competition auction during the first quarter of 2009." The private equity fund was never identified. Telecom Italia Media, which runs Italian television stations La7 and MTV Italia, is reorganising its activities to cut costs and boost revenues. It aims to break even in 2010 as it positions itself in the growing digital terrestrial television market. Its stock ended 0.22 percent higher at 0.0895 euros in Milan. France Telecom ship sent to fix cables under Mediterranean (December 21, 2008) France Telecom sent a ship on Saturday to repair broken cables under the Mediterranean disputed Internet and phone communications across the Middle East and Asia, a French source said. With this "very rare situation," a spokesman from France Telecom said a ship had been sent by the company in order to fix the lines between Sicily and Tunisia, and services were expected to return to normal by the end of December. Three submarine cables, owned by different operators including France Telecom, were damaged on Friday. The cause of the cut remains unclear. Egypt was affected worst among countries involved in the accident. Singapore, Malaysia, India, Pakistan, the United Arab Emirates and Qatar were also affected by the disruption but most reported services were restored Saturday. According to the French source, many operators said web services had improved as alternative routes had been used. Antitrust accepts Telecom Italia pledges, ends probe (December 20, 2008) ROME (Reuters) - Italy's antitrust authority said on Saturday it had accepted commitments made by Telecom Italia to increase competition in the sector and ended a probe launched last year in response to complaints by competitors. The antitrust body said it had "accepted and made binding the commitments presented by the company and brings to an end, without any sanctions, the investigation launched into a possible abuse of a dominant position". The main commitment by Telecom Italia was that it would limit its activity of trying to win back customers who switched to rival operators. An independent company will be responsible for ensuring that Telecom Italia's commercial department does not use data in possession of the network and wholesale department to contact lost clients. In addition, a toll-free number will be set up on which customers can complain about "aggressive offers" from Telecom Italia's sales staff. The probe was launched in October last year after two rivals, Fastweb and Wind complained to the authority about Telecom Italia using an excessively aggressive campaign "in a selective way towards clients who had passed, or were about to pass to other operators." India Reliance adds 1.77 new telecom subscribers in Nov (December 13, 2008) MUMBAI (Reuters) - India's Reliance Communications added 1.77 million new mobile phone subscribers in November, taking its total user base to 59.57 million, a company spokesman said on Saturday. Reliance Communications is the number two operator in the market of more than 320 million mobile users. Regulator approves Telecom Italia's network plans (December 11, 2008) ROME (AP) - Italy's telecommunications regulator approved on Thursday Telecom Italia's plans to guarantee its competitors access to the former monopoly's fixed-line network. Telecom Italia's so-called "Open Access" will be a new structure within the existing company, but autonomous from its commercial business. It will be run by a chief information officer. Telecom Italia Chief Executive Franco Bernabe has ruled out spinning off the network as a separate business, saying the network is core to the business. Telecom Italia has been negotiating with authorities for more than two years, through several management changes. The European Union has asked to be advised of the plans to make sure they comply with EU telecommunications and competition rules. Italy is the second European country after Britain to open its fixed-line network, according to telecommunications analyst Carlo Alberto Maffe of Bocconi University. Maffe said the agreement won't just affect the traditional copper fixed-line network still in use, but also will have implications for the long-term evolution of the more powerful broadband network. Alcatel-Lucent to axe 1,000 managers; no job cuts in India (From The Financial Express, December 12, 2008) New Delhi - Parisian telecom equipment major Alcatel-Lucent will cut 1,000 managerial posts and remove 5,000 contractors as part of its cost-saving initiatives, according to a statement issued by the company. “The company expects to reduce the number of managers by approximately 1,000 and the number of contractors by approximately 5,000 aimed at saving euro 750 million by the end of 2009 fiscal.” However, no job cuts would take place in its India operations, which underlines that with growing subscriber base and telecom service providers expanding operations, India is the market for telecom investments. Alcatel-Lucent also said that it will complete its existing restructuring initiatives as well as seek savings in real estate, support functions and discretionary spending. The French company currently has operations in 130 countries. The company has said that it would initiate a set of strong actions designed to reduce the company’s break-even point by euro1 billion per year in both 2009 and 2010 in order to improve gross margin. This would be done by reducing its manufacturing, supply chain and procurement costs, introducing stricter pricing discipline and over time, improving the product mix. The company is also hoping to enhance the research and development efficiency by focusing on four key segments (optical, IP, broadband and applications enablement) and partnering or rationalizing spend in other areas. Altogether, Alcatel-Lucent expects that by the fourth quarter of 2009, it should achieve total savings of euro 750 million at constant exchange rate. In its estimates for the year 2009-10, Alcatel-Lucent expects the market for telecommunications equipment and related deployment services to be down between 8% and 12% at constant exchange rate and expects to maintain a stable marketshare. Speaking on the company’s strategy, Ben Verwaayen, CEO of Alcatel-Lucent, said, “We will work closely with our service providers, enterprise customers and applications providers to make this strategic transformation happen. We want to stimulate a sustainable business model for the industry that will fuel innovation.” San Miguel, Qatar Telecom Partner, to acquire phone company (December 11, 2008) (Bloomberg) -- San Miguel Corp., the Philippine beermaker seeking to borrow as much as $2 billion for acquisitions, will buy control of a local phone company as part of a partnership with Qatar Telecom QSC. San Miguel, the nation’s biggest food and drink company, is buying 60 percent of Liberty Telecommunications Holdings Inc., President Ramon Ang said in a mobile-phone message today. The company will use Liberty in its venture into telecommunications with Qatar Telecom, Ang said. The brewer that’s been making San Miguel beer for more than a century is seeking control of Petron Corp., the Philippines’ largest oil refiner, and has bought 27 percent of the nation’s biggest power retailer. San Miguel is expanding into faster- growing industries such as energy and mining, as well as those with wider margins, such as telecommunications. The company on Dec. 8 announced a venture with Qatar Telecom to “look into opportunities in the wireless broadband, mobile and mobile broadband businesses in the Philippines.” Ang was elected chairman of Liberty on Dec. 9, the phone company said in a statement yesterday. Liberty also approved an increase in its capital by issuing preferred shares until May 2010, the statement said. San Miguel had an operating margin of 8 percent in the three months ended September, compared with 42 percent for Philippine Long Distance Telephone Co., the nation’s biggest company by value. Globe Telecom Inc.’s margin during the same period was 34 percent. Turkcell wins 3G license in Turkey (November 28, 2008) ANKARA, Turkey (AP) – Turkcell, Turkey's largest mobile phone operator, on Friday won a tender for the country's third-generation mobile phone license. Third-generation, or 3G, operations support Web surfing, video and other services. Turkcell offered euro358 million ($462 million) for an A-type 3G mobile phone license, the highest bandwidth from a total of four that were auctioned. The company outbid rivals Vodafone and Avea. Vodafone and Avea then won licenses for lower 3G bandwidths, with offers of euro250 million and euro214 million respectively. Turkcell said the system would become operational in Turkey by mid-2009. Turkcell is the leading cell phone operator in Turkey with more than 36 million customers. The company had won a similar tender last year, but that bid was canceled after Vodafone and Avea insisted that a deal allowing customers to change mobile phone operators without changing their phone numbers should come into effect first. Telefonica against new Telecom Italia investor at current price (November 20, 2008) (Bloomberg) - Telefonica SA, Europe's second- largest telephone company, wouldn't welcome the arrival of new investors at Telecom Italia SpA at the current market price. "Attracting new capital at these levels is hardly an attractive proposition for existing shareholders like ourselves,'' Chief Financial Officer Santiago Fernandez Valbuena told investors today at a Morgan Stanley conference in Barcelona, Spain. "We are not great enthusiasts of the idea of being diluted at these levels. Having said that, the environment is sufficiently hard for us to be open to questions.'' Telefonica and its Italian partners completed the purchase of an indirect stake in Italy's biggest phone company in October last year for 4.16 billion euros ($5.2 billion). Telecom Italia's shares have slumped 52 percent this year. Valbuena also said Telecom Italia's "liabilities'' could need some "refining in terms of how much debt related to equity and in terms of that composition of that equity.'' In Germany, Telefonica's priority is to expand its current operations. The company held talks with broadband operators this year and discussions "didn't go very far,'' he said. France Telecom is in talks to buy telephone license in Togo (November 19, 2008) (Bloomberg) - France Telecom SA, Europe's third- largest telephone company, said it's in talks to buy a phone license in Togo in western Africa. The company didn't disclose financial details. The license would give France Telecom the right to operate in the country under its Orange brand, the Paris-based company said in an e-mailed statement today. Togo had an estimated population of about 5.9 million in July, according to the CIA World Factbook. France Telecom said about 25 percent of Togolese have a mobile phone. The company expanded in Kenya and Uganda this year as the former French monopoly seeks faster growth than in its home market. France Telecom last month set up a joint venture in Uganda with Hits Telecom Uganda and plans to invest $200 million in a mobile network there in the next three years. Telkom Kenya Ltd., a joint venture between France Telecom and the Kenyan government, started operations in September. Job cuts rescue BT's falling stocks (November 12, 2008) London (Reuters) - Britain's BT Group beat second-quarter earnings forecasts yesterday and announced 10,000 job cuts and a possible boost to its pension scheme, sending its shares up over 12 per cent just days after a profit warning. Shares in the former state telecom group crashed to historic lows less than two weeks ago after it warned about the profitability of its growth engine Global Services division. Analysts at the time said BT was hitting a "perfect storm", with concerns over its pension scheme, profitability, capital expenditure plans and dividend all coming at once. However, they welcomed the results yesterday as fin-ally bringing some good news to the company. Its shares were up over 12 per cent at 126 pence at 0925 GMT (1.25pm UAE time) yesterday. BT said it had reviewed its pension scheme and proposed a range of changes such as raising the age of retirement and increasing employee contributions which could reduce the ongoing cost of the defined benefit pension scheme by about £100 million (Dh544.2 million) per year. SingTel profit falls 12 pct on stronger currency (November 11, 2008) SINGAPORE (AP) - Singapore Telecommunications Ltd., the largest telephone company in Southeast Asia, said Wednesday that profit fell 12 percent in the July-September period as a strengthening local currency hurt the value of earnings from its units abroad. The company, also known as SingTel, said in a statement that its net income for its fiscal second quarter fell to 868 million Singapore dollars ($577 million), down from SG$988 million a year earlier. Sales rose 5.3 percent to SG$3.9 billion ($2.6 billion). "Our expansion in the region subjects us to the volatility of the regional currencies," SingTel Group Chief Executive Chua Sock Koong said. "A stronger Singapore dollar reduces our mobile associates' earnings." SingTel's stakes in regional operators such as India's Bharti Airtel Ltd., Indonesia's PT Telkomsel, the Philippines' Globe Telecom Inc., Pakistan's Warid Telecom Ltd., Pacific Bangladesh Telecom Ltd. and Thailand's Advanced Info Service PCL account for more than half of the company's profits. The company also warned that the global economic slowdown will undermine profits going forward. "The current global financial crisis is unprecedented and the negative impact on businesses will be inevitable," Chua said. Vodafone net profit drops 35%, plans cost cuts (November 11, 2008) LONDON (AFP) - British mobile phone company Vodafone said on Tuesday that its net profit had slumped 35 percent in the first half of its financial year as it booked a hefty loss on the value of its Turkish business. Vodafone said that it planned to cut costs by about one billion pounds annually from 2011, while the group downgraded its full-year revenue outlook. The share price of Vodafone jumped 6.93 percent to 115.8 percent on London's FTSE 100 index, which was down 1.62 percent in late morning trade. "Investors in Vodafone... will be pleased that income remains solid in a challenging market and there was no skeleton in the cupboard to scare us off," said Simon Denham, managing director of Capital Spreads. Vodafone said in an earnings statement that profit after tax slid to 2.14 billion pounds (2.63 billion euros, 3.35 billion dollars) in the six months to September 30 compared with the first half of 2007/08. The company booked a loss of 1.7 billion pounds on the value of Vodafone Turkey. "Our turnaround in Turkey is taking longer than we anticipated," Vodafone's new chief executive Vittorio Colao said in the company's earnings statement. Group revenue rose 17 percent to 19.90 billion pounds in the six months to September 30 compared with the first half of 2007/08, thanks to benefits derived from currency exchange rates. However Vodafone downgraded its forecast for full-year revenue to between 38.8 and 39.7 billion pounds from a previous top estimate of 40.7 billion pounds. Vodafone is the world's biggest mobile phone company by revenues. "The first half results reflect a solid overall performance in a challenging operating and a weaker macro economic environment," said Colao, who in July replaced Arun Sarin, who stepped down after five years as Vodafone chief executive. "Operating conditions are expected to continue to be challenging in Europe given ongoing competitive and regulatory pressures and recent deterioration of economic conditions in certain markets," Colao added. In recent years, Vodafone has expanded into emerging markets across Africa and Asia, as it looks to offset flagging sales and fierce competition in maturing Western markets. Nokia Siemens Networks to cut 1,820 jobs (November 11, 2008) HELSINKI (Reuters) - Telecom gear vendor Nokia Siemens Networks said on Tuesday it would slash around 1,820 jobs, mostly in Finland and Germany, as it enters the last part of its 2 billion euro ($2.58 billion) cost-cutting programme. The news comes one day after Canada's Nortel said it would axe 1,300 jobs as vendors try to cope with fierce competition for new business, subdued demand and falling prices. "Continued challenging telecommunications market conditions have shown the need for further reductions," Nokia Siemens said in a statement. Nokia Siemens said it aims to cut up to 750 jobs in Finland and close one of its sites employing 500 staff in Munich. It said it had decided to sell a manufacturing site in Durach, Germany -- which employs some 500 employees -- to the plant's current management. It said it would also cut some 50 jobs in Egypt and 20 in the United States. The telecom equipment market has been in the midst of fierce competition for new business over the last few years and the outlook remains tough. Research group Dell'Oro expects the 2009 mobile infrastructure market to decline "in the single digits" from this year, while sector leader Ericsson has forecast a "flattish" market. Mobile phone group Vodafone said on Tuesday it would seek to cut operating costs by approximately 1 billion pounds ($1.58 billion) per year by its 2011 financial year to offset pressures from cost inflation and competition. NSN Chief Executive Simon Beresford-Wylie declined to comment on the company's outlook, saying it would give further details at Nokia's investor day on December 4, but told Reuters the firm was closely monitoring the economic slowdown. Nokia shares were down 2.8 percent at 1100 GMT, in line with a weaker sector index. SHARP CUTS Nokia Siemens Networks -- a 50-50 joint venture between the world's top cellphone maker, Nokia, and German conglomerate Siemens -- started operations in April 2007 and shortly after launched a large lay-off programme. The programme, which includes some 9,000 job cuts in total, aims to help boost its operating profit margin to 10 percent by the end of 2009. At end-September, NSN said it had 60,200 staff and had already cut more than 6,000 jobs. Its underlying operating profit margin fell to 5.1 percent in the third quarter from 6.7 percent in the previous three-month period. "It's been a very tough couple of years," Beresford-Wylie said. Nokia Siemens, Ericsson and Alcatel-Lucent are the leading players in the telecoms network market, but in recent years they have been increasingly challenged by Chinese vendors Huawei and ZTE. Telecom Italia 3Q profits down 13 percent (November 7, 2008) MILAN, Italy (AP) - Telecom Italia, Italy's largest telephone company, reported a 13 percent drop in third quarter profits on Friday but reaffirmed 2008 targets. Telecom Italia said profits were 630 million euros ($803 million), down from 720 million euros the same period a year earlier. Revenues were down 1.4 percent to 7.56 million euros ($9.63 million) from a year earlier. Telecom Italia cited the impact of regulatory change, worth 149 million euros ($190 million), as well as the renegotiation of a domestic roaming contract with the third-generation wireless telecoms operator H3G , which had a negative impact of 18 million euros ($23 million). CEO Franco Bernabe reaffirmed 2008 targets with revenues in excess of 23 billion euros ($29 billion), noting that the telecommunications industry "has not demonstrated particular weakenesses" amid the global financial turmoil. Bernabe said strong performance in the Brazilian and German subsidiaries bolstered Telecom Italia results. Telecom Italia shares closed up 1.4 percent at 0.98 euros ($1.25) on the Milan Stock Exchange. Swisscom posts 32 percent drop in 3Q net profit (November 5, 2008) BERN, Switzerland (AP) - Swisscom AG reported Wednesday a 32 percent decline in net profit for the third quarter partly due to costs related to the launch of the iPhone and the acquisition of Italian telecom Fastweb SpA. Switzerland's largest telephone company said net income for the quarter was 470 million Swiss francs ($401 million) compared with 689 million francs for the same period last year, a Swisscom statement said. Pre-tax profit for the quarter dropped 3.6 percent, to 1.188 billion francs ($ 1.014 billion) from 1.233 billion francs ($1.052) because of subsidies and dealer commissions on the sale of over 100,000 iPhones, Swisscom said. The decline in net income is also due to the amortization of 143 million francs ($122 million) in cost for the takeover of Fastweb, Swisscom said. Fastweb had a 17.2 percent increase in net revenue for the quarter to 687 million francs ($586.4 million), Swisscom said. The company's overall net revenue for the quarter was 3.1 billion francs. Shares in Swisscom were down 3.13 percent at 355.50 francs ($303.5) on the Zurich exchange. France isn't selling France Telecom stake, government says (November 3, 2008) (Bloomberg) - The French government isn't selling shares in France Telecom SA, according to the head of the state shareholding agency. "There is no operation scheduled on France Telecom,'' Bruno Bezard, the agency head, said in a telephone interview. "It is not on the agenda. Market participants who spread such rumors need to be more responsible.'' Microsoft, LG sign mobile collaboration deal (November 3, 2008) SEOUL (Reuters) - Microsoft Corp. and South Korea's LG Electronics Inc on Monday said they had signed a preliminary agreement on strategic collaboration in mobile technology. "The agreement ensures continued strategic collaboration in R&D, marketing, applications, and services in the field of converged mobile devices," LG said in a statement. "Both companies will continue to define and align their mobile strategies through annual top management meeting." The agreement was signed during Microsoft CEO Steve Ballmer's trip to South Korea. Meanwhile larger home rival Samsung Electronics on the same day announced the launch of the domestic version of the Omnia touch screen handset model, based on Microsoft's Windows Mobile 6.1 operating system. The model will be available from mid-November under an exclusive deal with No. 1 mobile operator SK Telecom, Samsung said. Microsoft is hoping its Windows Mobile operating system can continue to challenge Symbian, a platform backed by the world's top mobile phone maker Nokia and used in two-thirds of smartphones -- mobile handsets with computer-like capabilities. Blackberry-maker Research in Motion and Apple Inc's iPhone are also growing threats to Symbian, while several manufacturers are planning or have started to roll out smartphones based on Google's Android software. Both LG and Samsung are members of the Symbian Foundation and are also developing models based on Android. "These are not new deals, but rather a way for South Korean makers to reinforce existing alliances," said Greg Roh, an analyst at Korea Investment & Securities, about the Microsoft-related announcements. "Competition is getting more and more fierce in the smartphone segment, and South Korean makers have some weaknesses on Symbian platforms, so it is understandable that they would broaden their alliances." Telefonica says to control 96.75 pct of Chile unit (November 2, 2008) SANTIAGO (Reuters) - Spain's Telefonica SA said on Sunday it has secured control of 96.75 percent of its Chilean unit Telefonica Chile CTCa.SN after a buyout offer to shareholders aimed at gaining sole control of its affiliate. Spain's Telefonica, which already held 44.9 percent of Telefonica Chile before the buyout, said it would spend around $815 million to buy back shares from shareholders who have agreed to its offer. Shareholders agreed to the buyout after the company raised its original buyout offer by 10 percent last month. It will buy back the shares on Tuesday. "With the end of this operation, only 2.0 percent of the company's shares remain floating on the local market. In New York, 1.25 percent of (ADR) shares will continue to trade on the New York Stock Exchange," Telefonica said in a statement. Telefonica says it opted for the buyout to give it more freedom when it comes to management of its local unit. Vodafone offers Storm free in U.K. with 2-year plan (November 1, 2008) TORONTO (Reuters) - Vodafone said on Friday it was offering the BlackBerry Storm smartphone free to customers in Britain willing to sign a two-year contract -- a move that could brighten the outlook for sales of the new device. "The BlackBerry Storm pricing will start from free on a two year contract at 35 pounds ($56.35) per month on a Best for Text plan that will include 600 minutes and unlimited texts," Vodafone said in a release on its website. The BlackBerry Storm is produced by Canadian firm Research In Motion, whose shares rose C$3.17 Friday to C$61.02 on the Toronto Stock Exchange. Vodafone is the world's biggest mobile phone company by revenue. France Telecom quarterly sales rise on home market (October 31, 2008) (Bloomberg) - France Telecom SA, Europe's third- largest telephone company, said third-quarter sales rose 2.3 percent as client gains in its home market cushioned it from the effects of a global economic slowdown. Sales rose to 13.55 billion euros ($18 billion) from 13.51 billion euros a year earlier, the Paris-based company said in an e-mailed statement today. The company said third-quarter profit was little changed and repeated its full-year outlook. The company said business is “sustained'' in mature markets including France, and the effects of economic slowdown remain limited to Spain and Africa. France Telecom increased domestic mobile revenue as it drew subscribers to Apple Inc.'s iPhone 3G, for which it is the exclusive French partner. “The sales increase is mostly due to France, where both the mobile and the fixed-broadband businesses did better than expected,'' said Rob Goyens, an analyst at Dexia Securities. The company's comments on the effects of economic slowdown “are reassuring,'' he said. France Telecom slipped 74 cents, or 3.7 percent, to close at 19.52 euros in Paris trading. The stock has lost 21 percent this year, compared with a 37 percent drop for the Bloomberg Europe Telecommunication Services Index. Motorola posts $397M 3Q loss; more job cuts (October 30, 2008) NEW YORK (AP) - Motorola Inc. posted a hefty loss in the third quarter Thursday, citing the continued troubles of its cell phone division. The company will postpone the planned spin-off of the unit, and cut more jobs. The maker of communications gear said it would get rid of 3,000 jobs by April, with about 2,000 of them coming from the cell phone unit. The company last announced 2,600 job cuts in April. Motorola lost $397 million, or 18 cents per share, in the July-September period. It had earned $60 million, or 3 cents per share, in the same period a year ago. Sales fell 15 percent to $7.48 billion. The loss included 23 cents of charges, mostly for restructuring costs. Without the charges, Motorola would have earned 5 cents a share, reflecting unexpectedly strong results in its non-cell phone operations. Analysts polled by Thomson Reuters had on average expected the company to earn 2 cents per share on revenue of $7.82 billion. For the fourth quarter, Motorola said it expects to earn 2 cents to 4 cents per share. Analysts polled by Thomson Reuters had expected the company to earn 7 cents per share in the quarter, excluding items. Shares of Motorola fell 29 cents, or 5.3 percent, to close at $5.17, even as broader markets ended up higher. The job cuts are part of efforts to cut costs by $800 million next year, Chief Executive Greg Brown said. Motorola sold 25.4 million cell phones in the third quarter, down from the 28.1 million it sold in the second quarter. The company had said it expected a slight decline. With an 8.5 percent market share, it lost the spot as No. 3 cell phone maker worldwide to Sony Ericsson in the quarter, according to research firm IDC. Nokia Corp. and Samsung Electronics Co. are No. 1 and No. 2, respectively. For Motorola, "the loss of share continues to be extremely worrisome," said Rick Franklin, an analyst at Edward Jones. "This business continues to run without any wheels." The cell phone unit lost $840 million, including a $370 million write-down of inventory. Revenue was $3.1 billion. Sanjay Jha, who was appointed in August to lead the handset division, said the weak economy and stresses in the financial market were main reasons for the postponed spin-off. He said the unit would slim down its product portfolio and become a leaner organization. Jha said the company had 20 major platforms for cell phones, making development unwieldy yet leaving Motorola with few products in the two categories that have been in demand this year: "smart" phones and very cheap phones. He is pruning the portfolio to focus on three software systems: Windows Mobile, which Motorola already uses on a few smart phones; P2K, its own system, used on the Razr phone; and Android, a free operating system from Google Inc. Competitor HTC Corp. recently launched the first Android phone. Jha said Motorola will have one by the 2009 holiday season. Designers at Motorola have been too focused on making "bright shiny objects," Jha said. In the future, he wants them to focus more on making phones easy to use. The troubles of the cell phone division stem from its inability to produce a follow-up to a phone that was, for a while, the "bright shiny object" everyone had to have: the Razr phone. Jha also said Motorola will pull back from the cell phone markets of Europe and parts of Asia, though Jha said China will remain a focus for the company, along with the Americas. Motorola is not alone in seeing a decline in cell phone sales. IDC said Thursday that global handset shipments declined 0.4 percent from the second quarter to the third, even though the quarter normally sees a pre-holiday ramp-up. Sales at Motorola's healthier units were essentially flat, and they boosted profits. Home and Networks Mobility, which makes cable-TV set-top boxes, modems and related gear, saw its operating earnings increase 65 percent to $263 million, on $2.4 billion in sales. Enterprise Mobility, which makes police radios and other communications equipment for organizations, posted operating earnings of $403 million, up 23 percent, on sales of $2 billion. Intel invests 11.5 mln to help develop Taiwan 4G network (October 30, 2008) TAIPEI (AFP) - Intel Corp Thursday said it would invest 386 million dollars (11.5 million US) in Taiwanese carrier VMAX Telecom Co. to help it develop the island's first fourth-generation mobile network. VMAX aims to deploy Taiwan's first mobile WiMAX network which is slated to become operational next year. WiMAX 4G technology provides high-speed broadband wireless services, sharply improving high-quality image and data services, and potentially allowing for such features as multi-channel high-definition TV broadcasting. "Intel Capital's intended investment and Intel's accompanying business engagement will enable VMAX to deploy Taiwan's first mobile WiMAX network, intended to be commercially available within the first half of next year," Intel said in a statement. Unlisted VMAX, with capital of one billion Taiwan dollars, is a joint venture between telecommunications-equipment maker Tecom Co. and local mobile-phone operator VIBO Telecom Inc. Intel president and CEO Paul Otellini said the US chip maker, through Intel Capital, had also signed an agreement with Taiwan's economic ministry to open a centre to develop software for next-generation mobile devices. "Intel and Taiwan will continue to collaborate to create growth opportunities for the industry," Otellini said. Intel said the accords would "extend Taiwan's position as a leading centre for developing and deploying the world's next generation of connected devices and related technologies." Libyan funds considering Telecom Italia investment (October 30, 2008) (Bloomberg) - Libyan sovereign funds are discussing a possible investment in Telecom Italia SpA, Saif al- Islam Qaddafi said at a conference in Rome today. “Our people are talking with Telecom,'' Qaddafi said. ``I think they're talking about investing capital and buying funds.'' Saif al-Islam Qaddafi is the son of Libyan leader Muammar Qaddafi and president of the Qaddafi Foundation. Telecom Italia, Italy's biggest phone company, is seeking new investors, Chief Executive Officer Franco Bernabe said Oct. 25. The Milan-based company rose as much as 6.7 percent, to 92.9 cents, and traded at 89.1 cents, up 2.2 percent, at 1:50 p.m. local time. Telecom Italia has a market value of 13.4 billion euros ($17.6 billion). Telecom Italian slipped to an 11- year low of 72 cents on Oct. 10. "We have good investments in Italy,'' said Shokri Muhammad Ghanem, chairman of Libya's National Oil Corp. "Sometimes we are bargain hunters.'' Making further investments "is a decision that will have to be taken by the board'' of the national sovereign wealth fund. ``It's a decision we'll take where there is a good buying opportunity.'' Libyan investors raised their stake in UniCredit SpA, Italy's biggest bank by assets, to 4.9 percent on Oct. 23. Libyan funds own 1 percent of Eni SpA, the country's largest energy company, and want to raise the stake, la Repubblica reported yesterday. Cell phone shipments fall 0.4 percent in 3Q (October 29, 2008) NEW YORK - The usual pre-holiday ramp-up in cell phone shipments didn't happen this year because of the feeble global economy, a research firm has said. Manufacturers shipped 299 million phones in the July-September period, down 0.4 percent from the second quarter, according to IDC. The third quarter normally sees a rise in shipments, as stores stock up ahead of the holidays. Shipments still grew 3.2 percent compared to last year. But as cell phones have become a global must-have in the last few years, it has been more common to see growth rates of up to 20 percent. Sony Ericsson unseated Motorola Inc. as the third-largest cell phone manufacturer, with 8.6 percent share of the market. Motorola had 8.5 percent. Sony Ericsson also leapfrogged LG Electronics Inc., pushing it down to No. 5 slot. Nokia Corp. remained the top cell phone maker, with 39.4 percent share, according to IDC. (Nokia's own figure is 38 percent.) It is followed by Samsung Electronics Co., with 17.3 percent by IDC's count. Motorola announced Thursday that it would trim its product portfolio and focus its designs on the Americas and China instead of Europe. It also delayed the spin-off of its handset unit, which was expected to happen in the third quarter next year. Another firm, ABI Research, also weighed in Thursday with slightly different numbers. It said third-quarter shipments rose 8.2 percent from a year ago. The firms agreed that "smart" phones were the hot category in the quarter, electrified by the introduction of a new iPhone from Apple Inc. Smart phones are suddenly the devices sought by both seasoned and first-time users, said IDC analyst Ramon Llamas. In North America in particular, smart phones from Apple, Palm Inc. and BlackBerrys from Research In Motion Ltd. did far better than conventional phones. Softbank quarterly profit rises on iPhone sales (October 29, 2008) TOKYO (AP) – Japan's No. 3 mobile carrier Softbank Corp. said Wednesday its net profit rose 1.9 percent in the July-September quarter thanks to steady demand for Apple's iPhone. Softbank in July launched the much-hyped sale of the popular iPhone in Japan. The company said the launch of the Apple Inc. gadget helped lift its profit, which came at 21.7 billion yen ($225 million). "The iPhone certainly supported our profit and boosted the number of new mobile phone subscribers during the quarter," said a Softbank spokesman, who declined to be named due to a company policy. "Since the July launch, iPhone sales have been very good," the spokesman said. But Softbank declined to give iPhone sales figures. The number of new mobile phone subscribers increased by 521,400 during the quarter, thanks partly to the iPhone. But the company's revenue in the July-September quarter slipped 2.8 percent year-on-year to 681.7 billion yen ($7 billion) due to slumping sales of mobile handsets. "Amid an economic downturn, consumers tend to keep their mobile phone handsets longer rather than switching them to the latest models," said the Softbank spokesman. Sales from the mobile phone business fell 5.1 percent to 401.3 billion yen ($4.2 billion) during the quarter. The mobile phone revenue alone accounts for nearly 60 percent of Softbank's total sales. In the six months through September, Softbank's net profit sank 11.5 percent to 41.1 billion yen ($426 million), with revenue down 2.6 percent year-on-year at 1.3 trillion yen ($13.8 billion). Softbank has been increasing users with the latest number of its mobile service customers standing at 19.6 million. Its market share stood at only 18.7 percent, compared with Japan's top mobile carrier NTT DoCoMo Inc.'s 51.5 percent and its rival KDDI Corp.'s 29 percent. Shares of Softbank surged 15.4 percent to 750 yen on Wednesday. The results were released after trading ended. Nigeria: Telecom market value to hit $10 billion in 2010 (From the Daily Independent, October 28, 2008) - Federal Government has assured that the monetary value of the current 50 million telecom subscriber base in the Nigerian market can scale up from the present $5 billion per annum to $10 billion by 2010. Minister of Commerce and Industry, Charles Ugwu, disclosed this on Tuesday at the opening ceremony of the 5th edition of "Bridges Across Borders" (BAB) conference held at the NICON Luxury hotel in Abuja. The minister, who noted that the telecom market in Nigeria was valued at $5 billion per annum, added that the Nigerian average spending on telephone service is about N2, 570 per month. Noting that the 50 million subscriber mark will keep growing as new investors keep entering into the sector, the minister acknowledged that the liberalisation of the telecommunication industry in 2001 has brought about new investment in the business services. Ugwu, who was stressing the imperativeness of service sector that represents a dominant share of the economy globally, said the sector accounts for 50-60 percent of economic activities in most developing countries and over 70 percent in some developed ones. "Services are essential inputs into virtually all products, including those in the manufacturing and agriculture." He said Federal Government's reforms in the banking, communication, aviation, and other sectors aimed at attracting trade and investment were measure taken to impact positively on the Nigerian economy. Norway's Telenor buys Unitech's telecom firm (From the Business Standard, October 28, 2008) - Norway-based Telenor, the world’s seventh largest telecom operator with a subscriber base of about 159 million, has bought new-generation telecom company Unitech Wireless by paying Rs 6,120 crore for a 60 percent stake. The deal puts the enterprise value of the company, which holds a license for 22 circles and is yet to roll out its services, at Rs 11,620 crore. The company is promoted by Delhi-based realty group Unitech, which was in the news last week after its share price was hammered down on rumours of payment defaults. Telenor is estimated to have paid a premium of Rs 50 per share for fresh equity by the telecom company. The telecom firm will invest Rs 15,000 crore in the next three years and roll out services in 22 circles, for which it has received a license in phases. In the first phase, it will roll out services in 13 circles, for which it has received spectrum, or the radio frequencies that enable wireless communications, by the middle of next year. Explaining his decision to give Telenor a majority stake, Sanjay Chandra, chairman of Unitech Wireless, said: “We were open to roping in a minority or majority partner stakeholder, but with Telenor we are in safe hands and we will also need a lot of capital.” Although Chandra said the company received a “fair price” for the value of the license, the price at which the deal has been struck is lower than a similar deal struck by Etisalat last month. The UAE-promoted firm bought 45 percent in another new license holder, Swan Telecom, for Rs 4,050 crore for 13 circles that gives Swan an enterprise value of Rs 10,350 crore. Also, in June this year the AV Birla group’s Idea Cellular bought BK Modi’s 40.8 percent stake in Spice Communications for Rs 2,700 crore for just two circles with over 4.5 million subscribers. Unitech, however, paid Rs 1,650 crore as license fee for the pan-Indian license, for which it gets a valuation of over Rs 11,000 crore. Unitech will have three members on the board, including the chairman. Telenor will have four board members, including the managing director. “We are long-term investors and experts at greenfield operations. So though the market is crowded, there is still large scope for penetration in India,” said Sigve Brekke, executive vice-president and head of Telenor (Asia operations). Telenor has operations in Bangladesh (where it is the largest mobile operator), Pakistan, Malaysia and Thailand. With over 65 million subscribers in Asia, it is the fourth-largest global player in this market after SingTel, NTT DoComo and Vodafone. Telenor’s investment will be in phases, with the first tranche of 25 percent likely in a month. The entire amount is expected to be in by 2009, Brekke said. The company will raise the money for the deal through a rights issue. Vodafone enters into partnership with Russia's MTS (From InfoTech, October 28, 2008) LONDON - British telecom giant Vodafone said it has entered into a strategic partnership with Russia's Mobile TeleSystems OJSC which includes collaboration on future technological developments. The company today announced a strategic and non-equity partnership to provide customers with high quality communication services and to collaborate jointly on future technological developments, Vodafone said in a statement. The agreement would provide Mobile TeleSystems (MTS) access to products, services and devices from Vodafone for its markets of operation in Russia, Ukraine, Uzbekistan, Turkmenistan and Armenia. Vodafone will also open a representative office in Moscow to cooperate more closely with MTS on future offerings and customer services. The company's products will be made available to MTS's 87 million subscribers, including more than 60 million customer s in Russia. “MTS will be able to draw on Vodafone's expertise in building and developing third generation (3G) networks and mobile broadband products...to enhance quality and further improve the efficiency of its operations,” the statement said. The partnership with MTS will give Vodafone valuable insight into the opportunities of the important telecommunications markets of Russia and the Commonwealth of Independent States (CIS), which are among the fastest growing in the world. “Vodafone's commercial insights and technical expertise will translate into significant operational efficiencies for MTS over the long-term as we transition our networks to 3G and beyond,” MTS CEO and President Mikhail Shamolin said. Nokia Siemens wins Italian 3G upgrade contract (From Cellular News, October 27, 2008) Telecom Italia has awarded a contract to Nokia Siemens Networks for a 3G network modernization plan. The contract will also include preparation for an LTE deployment in the future. The company release was full of talk about being eco-friendly and cutting electricity bills by 65%, but didn't include any significant technical details or the financial terms of the contract. “We are proud to partner with Telecom Italia to pave their network evolution path with our latest technology designed to enable an easy, cost-efficient and environmentally sustainable way forward.” said Roberto Loiola, head of customers and markets in South East Europe for Nokia Siemens Networks. According to figures from the Mobile World subscriber database, Telecom Italia Mobile (TIM) ended the first half of this year with 35.8 million customers, of which 6.5 million are using the company's 3G network. EU urges more telecom competition, despite crisis (October 25, 2008) BRUSSELS (AFP) – The European Commission Saturday urged greater competition in the union's telecommunications sector, rejecting calls from operators for a moratorium because of the global financial crisis. "Some of you ... have come to me in the past weeks and told me that now, because of the financial crisis, it would be time to soften or even to abandon telecoms regulation," Viviane Reding,the EU commissioner responsible for the information society and media, told a conference of operators in Venice. "First of all, I firmly believe that regulation taking care of competition always has a positive effect on the economy. Times of economic difficulties are thus not a reason to suspend the principles of competition law," she said according to remarks released in Brussels. Last November the commission presented a series of measures aiming to promote competition and services for consumers in the telecoms sector. It called for better coordination between member states with a new "super-regulator." But the proposals have received a frosty reception from some member states and existing national operators. "You and your lobbyists should be aware that the times when one could simply say 'no regulation' to have policy makers and public opinion on your side, that these times are over now," Reding said. "There is a very interesting lesson from the ongoing financial crisis for the overall perception of regulation. It is certainly not over-regulation that has caused the financial crisis!" Reding said the absence of a single telecoms market in Europe was "extremely damaging for Europe's economy." She said one expert calculated the additional cost of regulatory fragmentation in telecoms was 20 billion euros (25 billion dollars) a year. "Commission experts believe this figure to be still a very conservative estimate," Reding said. RIM unveils touch-screen Blackberry (October 8, 2008) WASHINGTON (AFP) - Research in Motion Ltd (RIM), maker of the Blackberry, unveiled its first smartphone with a touch-screen on Wednesday, its answer to the popular Apple iPhone. The phone, the Blackberry Storm, will be available later this year through Verizon Wireless in the United States and Vodafone in Europe, India, Australia and New Zealand, the Canadian company said. The Storm resembles the iPhone but its color touch-screen differs in that it is "clickable" -- the screen depresses slightly when touched like a typewriter key. RIM president Mike Lazaridis described the touch-screen as a "truly tactile touch interface" which "solves the longstanding problem associated with typing on traditional touch-screens." Users navigate on the touch-screen by using their finger like a cursor, scrolling, highlighting, panning and zooming and clicking on selections. Other features of the Storm include wireless email through high-speed 3G mobile broadband networks, an HTML Web browser which allows audio and video streaming and SMS, MMS and IM messaging. It also features a media player, a 3.2-megapixel camera, a video camera and Global Positioning System (GPS) capability alongside Blackberry Maps. RIM did not provide a price for the phone or a release date except to say it would be in stores by the Christmas holiday season. The Storm is seen by many industry analysts as RIM's response to the iPhone and an attempt to increase the popularity of the Blackberry beyond businessmen addicted to its email capabilities. "This is going to draw lot of comparisons with the Apple iPhone obviously because it's 'touch' and it's cool and it's sleek and it's sexy and it's beautiful," said Ramon Llamas, an analyst at market intelligence firm IDC. "But it's not just a defensive posture," he said. "I think it's a natural evolution of things -- touch-screen is a thing everybody's very hot on right now." The Blackberry is the dominant smartphone in the United States, with a market share of around 50 percent, but is facing increasing competition from the iPhone and others. The release of the Storm comes some two weeks after Internet giant Google entered the mobile phone market with a touch-screen smartphone developed with T-Mobile, the T-Mobile G1, which runs on Google open-source software. According to the IDC's Llamas, the number of smartphone users in the United States remains small compared to the number of regular cellphone users, just 10-12 percent of the total 260-270 million subscribers. France Telecom's Orange confirmed as mobile license winner in Armenia (From Global Insight, October 8, 2008) - Armenia’s third mobile license has been awarded to France Telecom’s Orange. The operator’s bid of 51.5 million euro (US$70 million) was higher than bids from Sweden’s Tele2 and the Anglo-Irish consortium CEO Blackstock. Orange has gained the country’s third 3G license, in addition to the third GSM license. It will receive the licenses in mid-December, and begin offering services six months thereafter. Significance: The news provides official confirmation of a decision widely expected. It extends Orange’s European footprint, which currently spans across Austria, Belgium, Moldova, Poland, Romania, Slovakia, Spain, Switzerland, and the United Kingdom, as well as France. The operator will compete in Armenia with Armentel, owned by Russia’s VimpelCom, and K-Telecom, owned by Russia’s Mobile TeleSystems (MTS), which had 654,500 and 1.49 million subscribers respectively, at the end of the first half of 2008. Both operators also own 3G licenses. The population of Armenia is around three million, with mobile penetration at 57.4% and rising at the end of 2007. Chile's CTC hangs up on Telefonica takeover bid (October 7, 2008) SANTIAGO (AFP) - It was bad news for Telefonica as shareholders of Chile's CTC nixed a takeover bid by Spain's telecoms giant, which has interests across Latin America. The Chilean company's shareholders on Tuesday voted against Telefonica's offer to buy the entire operation; it would have taken 75 percent of the vote to move ahead but won just 55.69 percent. Chilean pension fund administrators (nicknamed AFP) opposed the deal. AFP have a 21-percent stake in CTC, which Telefonica controls with a 44.9 percent interest. Telefonica had said it would pay 1.8 dollars for A series and 1.6 dollars for B series stock in the company, in a total offer worth some 985 million dollars. T-Mobile admits losing data for 17 million customers (October 4, 2008) BERLIN (AFP) - Europe's leading telecommunications company, Deutsche Telekom, admitted Saturday that it has lost confidential data belonging to 17 million T-mobile clients. The theft, in 2006, which is now subject to a judicial inquiry, involved telephone numbers, dates of birth, addresses and email addresses, subsidiary T-Mobile said in a statement. Spokesman Frank Domagala said that bank details were not attached, and that "according to our information, even though these details have been put up for sale on the black market, there has not been a buyer." Domagala added that data security procedures have been reinforced since 2006. According to news weekly Der Spiegel, copies of the information continue to circulate. In T-Mobile's statement, managing director Philipp Humm said the company was aware that the data was being "once more used to the detriment of our clients." German detectives have been working for weeks in tandem with the company, seeking to protect people whose lives could be endangered through the lost information. Apple sells unlocked iPhones in Hong Kong (September 27, 2008) HONG KONG (AFP) - Apple has started selling unlocked models of its popular iPhone 3G in Hong Kong which allow users the freedom to select the telecoms provider of their choice. The eight gigabyte version was on sale Saturday at Apple's online store for 5,400 Hong Kong dollars (about 700 US dollars), while the 16 gigabyte model was 6,200 dollars. Apple said the phone can be activated with any wireless carrier. The move is a shift from Apple's previous strategy of tying the phone exclusively to a single mobile operator in each country or territory. The iPhone 3G was previously only officially available in Hong Kong bundled with a two-year contract from tycoon Li Ka-shing's Hutchison Telecom, on tariff plans ranging from 188 to 498 dollars a month. The latest version offers a touch screen, high-speed Internet browsing with third generation networks, WiFi, e-mail, GPS and an integrated music and video player. Apple sold a million iPhone 3G models in the first weekend after its July 11 launch in 21 countries and territories around the world. ITU: Mobile phone subscriptions to reach 4 billion by year-end (September 26, 2008) GENEVA (AFP) - The number of mobile phone subscriptions in the world will reach four billion by the end of the year driven by growth in developing economies, the International Telecommunications Union said Friday. "Since the turn of the century, the growth of mobile cellular subscribers has been impressive," the ITU said in a statement. The ITU stressed however that its estimate does not mean that four billion individuals each have their own mobile phone, as many people in developed countries have more than one. Earlier this year the ITU said that the number of mobile phone subscriptions topped 3.3 billion by the end of 2007. Continued progress in 2008 is chiefly due to the growth in major developing markets such as Brazil, Russia, India and China. "These economies alone are expected to account for over 1.3 billion mobile subscribers by the end of 2008," the ITU said. China surpassed the 600 million mark by mid-2008, becoming the world's biggest mobile phone market, while India had around 296 million subscribers by the end of July. "Market liberalisation has played a key role in spreading mobile telephony by driving competition and bringing down prices," the ITU noted. EU Parliament calls for telecom regulatory group (September 24, 2008) BRUSSELS, Belgium (AP) - The European Parliament called Wednesday for a new, independent telecommunications regulatory group to help open up competition for Internet and phone services across Europe. But its choice — a group made up of national telecom agencies — does not go as far as the European Commission's demand for a tough EU-wide body that could weaken the grip many former state-owned telecom monopolies have in EU nations. The European Commission — which is akin to the executive branch of U.S. government but has limited powers — claims that regulators' reluctance to break open static markets is holding back the expansion of broadband across Europe. For instance, the European Commission has repeatedly attacked German regulators for taking a soft touch on Deutsche Telekom AG's high-speed Internet network. The German government has agreed that the company can shut rivals out of the broadband infrastructure so that Deutsche Telekom can recoup its investment. Lawmakers in the European Parliament watered down some of the commission's other suggestions, saying the new agency should not take charge of EU network and information security. They also gave lukewarm support for a proposal that would allow regulators to split up major telecom companies. The European Commission claims that separating telecom services away from managing network infrastructure would reduce conflicts of interest and boost competition. The Parliament said such splits should happen only if regulators across Europe — the European Commission and the new group — agree that it is the only way to create competition in a country where one company effectively controls the pipes that provide telecom services. Europe's biggest telecom companies said there was "no justification" for the move, warning it could seriously discourage plans to invest some in high-speed next-generation networks. These changes would need backing by EU governments and may not become law if some nations are reluctant to make the reforms. Google rolls out rival to iPhone (September 23, 3008) NEW YORK (Reuters) - T-Mobile has rolled out Google's answer to the iPhone as the Web search giant makes its biggest stab yet at leaping from consumers' computers into their pockets with a device cheaper than rival Apple offers. The widely-anticipated G1 phone, introduced on Tuesday made by HTC Corp, has a touch-sensitive screen, a computer-like keyboard, Wi-Fi connections and uses Google's new Android operating system. Available in three colors -- black, white and brown -- it includes familiar Google services, such as Google Maps, Gmail and YouTube. Like the iPhone and other "smartphones" the device is meant to broaden the appeal of Web surfing on the go. "If we see more mobile Web usage we'll be happy," Google co-founder Sergey Brin told Reuters after arriving at the launch on roller-blades. His company, a powerhouse in Web advertising, would benefit if Android led more cell users to spend time on the Web, no matter which phone they are using. Google is well ahead of rivals Yahoo Inc and Microsoft Corp in Web search on computers, but it wants to use Android to ensure this dominance carries over to the phone when mobile Web surfing becomes more popular. But while no clear mobile Web winner has emerged so far, Google faces stiff competition from longer established phone players such as Nokia, Research In Motion Ltd's BlackBerry and Microsoft, as well as Apple. Analysts saw the device as a "good first step" rather than an iPhone killer, but some expect as many as 400,000 to be sold in the United States by year-end. A T-Mobile executive said the estimate was "not incredible." When it becomes available to U.S. consumers on October 22, the G1 will sell for about $179 -- slightly cheaper than the entry-level price of $199 for Apple Inc's iPhone -- with a two-year contract. The G1 will be launched by T-Mobile's UK unit in November and other European countries such as Germany, Netherlands and the Czech Republic in the first quarter of 2009. "The G1 doesn't threaten Apple now, but Android has raised the bar for competing mobile platforms. The bigger concern here is for Microsoft and Nokia if Google can win over the hearts and minds of operators and developers," said Geoff Blaber, an analyst with British firm CCS Insight. Ericsson to cut 200 jobs in Spain (September 15, 2008) STOCKHOLM (Reuters) - Telecom equipment maker Ericsson (ERICb.ST) plans to cut 200 jobs in Spain under its previously announced cost savings program, a spokesman for the company said on Monday. Ericsson, the world's biggest mobile network maker, announced in February it wanted to chop about 4 billion Swedish crowns ($588 million) per year from costs. At the time, Ericsson Chief Executive Carl-Henric Svanberg said 1,000 jobs would go in Sweden and he estimated global job losses would be about 4,000. The company has said it will take charges for the cuts at the time it makes them. Ericsson spokesman Fredrik Hallstan said word of the Spanish cuts had appeared in an industry publication, but Ericsson had not yet officially announced them as discussions were being held with unions. Hallstan said he could not say what kind of jobs were going yet, while the discussions with unions were under way. "It's part of the big program," he said. In March, Ericsson said it was cutting more than 500 jobs in Germany and Britain as part of the wider program. China telecom firms win 75 million dollar Libya deals (September 13, 2008) AFP - Chinese telecom firms Huawei and ZTE have won contracts worth 75 million dollars to expand the mobile phone network in Libya, the state-run telecommunications office said on Friday. A total of 58 million dollars (41 million euros) has been awarded to expand the existing network of the Libyana public mobile phone company from one million lines to 6.5 million lines, a statement said. ZTE and Huawei will also expand the mobile network along the Libyan coast. In line with a second contract worth 17 million dollars (12 million euros), Huwaei alone will install the first phase of a fiber-optic network in the Libyan capital, Tripoli. Mohamed Kadhafi, who heads Libya's telecommunications office, has said the government earns some two billion dollars from the telecommunications industry, the official JANA news agency said. — AFP Chinese telecom firms Huawei and ZTE have won contracts worth 75 million dollars to expand the mobile phone network in Libya, the state-run telecommunications office said on Friday. A total of 58 million dollars (41 million euros) has been awarded to expand the existing network of the Libyana public mobile phone company from one million lines to 6.5 million lines, a statement said. ZTE and Huawei will also expand the mobile network along the Libyan coast. In line with a second contract worth 17 million dollars (12 million euros), Huwaei alone will install the first phase of a fiber-optic network in the Libyan capital, Tripoli. Mohamed Kadhafi, who heads Libya's telecommunications office, has said the government earns some two billion dollars from the telecommunications industry, the official JANA news agency said. O2 to start underground mobile service in Glasgow (September 10, 2008) LONDON (Reuters) - Telecoms carrier O2 will start a limited program giving underground rail passengers access to mobile signals in Glasgow later this year, one of the first such services to be offered in Britain. Britain trails other European and especially Asian nations in offering mobile access to underground train passengers and O2 said the Glasgow system could be a precursor to similar services being offered elsewhere in Britain, including London. The service, due to begin in December, will initially be confined to five of the busiest stations and platforms in the Scottish city's subway system, but may later be extended to include other stations and the trains themselves. The metro system in the northern English city of Newcastle, which is partly above ground, has offered underground mobile services for years. Phil Kendall, wireless analyst at research firm Strategy Analytics, said the move to offer more underground mobile access in Britain was long overdue. "We're definitely a little behind the curve," he said. "Commuters are a pretty good market in terms of extra use, so there's definitely good revenue potential." O2's Glasgow service will use an antenna system provided by British broadcast and mobile technology group Arqiva. It will allow third-generation services such as video, Internet access and multi-media messaging as well as voice calls and texts. Local transport authority Strathclyde Partnership for Transport said the deal opened the door for wider WiFi coverage in the underground network in future. Reports: Telefonica Wants 10% Stake in Telecom Italia (September 9, 2008) (Bloomberg) - Telefonica SA may seek a direct stake of about 10 percent in Telecom Italia SpA to gain influence at Italy's biggest phone company, Il Sole 24 Ore reported, without saying where it got the information. Telefonica currently holds an interest in Telco SpA, the company that owns 24.5 percent of Telecom Italia. Telefonica Chairman Cesar Alierta met with Telecom Italia Chief Executive Officer Franco Bernabe yesterday and today will see Mediobanca SpA Chairman Cesare Geronzi in Rome, Il Sole reported. Alierta is also scheduled to meet Italian Finance Minister Giulio Tremonti, Industry Minister Claudio Scajola and Gianni Letta, the prime minister's undersecretary, the daily reported. Russia's Uralsvyazinform plans 5-yr $150 mln CLNs (September 9, 2008) YEKATERINBURG, Russia, Sept 9 - Russian fixed-line telecom operator Uralsvyazinform plans to issue five-year credit linked notes worth $150 million in the fourth quarter of this year, the company said on Tuesday. Uralsvyazinform, which operates in the Ural mountains area, said in a statement it expected a rate of 9 percent in the first 18 months of the notes' tenor. "The funds are planned to be used for general corporate needs," the statement said. The company said it would hold an auction on Sept. 30 to pick financial institutions to organise the credit. Uralsvyazinform is controlled by the state holding company Svyazinvest, which holds 51.4 percent of its voting stock. Official: EU to propose 11-cent price cap for cross-border texts (September 3, 2008) BRUSSELS (AFP) - The EU's telecommunications commissioner has drafted plans to regulate the price of sending cross-border text messages by mobile phones in the bloc with a cap of 11 euro cents (16 dollar cents), an official said Wednesday. Commissioner Viviane Reding aims to get backing for the proposal, part of a package on mobile services, from fellow commissioners in late September or early October before it is submitted to member states and the European Parliament for approval. Reding is aiming to build on her success last year in pushing through caps on the price of mobile voice calls between EU countries with he plan to limit the cost of sending cross-border text messages, as well as surfing the internet on a mobile phone. In July, she suggested that the cap on the price of sending a text message from one country to another could range from 11 to 15 cents before tax, but eventually settled on the lower limit in her proposal, the EU official said. If the cap is approved, it would make sending cross-border text messages much cheaper in Europe, where it currently costs 29 cents on average, 10 times what it costs to send a message domestically. Reding also wants to regulate the price of downloading data on a mobile phone for such services as web surfing, although at the wholesale level and not retail level. Her package also includes plans to require billing by the second for cross-border EU calls longer than half a minute after she found evidence that some operators inflate prices by rounding up to the next minute. Lastly, Reding's proposals include plans to prolong the cap on the price of voice calls, which is due to expire in 2010, to 2013. EU member states will have a chance to give their opinion on the package at a meeting of telecommunications ministers on November 27 and the European Parliament in the first half of 2009. Greece says to invest 2.1 bln euros to upgrade telecom network (September 3, 2008) ATHENS (AFP) - Greece wants to invest in a new fibre optic network that will drastically upgrade its broadband and cable television capabilities, the Greek economy and telecoms ministers said on Wednesday. "We have decided to invest as a country in a modern fibre optic network that will change the daily life of Greek citizens," Economy Minister George Alogoskoufis told a news conference. The seven-year project estimated to cost 2.1 billion euros (three billion dollars) will provide high-definition TV, video telephony, quicker Internet connections and other high-bandwidth services, Alogoskoufis said. It will be developed through a public-private partnership and is eligible for funding from the European Investment Bank, he said. An international tender on the open-access network will be issued in the second half of 2009, Greek Telecoms Minister Costis Hatzidakis said. The contract involves the construction, maintenance and operation of a dark fibre network for 30 years, Hatzidakis said. An Internet laggard for years, Greece has laboured to increase the number of high-bandwidth users by slashing subscription prices and improving connections. Twelve percent of Greeks currently have access to high-speed Internet, Alogoskoufis said, compared to 0.1 percent in 2004. Regulator: India adds 9.22 mln mobile users in July (August 25, 2008) NEW DELHI (Reuters) - Indian mobile telecoms firms added 9.2 million users in July, taking subscribers in the world's fastest growing wireless market to nearly 300 million, the Telecom Regulatory Authority of India said on Monday. Leading mobile firm Bharti Airtel (BRTI.BO) signed up 2.7 million customers, enough for it to overtake state-run Bharat Sanchar Nigam Ltd as India's largest telecom firm by total subscribers, including fixed-line subscribers. Second-ranked mobile firm Reliance Communications (RLCM.BO) added 1.75 million customers, and No. 3 Vodafone Essar, controlled by Britain's Vodafone Plc (VOD.L), added 1.76 million. India is the world's fastest-growing market for wireless services and the second-largest market for such services after China, with growth fuelled by cheap handsets and call rates as low as 1 U.S. cent a minute. The regulator's data showed Indian wireless phone users rose to 296.1 million in July, while fixed-line line subscriptions fell by around 160,000 to 38.8 million. Vodafone completes purchase of Ghana Telecom stake (August 18, 2008) LONDON (AFP) – British mobile phone giant Vodafone said Monday it had completed the purchase of a 70-percent stake in state-run Ghana Telecommunications. "Further to the ... approval from the Ghanaian Parliament, Vodafone announces today that it has completed the acquisition of a 70 percent stake in Ghana Telecom for 900 million dollars," or 610 million euros, a statement said. Last week, the Ghanaian parliament ratified the controversial sale, which the country's opposition had argued was a sellout. The purchase, worth 483 million pounds and announced last month, sees the government of Ghana retain a 30-percent holding. The deal values the nation's leading fixed line operator at about 1.3 billion dollars. In recent years, Vodafone has sought aggressive expansion into emerging markets in Asia and Africa, as it looks to combat weakening sales and fierce competition in Western markets. Ghana Telecom is the west African country's third largest mobile phone group with 1.4 million customers or 17 percent of the market. Report: Deutsche Telekom to slash call centres (August 17, 2008) BERLIN (AFP) – Germany's Deutsche Telekom, the biggest telecoms group in Europe, intends to shut nearly half its call centres in Germany, according to a report due out Monday in the Focus newsweekly. Its chief executive Rene Obermann has already told the mayors of the communities concerned about the plans that will see the elimination of thousands of jobs, the magazine said. It added that a group announcement would be made Thursday. In a statement, Deutsche Telekom confirmed it wants to consolidate its call centres into a smaller number of "modern and competitive" facilities, adding that there would be no outsourcing abroad. Headquartered in Bonn, Deutsche Telekom has 60 call centres with a total of 18,000 employees. In North Rhine-Westphalia, the richest and most populous German state, four out of nine call centres will face closure. Deutsche Telekom announced in 2005 that it would eliminate 32,000 jobs by this year. It employed 242,000 in 50-odd countries at the end of 2007, with 150,000 of those positions in Germany. Bharti Airtel likely to be number one telecom operator in India (From The Financial Express, August 17, 2008) - India’s largest mobile operator, Bharti Airtel, is soon likely to become the country’s largest telecom operator (both fixed line and mobile), beating the state-owned BSNL within a months time. BSNL has a total subscriber base of 73 million in June, compared to Bharti’s 71.7 million. Given an average growth of previous months, Bharti should be well ahead of BSNL by at least a margin of one million subscribers. While Bharti is adding well over 2.5 million customers each month, BSNL’s subscriber base is growing by merely 6,00,000 each month. Landline connections, which are seeing a positive growth for Bharti, constitute just a minuscule 3% of its subscribers; for BSNL, the landline subscribers constitute slightly less than half. Bharti Airtel, which has a mobile subscriber base of over 69 million in June, is growing at an average of 3%, while BSNL, which has a mobile subscriber base of over 37 million is growing at less than 1% and adding around 3 lakh subscribers each month. The state-run company is also experiencing a decline in its fixed line growth, its landline subscribers declined by 1,60,000 in June contrary to Bharti Airtel. BSNL, which was the country’s second largest GSM service provider before Vodafone, slipped to the third position, owing to delays in its capacity expansion arising out of the delay in tenders and equipment orders. BSNL is now expanding the capacity of mobile network, the company has already ordered the equipment required for expansion. The company has ordered 5 million lines each for the north and eEast, while an additional 5.5 million for south and a 9 million lines for the western zone. With this, it is hoping to have an extra capacity of as much as 24.5 million lines. In an interview to FE earlier, BSNL chairman Kuldeep Goyal had said that CDMA is another important area of expansion for the company, which is in the process of ordering equipment in CDMA. Currently, the company has 4.6 million customers in CDMA and is hoping to add another 3 million customers. It is ordering equipments to add another 2 million lines. Telenor to appeal ruling of $2.8 bln damages to Vimpelcom (August 16, 2008) OSLO (AFP) – Norwegian telecom group Telenor on Saturday said it would appeal a ruling by a Russian court to pay damages of 2.8 billion dollars (1.9 billion euros) to Russia's Vimpelcom, calling it "unfounded." "Telenor believes the ruling is unfounded, and will pursue all possible legal remedies to reverse the decision," the company said in a statement. "Telenor expects to prevail on appeal," it said. A court in Siberia ruled in favour of a minority shareholder in Vimpelcom which had complained that Telenor delayed for a year the takeover by the Russian mobile phone group of Ukrainian Radio Systems, the Telenor statement said. The Vimpelcom minority shareholder which brought the complaint was Farimex Products, a company registered in the British Virgin Islands. "The court stated that the damages should be paid to Vimpelcom. Although named as a third party in Farimex's complaint, Vimpelcom has not participated in the case," Telenor said. Telenor holds a 29.9-percent stake in Vimpelcom, the number two mobile phone company in Russia. Singapore Telecom Q1 net profit down 5.3 percent (August 12, 2008) SINGAPORE (AFP) – Singapore Telecommunications said Tuesday first quarter net profit fell 5.3 percent from the previous year as a stronger Singapore dollar cut earnings from its regional mobile businesses. Net profit in the first financial quarter to June came in at 878 million Singapore dollars (622 million US), down from 927 million dollars over the same period last year, Southeast Asia's biggest telecom firm said in a statement. Operating revenue rose 5.9 percent to 3.78 billion dollars from 3.57 billion dollars but the firm, also known as SingTel, warned that currency fluctuations could further hurt earnings. "As we report in Singapore dollar, the financial results of our regional associates are exposed to fluctuations in foreign exchange rates," said SingTel chief executive Chua Sock Koong. "In this quarter, the impact was negative." Pre-tax profit contributions from its regional mobile phone businesses fell 11 percent to 582 million dollars as the currencies of the countries where SingTel operates fell against the Singapore dollar. Lower earnings from the Philippines' Globe Telecom, Indonesia's Telkomsel and losses from Pakistan's Warid Telecom contributed to the decline, SingTel said. Outside of Singapore, SingTel also has stakes in India's Bharti, AIS in Thailand and PBTL in Bangladesh. It has a wholly owned subsidiary in Australia called SingTel Optus. For the June quarter, 42 percent of SingTel's earnings before interest, taxes, depreciation and amortisation (EBITDA) came from its regional mobile associates, while Optus accounted for 31 percent. The Singapore home market accounted for the rest. SingTel said that if regional currencies had remained stable, pre-tax profit contribution would have been flat. For the quarter ended June 30, the Singapore dollar rose 13 percent against the Indian rupee, 15 percent against the Indonesian rupiah and 10 percent against the Thai baht from the same period last year. SingTel said on Monday its regional mobile user base was up 45 percent to almost 198 million in the second quarter against a year earlier. By midday Tuesday, SingTel shares were trading at 3.48 dollars a share, down ten cents from the previous day. The main Straits Times Index was up 1.12 points to 2,826.51. Deutsche Telekom 2Q profit down (August 7, 2008) FRANKFURT, Germany (AP) – Deutsche Telekom AG said Thursday its second-quarter net profit dropped 35 percent as the strength of the euro, the continued exit of traditional landline consumers and higher debt costs ate into revenue. However, Europe's biggest telecom maintained its full-year earnings forecast. The Bonn-based company said net profit for the April-June period fell to 394 million euros ($607 million) from 604 million euros a year earlier, while sales slipped 3 percent to 15.1 billion euros ($23.3 billion) compared with 15.6 billion euros a year earlier. The company's pretax profit in the quarter fell nearly 30 percent to 892 million euros ($1.4 billion) from 1.3 billion euros. Despite the dip, Chief Executive Rene Obermann said the company was still poised to reach its 2008 financial targets, including a pretax profit of approximately 19.3 billion euros ($30 billion), on par with that of 2007. "We made good progress during the first half of the year in achieving our strategic objectives, both in operations and with our cost savings," Obermann said. "This leads us to assume that we will reach our financial targets in the 2008 financial year." The lower net profit was hampered by a continued loss of customers using land lines, something the company has been unable to stem as more and more consumers opt for only cell phones or seeking lower costs by subscribing to Telekom rivals such as Vodafone or Arcor who offer bundled packages that mix telephone, Internet access and even television. But the company's mobile communications division, which includes T-Mobile, helped offset the drop, posting a 0.3 percent increase in second-quarter revenue to 8.68 billion euros ($116 billion) from 8.65 billion euros a year ago. The mobile division saw an 12 percent increase in operating profit to 1.4 billion euros ($2.2 billion) from 1.3 billion euros a year ago. Deutsche Telekom said its U.S. business is continuing to demonstrate robust development in operations, though the weakness of the dollar is clearly affecting earnings. Including SunCom, which was taken over in the first quarter of the year, T-Mobile USA had 31.5 million customers as of June 30, 2008, 4.6 million more than a year earlier. The company said mobile communication business developments in Central and Eastern Europe remained encouraging, with companies in Poland, the Czech Republic and Slovakia delivering high double-digit growth rates. Meanwhile in Britain, Telekom saw an 12 percent decrease in mobile revenues for the first six months to 2.7 billion euros ($3.2 billion) because of currency effects, and increased sales and customer retention costs. The broadband and fixed network division saw a 6.4 percent decline in revenues. The decrease was widely expected as Deutsche Telekom, like its rivals, has seen an exodus of consumers from the once traditional hardline home phone. Deutsche Telekom said revenue at broadband fixed network fell to 5.3 billion euros ($8.2 billion) from 5.7 billion euros a year ago. The division's operating profit fell nearly 10 percent to 837 million euros ($1.3 billion) from 929 million euros a year ago. "In its domestic market, T-Home recorded stable earnings and a decrease in revenue in line with expectations," Deutsche Telekom said. The business customers segment saw a 10 percent decline in total revenue for the quarter to 2.7 billion euros ($4.2 billion) from nearly 3 billion euros a year ago. Meanwhile, the division posted a pretax loss of 65 million euros ($100 million) compared with a pretax profit of 34 million euros a year ago. Deutsche Telekom said business customers' results were affected by two main factors during the first half of 2008: The company's media and broadcast division was sold, and a billing unit was reassigned to the broadband and fixed network division. Shares of Deutsche Telekom were up 1.2 percent at 11.50 euros ($17.71) in Frankfurt. Siemens sells SHC cordless phone unit to Arques Industries (August 1, 2008) FRANKFURT (AFP) – The German industrial group Siemens announced on Friday another divestment in its telecoms activities, saying it would sell 80 percent of its SHC unit, which makes cordless phones, to Arques Industries. The amount of the transaction was not provided, but the deal was to be finalised by October 1, a statement said. SEC, which Siemens described as the European leader in cordless telephones, employs 2,100 people and posted 2007 sales of 792 million euros (1.23 billion dollars). It no longer belongs to Siemens core activities of energy, industry and medical technologies, the group said. Arques Industries is a specialist in the purchase of industrial holdings, which it then turns around. It will have the right to use the Siemens brand for another two years. The German industrial group is being shaken up by chairman Peter Loescher, who was brought in a year ago to steer the company out of a corruption scandal that broke in 2006. Earlier this week, Siemens said it had sold its SEN division, which provided telecommunications services to businesses, to The Gores Group, an investment fund. Telefonica posts 20.2 percent drop in second quarter net profit (July 31, 2008) MADRID (AFP) – Spanish telecom firm Telefonica said Thursday its second quarter net profit dropped 20.2 percent to 2.05 billion euros (3.2 billion) from the same period last year when its results were boosted by a large one-time gain. Sales for the period rose 1.2 percent to 14.25 billion euros while operational income before depreciation and amortization fell 6.8 percent to 5.74 billion euros, Spain's largest telecoms firm said in a statement. Telefonica appeared to withstand the downturn in its domestic market, one of the most severe economic slowdowns in Europe, as sales for the period in Spain inched up 0.8 percent to 5.2 billion euros. Last week British cellphone operator Vodafone, Europe's largest mobile operator, warned that its results would suffer in 2008 due to the sharp slowdown in Spain, the eurozone's fourth-largest economy. Telefonica's second quarter net profits in 2007 included a capital gain of 1.3 billion euros from the sale of radio operator Airwave in Britain. The results mean Telefonica has rung up a first half net profit of 3.59 billion euros, a 6.2 percent drop over the same time last year. Sales during the first six months of the year total 28.15 billion euros, a 1.2 percent increase. BT posts sliding profits in first quarter (July 31, 2008) LONDON (AFP) – Telecom operator BT Group said on Thursday that net profits sank 35 percent in the first quarter of its fiscal year amid fierce competition for broadband Internet services and higher restructuring costs. Net profits stood at 397 million pounds (504 million euros, 786 million dollars) in the three months to the end of June, which compared with 607 million pounds for the same period a year earlier. Sales climbed by three percent to 5.177 billion pounds. Pakistan Telecom company Ufone launches “Video News Service” (July 15, 2008) ISLAMABAD (NNI) - Ufone, one of the leading telecom companies of the country, has surpassed new barriers of communication services by launching one of its kinds “Video News Service.” This video news service launched by Ufone will enable subscribers to receive video updates about latest developments and breaking news throughout the day everywhere in Pakistan. With this service customers will receive up to 3 MMS per day with breaking news between 9am to 9pm. To subscribe to this exclusive service, customers can simply SMS ‘news’ to 2478 from their MMS enabled handsets, and can get video news updates all day without any hassle. At the launch of this unique service, Mr. Ali Ikram, Head of VAS Ufone commented, “At Ufone, our first and only priority is our customers. Our commitment to them is as steadfast as our dedication to strengthen customer support. With the launch of this video news service we are making sure our customers get all the breaking news on their handsets anytime anywhere and feel updated with ease.” British Telecom to spend $3 billion on fiber networks (July 15, 2008) (Reuters) - UK telecom British Telecom will be investing $3 billion in new fiber networks to bring 100 Mbps internet connections to the country. Instead of whining, capping bandwidth and degrading other company's services like US operators, BT seems to realize that being the provider of the pipes is not so bad after all: BT will be offering the fiber network to other providers at wholesale prices to "ensure the broadband market remains competitive". These wholesale buyers will be able to install their own fiber networks in BT's "cabinets", the way-point between the main network and the last mile, just as they have done with copper. Not everybody will be getting these super high speeds, however. 100Mbps will only come with "fiber to the curb" connections. But even with the "fiber to the cabinet" connections, users will get up to 60Mbps. In a startlingly customer friendly statement, BT boss Ian Livingston said that "Broadband has boosted the UK economy and is now an essential part of our customers' lives. Our aim is that urban and rural areas alike will benefit from our investment". The aim is to have this network running to around 10 million homes by 2012. Granted, Britain is a lot smaller than the US, but still, come on Comcast. Come on AT&T. Stop gipping your customers and spend some money already. S.Africa's Telkom says Vodafone talks ongoing (July 15, 2008) JOHANNESBURG (Reuters) - South Africa's Telkom on Tuesday said it was still in discussions with a Vodafone unit for part of its stake in mobile operator Vodacom, sending its shares up 1.90 percent. Africa's biggest telecom company said that independent talks with a consortium led by Mvelaphanda Group for its entire share capital were also ongoing. "Shareholders are therefore advised to continue to exercise caution when dealing in Telkom securities until a further announcement is made," the firm said in a statement. Telekom Austria in talks to cut 1,700 jobs (July 14, 2008) VIENNA (Reuters) - Telekom Austria is in talks with unions to cut 1,000 of 9,000 jobs in its wireline unit this year and up to 700 more in 2009, Austrian daily newspaper Die Presse reported over the weekend. The company aims for concluding talks with the unions over the next weeks and present the proposal -- which includes measures such as golden handshakes and early retirements -- at its supervisory board meeting on August 19, Die Presse said. Telekom Austria declined to comment on the report. EU's Reding set to propose slashing cost of texts (July 14, 2008) BRUSSELS (Reuters) - The cost of sending a text message from the bar or the beach when mobile phone users are outside their home state in the European Union will be cut by 70 percent from next year under new plans, an EU source said. EU Telecom Commissioner Viviane Reding will announce outline plans on Tuesday that include extending price caps on roamed voice calls for another three years, the source added. After the "No" vote in the Irish referendum on the Lisbon Treaty in June, Brussels is keen to show it has a role to play in the lives of the bloc's 490 million citizens. Price caps on roamed voice calls introduced last year by Reding were one of Brussels' most popular policies ever. A formal legislative proposal will be made in the autumn and could come into force by the summer of 2009. As the European summer holiday season is getting under way, Reding's proposal for extending the legislation to cap the price of texts will also help cut bills landing on doormats back home. Some 2.5 billion roamed text messages are sent each year. National telecom watchdogs in the EU say the average retail price of sending a text when roaming in the bloc is 29 euro cents (46 U.S. cents) and a retail "Eurotariff" of 11 to 15 cents would allow for full recovery of costs and give operators a reasonable return. Reding gave operators a retail target of 12 cents per text but a study for the Danish government recommended 4.2 cents. The retail cap would be around the 12 cents level and a wholesale cap probably between 4 and 8 cents, a Commission source said. In data, operators will get more time over the summer to cut prices further otherwise caps may be included in the autumn proposal, the source said. Data roaming is when a customer uses his laptop or mobile phone abroad to send emails or download a song. On Tuesday, Reding will also call for greater transparency in data roaming tariffs to avoid "bill shock." The text market is mature but data roaming is still in its infancy. Telecom regulators and operators have insisted that price caps would not be appropriate. Mobile phone industry officials said the price of roamed data and texts was falling fast while the voice roaming regulation introduced last year "has given consumers little benefit and stifled market growth." HEADLINE GRABBING The measures will need approval from EU governments and the European Parliament to come into force. Reding warned mobile phone giants such as Vodafone, O2, T-Mobile and Orange in February that she would propose price caps unless they slashed the cost of roamed texts and data transfer. Operators say they could not introduce coordinated price cuts to similar levels for fear of triggering antitrust probes. Many have cut the price of data roaming and say they offer free texts as part of packages in some cases. "European mobile operators are improving transparency around data roaming prices and reducing the likelihood of unexpected bills," a mobile phone industry official said. Reding is set to say a three-year extension on roamed voice caps to 2013 is needed as operators have cut prices to just below the ceiling, a sign Reding and telecom regulators say shows a lack of vigorous competition. Commission officials have indicated that the cap on making a roamed call could fall from 46 cents this year to 32 cents by 2013. For a big operator like Vodafone, texts and data roaming represent about 1 percent each of revenues and Reding's proposals will have a minor impact compared with voice caps. "It makes great headlines in the short term but the consequences won't be seen for some time. It's naive to think companies can keep taking it on the chin," a senior operator official said. The biggest hit operators face comes from separate proposals Reding is due to finalize in the autumn to cut by 70 percent termination fees operators charge each other for handling calls. This sector is five times the size of roamed services. Vodafone has said slashing termination fees would inevitably make it more expensive for customers to own a mobile phone as costs are recouped through introducing an effective fee. Apple sells 1 million new iPhones (July 14, 2008) NEW YORK (Reuters) - Apple Inc said on Monday it has sold 1 million new iPhones in its initial weekend, on par with estimates set by analysts, sending its stock rising more than 2 percent. The original iPhone, introduced in late June 2007 in the United States only, sold about 270,000 units in its first two days. Sales topped 1 million by early September. The new device sells in 21 countries. Apple executives were pleased with the early results. "IPhone 3G had a stunning opening weekend," Apple Chief Executive Steve Jobs said in a statement. "It took 74 days to sell the first 1 million original iPhones, so the new iPhone 3G is clearly off to a great start around the world." Steven Hodges, President for the Northeast region for AT&T Inc, Apple's only U.S. carrier partner, would not disclose how many iPhones it sold but said it would be AT&T's key device for the holiday shopping season this year. "It's definitely in the center of demand," he said at the operator's holiday phone showcase in New York. Still, iPhone sales pale compared with those of established mobile phone makers, such as Nokia Oyj, which sells almost 10 million phones a week, or Samsung Electronics Co Ltd and LG Electronics Inc, which each ship more than 100 million a year. While those phone makers often unveil dozens of models a year, Apple has only one, and its sales spark a retail frenzy as consumers around the world line up to grab one. Apple's addition of support for corporate e-mail pits it more directly against Research In Motion, the maker of the wildly popular Blackberry e-mail devices. While big firms are not moving en masse from Blackberry so far, many are at least looking at the iPhone as an alternative, according to Damian Goldstein, an AT&T enterprise specialist. "They're more open to it," he said, adding that most companies are at least getting a few iPhones to test. The iPhone 3G still has the popular touch screen, but also offers a faster wireless network and the ability to download third-party applications such as games. Perhaps more important, the new iPhone sells for about $200 in the United States, about one-half the price of its predecessor. "We don't yet know the breakdown of how many phones were sold to new customers and how many existing iPhone customers upgraded, but regardless, sales during the first weekend were very impressive," said Jeff Kagan, an independent telecommunications analyst, in a note. Analysts said iPhone sales may dent sales and profit margins at Samsung and LG this year. Activation problems marred its U.S. launch on Friday, with many buyers leaving stores frustrated that they could not use the hotly anticipated gadget after waiting in line for hours. AT&T Inc, the sole U.S. carrier for the iPhone, blamed problems synchronizing the phone with Apple's iTunes online music and software store, saying it was probably caused by too many people trying to access iTunes at the same time. Analysts expect Apple to exceed its original target of 10 million iPhones by the end of 2008. "The iPhone 3G launch was clearly not as smooth as last year's launch. However, demand was clearly strong across the U.S. ...," said Morgan Keegan analyst Tavis McCourt in a note to investors. Apple shares closed up $1.30, or less than 1 percent, at $173.88 after earlier hitting a session high of $179.30. Palm unveils new Treo in shadow of iPhone debut (July 13, 2008) NEW YORK (Reuters) - Palm Inc on Monday introduced a new high-end Treo mobile phone, hoping to challenge the BlackBerry's dominance with business users, but its debut fell in the shadow of the launch of Apple Inc's debut of its less pricey new iPhone which sold more than 1 million units over the weekend. Shares of Palm closed down nearly 2 percent after Palm unveiled its 800w smartphone, available for $250 after signing up for a service contract with its wireless carrier partner Sprint (S.N), and a $100 rebate. By contrast, Apple's iPhone 3G, which sold more than 1 million units over the weekend, sells for about $200, nearly half the price of its previous version. Apple's stock closed up 0.75 percent. The lower price has spurred iPhone rivals to keep prices low, such as Samsung Electronics Co Ltd's recently introduced "Instinct" -- also available via Sprint -- which is set at $130 after rebate. "Despite recent price cuts in the smartphone sector, the new Treo is priced at $249.99 with a two-year contract, making the 800w model one of the most expensive smartphones offered at Sprint," said CL King & Associates analyst Lawrence Harris in a client note. Smartphones like the Treo, iPhone and Research in Motion's Blackberry Curve -- which sells for $149 after rebate according to Sprint's Web site -- offers features such as a high speed Internet connection and access to email, and documents. The new Treo comes with a full keyboard, which the iPhone lacks. Both have "Wi-Fi" wireless Internet capability, satellite navigation systems, and built-in digital cameras. Palm executive Brodie Keast told Reuters that the Treo is primarily meant to take on the Blackberry's dominance among business users, but acknowledges that the iPhone has drawn a lot of attention. But, he says there remains a lot of room for growth in the smartphone market. "It's also a very large market," he said. "We don't need to defeat RIM or Apple in order to succeed." Nokia Siemens Networks wins deal with China Mobile (July 11, 2008) HELSINKI (AFP) - The Finnish telecom group Nokia Siemens Networks (NSN) said on Friday it had won a network expansion deal for 550 million euros (867 million dollars) with China Mobile. NSN will design, build, maintain and optimise the radio and core network for China Mobile, including base station, mobile softswitching and operating support systems in provinces and cities across China. "This agreement represents the strengthening of our position as a leading solution provider to China Mobile," Zhang Zhiqiang, the head of Nokia Siemens Networks Greater China Region, said in a statement. Established in 2000, China Mobile has a registered capital of 51.8 billion RMB Yuan (4.8 billion euros, 7.6 billion dollars) and is Asia's largest telecom carrier. Nokia says 9 more firms sign up for Symbian pact (July 10, 2008) HELSINKI (Reuters) - Nine more firms, including telecom operators "3" and TIM, have lined up to support the new open mobile software alliance Symbian Foundation, the world's top cellphone maker, Nokia, said on Thursday. Nokia said on June 24 it would buy out other shareholders of UK-based smartphone software maker Symbian for $410 million and make its software royalty-free to other phone makers, in response to new rivals such as Google Inc. Nokia will contribute Symbian's assets to the not-for-profit organization, Symbian Foundation, in which it would unite with leading handset makers, network operators and communications chipmakers to create an open-source platform. Nokia said the foundation has now 30 members after also mobile operators 3, America Movil and TIM, chip firm Marvell, and services and software providers Aplix, Elektrobit, EMCC Software, Sasken and TietoEnator joined. EU mobile phone users might have to pay to receive calls (June 17, 2008) BRUSSELS (AFP) - The European Commission said Monday it would not stop telecom firms from charging customers for calls received on their mobile phones in their own country but warned that users could oppose the move. "This is for companies to decide. If companies think that this makes their offer particularly attractive, then we will not forbid it," said telecom spokesman, Martin Selmayr, when asked if the system might change in Europe. "But we will also not force companies to move to that," he said, adding that the commission would not be imposing any so-called "bill and keep" business model on them. Europeans pay to make mobile calls but are generally only charged for receiving them when they are abroad. Users elsewhere, in the United States and some parts of Asia, notably China, pay for both even in their home country. At the moment in the EU, telecom companies bill each other a "mobile termination charge" for calls made between any two networks which is then passed on to customers. The commission, the EU's competition watchdog, wants to cut the mobile termination charge, which averages around nine euro cents (14 US cents) per minute, across the 27 EU nations. The charge ranges from as low as two cents to as high as 20 cents, with Cyprus costing the least, while Bulgaria and Poland were among the most expensive. Selmayr said the idea is to cut these charges to a level that would incite mobile phone operators to "move to a less bureaucratic system of bill-and-keep in the long run. "It is not something that happens from one day to another," he said, adding that it was a long-term measure that would mean "less administrative burden, less red tape, more competition and in the end, lower charges for consumers." The telecom industry itself reserved its opinion. "The principle is that customers don't pay in Europe (to get calls). It's well understood and accepted by consumers," said David Pringle, spokesman for the London-based GSM Association, which represents some 750 mobile operators worldwide. He said the market was changing rapidly and it would be up to individual mobile operators to decide what to do. But he added: "I would be surprised that any operator says that now." Back to the News Center

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