a week in wireless


I don’t like it. It’s quiet… Too quiet

It’s always quiet in the week after World Congress. It’s as if the whole industry has pulled the duvet up over its head and is issuing only the occasional, muffled rejection of any attempt to persuade it out of bed. This was not a week during which the Gods of News Announcements, in their fury, flung thunderbolts down around our ears. They barely managed a stiff breeze – hardly surprising after the Beaufort-buster they whipped up in Barcelona.

And so, for much of the week, the Informer stared listless from his window, the occasional news-trawl and ring-round proving largely fruitless. Reading the dictionary for a while, he found that a haruspex was a religious official in ancient Rome who interpreted omens by inspecting the entrails of sacrificial animals. And he knew how the haruspex must have felt when there were no more animals left to sacrifice.

One thing that apparently has been sacrificed is the agreement between Orange and Vodafone’s UK operations to share their 3G radio access infrastructures. A year or so ago the two firms announced that they were to embark on a 3G RAN sharing deal. This week, however, a joint press release stated the following:

“Orange UK and Vodafone UK will continue to maintain separate networks, will retain full responsibility for the quality of service they offer their respective customers and will remain competitors in the UK mobile wholesale and retail markets.”

What the two will be doing is sharing mast sites for their GSM and WCDMA networks. The two carriers reckon that, in the first two years of the arrangement, they will be able to reduce their combined site presence by 15 per cent – a reduction of almost 3,000 sites. They trumpeted the ecological improvements that this would reap, as well as the financial rewards each would derive from scaling back on its footprint.

This will be good news for everyone who fears The Rays!!! and urges us all to THINK OF THE CHILDREN! Although no doubt there will be complaints from those people who find themselves in proximity to the masts that have been chosen to remain in place.

Over in France, Orange was busy with another collaboration, this time with Gallic electronics vendors Thomson and Sagem. The three firms have established a joint venture with the remit of improving the interoperability of domestic digital equipment.

The JV – Soft At Home – aims for a collision of device connectivity and advanced services that could see PC-based content such as photographs called up remotely on the television screen, or voice calls to be initiated from a multimedia remote. Essentially what we’re looking at here is a level of functionality that will probably render the species even more sedentary than it already is.

Speaking of inertia, the proposed acquisition of US enterprise communications specialist 3Com by Chinese vendor Huawei and finance house Bain Capital has been stopped in its tracks with a tobacco chewin’ “Y’ain’t from round here, are ya boy…” from the Committee on Foreign Investment in the United States, which in a film would probably be played by an ageing Jackie Gleeson.

Last September, 3Com’s board of directors gave its unanimous approval to an agreement under which the firm would be acquired by Bain and Huawei for $2.2bn. In a bid to pre-empt US jitters about foreign (specifically Chinese) ownership, the companies committed to Huawei being restricted to a minority stake. But this was apparently not enough to put the Yanks at ease.

Speaking to the Informer’s chums at Mobile Communications International last year, Huawei’s chief marketing officer Zijhun Xu conceded that the privacy with which it conducts operations – financial results aren’t published, precise ownership details are hard to find – does generate some problems. He said this could make it look as if “the company is not transparent and that it does not enjoy a good reputation.” Although he added that all customers are given access to detailed financials.

Certainly the US Government seems a tad suspicious. This will doubtless create reciprocal issues with foreign (specifically US) investment in Chinese firms. Indeed the view from Beijing is likely to be that the US is using security concerns – 3Com has a supply deal with the US Government – as a means of justifying a protectionist stance on foreign investment.

Sino-US relations might be a little rosier between Motorola and ZTE. According to a report from Reuters this week, the Chinese vendor has spoken – in albeit non-specific terms – of wanting to deepen its relationship with the US player, which is having a rough old time of it in the handset space. As we’ve said before, any external saviour of the Motorola handset business is likely to come from China, either in acquisition or JV form.

On the subject of international investment, Indian carrier Reliance Communications this week nabbed itself a Ugandan firm called Anupam Global Soft, which holds a cellular licence in the African nation. The Indian firm has committed to a $500m investment in Uganda, where it wants to deploy a variety of service; fixed line voice and internet, long distance and WiMAX, according to local reports. With the scale that Indian players have built and the expertise they have developed in working with extremely low average revenues, they are well positioned for emerging market expansion and we’ll probably see a lot more of it.

If you follow Formula One motor racing, you’ll be seeing a lot more of Vodafone, according to brand analysis outfit Margaux Matrix, which this week reported that the Big V has hit the top of the Formula One brand exposure league, displacing Marlboro – a brand that has been synonymous with F1 for as long as the Informer can remember. It’s good, the Informer supposes, that cigarette brands are being phased out of high profile sponsorships, but there was never an F1 car that looked as good as the JPS Lotus, was there?

The thing about brand sponsorship is that it’s nigh on impossible to prove that it’s worth all the cash that gets thrown at it. Just how many people watch Ferraris zipping by at 200mph and think: “that reminds me, I must get a new phone” is anyone’s guess. In fact, a few years ago the Informer was speaking to a Vodafone spokesman who told him that the only time the firm had received any public feedback specific to its F1 sponsorship was when Rubens Barrichello hit the anchors on the home straight of a race in 2002, allowing German man-machine Michael Schumacher to take the chequered flag on team orders. Apparently Voda’s customer service units were inundated with complaints.

Vodafone will be hoping that its UK BlackBerry customers will certainly not be complaining now that it has given them a new stick to beat it with. The carrier has cosied up to disaster recovery specialist Neverfail to introduce a “high availability” option for enterprise customers who use the devices. The service promises “uninterrupted availability of Blackberry services to Vodafone business customers.”

So convinced of the solution’s ability to prevent service collapse is Vodafone, that it’s installed it on its own corporate network. It’s not clear how much extra Vodafone’s enterprise BlackBerry users – the largest single customer base outside of the US – will have to pay for this, though.

Things seem to be ticking along nicely at Canadian firm Research In Motion (RIM), which makes the BlackBerry. RIM announced this week that it expects Q4 adds to be up to 20 per cent higher than the 1.82 million that it had previously predicted. By the end of March, the firm said, its total subscriber base should hit 14 million. Revenues for the three months to end March should hit between $1.80bn and $1.87bn.

Not all of the BlackBerry pie is lip-smackin’ good, though. RIM is in the courts with Motorola over IP charges being levied by the US firm. These are too high, says RIM, also complaining that Moto is failing to acknowledge some RIM patents. Now, now, children. Play nicely.

Sticking with the enterprise market, Swedish vendor Ericsson this week announced its intention to quit the enterprise PBX space. Ericsson is offloading the relevant division to Canadian enterprise communications outfit Aastra for SEK650m (US$102m), with the sale expected to close in April this year. 2007 saw the unit rack up sales of SEK3bn and Ericsson reckons it will clear SEK200m on the deal, which will see 630 staff switch to the Canadian firm. On announcing the deal, Ericsson predicted further consolidation in the enterprise space.

Finally here’s a story that’s included based on the sheer optimism of the PR chap that sent it in. It’s about a marketing tie in with a new Samsung phone, the G600 Pink, and an upcoming film about a beautiful woman who has been a bridesmaid 27 times and – despite being beautiful and kind and beautiful – still hasn’t found that Mr Right. Back in the day it would have been a classic Ryan/Hanks vehicle. In short, the kind of film that makes you want to regurgitate. There’s all sorts of promo stuff being done and there’s some deal or other whereby if women propose to their boyfriends this month they stand the chance of winning one of these handsets.

Anyway, it so happened that the Informer was reading the email, thinking to himself: “What the hell am I supposed to do with this old fluff?” when the person who sent it phoned up and asked him whether or not it was the sort of thing that he would use. “Of course not,” the Informer thought, wrongly as it turned out.


2 comments

  1. Nick H 22/02/2008 @ 6:12 pm

    THINK OF THE CHILDREN? If we thought of the children surely we’d all be insisting we build the masts IN the schools. I suspect it’s not the mast that’s irradiating the little lovelies, but the 2W transmitter they’ve got clamped to their ear. Nowadays most mobile handset designers have worked out that it’s a good idea to incorporate power control, so the better the signal quality, the less the transmitter needs to shout. So if you want a soothing, gentle GSM signal next to your brain, the best thing to do is go and stand close to a base station. Move the base station away from the school and your darling gets fried brains as your handsets pumps its way up to being a handheld microwave.

    It’s a PR opportunity that the technically illiterate marketing departments of our operators have totally failed to recognise. People who want to take masts away from schools obviously hate children. Therefore they must be paedophiles. Where’s the News of the World when you need it. Masts are lovely. Masts are child friendly. We want them. Maybe we can even get David Cameron to start a hug-a-mast campaign.

    You’re right. The week after Barcelona is boring…

  2. Kelly Ungs 22/02/2008 @ 3:52 pm

    Perhaps you are sleeping in a little late after too many cervezas in Barcelona? This was a quiet week? Are your North American sources asleep at the wheel?

    The major wireless carriers in the US each announced changed business models over to flat rate billing. Stop counting minutes and get flat data plans up to 5GB per month. In the words of David Letterman, I think that’s something!

    RIM’s servers go down AGAIN, (second time in two software upgrade cycles) dropping service to email in your pocket service. Addicts nearly die from withdrawal? Dave would say “that’s not nothing, that’s something!”

    Some news across the pond to your west does happen outside press releases. You need to get up really early and start watching Dave!

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