a week in wireless


More than meets the eye

AWIW578

Transformation. It’s such a positive word, isn’t it; one that conjures images of butterflies emerging from the crysalis, of landscapes freshly draped in virgin snow. Or, more prosaically, of the kind of massive weight loss that drives people to pose for photographs standing inside a pair of parachute-sized trousers, holding the waistband out with their thumb and beaming the beam of the newly and evangelically slender.

Which is precisely why it’s the kind of word used by corporate entities when they’ve got some ugly job cutting to do. Bouygues Telecom was dusting off the guillotine this week, announcing that 1,516 heads will roll as part of its Business Transformation Plan. This plan has become necessary, CEO Olivier Roussat said this week, because talks held with Iliad’s Free and Orange over the last couple of months aimed at driving further consolidation in the French market proved stérile. 

Bouygues’ transformation plan involves it investing more heavily in its network, cutting its fixed prices and eliminating the aforementioned 1,516 jobs, which Roussat positioned as the blunt reality of life in a modern, four-player market. “Chin up, Benoit,” Roussat will say. “I don’t want you to see this as you losing your job, I want you to see it as you being transformed. Transformed into some kind of beautiful butterfly. A beautiful, jobless butterfly.”

It’s not just Bouygues feeling the pinch; France is in the bony grip of record unemployment. In the wake of Bouygues’ announcement, French Economy Minister Arnaud Montebourg said that the government was keen to see consolidation rather than job cuts but, as the Informer’s dear old mum used to say: “I want doesn’t get”.

It is not clear why discussions between Bouygues and Free, and Bouygues and Orange bore no fruit. Bouygues was clearly up for it and Orange recently voiced its enthusiasm for M&A with a statement in which it said it was actively “assessing the opportunities” that consolidation might offer.

Free meanwhile has created a self-feeding circular business model in which price cuts force job cuts, creating a market full of unemployed people who need super cheap telephony services. Neat.

When governments aren’t panicking about unemployment they’re snooping on their citizens like some grubby pervert standing on an upturned dustbin outside your window. And the operator community is looking to put the watchers themselves in the spotlight. Late last week Vodafone engaged in a spot of whistle blowing, revealing the level of government access required in each of the 29 countries where the company holds an operating licence.

In the majority of cases, the operator said, the law requires some form of court order for wiretapping to occur but in a small number of markets governments have constant and unlimited access to the network. Vodafone was unable to identify these particular countries because of the government-issue socks stuffed in its mouth.

The revelations prompted Viviane Reding, Vice President of the European Commission and more recently champion of the ‘right to be forgotten’ to dig into her bag of folksy analogies. “There should not be unregulated, direct and automatic mass access by law enforcement authorities to data of citizens held by private companies. Only where there is a clear suspicion. Not with a hoover but with tweezers,” she said.

Vodafone called for state agencies themselves to be more transparent about their observational activities, which is at best a giddily naïve request. “In our view, it is governments – not communications operators – who hold the primary duty to provide greater transparency on the number of agency and authority demands issued to operators,” the firm said. For crying out loud, though, we’re talking about spying! If you have transparency, it’s not spying. It’s like you can’t have Hide and Seek if nobody hides. It’s just a game of Look There Are Some People.

The UK operator said there was little consistency in state behaviours across its footprint, but made reference to one well-documented example of state intervention, when it was forced to shut down its Egyptian network in 2011 during a period of social unrest. On a similar track, Telenor announced this week that the recent Facebook outage in Thailand was state mandated as the government sought to clamp down on its critics.

Emboldened by Vodafone’s confessional, German incumbent Deutsche Telekom published figures on wiretapping in its domestic market this week. DT said that “under specific circumstances” it is legally obligated to provide information to the security authorities and to enable interception measures and that in order to make this area of its activity more transparent it is now publishing the figures annually.

With its report covering requests made in 2013, Deutsche Telekom revealed that it had received request to intercept a total of 49,796 lines based on court orders that give evidence to the suspicion that the individual, either as a perpetrator or accessory, has already, will attempt, or has prepared to commit a serious criminal offence.

It also received requests for a total of 436,331 data traffic records, when it is deemed necessary to establish the facts or determine their whereabouts of a subscriber and requests for subscriber master data totalled 28,162. Finally it revealed requests in 946,641 cases for data on IP address owners. “Deutsche Telekom does not respond to inquiries from authorities outside of Germany,” the company said, presumably casting an accusatory glare at the US. Although, as Chancellor Merkel has found out, US agencies don’t actually make requests. They just do it.

In the US this week, FCC chairman Tom Wheeler—a recent focus for the forensic wit of John Oliver (if you haven’t seen it, see it)—told US network operators that they should be more proactive in their security activities if they want to avoid heavy regulation. “The private sector-led effort must be more dynamic than traditional regulation and more measurably effective than blindly trusting the market or voluntary best practices to defend our country,” he said. “Um, just don’t make those networks too secure,” he didn’t add.

In no way casting aspersions with this segue, let’s move on to China, where the world’s largest MNO, China Mobile, has made a rare foray into international investment. The firm said this week that it’s taken an 18 per cent stake in third placed Thai operator True Group, for $882m. The partnership will help reduce True’s debt burden as well as strengthen the company’s overall financial status, China Mobile said.

True is also planning a rights offering to raise a further $2bn for future investment in “converged telecommunications and new technologies”. True is currently the only Thai operator to have launched LTE services, with a quarter of a million LTE subscriptions at the end of the first quarter this year, according to WCIS+. Also planning a rights issue is Indian operator Idea Cellular, which is looking for half a billion dollars to fund spectrum acquisitions.

Now, what the South Korean’s don’t know about spectrum usage ain’t worth knowing, and SK Telecom this week claimed to have broken another record in mobile download speeds. The firm used carrier aggregation technologies in a trial with Nokia, converging both FDD and TDD spectrum to demonstrate throughput of 3.78Gbps, downloading a 5GB HD movie in just 11 seconds.

Nokia said there are significant benefits for operators in all geographical regions in combining their TDD and FDD LTE spectrum resources, one being the increased capacity for downlink and uplink data-intensive applications such as video streaming – and also the ability to eliminate supplementary downlink (SDL) completely.

Take care.

The Informer


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