power shift - Total Telecom

Transcription

Busines s analysis for telecoms profes sionals
Dec 2010–Jan 2011
leader
contents
POWER SHIFT
2 Cloud services
This year marked a shift in power in mobile. We look at 2010
highlights as well as cloud services and fibre business models
T
Ian Kemp
Editor
Total Telecom Plus
his has been the year when
merger and acquisition
activity sprung back to life
in the telecoms and ICT sectors.
M&A activity accelerated as the
year drew to a close as we showed in
the last issue of Total Telecom Plus.
It is in the mobile sector where
the biggest upheaval is playing out.
Bharti Airtel in April moved up to
the number five spot among global
mobile operators by subscribers
when it bought the African assets of
Kuwait mobile operator Zain for
US$10.7 billion. But Bharti could
itself be surpassed by Russia’s
Vimpelcom if its deal, announced
in October, to buy the telecoms
assets of Weather Investments—
In mobile, at least,
the balance of
power is shifting
including Italy’s Wind and a
majority stake in Egypt’s Orascom
Telecom—is approved. United Arab
Emirates operator Etisalat also
continues to move up the ranks, in
October agreeing to buy a 46% stake
in Zain for $11.7 billion. Wireless
Intelligence says that will propel
Etisalat into a regional superpower,
with 150 million connections in the
Middle East, Africa and Asia.
All the while Europe’s biggest
mobile operator, Vodafone, is
offloading non-core assets: in
NETWORK STRATEGIES
September it sold its 3.2% stake in
China Mobile for £4.3 billion and
with barely a whisper in November
offloaded its interests in Japan’s
Softbank for £3.1 billion.
In mobile, at least, the global
balance of power is shifting towards
the BRIC countries and the Middle
East. That is sure to be reflected in
Total Telecom’s Global 100 ranking of
fixed and mobile network operators
going forward. This year’s Global
100 marks the fall of Zain and
charts the major risers and fallers,
as we show in our extract on p.8.
Mobile M&A has been matched
by LTE activity this year (TT Plus
July/August). That is shown in the
weight of coverage in our Timeline
Review of the Year on p.19 which
rounds up many of the critical
events in telecoms in 2010.
As well as being the year that
LTE rollouts began, operators and
governments have been grappling
with business models for nextgeneration fibre networks. On p.11
two fibre experts set out the typical
costs for NGA architectures based
on their detailed studies.
Of course, new fixed and mobile
architectures will be crucial to
support new services. Many of them
will be delivered in the cloud, but
operators are not necessarily best
placed despite their network assets
(story p.2). And our Technology
Trends this month shows just how
vital policy management will be to
delivering mobile data services. n
New partnership deals
show telcos are raising the
stakes to provide cloud
services to enterprises.
technology trends
6 Policy
management
Mobile operators needing
to better manage data
traffic flow and improve
service quality are looking
to policy management.
operator ranking
8 Global 100
An extract from Total
Telecom’s ranking of the
world’s biggest network
operators, plus figures on
the latest revenue and
capex trends.
business and finance
11Fibre economics
Two experts reveal their
studies into the cost of
building next-generation
access fibre networks
timeline
16Reviewing 2010
A look back at some of the
key business, network and
people events this year as
documented in our
monthly Timelines
statistics
27Prime numbers
A breakdown of IPTV
subscribers worldwide in
Q3, network equipment
growth, new LTE revenue
and subscriber forecasts,
and mobile handset sales
nEtWORK stRatEGIEs
CLOUD SERVICES
JOInInG FORcES
new partnership deals show telcos are raising the stakes to provide cloud services to
enterprises, but so too are aggregators and Internet powerhouses. By Ingrid lunden
T
elcos hoping their infrastructure
will give them an advantage in
cloud computing face a threat
from upstarts building or aggregating
their own network assets. Virtual network
operators and IT and Internet powerhouses are muscling in and aim to
compete with operators both on cost and
service levels.
but those same companies could also
give telcos a boost in providing cloud
services to their enterprise customers.
Indeed a spate of partnership announcements in October and November indicates
that operators are raising the stakes in
the enterprise market.
cloud-based services for enterprises
will generate revenues of uS$35.6 billion
globally by 2015, up from $12.1 billion in
2010, forecasts Analysys Mason. but mass
adoption of cloud computing by enterprise customers is still a long way off.
Telcos hope their early entry into enterprise cloud services will help them to reap
the benefits. Indeed, now could be the
time to step up offerings: 2011 will mark a
jump in the growth of enterprise cloud
service revenues, of 43%, says Analysys
Mason, but that growth will fall dramatically in subsequent years (see chart p.4).
Already telcos are turning to global IT
providers to help speed cloud service
launches. IbM in October launched cloud
Service provider, a carrier-grade set of
hardware, software and services based on
its Service delivery Manager platform
and designed to help operators deliver
cloud services to business customers. IbM
claims it can help telcos reduce the time
to launch new cloud services—such as
virtual desktop management, storage,
hosting or applications-as-a-service—
typically from six months to six weeks.
Orange and SK Telecom are among operators testing the service, with the former
using it to trial infrastructure-as-a-service offerings for enterprise customers.
Also in October, colt announced a
partnership with unisys to deliver cloud
2
services. unisys will implement cloud
computing technology in six new colt
data centres to enable both companies to
deliver cloud-based services to their
customers across Europe.
And in the same month, in Spain
Telefonica announced a “virtual desktop”
offering for fixed and mobile terminals
using cloud technology from NEc. The
two have already been working together
for a year on Telefonica’s software-as-aservice (SaaS) offering Aplicateca, aimed
at SMEs and large enterprises. Jaime
Serrano, cEO of NEc Iberica, says the
Spanish operator is looking to extend the
product to the rest of its European and
latin American footprint.
“I think that we are still in the earliest
stage of this market,” says Serrano. “We
are in phase zero/one of deployment. It’s
very cost effective, easier and cheaper for
customers, but phase two/three will be
much more. cloud will help society do
more than just IT; it can help with administration, traffic and many other things.”
Analysts say there is a growing opportunity for telcos to act as “cloud
brokers”—intermediaries between end
users and cloud providers, delivering
services ranging from SlAs with multiple vendors to compliance and security.
Gartner predicts 20% of all cloud services
will be handled by brokers by 2015, with
total global cloud services revenue reaching $148.8 billion a year earlier.
capgemini in cloud computing: The
Telco Opportunity, singles out other areas
of operator expertise including on-demand
hosting; SaaS enablement; on-demand
computing and storage; security; unified
communications; billing; and delivering
wholesale capacity for regional cloud
operators. “Enterprises and governments
spend nearly uS$2.4 trillion worldwide on
IT products and services, many of which
can be delivered from the cloud,” says the
report. “Within the enterprise segment
telcos are aggressively targeting SMEs
due to the growing interest in this segment
for cloud-delivered software. SME share
in overall cloud services revenue is
expected to increase from 25% to 40%
between 2009 and 2015.”
certainly, telcos should be a perfect fit
for cloud services: they have both the
network and the existing customer relationships delivering data connectivity to
businesses. but telcos that do not own
network are also eyeing the opportunity,
claiming they can provide greater flexibility and lower pricing: virtual network
operator Virtela since June has been
offering cloud infrastructure services—
ranging from application acceleration to
security solutions—that it claims can
provide a cost reduction of up to 80% on
companies’ premises-based services.
That competition is set to intensify:
Gartner estimates that by 2015 20% of
non-IT Global 500 companies will
Cloud offerings from telecoms operators
telco
BT
Orange Business Services
Deutsche Telekom/T-Systems
TeliaSonera
Belgacom
Telefonica
aT&T
Verizon Business
Telstra
SK Telecom
nTT
Bharti airtel
Tata communications
saas
✓
✓
✓
✗
✗
✓
✓
✓
✓
✗
✗
✗
✗
Iaas
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
Paas
✗
✗
✓
✗
✗
✗
✓ (planned)
✗
✓ (planned)
✓
✗
✗
✗
Source: capgemini TME Strategy Lab
www.totaltele.com December 2010/January 2011
NETWORK STRATEGIES
themselves be cloud service providers, as
they deliver their core services via the
cloud and move into the value chain.
The good news for network operators:
cloud-based infrastructure services are
growing in importance. Analysys Mason
says the majority of cloud services today are
based around software-as-a-service (SaaS),
accounting for 70% of the market; infrastructure-as-a-service (IaaS)—outsourcing
network, servers and storage—accounts for
30%. But the balance will shift by 2015, with
IaaS growing to a 40% share. New figures
from Gartner forecast worldwide SaaS
revenues within the enterprise application
market will reach $9.2 billion this year.
Approaching cloud services with
network-style guarantees could become a
key point of differentiation and one from
which telcos could profit. “What I consistently hear is that enterprises of all sizes
right now [are seeing] a reluctance from
cloud service providers to take on the
risk. Those providers don’t want to sign
up to the kind of SLA offerings that telcos
always have offered for their traditional
services,” says Craig Wilson, VP of global
telecommunications at IBM. “Is there a
demand for committed, differentiated
SLAs? Yes, definitely.”
Reflecting that, a new survey conducted
by IDG Research for managed service
provider Savvis found 60% of respondents considered it “extremely or very
challenging” to get a cloud computing
service to fit business needs, while 62%
said security was a key concern. IDG
surveyed 172 CTOs, CIOs and IT managers in enterprises globally.
Virtela says it offers a “250 percent”
money-back guarantee for companies
which don’t see their applications become
5%–25% faster using its cloud platform.
“The traditional model for application
services was around a managed service
provider offering equipment and
focusing this around uptime,” says Ron
Haigh, VP for cloud services and architecture at Virtela. “It’s important and we
still have SLAs for this, but now the bar is
higher: It’s not just ‘will it perform better’,
but ‘will it have a meaningful impact?’”
Virtela says IBM is one of its big partners
using its platform to provide cloud services, packaging them with its own SLAs.
But while telcos and VNOs are busy
partnering with IT companies to launch
cloud services, some say they will face
stiffest competition from Internet and IT
powerhouses already cutting their margins
fine to pick up business (see box p.5).
“The [biggest] threat [comes from]
companies like Amazon, Microsoft and
Google,” says Andrew Greenway, global
cloud computing programme lead at
Accenture. “I don’t think the telcos would
have traditionally seen them as competitors, but in cloud the huge scale of
investment they are coming in with, and
Incorporated in 1997, with a tax holiday up to FY 2018, Lanka Bell Limited
(LBL) is Sri Lanka’s leading CDMA 2000-1X (fixed line) operator that also
offers WiMAX IEEE 802.16 d data services on the 3.5G spectrum, via 509
base stations and 65 branch offices throughout Sri Lanka.
INVITATION FOR
EXPRESSIONS
OF INTEREST
KPMG in Sri Lanka
LBL is connected to the 65,000 km long FLAG Global Undersea Fiber
Optic Network that connects all continents of the World, as well as to
the 88,000 km long Reliance Domestic Terrestrial Network covering
the length and breadth of India. LBL owns and operates the sole
landing station of FLAG in Sri Lanka.
Having established a strong brand name, LBL was awarded the “Peoples
Fixed Line Telecommunication Service Brand of the Year” at the Annual
Peoples Awards 2010 organized by the Sri Lanka Institute of Marketing
and AC Nielsen.
The shareholders of LBL invite telecom operators and/or investors
to submit their expressions of interest to acquire 99.99% of the company.
Such expressions of interest should be addressed to the Financial Advisors,
KPMG Ford, Rhodes, Thornton & Co., on or before 31st December 2010.
All communication should be directed to:
Reyaz Mihular
Partner – Head of Financial Advisory
KPMG Ford, Rhodes, Thornton & Co.
32 A, Sir Mohamed Macan Markar Mawatha
Colombo 00300
E-mail: lk-fmlankabell@kpmg.com
(c) 2010 KPMG Ford, Rhodes, Thornton & Co., a Sri Lankan Partnership and a member firm of the KPMG network of independent
member firms affiliated with KPMG International Cooperative (”KPMG International”), a Swiss entity. All rights reserved.
December 2010/January 2011 www.totaltele.com
3
nEtWORK stRatEGIEs
Enterprise cloud service growth
45%
35
40%
30
35%
30%
25
25%
20
20%
15
15%
10
10%
5
2% managed service providers
US$0.5 billion
23%
communications
service providers
US$8.2 billion
Year-on-year growth rate
Revenue (U$ billions)
— Growth n Vendor-driven n Registered IT partners
n Managed service providers
n communications service providers
40
to get them very cost effective. They will
need to virtualise everything and offer
sophisticated services, because that is
what can now be bought. That is a big
challenge for them.”
When it comes to the enterprise cloud
market Analysys Mason estimates that by
2015 telcos and managed service providers together will take 25% of revenues
(see pie chart). Registered IT and applications partners—such as agents, systems
integrators, dealers and direct market
resellers—will account for 39% of this
end-user-generated revenue; while IT
and applications vendors (such as
Salesforce.com) will generate 36% of the
revenue, either through Web-based sales
or dedicated account representatives.
IT and integration skills, as well as
network assets, are becoming an intrinsic
part of the cloud computing play, particularly when one company is unlikely to
be able to provide all the components.
Enterprise cloud revenues, 2015
39%
Registered
It partners
US$14.0 billion
36%
vendor-driven
US$12.9 billion
5%
0%
0
2010 2011 2012 2013 2014 2015
Source: analysys Mason
Source: analysys Mason
their cost points, are way below what
telcos are used to.” Greenway says he
recently went through a cloud benchmarking exercise with a telco client,
comparing it with other telcos and against
other providers: “Just trying to do some
bottom-up calculations, the telcos were
totally out of line [cost-wise],” he says.
“So for telcos to launch these services
successfully, they will need to…get their
house in order, and if they want to offer
those services themselves they will need
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NETWORK STRATEGIES
“It’s still a recent and fragmented
market with many players,” says Alex
Rigaldo, head of the cloud computing
programme at Orange Business Services.
“When a customer wants to put an app
into the cloud they need to find the right
player, specific support, billing and so on.
That’s okay for one or two applications,
but when it comes to placing all your IT
into the cloud it becomes a nightmare.”
As a result, IT services companies are
snapping up cloud integration specialists
to address the problem. In November,
Dell announced the acquisition of Boomi,
which sells a platform to integrate enterprise data from cloud applications with
on-premises applications. That followed
IBM’s purchase in May of cloud software
integration company Cast Iron Systems.
NEC, in an interview with Total
Telecom in November, claimed operators
lack the IT skills necessary to succeed in
cloud computing. “Most operators don’t
have a clue about how to combine IT
services with their network and then
operate it as a [cloud computing] business,” said Toshiyuki Mineno, senior VP
at NEC. Mineno also expressed doubts
over cloud service and virtual network
operators (VNOs) that don’t own their
own infrastructure but deliver aggregated services or services over the public
Internet. “Google, Salesforce.com and
Amazon are competitors to the operators
because they’re utilising their networks
but also taking revenue from them,” he
said. “[But] they cannot provide carriergrade services or guaranteed SLAs.”
Indeed, operators are fighting back and
say their network infrastructure gives
them a key advantage. “Most enterprises
would not trust a public cloud for critical
applications,” says Rigaldo at Orange.
“We are positioning ourselves as a trusted
intermediary, a single place where people
can buy and use online all cloud services,
and potentially migrate to more professional services.” Like other operators
Orange is partnering with third parties
for applications and infrastructure, such
as the alliance it struck in September with
Cisco, VMware and EMC to provide
cloud services with end-to-end SLAs.
Rigaldo says Orange has picked up 100
Net gains: Internet powerhouses maintain their lead
Cloud services were effectively kicked off by Internet companies, and they are still the ones
running with the ball. “In SaaS the leader is Saleforce.com, with Amazon coming up swiftly
behind,” says Haigh at Virtela.
Salesforce.com in November beat analyst expectations by posting revenues of US$429
million, a 30% increase compared to the same quarter a year earlier. Marc Benioff, the CEO,
says the company is on track to make US$2 billion in revenues in 2012.
Amazon, which started its Web Services division four years ago and now offers a range of
cloud-based applications and infrastructure services, in November announced it is adding a
new “supercomputing” component, which businesses can use to boost processing power
for application development, computations or data-heavy instances. Amazon—which uses
a mix of the public Internet and virtual private networks to provide services—is well known
for being one of the most competitive in terms of pricing for its services, and for having one
of the widest ranges of offerings. UBS forecasts that Amazon Web Services will have sales
of US$500 million in 2010, rising to $750 million in 2011. The company also offers SLAs for
Elastic Compute Cloud (EC2), its primary cloud computing service.
Google also has big ambitions in this market and could partner with telcos that don’t
directly compete on the applications front to deliver services. “There is nothing I can disclose
on Google today, but we are talking to them regularly; they are talking to all of us [telcos]
regularly,” says Alex Rigaldo, head of the cloud computing programme at Orange Business
Services. “The IT market is very difficult to break into for large companies” that don’t have
the channel partnerships established to target enterprises.
cloud customers since launching in June
2009, and already has one big customer
on its books for integration/aggregation
work: “A luxury brand, with more than
30,000 employees worldwide…We’re
putting together a single application store
to be accessed via laptops and desktops.
We give a single interface where each
employee has access to all collaboration
services either from Orange or third
parties such as WebEx, and some operated by the customer itself. We give
different service levels depending on the
user’s profile, and we bill on what has
actually been used.”
In December Orange Business Services
Global IT cloud services growth
n Infrastructure-as-a service n Platform-as-a-service
n Software-as-a service ● CAGR
$17.4
billion
21%
3.7
10%
1.7
$44.2
billion
37%
35%
69%
12.0
2009
12.8
29%
5.8
13%
25.6
58%
21%
2013
Source: Capgemini TME Strategy Lab
announced Business VPN Galerie, a
service that connects enterprises to cloud
service providers’ applications through
the operator’s IP virtual private network,
promising end-to-end SLAs.
Operators such as AT&T, Verizon,
T-Systems and BT have been offering
cloud services for some time (see table
p.2). But in addition to Orange, the past
few months have seen a succession of new
or revamped cloud launches from telcos.
In the US, for example, Verizon in
November announced it will be beefing
up its own unified comms/collaboration
products with Microsoft’s SME-focused
cloud offering, Microsoft Online Services.
Verizon claims that using these services in
the cloud could cost users up to 40% less
than equivalent on-premises services.
But in the longer term, some think
carriers’ network assets will not be a
guarantee of success. “I think Amazon
has proven that you don’t need to own
your own network to be a leader in cloud
services,” says Haigh at Virtela.
UK VNO Azzurri Communications has
yet to launch a cloud service, but CEO
Mark Quartermaine says this will be
coming. “I can see the scenario where a
CIO is buying a hosted solution. That
becomes an opex- or utility-based model
that can be flexed up or down, buying
capacity for peak demand,” he says. n
5
TECHNOLOGY TRENDS
POLICY MANAGEMENT
THE BEST POLICY
Mobile operators needing to better manage their data traffic flow in order to improve
congestion and service quality are turning to policy management. By Roy Rubenstein
P
olicy management is becoming a
key technology for mobile operators as they tackle rapid data traffic
growth in their networks: The ability to
adapt a subscriber’s session enables operators to address traffic congestion and
ensure service quality. But policy management is also enabling operators to be
more creative in their service plans and
even to deliver services consistently irrespective of the access network.
Fixed broadband networks have for
some time used policy enforcement rules
to control end-users’ services: for
example, to enable parental control, and
to ensure fair-usage by blocking the
minority of users that hog network capacity. But it is mobile broadband that is
predominantly forcing operators to
embrace the technology, to manage traffic
congestion and enable new services.
Susie Kim Riley, chief marketing officer
at Tekelec, says she recently attended a
conference where Vodafone presented
graphs that showed the benefits it is experiencing from implementing the vendor’s
policy infrastructure. “They were rather
dramatic,” she says. “As soon as they
started implementing [policy management], the network growth started to
taper off because they were actively
managing their network peaks.” Vodafone
has managed to reduce peak traffic by
16%–24%, claims Riley.
EU legislation has also been a catalyst
for operators to embrace policy management, though use in mobile networks is
still in its infancy: Since July EU operators must inform users when they are
approaching a €50 roaming limit. “Policy
helps provide transparency into that
usage but also manages the gating mechanism,” says Jonathan Downey, director
of product marketing, Openet. “When
you hit that limit it cuts you off and redirects you to give you service options.”
Policy management resides in the
network’s control plane, and oversees the
data plane where packets are analysed
6
using techniques such as deep packet
inspection (Total Telecom Plus, May 2010)
and processed. Such packet processing
includes assigning bandwidth, setting
priority based on a packet’s class, or
blocking a flow.
Once informed about a new flow, policy
management defines the rules to be
applied to the packets based on the
subscriber’s data. “It could be for a particular application, it could be time-of-day
based, it could even be location-based;
there are all sorts of things you can put in
to change the way [a flow] is treated,” says
Peter Mottishaw, principal analyst at
Analysys Mason.
Fixed networks use policy management
to block some peer-to-peer traffic without
impairing legitimate peer-to-peer usage.
Such applications have used static policies provided by system vendors as part of
their switches or routers, says Shira
Levine, directing analyst, next generation OSS and policy at Infonetics
Research. “[Now] policy is becoming
more dynamic, capable of making realtime decisions, and is moving out of the
network infrastructure into a more independent IT solution,” she says.
A key policy networking block is the
policy charging and rules function (PCRF)
which performs the policy management
based on configured rules. “The PCRF is
about real-time control, the ability during
Business drivers for policy control
Reduce network
congestion
Increasing revenue
per user
Delivering tiered
services
Building out
IMS compliant
architecture
Regulatory
compliance
0%
20%
40%
60%
80%
Percentage of service provider respondents: 25 large telcos
questioned globally, representing 28% of global revenues
Source: Infonetics Research
a session to dynamically change its
attributes so that the subscriber can have
a good user experience for a multitude of
applications,” says Riley.
The PCRF interfaces to the policy
enforcement which enacts the rules on
traffic. Policy enforcement can be implemented in a variety of platforms including
the gateway GPRS support node (GGSN),
routers, and standalone deep packet
inspection (DPI) platforms. The PCRF
also interfaces to the subscriber profile
repository (SPR) which holds information
on what a subscriber is entitled to. When
a user signs up to a service, the operator’s
provisioning system informs the SPR of
the subscriber’s profile.
It is the more demanding requirements
of mobile that are driving policy management innovation. While parental control
and fair usage are now being applied to
mobile as they have been in fixed
networks, mobile has more variables to
consider. These include terminal types, a
scarcer radio channel resource, and location—whether a user has access to WiFi
or is roaming.
Yves Bellego, head of network strategy
at Orange, describes policy management
as one of a set of features the operator is
exploring across its networks for traffic
management and ensuring quality of
service (QoS). Orange’s focus is on wireless, but policy management is already in
use for its wireline services to enable
parental control of content. For mobile,
Orange is using the technology to enact a
fair-usage policy, downgrading a user’s
download throughput once they exceed
their monthly quota.
Orange says its next step is tackling
QoS management. “The need to ensure
traffic management is a short-term need
for wireless, while QoS arises because we
have very different services going over
the air simultaneously, whether for the
same customer or for different ones,” says
Bellego. Such functions require policy
management in the form of an installed
TECHNOLOGY TRENDS
PCRF, and QoS processing in the radio
access network, says Bellego.
Ericsson says QoS management will
become increasingly important as more
machines and m2m devices—it forecasts
50 billion globally by 2020—are connected
to the mobile network. Soft-drink vending
machines and high-definition security
cameras have differing requirements, for
example: vending machines are low data
requirements that send bursts to update
their status in the early hours; but when a
security camera is triggered, it is a highcapacity, high-priority stream.
“If the current state is characterised by
a larger variety of people with differing
demands, the next wave will be an even
larger variety of connections, not just [to]
people but [also to] machines,” says Jan
Häglund, VP and deputy head of product
area IP and broadband at Ericsson.
Orange’s Bellego and his team are
exploring differentiated services. “We
recognise this is technically feasible.
However, is there any interest in doing it
[from a business perspective]?”
Policy management vendors are hoping
their case studies can convince operators.
Bridgewater Systems says one European
operator is introducing a ‘happy hour’
where users can download all the data
they want between the hours of 8pm and
9pm independent of their plan. Another
operator customer is implementing tiered
roaming plans whereby rates are cheapest
if the user is in a neighbouring country.
What’s more, selling a data plan to new
devices such as the Apple iPad tablet, for
a set time and a given quota, becomes
more straightforward using policy.
“Policy enables data plans in more flexible ways,” says Downey at Openet.
Operators are also working on service
plans where the monthly download quota
does not depend on the access network:
for example, capping it at 10 Gigabytes
per month irrespective of whether it is
downloaded over fixed, WiFi or mobile.
“Our target at the end is something that
is converged between fixed and mobile,
but in the short term what we have is
mobile data traffic increases and some
specific issues with that,” says Bellego.
Policy also gives operators a way to
Content challenges: telcos need to better analyse their customers
Service providers must improve their ability to analyse customers’ requirements as well as
their billing systems if they are to exploit new content-based business opportunities. That
is a key finding of a study commissioned by Oracle Communications that surveyed 50
media players and 50 wireless and wireline service providers in EMEA. “In telecoms, 82% of
service providers are looking to offer focused offerings to customers but only 12% are able
to execute against the analysis of customers’ behaviour in order to understand what to offer
those people,” says Gordon Rawling, director of EMEA marketing at Oracle.
The report found that only 16% can provide detailed insight into a user’s behaviour. In turn,
46% can make recommendations based on customers’ current interactions. Yet telcos are
keen to provide users with content through partnerships with IT and Internet firms. Already
82% have such partnerships and all expect to grow their offerings via mobile apps, Internet
portals, sourced content from media and entertainment companies, content aggregators,
social media companies and even creative consumers selling their content.
And as operators grow their content offerings, they will need to improve their ability to
bill customers. Telcos are in a much better position than media providers, says Rawling,
yet 40% still can’t process micropayments, 28% can’t cater for subscriptions while 12%
are unable to process one-off payments. “Telcos have more maturity to service some of
the back-office functions around partnering and around billing,” he says. “But if they can’t
draw together the insights they have and differentiate them back to the consumer and the
[content] partners, they have nothing to monitise and nothing to bill.”
entice users to higher-fee services. Tekelec
says one US operator has a turbo-boost
option that allows users to try a higherspeed data tier. “Some 40% of users that
have tried it have upgraded,” says Riley.
Infonetics’ Levine says Saudi Telecom,
working with vendor BroadHop, has
implemented a parental control scheme
using policy that allows subscribers to
turn off their children’s phones during
prayer times. “Prayer times change
during the year… so it requires a complex
rules decision,” says Levine.
But operators must overcome challenges regarding policy management. “If
you do a bad job of this you can really
upset your customers,” says Mottishaw.
Orange says its biggest challenge is not
just confined to policy: “[It is] managing
the customer and their services over the
various access networks,” says Bellego.
For example, using WiFi for mobile traffic
offloading and delivering a customer’s
services over whatever network is available. “That is not only a question of policy
but also identity management: How to
recognise
the
customer
whether
connected through the mobile network, a
WiFi hotspot, or through the LiveBox at
home,” he says. The step after that is
delivering personalised services with
associated functionalities, adds Bellego.
Operators must also assess the different policy management offerings from
vendors. “Because it is such a hot space
everyone wants to jump on the bandwagon,” says David Sharpley, senior vice
president, marketing & product management, at Bridgewater Systems.
Growing interest in policy control has
seen a significant influx of vendors in the
past three years, with Analysys Mason
counting over 30 offering policy management products. “The danger is if you
don’t think through ahead of time the
overall strategy and how it all fits
together, you could end up with a lot of
incompatible stove-pipe solutions,” says
Mottishaw. “They could look back in five
years’ time and discover they have very
unpleasant legacy [equipment].”
Regulation could also play a significant
part in decisions to implement the technology. “There are definitely technology
challenges,” says Larry Socher, global
lead network practice at Accenture. “But
the bigger deal—take mobile broadband
management—when implementing a
traffic shaping solution is walking a tightrope with net neutrality.”
Tekelec claims operators have also held
back from introducing new creative
features due to uncertainty over net
neutrality. One US operator decided not
to enable a feature that would reduce by
fivefold the download time of a video
over its access network, due to the fear of
the unknown regarding net neutrality
regulation (see TT Plus October: Unequal
Measures). n
7
GlOBal 100
N E T W O R K O P E R AT O R R A N K I N G S
RIsE anD FaLL
Network operator revenues are rising and increased capex is reflecting greater financial
confidence. Meanwhile a spate of M&A activity promises to shake up the ranking order
N
ew figures from analysts show
service provider revenues are on
the increase, and that spending
on key network and service technologies
is also rising. Telegeography says the
aggregated third-quarter revenues of the
world’s 30 largest telcos were uS$309
billion, almost 3% more than in the same
quarter in 2009. for the preceding four
quarters that growth “had been languishing at around 1%”, it says.
but that is not the full picture.
Telegeography says the global telecoms
services market has been growing by an
average annual rate of just over 5% over
the past five years when measured in local
currencies, and forecasts that growth rate
will be halved over the next five years:
“The last two quarters have seen some
aggressive M&A activity come to fruition…Stripping out the revenue impacts
of the major deals, the underlying growth
at the top 30 over the past year has been
more like 2.2%. Even so, that is a reasonably strong bounce back for a mature
telecoms market that has been through
an extremely difficult period.”
Greater financial confidence is reflected
in increased capital expenditure by operators. Strategy Analytics says wireless
capex increased by 1.7% in the third
quarter compared to the same period in
2009, and says that is the first year-on-
year increase in six quarters: “consistent
improvement in operator financial
performance throughout 2010 has finally
flowed through to capex,” says phil
Kendall, director, wireless operator strategies, in a report. Service revenues of
wireless operators increased 4.5% year on
year, while EbITdA increased 3.2%.
Another analyst company, Infonetics,
shows spending by carriers and enterprises on key network equipment is also
rising. Infonetics says wireless lAN
equipment revenue reached $680 million
worldwide in 3Q10, up 12% from 3Q09.
And it says sales of Ethernet switches are
likely to be the highest ever this year, at
$18.5 billion, up 29% from last year.
Quarter over quarter, the worldwide
2G and 3G mobile infrastructure market
grew 2% in 3Q10, to $8.8 billion says
Infonetics, although that is down 20.7%
from 3Q09 “when the market was inflated
by massive 3G rollouts in china”.
china’s operators have boosted revenues as they expanded 3G services, says
Wireless Intelligence. Its ranking of
mobile operators for Q2 also shows how a
shift in power is taking place (see table
below right p.9). The final position in the
table is calculated as a sum of rankings by
connections and revenues. Among the
risers are bharti Airtel, Vimpelcom and
America Movil, while Zain has dropped
Global 100: Top Ten Ranking Winners
Revenue
Revenue rank
company name
Rank 2010
20
change y-o-y
21
(rank in 2009)
Oi (41)
65
16
centuryLink (81)
58
10
Telkom South africa (68)
59
10
82
A
s we went to press with this year’s
Global 100, all eyes were not on
the top of the table—the top five
all retained their places, while there was
just one new entrant in the top 20—but
rather on the middle of the rankings,
where one company’s position belies the
state of flux it finds itself in.
Just three years ago Kuwaiti telecoms
group Zain set out its aim to establish
itself as a top 10 global operator by 2011.
Its lofty ambitions helped push it into
47th place in the revenue rankings in
2009, from 60th the year before, a position it has retained this year. but as that
2011 deadline approaches, a change in
strategy threatens to push Zain out of the
Global 100 altogether.
At the start of this year there were
already signs that Zain was set to break up
Global 100: Top Ten Ranking Losers
Revenue in
Revenue
Revenue rank
company name
Rank 2010
77
change y-o-y
-11
(rank in 2009)
PccW (66)
3,470
41
-9
Vimpelcom (32)
6,076
3,863
85
-7
Eircom (78)
1,828
canTV (69)
3,831
29
-6
Qwest communications (23)
8,588
9
Iliad (91)
1,954
34
-6
Hutchison Whampoa (28)
6,997
28
8
SK Telecom (36)
8,674
71
-6
Level 3 (65)
2,624
37
8
Bharti airtel (45)
6,515
80
-6
Bezeq (74)
2,121
54
8
Brasil Telecom (62)
4,358
81
-6
Windstream (75)
2,090
33
7
Rogers (40)
7,060
43
-5
OTE (38)
5,984
52
6
Telkom Indonesia (58)
4,783
57
-5
Megafon (52)
4,185
euros (m) 09-10
11,948
Source: company data/Diana crossland
8
out altogether, a decline also charted this
year in Total Telecom’s Global 100 ranking
of network operators.
Some market changes are yet to be
reflected fully in the Global 100, which is
based on companies’ last full financial
years. Nevertheless, it remains the most
comprehensive listing of fixed and mobile
network operators, highlighting key
market trends. following is an extract,
and to access the full report and ranking
tables in pdf format click here.
Revenue in
euros (m) 09-10
2,256
Source: company data/Diana crossland
GlOBal 100
rather than expand its operations. by June
the telco had concluded the sale of its
African assets to India’s bharti Airtel for
uS$10.7 billion. looking at the operator’s
service revenue figures for each of its
separate country business units, the 15
businesses divested accounted for 41.4% of
Zain’s revenues in 2009. Without those
operations, Zain would likely have been in
the bottom quarter of the table this year.
further developments mean Zain is
unlikely to feature at all in the 2011 rankings. In early November united Arab
Emirates incumbent Etisalat confirmed
that it has made an offer to acquire 51%
of Zain, subject to certain conditions that
include the sale of Zain’s fourth-largest
revenue-generating unit, Saudi Arabia.
The deal is valued at uS$11.7 billion.
The offer remains conditional, but on
the day it was announced Etisalat chairman Mohammed Omran was already
talking about “unifying our resources
and integrating our networks”.
Etisalat, as a result, is likely to continue
to move up the rankings in 2011, from its
position at number 45 this year. Zain’s
top two revenue-generating businesses
(excluding the divested African operations) in 2009 were Iraq and Kuwait,
which together contributed $2.56 billion
to turnover. Etisalat rose five places in
this year’s ranking from 50th in 2009,
having the previous year held the number
61 spot, one place lower than Zain.
Meanwhile, Zain’s former African
operations should also provide new
owner bharti Airtel with a boost in the
2011 ranking. The Indian operator was
one of the biggest winners in this year’s
table, rising eight places to number 37;
that is 20 places higher than it reached
just two years ago. The addition of Zain’s
African operations could have pushed
bharti Airtel into the top 30.
bharti Airtel is the highest ranking as
well as the fastest rising of India’s representatives in the Global 100, but other
telcos from the country also fared well,
despite intense competition in the mobile
space pushing ARpus down. State-owned
operator bharat Sanchar Nigam ltd
(bSNl) rose four places to 44th in this
year’s
ranking,
while
Reliance
communications was up one to 62nd.
The biggest advances in the Global 100
ranking came in latin America. Oi, which
provides fixed and mobile services in
brazil, advanced 21 places to take the
number 20 position, largely due to the
fact that brasil Telecom was included in
its results for the first time.
portugal Telecom fell by one place to
number 36 in our rankings and could
slide further next year, because its acquisition of Oi is unlikely to offset the loss of
its stake in rival brazilian operator Vivo;
the portuguese incumbent finalised the
sale of its 50% stake in brasilcel, the
holding company for Vivo, to its equal
partner in the venture Telefonica in
September for $9.8 billion. n
Mobile operator rankings, connections and revenues, Q2 2010
Operator-Group
connections
(millions)
1
china Mobile
556.3
2
Vodafone Group
331.4
3
america Movil Group
211.3
4
Telefonica Group
155.0
=5 Deutsche Telekom Group
108.2
=5 Verizon Wireless
99.7
7
aT&T
91.0
8
china Unicom
157.0
9
MTn Group
101.6
10 France Telecom Group
78.4
11 nTT Docomo Group
56.6
=12 Bharti airtel Group
176.9
=12 Telecom Italia Group
75.0
14 Sistema Group
102.4
of which MTS Group
98.8
15 Weather Investments Group
88.7
of which Orascom Group
66.7
16 Vimpelcom Group
89.4
17 Telenor Group
90.8
18 Sprint
48.2
19 Vivo
56.0
20 china Telecom
74.5
Rank
1
2
3
6
8
11
12
5
10
17
24
4
18
9
15
14
13
28
25
19
Revenue
($ millions)
17,715
14,561
6,950
8,851
10,423
14,046
13,186
3,002
3,726
6,858
11,829
2,148
4,534
2,251
2,228
2,409
877
2,289
2,250
6,448
2,315
1,671
Rank
1
2
8
7
6
3
4
17
13
9
5
26
12
23
change
(year-on-year)
—
—
+2
-1
-2
+1
—
+1
+2
-2
—
+4
+1
—
19
+2
22
24
10
21
31
+4
-7
-4
+3
+16
Source: Wireless Intelligence
9
Entries now open
Entry deadline • 18 March 2011
Asia Communication Awards
Celebrating the success of Asian telecoms, globally
Raffles Hotel, Singapore • 22 June 2011
www.asiacommsawards.com
Organised by:
Founding Partner:
asia • communication • awards
BusInEss and fInancE
FIBRE ECONOMICS
cOstInG FIBRE nETWORKS
Ioannis tomkos and sotiria chatzi have carried out studies into the cost of building
next-generation access fibre networks in Europe using different architectures
provide 25-50 Mbps download speeds
with 2-10 Mbps upload speeds.
• Fibre-to-the-cabinet or Fibre-to-thecurb (fTTc), where the street cabinet is
much closer to the user’s premises (typically within 300 metres). for this
architecture, a VdSl2 multiplexer can be
placed at the cabinet to provide 50-100
Mbps download speeds with upload
speeds of 5-15 Mbps.
• Fibre-to-the-building (FTTB), where
the fibre reaches the basement of a multidwelling unit building, and the final part
of the connection to individual apartments/rooms is based on a copper pair. In
this case, either a VdSl2 multiplexer or
an Ethernet switch may be placed at the
basement of the building to provide 100
Mbps download speeds and 10-20 Mbps
upload speeds. The distances of the buildings from the operator’s central office
can be up to tens of kilometres.
• Fibre-to-the-home (FTTH), where
the fibre directly reaches the boundary of
the apartment/housing unit. depending
on the technology used, the distances of
the homes from the operator’s central
office might be up to 20 kilometres, with
the possibility for it to be up to 100 kilometres away. In the case of fTTh, either
an Ethernet switch or an optical network
unit (ONu) may be used at the homes to
provide +100 Mbps symmetric download
and upload speeds, with the capability to
go to 1 Gigabit per second (Gbps) or even
beyond for some technologies.
The fTTh architecture could then be
subdivided into at least two other broad
alternative implementations. In the first
option, home run fibre, a single fibre
connects an Ethernet switch port located
at the central office of the network operator with each individual household in a
point-to-point configuration.
In the second option, known as a star
configuration, a single optical fibre is
used as a shared medium for many enduser connections from the central office
up to a street cabinet or a manhole located
close to the user. from that point onwards,
up to each individual household, a single
optical fibre connection is made.
The star configuration can be subdivided into two other categories based on
The total investment required to meet EU NGA
network targets will be 250-300 billion euros
Comparative NGA infrastructure costs
4500
fttH-P2P/fttc fttB/fttc
5.1
1.7
4000
fttc/fttH POn
3.1
◆ FTTH-P2P ✖ FTTH-GPOn n FTTB ▲ FTTc
3500
capex/user ($)
T
he European union in its digital
Agenda 2020 set as one of its main
targets that by that date all Eu
citizens should have broadband access
above 30 Megabits per second (Mbps),
and that 50% or more households should
have access speeds above 100 Mbps. To
reach those ambitious objectives all Eu
nations will need to develop a comprehensive strategy with respect to Next
Generation Access (NGA) networks.
Advanced optical NGA networks
require huge capital investments due to
the high cost to connect each household,
particularly in less densely populated
areas. In fact the total investment required
is estimated to be in the order of 250-300
billion euros, and will need to be
supported by a mix of public and private
funding (see also Total Telecom plus July/
August). It is widely acknowledged that
targeted policy decisions by governmental bodies—at Eu level, national level and
even down to individual municipalities—
will be mandatory and that some degree
of state intervention and aid will be
required to meet the goals.
Service providers are expected to use a
mix of architectures and technologies,
with cost considerations mostly determining the choice of deployment in areas
with different characteristics—such as
household densities, types of housing
units, available existing infrastructure
and so on.
NGA architectures are differentiated at
a primary level by where the optical fibre
connection, that starts at the central
office of the telecoms operator, terminates. As a result, service providers have
four main architectural options:
• Fibre-to-the-node (FTTN), where
the optical fibre is terminated in a street
cabinet that may be several hundred
metres or a couple of kilometres away
from the customer premises, with the
final part of the connection being a
copper pair. In this case, a VdSl multiplexer can be used at the cabinet to
3000
2500
2000
1500
1000
500
0
0
2000
4000
6000
8000
10000
Household density (households/km2)
11
BUSINESS AND FINANCE
the type of equipment used to distribute
the signals from the shared fibre to the
individual end-users. In the first category, called active star, an Ethernet switch
is used for that purpose. In the second
category, called passive star, a simple
passive optical splitter is used.
In both cases a multiple access control
technique should be used to multiplex
up-stream traffic coming from the
ONUs/homes. Today’s available standards/products (such as GPON and EPON)
use Time Division Multiple Access
(TDMA). In the 2010-2015 timeframe new
standards and products will be available
based on techniques such as Wavelength
Division Multiple Access and Orthogonal
Frequency Division Multiple Access
(OFDMA); and dedicated virtual channels based on Wavelength Division
Multiplexing with direct detection, or
Dense Wavelength Division Multiplexing
(DWDM) with coherent detection.
Another broad categorization of NGA
network architectures is based on whether
or not any active equipment is used somewhere in the field at the so-called outside
plant, in which case it is necessary to
distinguish between active and passive
optical networks. Active optical networks
(AON) rely on some sort of electrically
powered equipment to distribute the
signal (in a point-to-multipoint architecture), such as a switch, router or access
multiplexer. Examples of such networks
are those that use an ADSL or VDSL
access multiplexer in the field—in FTTN,
FTTC or FTTB configurations—or
those networks that rely on the use of an
Ethernet switch placed at a street cabinet
or a manhole somewhere close to the end
users (FTTB or FTTH configurations).
Passive optical networks (PON) also
refer mostly to a point-to-multipoint
architecture, in which unpowered optical
splitters are used to enable a single optical
fibre to serve multiple premises, typically
16-128 households. However, a point-topoint FTTH configuration, where a
single fibre connects an Ethernet switch
port located at the central office of the
network operator with each individual
household, is also a passive network—as
far as the outside plant is concerned.
12
Fibre progress: subscriber numbers and operator rollouts
In the July/August issue of Total Telecom Plus we looked at how governments and operators
are working out the dynamics of funding new fibre networks and outlined subscriber numbers
and forecasts. Since then operators have continued to announce rollout plans (see below).
Figures from the FTTH Council show there were 3.2 million FTTH/B subscribers in Europe by
the end of June (nearly 4.5 million including Russia), compared with 8.6 million in the US and 43
million in Asia. Lithuania leads the way in Europe with household penetration at 21%, followed by
Sweden (12.9%), Norway (12.0%), Slovenia (11.2%) and Slovakia (8.7%). In terms of subscribers
Russia leads the way with 1.2 million, followed by Sweden (569,000), France (371,312), Italy
(347,000), Lithuania (284,4000), Norway (240,689) and the Netherlands (211,500).
In December the OECD also gave new subscriber numbers for its members, showing
that some 12% of all fixed broadband subscribers were fibre/LAN customers at the end of
June this year. That amounted to 34.6 million of the total 294 million broadband subscribers.
Japan and South Korea lead the way among OECD countries, with fibre accounting for
55% and 52% of all broadband connections respectively. Next come the Slovak Republic
(28%), Sweden (25%), Norway (14%) and Denmark (12%). The US had just 5% household
penetration, Germany 1%, and France, Spain and the UK below 1%.
Among recent operator and government plans:
• Italian operators Telecom Italia, FastWeb, Wind, Vodafone, Tiscali, BT and 3 are proposing
to build a nationwide open access fibre network using public and private funds
• The German government plans to provide three-quarters of households with broadband at
speeds up to 50 Mbps by 2014, working with Deutsche Telekom and corporate companies
• Softbank floated a JPY500 billion (E4.5 billion) plan to build a nationwide fibre network in
partnership with rival operators NTT and KDDI
• The Australian government issued the business plan for the A$35 billion National Broadband
Network, including Telstra’s agreement to sell its nework to the building company
• The UK government increased public investment in high speed broadband from £200
million to £830 million to provide speeds of 24 Mbps by 2015
• Telecom New Zealand was selected as a preferred bidder to build three-quarters of the
country’s NZ$3 billion (US$2.2 billion) open access fibre network
• India is planning a national fibre network costing INR600 billion (E10 billion)
Comparing architecture costs
Point-to-multipoint network architectures—FTTC, FTTH active star, FTTH
passive star—reduce the amount of fibre
and central office equipment required
compared with point-to-point—FTTB,
FTTH home-run fibre—architectures.
The home-run FTTH point-to-point
architecture, since each fibre is dedicated
to each end-user, results in very high
outside plant (OSP) costs, due to the need
for more fibres as well as more/larger
ducts and larger trenches to host them.
The cost benefit from FTTH point-tomultipoint architectures stems from the
fact that the feeder fibre is shared among
many end-users depending on the splitting ratio. The cost benefit depends on
the amount of sharing implemented at
the feeder fibre cable (i.e. which depends
on the splitting ratio). High splitting
ratio PONs can lead to reduced OSP costs
and make this architecture/technology
option comparable, in terms of OSP costs,
to FTTB and FTTC—although of course
these architecture options cannot achieve
the same level of performance in terms of
download/upload speeds as FTTH.
The point-to-multipoint FTTH passive
optical network (FTTH-PON) solution is
appealing to many network operators,
and particularly incumbents, due to its
capex and opex saving attributes. In addition, compared to FTTH point-to-point
and FTTB/FTTC architectures based on
active Ethernet and VDSL technologies
respectively, it offers a greener solution
due to the fact that it requires lower
power consumption.
We have carried out a techno-economic
study to investigate the projected OSP
costs for FTTC, FTTB, FTTH homerun fibre and FTTH passive star
architectures. OSP costs account for some
70%-80% of the total costs of deploying
new fixed infrastructure, but associated
deployment costs for the OSP vary significantly depending on the architecture
choice and the density of households at
the deployment area. Our analysis reveals
actual cost values for each architecture
and for a wide range of household densities at a deployment area.
For the estimate of the OSP capex per
BusInEss and fInancE
user, we have considered the actual
deployment methods of a fibre network
and the components needed to create the
infrastructure. We assumed that the
fTTx network forms part of an existing
access network, connecting a large
number of end-users to a central point,
the central Office (cO) or Access Node.
The cO contains the required active
transmission equipment used to provide
the applications and services over optical
fibre to the subscriber.
The fTTx OSp infrastructure elements
considered are: the feeder cabling, the
primary fibre concentration points, the
distribution cabling, the secondary fibre
concentration point and the drop cabling.
The handholes or manholes that house
the splitters are considered as the primary
fibre concentration points and the
secondary concentration points are the
y-branches that help disjoin the drop
cables (see cost table).
The prevailing installation method for
underground fibre cables involves the
creation of a duct network to enable
subsequent installation of cables by
pulling, blowing or floatation techniques.
This network comprises a combination of
large main ducts that contain smaller
subducts for individual cable installation
and further microducts for the installation of a single cable for the drop part of
the network. for our purposes the fibre
installation has been considered to take
place using the blowing technique.
The cost estimates are based on individual components and civil work costs
and were provided by construction and
telecoms operators. The potential deployment area considered is one with a mixture
of multi-dwelling units and single-dwelling units and with a varying density of
households per km2. The deployment
considered is based on a geographic model
already used in previous investigations.
The feeder part of the network is
deployed in big trenches with a capacity
of 56 high fibre count cables, inside subducts for easy installation and
replacement. The distribution part of the
network is parcelled according to the
density of the area into smaller ducts
varying from 144 low fibre count cables
capacity to 48 low fibre count cables.
These are used between the splitter and
the y-branches. The drop part is implemented within a pavement trench with
higher cost, by microducts containing 1,
2, 8 or 12 fibre cables.
for the estimate of capex per user and
as far as the OSp is concerned, we considered the total length of the different
types of trenches, ducts, subducts and
fibre cables, the total number of handholes/manholes, splitters and y-branches
OSP material/installation costs
description
HDPE duct – (24 micro tubes)
Manhole
Handhole
96 - fibre cable
72 - fibre cable
12 - fibre cable
8 - fibre cable
Microcable- 1f
Y-Branch unit
Trench I
Trench II
Microtrench I
Microtrench II
Pavement trench
HDPE duct in trench
cable in subduct
Splicing
unit
m
m
m
each
each
m
m
m
m
m
each
m
m
m
m
m
m
m
each
$
2.25
2.2
0.75
500
400
2.8
2.1
1.1
1.1
0.3
35
25
20
16
14
35
0.55
0.45
5
Source: construction companies/telecoms operators
needed, their total cost and the cost of
their installation.
The results of the techno-economic
model for the various fTTx architectures, in terms of the OSp costs, are
shown in the chart on p.11. As can be
seen, the OSp costs differ significantly as
a function of the household density at the
considered deployment area—depending
on the type of area: rural, urban, dense
urban and so on.
There is also a significant cost benefit
of the fTTh point-to-multipoint pON
architecture compared to the fTTh
point-to-point Ethernet one. The fTTh
point-to-point Ethernet architecture is
about five times more costly than the
fTTc case when considering only the
OSp costs; while the fTTh point-tomultipoint pON architecture is about
three times more costly than fTTc.
legacy fTTh point-to-multipoint pON
with low splitting ratio capability is still
much more costly than typical fTTb and
fTTc deployments. however, significant cost reductions are expected with
future high-splitting ratio pONs. n
Ioannis Tomkos is resident professor at the
Athens Information Technology Centre, and
Sotiria Chatzi is a research scientist there.
Both participate in EU fibre projects/research
13
freedom
The feeling of
www.worldcommsawa
Sponsors:
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to all the winner’s
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Best Customer Care • TeliaSonera International Carrier
Best Global Operator • BT Global Services
Best Managed Service • Orange Business Services
Best Mobile Device Strategy • Novatel Wireless
Best Mobile Operator • Bharti Airtel
Best New Service • Verizon Business
Best Operator in a Developing Market • Digicel
Best Project Management • Orange Business Services
Best Regional Operator • Interoute Communications
Best Wholesale Carrier • BT Wholesale
Team of the Year • Roshan
The Alireza Mahmoodshahi Technology Foresight Award • BT Group
The Green Award • BT Group
m
Users’ Choice • Verizon Business
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ards.com
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24 November 2010
The London Hilton on Park Lane
2010
TIMELINE
A roundup of the major stories
in telecoms in the past month,
as reported in our daily news
service www.totaltele.com
Business
Vodafone sells in Japan
Vodafone said it will sell off its
interest in Japan’s Softbank for
£3.1 billion, receiving £1.6 billion
in December to pay down group
net debt and a further £1.5 billion
in April 2012. Vodafone also said
it will introduce tiered mobile
data tariffs as well as cross-border
data roaming tariffs in Europe.
No net neutrality in Europe
The European Commission
ruled that it would be counter
productive currently to introduce
net neutrality laws in the EU.
its final round of funding. The
company aims to provide “fibre
quality” broadband services
in developing markets in Asia,
Africa, Latin America and the
Middle East.
The company has R&D,
manufacturing and services
operations in China.
Telepresence agreement
BT and AT&T said they will work
together to provide telepresence
services to corporates.
Australian MVNOs
Lycamobile launched an MVNO
operation in Australia using
Telstra’s network and focusing
on low-cost international calling.
Another MVNO, Amaysim, was
launched by the founders of
Simyo using Optus’ network.
The governments of Spain and
Portugal held preliminary talks
about removing roaming charges
between the two countries.
Etisalat 3G licence
US mobile payments venture
The German regulator said it will
cut mobile termination rates by
half, effective from 1 December.
AT&T Mobility, T-Mobile USA
and Verizon Wireless formed
a joint venture, Isis, to enable
contactless mobile payments and
mobile commerce services using
NFC technology.
KPN joins with Telefonica
Ericsson buys in China
KPN and Telefonica struck
a deal to provide services to
multinational companies in over
20 markets. It follows a similar
deal between Telefonica and
Telenor in September.
Ericsson acquired certain assets
of the Guangdong Nortel
Telecommunication Equipment
Company for US$50 million.
German MTRs slashed
Roaming talks
Etisalat acquired a 3G licence
for its operations in Nigeria
by purchasing Alheri Mobile
Services.
NETWORKS
LTE launches worldwide
2010 Q2
2009 Q4
2009 Q2
2008 Q4
2008 Q2
2007 Q4
2007 Q2
2006 Q4
2006 Q2
2005 Q4
n Hong Kong n Toyko n London n New York
2005 Q2
$/Mbps/Month (US$)
$100
$90
$80
$70
$60
$50
$40
$30
$20
$10
$0
Source: TeleGeography
The other three billion
Google-backed satellite operator
O3b Networks is set to launch
services in 2013 after securing
16
Sprint Nextel upgrades
Sprint Nextel said it will spend
up to US$5 billion to upgrade its
network over the next 3–5 years,
with Alcatel-Lucent, Ericsson and
Samsung Electronics selected to
carry out the work. The upgraded
network will provide LTE and
WiMAX services.
Major deals for Alcatel-Lucent
Alcatel-Lucent announced fixed
and mobile networking deals
worth around E1.2 billion with
China’s three operators China
Mobile, China Telecom and
China Unicom. And it said it has
won a four-year deal worth $4
billion to update the 3G network
of Verizon Wireless and build
LTE infrastructure.
Median GigE IP transit price, selected cities
Orascom sells in Tunisia
Qatar Telecom and Tunisian
investment firm Princesse
Holding agreed to buy Orascom
Telecom’s 50% stake in Telecom
Tunisia (Tunisiana) for US$1.2
billion. Qtel will make the
acquisition through its majorityowned Wataniya Telecom unit,
which already controls 50% of
Tunisiana.
Operators continued LTE
rollouts: TeliaSonera launched
services in Finland in the cities
of Turku and Helsinki, as well as
in four cities in Denmark; Elisa
also launched an LTE network for
businesses in Espoo in Finland;
CSL became the first Asian
operator to provider commercial
services, in Hong Kong; and Tele2
and Telenor started services in
four cities in Sweden through
their joint network venture
Net4Mobility. Meanwhile Verizon
said it launched commercial
LTE services in 38 markets on 5
December; and NTT DoCoMo
said it will begin operating in
three cities on 24 December. In
contrast, UK regulator Ofcom
said it doesn’t expect to award
spectrum until the end of 2013.
Prices for wholesale Internet access (IP transit) continue to decline even as
international traffic volumes continue to grow more than 60% annually, says
Telegeography. In Hong Kong, the median price for a 1,000 Mbps GigE port has
declined at a compound rate of 15% over the past five years, to $28 per Mbps.
The median GigE port price in New York City has fallen at a compound annual
rate of 22% over the same period, to under $8 per Mbps.
Ericsson contracts
Ericsson signed a three-year
extension deal to manage
TeliaSonera’s networks in 29
countries. The vendor also won a
contract to deploy a 3G network
for Indian operator Aircel,
reportedly worth SEK2.2 billion.
timeline
Huawei deals
Huawei entered talks to manage
and supply equipment for the
African networks of Bharti Airtel
acquired from Zain. And China
Mobile selected Huawei to build
a national optical transport
backbone network.
3G launches in India
Reliance Communications
became the second private
operator to launch 3G services in
India, following Tata Teleservices
in November. Bharti Airtel said
it also plans to launch 3G by the
end of the year.
UK extends broadband plans
The UK government said
it would invest a further
£300 million in the country’s
broadband infrastructure by
2017, setting aside £50 million to
expand into rural areas.
800-MHz spectrum auctions
Sweden and Switzerland said they
will auction mobile spectrum in
the 800-MHz band early in 2011,
following Germany’s sale of the
so-called digital dividend capacity
earlier this year.
Dutch spectrum auctions
NSN changes services head
The Dutch government plans to
hold mobile spectrum auctions
for 800-, 900- and 1800-MHz
frequencies by the start of 2012.
Nokia Siemens Networks
appointed Armando Almeida
as head of its Global Services
unit, taking over from Ashish
Chowdhary who will move
to a newly created position
responsible for operations across
India, Asia Pacific, Japan, Greater
China and the Middle East.
BT 1-Gigabit trials
BT said it will trial 1-Gigabit
broadband over its fibre nework
early in 2011, as part of its £2.5
billion rollout plans.
TDC awards LTE contract
Denmark’s TDC awarded
Ericsson a contract to build and
manage an LTE network.
Ireland spectrum auctions
Republic of Ireland regulator
Comreg said it will auction off
two bands of radio spectrum
next year, and spectrum used for
analogue TV services in 2012.
BSNL awards contract
BSNL shortlisted ZTE and
Alcatel-Lucent to supply
equipment for an additional
5.5 million lines for its mobile
network in India. Huawei and
Nokia Siemens Networks also bid
for the contract which is expected
to be worth INR13 billion.
India minister resigns
3G sharing in Russia
people
India’s telecoms minister,
Andimuthu Raja, resigned after
allegations that his department
cost the country $38.9 billion by
selling off 2G spectrum licences
cheaply in 2008. The Department
of Telecommunications has
threatened to cancel the licences
of some 85 companies.
New iBasis CEO
Ericsson chairman to leave
Willem Offerhaus is the new
CEO of iBasis, the wholesale
international voice carrier
owned by KPN. Offerhaus moves
from VP of sales at KPN’s ICT
subsidiary, Getronics. Current
iBasis CEO, John van Vianen,
moves to managing director of
KPN business markets.
Ericsson chairman Michael
Treschow, who has held the
position since 2002, will resign
next year or in 2012.
Russian operators MTS and
Comstar said they will share
3G network infrastructure in
Moscow. MTS also said it plans to
invest some RUB3 billion to roll
out LTE in Moscow in 2011.
Clearwire cuts headcount
Clearwire continued its costcutting measures announcing it
will cut 15% of its workforce, or
roughly 600 employees, to an
overall headcount of 3,600.
Huawei hires ex Nortel CTO
Huawei appointed former Nortel
CTO John Roese as its new
senior vice president and general
manager of North America R&D.
Earlier in November Sprint
Nextel excluded Huawei and
ZTE from its network upgrade
project following government
concerns over security.
Verizon CTO leaves
Verizon Communications’ chief
technology officer Shaygan
Kheradpir left after 23 years to
become chief operating officer
for Barclays’ global retail banking
division. He will be succeeded by
Anthony Melone who was CTO
at Verizon Wireless.
BTGS shuffles management
BT Global Services appointed
Andy Nicholson to head its
banking and finance team; Neil
Rogers will lead government
and health; Kim McMann heads
consumer packaged goods; and
Bas Burger global commerce.
17
The World Vendor Awards
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Write your winning entry
Entry deadline: Friday 21st January 2011
Do you have what it takes? Enter the World Vendor Awards
and prove you're one of the world's greatest vendors!
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contact Gordon White call: +44 (0) 20 7608 7041 or
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Celebrating Telecoms' Leading Players
5th May 2011 - Swan at the Globe - London
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Organised by:
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tImElInE: BusInEss
REvIEW OF THE YEaR
a roundup of the major stories in telecoms in the past year, featured in Total Telecom
Plus since april and reported in our daily news service, www.totaltele.com
apRil
name in Germany simply to “T”
as part of its aim to integrate its
fixed line and mobile operations
in its home market.
Bharti buys Zain Africa assets
bharti Airtel acquired the African
assets of Kuwait’s Zain, excluding
those in Morocco and Sudan,
for uS$10.7 billion including
debt. The deal moved bharti up
to fifth place in terms of mobile
connections (see chart below).
AT&T healthcare charge
AT&T took a one-off charge
of $1 billion in the first quarter
to account for the impact of
changes in the uS government’s
healthcare overhaul.
EU approves UK mobile merger
The European commission
approved the mobile joint venture
of deutsche Telekom and france
Telecom in the uK. The joint
venture took a market lead with
37% share, ahead of Telefonica
O2 with 27% and Vodafone 25%.
Nokia embraces Skype
Nokia made Skype available as a
free download from its Ovi online
store and for its Symbian-based
smartphones.
Mobinil agreement
TDC-Orange merger scuppered
france Telecom and Orascom
reached a settlement to end their
year-long dispute over joint
venture Mobinil, with the former
agreeing to pay a settlement fee
of $300 million.
The Swiss competition
commission blocked the planned
merger of the mobile units of
france Telecom and Tdc.
Japan LTE handset pact
Japanese mobile phone makers
Sharp, panasonic, fujitsu and
NEc teamed up to develop
an operating system for NTT
docoMo’s lTE phones. The
platform will be compatible with
Symbian and linux.
Ericsson agrees LG deal
Vodafone closes navigation
may
Ericsson agreed to buy Nortel’s
stake in the network equipment
joint venture lG-Nortel. Ericsson
acquired the majority stake of
50% plus 1 share for $242 million,
creating a new joint venture
called lG-Ericsson.
Belgacom eyes energy supply
CenturyTel buys Qwest
Telefonica rebrands
belgacom entered into talks
with renewable energy supplier
lampiris to resell electricity.
centuryTel agreed to buy Qwest
communications International
for uS$10.6 billion in an all-stock
deal to create a new nationwide
fixed-line carrier in the uS,
renamed centurylink.
Telefonica rebranded its mobile
operations across Spain and
latin America using the Movistar
name. O2 remains Telefonica’s
brand name for fixed and mobile
services in northern European.
C&W completes demerger
cable & Wireless completed
the demerger of its two business
units c&W communications and
c&W Worldwide.
Telekom rebrands in Germany
deutsche Telekom cut its brand
Vodafone closed its navigation
business, Wayfinder, some 18
months after acquiring the
Swedish firm for uS$30 million.
Aggregated operators and operator groups, Q409
Rank
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
Group
china Mobile
Vodafone Group
Telefonica Group
america Movil Group
airtel Group (pro forma)
china Unicom
Deutsche Telekom Group
Telenor Group
Sistema Group
(of which) MTS Group
Reliance communications
France Telecom Group
MTn Group
Verizon Wireless
aT&T Group
Telkomsel
total connections (millions)
525,331,266
309,580,257
202,333,430
186,544,900
169,486,523
147,587,000
127,919,986
101,367,838
99,317,515
97,800,700
93,795,614
93,437,439
92,125,000
91,249,000
85,120,000
81,644,000
Dell expands mobile partners
dell signed a deal with Telefonica
to develop mobile products
and services. dell entered
the smartphone market last
November and had already struck
deals with AT&T, china Mobile
and claro in brazil.
UK scraps broadband tax
A proposal to impose a £6
per-year tax on all fixed-line
connections was removed from
the uK’s digital Economy bill.
Netherlands awards licences
Tele2 Mobiel and the joint
venture of Ziggo and upc each
received four licences in the 2.6
Ghz frequency auction in the
Netherlands for next-generation
mobile services. KpN and
Vodafone Netherlands received
two licences and T-Mobile
Netherlands was issued with one.
june
Virgin moves into Middle East
markets
2
23
20
17
18
1
12
10
6
5
1
26
19
1
3
1
Following Bharti airtel’s acquisition of
15 of Zain’s African mobile networks
in april, Wireless Intelligence issued
this research that showed the Indian
operator would become one of the
five largest mobile groups in the world
by subscriber connections. Based on
fourth-quarter 2009 pro forma data,
international (non-Indian) markets will
account for around 30% of airtel’s
total connections following completion
of the Zain deal, said the analyst
company.
source: Wireless Intelligence
Virgin Mobile signed a deal
with Qatar Telecom to operate
a prepaid service in the Gulf
state. The uK operator was part
of a consortium that lost out
to Vodafone in 2007 for Qatar’s
second mobile licence.
Google raises video/TV bar
Google and dish Network said
they will launch Google TV in
the autumn, a service to bring
Web content to TVs.
19
tImElInE: BusInEss
Mobile operator ranking by revenues, 4Q09
Rank Group
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
Revenue
(us$)
china Mobile
18,352,230,420
Vodafone Group
16,119,297,760
Deutsche Telekom Group 14,055,607,800
Verizon Wireless
13,845,000,000
Telefonica Group
13,485,182,535
aT&T
12,600,000,000
nTT Docomo Group
9,988,124,000
France Telecom Group
8,326,130,850
KDDI
7,391,445,700
Sprint nextel
7,192,000,000
america Movil Group
6,944,161,535
Telecom Italia Group
5,172,629,100
SoftBank Mobile
4,813,159,540
Vivendi Group
4,162,326,900
MTn Group
3,655,224,300
SAP snaps up Sybase
German software company SAp
AG made an all-cash bid for Sybase
in a $5.8 billion deal.
Eircom pioneers three strikes
Irish operator Eircom launched
a three strikes policy to cut
off customers if they share
copyrighted music illegally,
becoming the first country to
implement a graduated response
system for illegal file sharing.
july/augusT
calculated
aRPu (us$)
11.66
17.36
36.63
50.58
22.04
48.84
59.97
29.68
78.48
49.81
12.26
23.96
74.05
38.61
13.23
Rank by
connections
1
2
6
13
3
14
25
11
38
29
4
16
50
34
12
unlimited mobile data packages,
instead setting tiered tariffs.
The European court of Justice
ruled that roaming caps brought
in by the Eu are legal and
justified, dismissing actions
brought by Vodafone, Telefonica
O2, Orange and T-Mobile.
Handset merger in Japan
fujitsu and Toshiba agreed to
merge their mobile operations,
creating Japan’s second largest
handset maker behind Sharp.
Reliance communications agreed
to buy India’s largest cable TV
company digicable Network
and merged its Internet TV and
broadband operations.
Versatel sells cable business
Broadband rights in Finland
News Corp pursues BSkyB
finland made broadband services
of at least 1 Megabit per second a
basic right for its citizens in its new
universal service obligations.
News corp made a £7.8 billion
cash offer for the 61% stake it
doesn’t own in bSkyb Group.
German operator Versatel sold its
retail cable business Versatel Kabel
to paris-based financial investors
chequers capital for E66 million.
Motorola splits in two
O2, Orange and Vodafone agreed
to carry out joint trials of broadcast
mobile TV technology IMb in the
uK, to assess how services can be
deployed using shared networks.
Unlimited data plans scrapped
AT&T, O2 uK and 3 uK over
the summer period scrapped
20
sepTemBeR
Telefonica wins Vivo battle
EC roaming caps upheld
Reliance buys TV firm
New mobile TV trials
This table from June showed that
higher aRPU in Western Europe, the
US and Japan enables operators there
to dominate revenue rankings. US
operators Verizon, aT&T and Sprint
nextel would not be ranked in the top
ten when measured by subscriber
connections. US aRPU in 2009 was
around US$50, the second highest
after Japan, while china mobile had
almost twice as many subscribers as
second-placed Vodafone.
source: Wireless Intelligence
Motorola said it will split into
two businesses in the first quarter
of 2011: Motorola Mobility and
Motorola Solutions.
Nokia sells wireless assets
Japan’s Renesas Electronics corp.
reached an agreement to buy the
wireless modem operations of
Nokia for around E160 million.
Telefonica ended its battle to
gain control of brazilian mobile
operator Vivo, buying portugal
Telecom’s stake for E7.5 billion.
Telefonica plans to merge Vivo
with its fixed-line operator Telesp,
giving it 70 million customers
in brazil, a full 25% of its total
customer base.
Intel buying spree
Intel bought Texas Instruments’
cable modem business, Internet
security company McAfee for
uS$7.68 billion, and the mobile
device unit of German chipmaker
Infineon for uS$1.4 billion.
NSN buys Motorola networks
Nokia Siemens Networks acquired
Motorola’s networks business for
uS$1.2 billion.
Vodafone to launch IPTV
Vodafone said it will launch IpTV
services for subscribers in Spain
(and did so in November).
TeliaSonera sell-off prospect
Sweden’s government said it will
reduce the state’s 37.3% stake in
TeliaSonera after winning another
four-year term. In May 2007 the
government divested an 8% stake
to institutional investors for
SEK18 billion (E1.9 billion).
GEttInG caRtER
alcatel-Lucent surprised many
when it appointed Stephen
(Lord) carter as its chief marketing, strategy & communications officer. Carter, formerly
the communications Minister
for the UK government, as well
as chief executive at regulator
Ofcom, took up the newly created position in april. as communications Minister carter
put together the Digital Britain plan, which included the
proposal—not universally welcomed, even by all in the UK
government—to levy a 50p tax
on all fixed lines to help fund
broadband for underserved
areas of the UK. The tax promised to raise up to £175 million per year to fund new network infrastructure in rural
areas, helping with the pledge
to make 2-Mbps services universally available in the UK by
2012. But it was scrapped in
May by the new coalition government, which also pushed
the 2-Mbps pledge back to
2015. carter duly criticised
the decisions and warned of
a funding gap for next-generation broadband services. carter is now turning his attention
to mobile broadband: in March
alcatel-Lucent announced its
Ultimate Wireless Packet core
products designed to help carriers move to LTE networks. In
november it was awarded a
four-year US$4 billion contract
by Verizon Wireless to expand
3G coverage and build an LTE
network, and also signed contracts with china’s three operators worth E1.18 billion. carter’s other posts have included
managing director of cable operator nTL, before it merged
with Telewest to become Virgin
Media, and managing director
and chief executive of adverting agency J Walter Thompson UK.
timeline: Business
Telekom Austria restructuring
Telekom Austria said its ongoing
reorganisation will cost E30-E40
million in 2010, half its previous
estimate. The company is
merging its fixed-line and
domestic mobile operations into
one unit, A1 Telekom Austria.
october
Merger promises mobile giant
Russian mobile operator
Vimpelcom struck a US$6.5
billion deal to merge with most
of the telecoms assets of Weather
Investments, creating the fifth
largest mobile operator in the
world by subscribers.
proposing to tax telecoms and
TV operators in order to fund
public broadcaster RTVE.
Canvas becomes YouView
Project Canvas, the UK Internet
content and video-on-demand
joint venture set to launch next
year, was renamed YouView TV.
million) per year between 2010
and 2012. But the EU queried
the tax and could rule it illegal,
as it did with similar proposals in
France and Spain.
TerreStar files for Chapter 11
November
Mobile satellite services
provider TerreStar Networks
filed for Chapter 11 bankruptcy
protection in the US.
Etisalat moves for Zain
Nitel sale approved
United Arab Emirates operator
Etisalat entered into an
agreement to buy 51% of Kuwait
mobile operator Zain, paving
the way for one of the biggest
corporate transactions of recent
times in the Middle East.
Nigeria approved the US$2.5
billion sale of state-run operator
Nitel to a consortium led by
China Unicom.
TI raises stake in Argentina
France Telecom moved for a 40%
stake in Morocco’s second biggest
telecoms operator Meditelecom,
worth around E650 million.
Qualcomm axes TV service
Qualcomm confirmed it will
shut down its FLO TV mobile
broadcast service next spring.
Telecom Italia increased its stake
in the company that controls
Telecom Argentina, to 58% from
50%. It follows a long battle with
the regulator over the Italian
operator’s share in Sofora.
Ericsson buys Nortel unit
3G launches in India
Verizon faces big payout
Ericsson bought Nortel’s MultiService Switch business for $65m.
Telenor and Telefonica struck a
partnership agreement to serve
corporate companies in their
respective markets globally.
Tata Teleservices and Bharti Airtel
prepared to launch 3G mobile
services by year end, while
Vodafone Essar said it will launch
in the first quarter next year.
They will follow the 3G launches
of state-owned operators BSNL
and MTNL in 2009.
Verizon Wireless will pay $25m
to the US Treasury and refund
a minimum $52.8m to about 15
million customers it wrongfully
charged. Regulator the FCC said
the payment is the largest ever.
Spanish tax under attack
Hungary next for telecoms tax
The European Commission gave
the Spanish government two
months to amend legislation
Hungary’s parliament passed
a proposal to tax the telecoms
sector 61 billion forints (E225
France Telecom acquisition
Telenor-Telefonica partnership
Mobile launch in South Africa
South African fixed-line operator
Telkom launched mobile
services to become the country’s
fourth mobile operator, joining
Vodacom, MTN and Cell C.
Service provider capex worldwide
n Capex — Capex: Revenue
15%
10%
5%
0
2009
2010
2011
2012
2013
2014
0%
Average capex-to-revenue ratio
20%
Average capex in $US billions
325
Service providers spent US$295
billion on telecoms and non-telecoms
capital expenditure projects worldwide
in 2009, 5.9% less than they spent
in 2008, said Infonetics in this Junepublished research. Carriers reduced
investment in network infrastructure by
8% in 2009, with the deepest cuts in
IP voice infrastructure, optical network
equipment, video infrastructure and IP
routers. Service provider revenues in
2009 were US$1.65 trillion, a decrease
of 4.2% from 2008 said Infonetics.
palm losES pilot
Hewlett-Packard snapped up
smartphone company Palm
in April for US$1.2 billion following months of speculation
about the handset company’s
future. Just a week earlier, Michael Abbott (pictured), who
oversaw Palm’s software and
services operations, resigned
from the company and took a
new role as vice president of
engineering at micro-blogging
service Twitter. Abbot helped
Palm develop the webOS mobile operating platform for its
Pre and Pixi smartphones, and
analysts suggest that remains
the company’s most valuable
asset. Following the deal announcement HP said it would
invest heavily in webOS, and
said the company could use
the platform on its touchscreen
tablets as well as smartphones
in future. Palm had already
taken steps to grow its smartphone strategy, striking deals
with several operators in Europe in March. New flagship
handsets Pre Plus and Pixi
Plus were launched in Europe in June; and in October
a new version of webOS was
announced together with Palm
Pre 2 handsets running the operating system. “It continues
to be our desire to grow our
share of the European market which is why we’re going
deeper into our existing territories by launching on more carriers, and going into new markets,” Paul Ghent, Palm’s vice
president of European sales,
told Total Telecom. Following
Abbot’s departure Palm subsequently took steps to retain
other senior executives, starting a retention programme to
pay bonuses. For Twitter, Abbott also brings experience
from his time at Microsoft,
where he was general manager of .Net Online Services.
21
timeline: Networks
april
across Europe, Asia Pacific and
Central and Latin America with
IPv6-capable MPLS nodes.
EU Broadband for all
The European Commission said it
would revise the universal services
law to guarantee broadband access
for all EU citizens, updating the
2002 provision.
22
Ericsson won new deals with
China Mobile and China Unicom
worth US$1.8 billion: An US$800
million deal with China Unicom
for 3G network with HSPA
Evolution technology, and a
framework contract worth US$1
billion with China Mobile for a
radio access network.
may
Orange hands network to BT
Orange UK struck a deal for BT to
take over the operation of its fixed
network. Orange will now offer
fixed-line voice and broadband
services over BT’s network, a
move which is expected to almost
double its broadband footprint.
AT&T network spending
AT&T said it will channel US$1
billion of its roughly $19 billion
2010 capital expenditure to
expand its global network and
enhance services for its business
customers. The US telco said it
plans to upgrade its networks
Russia’s largest mobile operator
Mobile TeleSystems signed a
five-year contact to outsource its
network in 16 regions to Nokia
Siemens Networks.
BT increases network spend
BT said it will increase its fibre
network investment by £1 billion,
to £2.5 billion in the period to
2015, to enable it to cover two
thirds of UK households. The
operator also signed a five-year
contract with Alcatel-Lucent to
expand its high-speed 21CN.
NSN wins deal for T-Mobile/3
Nokia Siemens Networks won a
contract worth about £400 million
with T-Mobile and 3 to expand
their 3G networks in the UK
under the MBNL joint venture.
India awards 3G licences
Construction of the East Africa
Submarine Cable System (Eassy)
was completed, according to
the West Indian Ocean Cable
Company (WIOCC), Eassy’s
largest shareholder.
India’s 3G auction raised
US$14.6 billion, with Bharti
Airtel, Vodafone Essar, Reliance,
Aircel and Idea Cellular
awarded bandwidth. In a related
development, India’s regulator
TRAI said the country’s four
largest operators—Bharti,
Vodafone, BSNL, MTNL—will
have to pay a total of INR120
billion for holding bandwidth in
excess of 6.2–8 MHz.
Infosys scores Microsoft deal
Germany awards spectrum
India’s Infosys Technologies won
a three-year outsourcing contract
with Microsoft worth more than
$100 million to manage internal
IT services, including help-desk
support, across 104 countries.
Germany’s spectrum auction
netted €4.38 billion. Telefonica
O2, Vodafone and Deutsche
Telekom each secured two paired
5-MHz chunks of spectrum in the
lucrative 800-MHz band, suitable
for LTE services. A total of 41
spectrum blocks were tendered,
with airwaves also offered in the
1.8-GHz, 2-GHz and 2.6-GHz
frequency bands.E-Plus was the
other spectrum winner.
Africa subsea cable complete
NSN gets O2 deal
Nokia Siemens Networks won
a services contract to expand
Telefonica O2’s mobile network
capacity across Germany.
Spending on networks and software rising again
225
10
— % Growth
n Revenue
5
150
0
75
0
-5
2009
2010
2011
2012
2013
% of revenue growth
Nokia in May announced its
second restructuring plan
in seven months in a bid to
take the initiative back from
its smartphone rivals. The
Finnish vendor split its mobile
phone operations into three
units, and announced that its
current mobile phones head
Rick Simonson (pictured)—
once tipped as a future Nokia
CEO—was to leave the company. The restructuring plan,
effective from July 1, saw its
Devices and Services business split into three units: Mobile Solutions, Mobile Phones
and Markets. Mobile Solutions
will focus on high-end devices
including mobile computers
based on its MeeGo operating system as well as Symbian-powered
smartphones,
and will be headed by Anssi
Vanjoki. The Mobile Phones
division will concentrate on
mid-to-low-end Series 40
handsets, and will be led by
Mary McDowell. And the Markets unit, headed up by Niklas
Savander, will be responsible
for Nokia’s go-to-market strategy, which includes sales and
marketing activities, and global
supply chain and sourcing operations. While Nokia is still the
world’s biggest handset maker
and the leader in high-end devices, it is losing smartphone
share to Apple and other competitors in Europe and North
America. According to Gartner, Nokia’s share of all handsets globally fell from 36.7% in
3Q09 to 28.2% in 3Q10. Simonson, who became head of
Nokia’s mobile phone division
in October 2009 having previously served as chief financial officer, was made a senior
advisor focused on Nokia Siemens Networks until the end
of this year, and will then join
NSN’s board.
Ericsson wins China deals
Revenue in $US billions
Nokia shake-up
MTS outsources network
june
This chart from our September issue
showed spending on network and
software equipment picking up this
year and accelerating through 2011.
Worldwide telecoms and datacom
equipment revenues totalled US$153.8
billion worldwide in 2009, down 5.2%
from 2008, but Infonetics expects
spending to grow to $208.3 billion in
2014. The company tracked 11 major
categories of enterprise and service
provider equipment, with only IPTV and
next-generation OSS growing in 2009.
2014
timeline: Networks
France awards 3G spectrum
French regulator Arcep awarded
two blocks of 3G frequencies to
SFR and Orange for a total of
E582.1 million. The auction came
after Iliad in January was awarded
France’s fourth 3G mobile licence.
winning licences for a total of
US$8.23 billion (E6.5 billion).
Sprint extends WiMAX
in the 2.6-GHz band for mobile
broadband services in December,
with the winners awarded
capacity in mid-2011.
july/august
Sprint Nextel extended WiMAX
coverage and services to seven
new metropolitan markets, but
said it did not rule out a move to
LTE technology.
US boost for broadband
september
Mexico’s second spectrum
auction ended with the award
of a single nationwide licence to
media giant Grupo Televisa and
Nextel Mexico.
Singapore launches NGN
New fibre service in Italy
Singtel launched services at
speeds up to 200-Mbps on
Singapore’s national nextgeneration broadband network.
Retail and wholesale consumer
and business services will be
deployed on fibre infrastructure
built by Singtel and OpenNet.
Fastweb launched a symmetrical
100-Mbps fibre service in Italy to
around 2 million households.
Barack Obama signed a
memorandum to make 500 MHz
of spectrum available over the
next 10 years for broadband
wireless services. Obama also
announced $795 million in grants
to expand broadband in rural and
hard-hit communities, part of the
$7.2 billion Recovery Act.
New submarine network
Alcatel-Lucent signed a US$500
million (E400 million) contract
with a consortium of 20 operators
to build a submarine network
between South Africa and France.
october
EC moves to open up NGNs
Nokia Siemens Networks won
a contract to supply equipment
for the new 3G network of Tata
Teleservices. In July, Harbinger
Capital Partners awarded a US$7
billion (E5.5 billion) eight-year
contract to NSN to build its
wholesale LTE network.
The European Commission
proposed a deadline of the end
of 2012 for EU member states
to allocate licences for mobile
broadband services and to free
up 800-MHz digital dividend
spectrum. And EU commissioner
Neelie Kroes commited to
ensuring every citizen can access
basic broadband by 2013 and
speeds of 30 Mbps by 2020.
Tata awards 3G contract
Austrian broadband spectrum
Tata Teleservices awarded
Huawei Technologies a contract
to provide equipment for 3G
networks in five telecoms circles.
Austria’s four main mobile
operators won out in the auction
of 2.6-GHz spectrum which
raised E39.5 million.
Chile to auction LTE spectrum
LTE network sharing
Chile will auction off spectrum
Polish mobile network operators
Telstra agreement on NGN
Australian incumbent Telstra
struck an agreement to allow
state-owned broadband company
NBN to use its copper and cable
network infrastructure for the
proposed nationwide fibre-tothe-home network.
Mexico wireless auction
NSN wins big mobile deals
Indian broadband auction
India’s broadband wireless
auction saw six companies
International Internet traffic (peak usage)
Telegeography said international
Internet traffic globally grew 62% to
mid-year 2010, down from the 74%
growth recorded in 2009. Carriers
made available 13.2 Terabits per
second of new international capacity to
that point, up from 9.4 Tbps in 2009.
The analyst company said peak usage
levels on intra-Asian links are 50%
higher than on intra-European links.
Africa’s international Internet backbone
capacity increased more than 14-fold
between 2006 and 2010.
Source: Primetrica/Telegeography
Peak usage of Internet bandwidth
100% n Intra-Asia n Trans-Pacific n Trans-Atlantic
90% n US Latin America n Intra-European
80%
70%
60%
50%
40%
30%
20%
10%
0%
2006
2007
2008
2009
2010
orange revamp
The recently appointed CEO
of France Telecom, Stéphane
Richard (pictured), in July announced plans for a widespread restructuring of the
company, pledging to recruit
10,000 employees in France
by 2012 and increase the
company’s global subscriber
base to 300 million by 2015.
France Telecom had 183.3
million subscribers at the end
of the first quarter. The fiveyear plan, called Conquests
2015, focuses on four key areas: employee well-being, networks, customers and international development. Part of
its aim is to restore a sense
of recognition and responsibility among middle management, as well as to define career paths more clearly “to help
employees build bridges from
very strenuous jobs to less
strenuous jobs”, said Richard.
The company has been under
scrutiny following the suicides
of 32 workers over the past
two years. France Telecom
plans to invest €2 billion in fibre access in France between
now and 2015, providing coverage to 40% of households by
2012. As a result it is reviewing its strategy of buying or developing exclusive content,
and could sell its TV channels.
Since 2008 it has spent €400
million a year on content such
as rights to French football
matches. But it will continue to
invest in its mobile networks in
Africa, and look to launch LTE
“by 2012 to 2013”. Richard
reiterated aggressive plans to
drive growth in emerging markets, particularly in Africa and
the Middle East.
23
timeline: Networks
PTK Centertel (Orange) and P4
(Play) were granted permission to
deploy a combined LTE network
via a joint venture company,
which they will then access
on a wholesale basis. The new
company will take part in the
forthcoming 2.6-GHz auction.
says it is the first significant
release of unlicensed spectrum in
over 20 years.
Deutsche Telekom will also
launch its own LTE services using
800-MHz spectrum by year end.
Bharti awards 3G contracts
T-Mobile launches LTE
Bharti Airtel named Ericsson,
Nokia Siemens Networks and
Huawei as the suppliers for its
forthcoming 3G network.
T-Mobile Austria launched
commercial LTE services in
Innsbruck, just four weeks after
the completion of the country’s
spectrum auction in September.
Commercial LTE launches
Poland became the fourth
country—after Sweden, Norway
and Uzbekistan—to launch
commercial LTE services when
CenterNet and Mobyland
switched on networks using the
1800 MHz frequency band. Soon
after, US operator MetroPCS
launched services in Las Vegas
and Dallas.
New submarine cable
France Telecom and partners plan
to deploy a new submarine cable
in the Indian Ocean to provide
further connectivity between
Africa, Asia and Europe.
Fibre network in Chile
Telefonica Chile will spend
US$2.5 billion over the next four
years to build a nationwide fibreto-the-home network covering
700,000 homes.
november
The Singapore government
will allocate 3G spectrum to
Singapore Telecom, StarHub and
M1 after there were no other
bidders for the S$20 million slots.
UK 3G spectrum reversal
BT must open fibre networks
UK regulator Ofcom ruled
that BT must give competitive
providers access to its new fibre
networks, including cable ducts
and telephone poles.
French network sharing
Telekom Austria selected Nokia
Siemens Networks to develop
LTE-ready mobile broadband
infrastructure and network
performance systems.
Nokia Siemens Networks will
upgrade and expand French
mobile operator SFR’s HSPA+
radio access network, which
will then be available for use by
subscribers of rival operators
Orange and Bouygues Telecom.
US white space proposal
German network sharing
The FCC confirmed it will free
up vacant TV airwaves known
as white spaces for mobile
broadband services. The regulator
Mobile operators Deutsche
Telekom, Vodafone Germany
and O2 Germany entered talks
to roll out a joint LTE network.
Telekom Austria picks NSN
China in his hands
Singapore 3G spectrum
Ofcom ruled that the refarming
of spectrum in the 900-MHz and
1800-MHz bands for 3G services
will not impact competition,
reversing its previous decision. It
could open the way for O2 and
Vodafone to use the spectrum, in
line with European legislation.
Denmark awards 3G spectrum
3 Denmark was awarded licences
in the 900-MHz and 1800-MHz
bands for DKK 12 million (about
E1.6 million).
Telecom NZ bids for NGN
Telecom New Zealand submitted
a new plan to become part of the
country’s Ultra-Fast Broadband
initiative, proposing operational
and structural separation.
Available colocation space in key cities
0%
Amsterdam
10%
20%
Average space available
30%
40%
50%
60%
70%
Chicago
Frankfurt
Montreal
New York
Los Angeles
San Francisco
Washington
London
24
— Average Range | Average
Data from TeleGeography in our
October issue showed that colocation
service providers are struggling to keep
up with demand. Despite significant
new construction, some 41% of sites
surveyed by TeleGeography were at
least 80% full by mid-2010, up from
34% of sites a year earlier. Operators
added 1.5 million square feet of new
colocation space and 124 megawatts
of power in the year to mid-2010, but
some key cities were showing less
than 25% available space.
Li Yue (pictured) in August took
over as chief executive of the
world’s largest operator by
subscribers, China Mobile, replacing Wang Jianzhou who
remained as chairman and executive director. The operator’s
total subscribers reached 554
million at the end of June following net additions of 31.76
million in the first half of the
year. China Mobile reported
net profit of CNY57.64 billion
($8.49 billion) for the first six
months, up from CNY55.33
billion in the same period last
year. Revenues rose 7.9%
to CNY229.82 billion from
CNY212.91 billion, although
ARPU slipped to CNY72 from
CNY75 a year earlier. China
Mobile said it has now completed construction of the third
phase of its TD-SCDMA 3G
network and had deployed
115,000 base stations across
238 cities by the end of June; it
is targeting 200,000 base stations by the end of the year. It
had signed up 10.46 million 3G
customers by the end of June,
and had 2.7 million users of its
mobile payment/wallet service
by then, just over a month after
launch. The company’s mobile
reading service, also launched
in May, had more than six million paying users by the end of
June, while its music download service had over 3.2 million users and its mobile video
service over six million. “Despite rising competition we are
confident that our net profit will
continue to grow as growth in
valued-added services such
as mobile reading and music
outpace the decline in voice
tariffs,” Li said. In March China Mobile bought a 20% stake
in Shanghai Pudong Development Bank to continue its diversification into mobile financial services.
timeline: people
april
Vodafone job cuts
Vodafone announced it will cut
375 jobs from its UK workforce
of around 9,000. The mobile
operator said the cuts will come
across a number of locations,
primarily in back office functions.
Telstra reshuffle
Telstra announced a reshuffle
of its executive team. Among
the changes, Stuart Lee was
promoted to group managing
director and Gordon Ballantyne
joined from HP as group MD for
Consumer and Channels.
may
MTN CEO to step down
Telecom Italia job cuts
Phuthuma Nhleko will step down
as president and CEO of South
Africa’s MTN Group in March
2011, after nine years in the role.
Telecom Italia outlined plans for
additional job cuts. The company
said it has cut 2,300 jobs in 200910 and expects another 4,522 jobs
to go by the end of 2012. The
move is part of its strategy to
reduce costs by E2.7 billion in the
2010-2012 period.
New Vodafone R&D head
Vodafone appointed Intel
executive Siavash Alamouti
as its new group research and
development director. Alamouti
succeeds Mike Walker, who
recently retired after 25 years
with Vodafone and Racal.
Siemens reduces IT workforce
Siemens confirmed a plan to
restructure its IT operations, SIS,
and cut 4,200 jobs worldwide by
the end of 2011. The move will
cost between E400 million and
E500 million.
july/august
New head for Tele2
Swedish operator Tele2 said Mats
Granryd would become its new
chief executive from the start
of September, replacing Harri
Koponen who left in February.
Vimpelcom chiefs ousted
Vimpelcom’s joint chief
executives Boris Nemsic and
Alexander Torbakhov left the
company and were replaced by
former chief Alexander Izsoimov.
Vimpelcom in April merged
with Ukraine’s Kyivstar where
Izsoimov was latterly CEO.
FT international head to leave
France Telecom said its deputy
chief executive officer in charge
of international activities, JeanYves Larrouturou, will leave.
Nortel gets new CFO
Nortel’s chief financial officer
Pavi Binning left to be replaced
by John Doolittle. Binning
was also the company’s chief
restructuring officer, a post that
will not be filled.
chief Matt Crockett announced
his resignation.
Omnifone gets new CEO
UK mobile music startup
Omnifone appointed former
BSkyB executive Jeff Hughes as its
new chief executive.
june
Microsoft devices shake-up
Robbie Bach retired from head
of Microsoft’s Entertainment and
Devices division after 22 years
at the company. Andy Lees now
heads the mobile unit, while CEO
Steve Ballmer fronts the division.
NSN job cuts
Nokia Siemens Networks said
it will cut 450 jobs in Finland,
through voluntary redundancies,
as part of previously announced
restructuring measures.
Yell departures
New BT Innovate CEO
NZ Telecom CFO leaves
BT appointed Clive Selley as
CEO of the Innovate and Design
division, which oversees network
and platform development,
technology strategy and research.
Chief financial officer Russ
Houlden left New Zealand
Telecom after two years in the
role. His departure came a month
after wholesale and international
Yell Group announced that
both CEO John Condron and
CFO John Davis are to leave the
company next year.
New Rostelecom CEO
Russian state-owned operator
Rostelecom appointed Alexander
Provotorov as chief executive,
moving from his position as
first deputy general director
at national telecoms holding
company Svyazinvest.
Zain restructures managers
Zain restructured its
management team, with,
Barrak Al Sabeeh becoming
COO, Haitham Al Khaled chief
technology officer and Ossama
Matta chief financial officer.
Eircom prepares for cuts
Republic of Ireland incumbent
Eircom said it is preparing a
company restructuring that could
see up to 2,000 redundancies,
on top of the 1,500 cuts already
made since March 2009.
Telkom SA gets new chief
Jeffrey Hedberg was appointed
acting CEO of South Africa’s
Telkom SA, in place of Reuben
September who retires in
November. Peter Nelson also
said he would resign from chief
financial officer in October.
nokia refocuses
It was all change at the top
at Nokia in September as the
Finnish handset maker first announced the departure of CEO
Olli-Pekka Kallasvuo and then
cleared the way for chairman
and former chief executive,
Jorma Ollila, to leave in 2012.
But that was not the end of the
management reorganisation.
Nokia, which has been losing
ground in the high-end handset market, a few days later announced the resignation
of Anssi Vanjoki, the head of
its Mobile Solutions unit, created in May to focus on the
smartphone segment. Vanjoki
will see out his six-month notice period. In contrast, Kallasvuo left almost at once, on 20
September, and was replaced
by Stephen Elop (pictured),
previously head of Microsoft’s
Business Division. Nokia cited
Elop’s background in the software industry, knowledge of
the US market and experience
of change management as important assets. Elop joined Microsoft in January 2008, and
was formerly chief operating
officer at Juniper Networks
and also held senior positions
at Adobe Systems and Macromedia. Another key Nokia executive, Ari Jaaksi, who helped
develop the MeeGo operating
system, stepped down in early
October. Nokia’s Symbian operating system took a 36.6%
share of all smartphones sold
worldwide in the third quarter,
according to Gartner, but that
was down from a 44.6% share
in the second quarter of 2009.
Kallasvuo, who became CEO
of Nokia in 2006, will continue in a non-executive capacity to chair the board of Nokia
Siemens Networks. He will receive a severance payment of
E4.6 million as well as the market value of 100,000 shares.
25
timeline: people
september
october
november
Hurd not seen any more
Hurd surfaces at Oracle
Nokia job cuts
Hewlett-Packard chairman
and chief executive Mark Hurd
resigned in the wake of a sexual
harassment investigation that
revealed he filed inaccurate
expense reports. Hurd’s severance
package was reported to be worth
more than US$35 million.
Former HP chief executive,
Mark Hurd, was appointed a
co-president of Oracle. HP then
appointed Leo Apotheker, the
former chief executive of SAP, as
its new CEO.
Nokia’s new CEO Stephen Elop
said the company will cut 1,800
jobs. The changes will come at
the Symbian smartphones unit,
and also in services.
Change at top for Safaricom
Kenyan operator Safaricom said
CEO Michael Joseph would
retire in November after 10 years
leading the company. He will be
replaced by Bob Collymore, who
has been on the Safaricom board
for more than four years.
Sprint loses heads
KPN names new CEO
Everything Everywhere cuts
Everything Everywhere
announced plans to cut 1,200
jobs, amounting to 7.5% of its
16,000-strong workforce.
Verizon Wireless new CFO
Verizon Wireless appointed
Andrew Davies to replace John
Townsend as chief financial
officer. Davies had been CFO of
Vodafone’s Indian operations.
Sprint Nextel’s senior VP of
product development, Kevin
Packingham, left the company in
August. Dan Schulman, who ran
Sprint’s prepaid business, also left
in August to take up a position at
American Express.
KDDI will replace its top
executive, senior vice president
Takashi Tanaka, who will move to
the role of president at the start
of December.
iPhone engineering departure
Verizon CFO retiring
Mark Papermaster, Apple’s
senior vice president for iPhone
engineering, left the company
shortly after it suffered complaints
over reception issues related to its
new antenna design.
Verizon chief financial officer
John Killian will retire at the end
of this year after 31 years with
the company. Killian was also
president of Verizon Business,
created after Verizon’s acquisition
of the former MCI in 2006.
KDDI head to be replaced
Turk Telekom new CEOs
Turk Telekom appointed Hakam
Kanafani as Group CEO from his
position as Oger Telecom’s chief
business development & synergy
officer, and promoted K. Gokhan
Bozkurt to CEO of Turk Telekom
from his position as VP of human
resources at the operator.
Russian resignation
Singtel international head
LG replaces CEO
Singapore Telecom appointed
Hui Weng Cheong as CEO
International from December,
succeeding Lim Chuan Poh who is
retiring from the company.
LG announced the resignation of
its CEO Nam Young, who will be
replaced by Koo Bon Joon, the
younger brother of LG chairman
Koo Bon Moo.
26
Eelco Blok will become KPN’s
next CEO and chairman when
Ad Scheepbouwer retires next
April. Blok has been on KPN’s
management board since 2004
and has worked there since 1983.
Evgeniy Yurchenko, the CEO
of Svyazinvest, resigned over
a strategy disagreement.
Svyazinvest is in the process of
merging national fixed operator
Rostelecom with its fixed and
mobile regional operators.
T-Mobile USA changes
Philipp Humm took over as CEO
of T-Mobile USA in October,
five months ahead of schedule,
replacing Robert Dotson. Further
changes see CTO Cole Brodman
becoming chief marketing officer,
and chief network officer, Neville
Ray, will become CTO.
PTC gets new CEO
Polish mobile operator PTC
named Miroslav Rakowski as its
new CEO from January, replacing
Klaus Hartmann. Rakowski is
currently chief sales officer and
director for CRM at T-Mobile
Czech Republic.
OTE appoints new leader
Michael Tsamaz was appointed
CEO and chairman of Greek
operator OTE, moving from his
position as head of OTE’s mobile
arm Cosmote.
ITU reappoints head
Hamadoun Touré of Mali
has been elected as secretary
general of the International
Telecommunication Union (ITU)
for a second four-year term.
Telstra job cuts
Telstra said it will cut 950 jobs,
mostly in executive and middle
management areas.
SYMBIAN FORTUNES
The development of the Symbian operating system was
taken back in-house by Nokia
in November, a month after
Symbian Foundation executive director, Lee Williams (pictured), resigned and was replaced by CFO Tim Holbrow.
David Wood, a co-founder of
Symbian, left the Foundation a
year earlier. Williams was appointed executive director in
October 2008, a few months
after handset maker Nokia
announced plans to take full
control of Symbian and turn
it into the open source Symbian Foundation. His resignation was the latest blow to
the Foundation as it struggled
to regain the initiative from
smartphone rivals Apple and
RIM and in the face of strong
growth of Google’s Android
operating system. His departure came less than a month
after Sony Ericsson confirmed
it would not develop handsets
based on the new version of
the operating system, Symbian 3, mirroring Samsung’s
decision to abandon the platform. Both handset makers
were key financial contributors
to the project. Symbian is still
the leading smartphone operating system, but its market
share declined to 36.6% in the
third quarter from 44.6% in the
same period of 2009, according to Gartner. Android’s share
was 25.5% in Q3. Strategy
Analytics, says Nokia’s smartphone market share slipped
to a low of 34.4% globally in
Q3, even though it shipped a
record 26.5 million units. Apple and RIM gained ground,
shipping 14.1 million and 12.4
million units respectively. The
Symbian Foundation will now
downsize its operations, and
by April 2011 will be governed
by a small group of directors.
PRImE numBERs
cOntacts
$55.5 billion
IPtv suBs Pass 40 mIllIOn
Global IPTV subscribers reached 40.5 million at the
end of September, says TeleGeography, up 8% from
Q2 and 37% in the past year. France accounts for
24% of all subscribers, followed by the US and China
(both 16%), South Korea (8%), Japan (4%), and
Germany and Hong Kong (both 3%). Among
operators China Telecom leads the way with 5.3
million subscribers, followed by Iliad with 4.0 million,
Verizon 3.3m, France Telecom 2.8m, AT&T 2.7m,
Korea Telecom 1.8m and SFR 2.5m. But IPTV still
accounts for fewer than 6% of all pay-TV subscribers.
IPTV Growth and Split by country, Q3 2010
40
n Others
n Hong Kong
n Germany
n Japan
n South Korea
n china
n US
n France
Subscribers (m)
35
30
25
20
15
10
5
0
2004 2005 2006 2007 2008 2009 3Q10
network equipment surge
The service provider router and switch
market—including IP edge routers, IP
core routers, carrier Ethernet switches
and aTM switches—grew 5% from the
second quarter to reach $3.3 billion
worldwide in the third quarter, says
Infonetics. In another report the analyst
company says the worldwide optical
network hardware market increased
6.2% to $3.23 billion quarter-on-quarter, led by healthy WDM equipment
sales; optical spending in north
america and the EMEa region jumped
16%. The ROaDM equipment segment
surged 25% quarter-over-quarter.
3G share of global wireless markets
mobile games booming
Juniper Research forecasts total
end-user revenues from mobile
games will surpass uS$11 billion
annually by 2015, up from $6
billion in 2009. The company also
says revenues from in-game
purchases will overtake traditional
pay-per-download revenues from
mobile games by 2013. In another
report, Juniper forecasts global
advertising spend on mobile
delivery channels will exceed
uS$11 billion by 2015, up from $3.1
billion this year, driven by smartphones with location-aware and
augmented reality capabilities.
Q3 2010 subscribers (m)
total
3G Others
Region
africa
Asia & Pacific
Eastern Europe
% of total
3G
Others
513
30
483
6%
94%
2,488
267
2,221
11%
89%
453
42
412
9%
91%
Latin america
549
42
507
8%
92%
Middle East
279
35
244
12%
88%
314
97
217
31%
69%
521
5,116
183
694
338
4,422
35%
14%
65%
86%
US & canada
Western Europe
total
$100 billion
LTE service revenues worldwide by 2014
(Juniper Research)
ltE forecasts rise
Mobile handset sales, 3Q10 (thousands)
3Q10
units
3Q10 market
share (%)
nokia
117,461.0
28.2
113,466.2
36.7
Samsung
71,671.8
17.2
60,627.7
19.6
LG
27,478.7
6.6
31,901.4
10.3
apple
13,484.4
3.2
7,040.4
2.3
Research in Motion
11,908.3
2.9
8,522.7
2.8
Sony Ericsson
10,346.5
2.5
13,409.5
4.3
Motorola
8,961.4
2.1
13,912.8
4.5
HTc
6,494.3
1.6
2,659.5
0.9
ZTE
6,003.6
1.4
4,143.7
1.3
Huawei
5,478.1
1.3
3,339.7
1.1
Others
137,797.6
33.0
49,871.1
16.1
total
417,085.7
100.0
308,894.7
100.0
company
Telco TV revenues from all
pay-tv services globally in 3Q10,
up 9% from 3Q09. More than
half of those revenues come
from Western Europe
(ABI Research)
3Q09 3Q09 market
units share (%)
Source: Gartner
Infonetics has increased its forecast
for the worldwide LTE infrastructure
market, expecting it to grow roughly
ten-fold from 2010 to 2014, to reach
US$11.5 billion. The analyst company
also increased its LTE subscriber
forecast, and now estimates 165
million worldwide by 2014. By the end
of 2010, a dozen LTE networks are
expected to go live (see Timeline), and
there are currently over 100 commitments by service providers to deploy
LTE networks, says Infonetics. Juniper
Research in a separate report says
revenues from consumer users will
remain under half of total LTE
revenues until at least 2015.
EdItORIal
4th Floor, Welken House,
10-11 charterhouse Square, London Ec1M 6EH
+44 (0)20 7608 7030; ttmag@totaltele.com
tOtal tElEcOm Plus
Ian Kemp
Editor
michelle young
art Editor
ian.kemp@totaltele.com
+44 (0)1626 835 703
m7chelle@gmail.com
tOtal tElEcOm
mary lennighan
Editor
nick Wood
assistant Editor
tim charters
Web Developer
mary.lennighan@totaltele.com
+44 (0)20 7608 7069
nick.wood@totaltele.com
+44 (0)20 7608 7046
tim.charters@terrapinn.com
+44 (0)20 7608 7073
CONTRIBUTING EDITORS
Roy Rubenstein
royruben@netvision.net.il
Omer, Israel
Ingrid lunden
ingridlunden@gmail.com
London
Ken Wieland
ken2wieland@yahoo.co.uk
London
craig stephen
ch.stephen@gmail.com
Hong Kong
+852 9048 1124
Jagdish Rattanani
jagdish@mtnl.net.in
Mumbai
+91 22 287 55087
advERtIsInG
HEaD OFFIcE, LOnDOn, UK
nick carter
nick.carter@totaltele.com
Sales Manager
+44 (0)20 7608 7065
Gordon White
gordon.white@totaltele.com
Sales Manager
+44 (0)20 7608 7041
UnITED STaTES anD canaDa
KcS International
T +1 717 397 7100 F +1 717 397 7800
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KarenKcS@aol.com
alan Kernc – West & canada
alanKcS@aol.com
JaPan
Hiroko Kujime
Pacific Business
+81-3-3661-6139
kujime-pbi@gol.com
T +81-3-3661-6138 F
aDVERTISInG PRODUcTIOn
Please forward all advertising material directly to:
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maRKEtInG
tally Judge
Marketing Manager
charles Georgiou
Marketing Executive
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+44 (0)20 7608 7076
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suBscRIPtIOn/custOmER sERvIcEs
aleisha Bryant
aleisha.bryant@terrapinn.com
customer Services Executive
+44 (0) 7608 7042
or subscribe online at: www.subscription.co.uk/totaltelecom
ManaGEMEnT
Rob chambers
Publisher
Greg Hitchen
chief Executive Officer
rob.chambers@totaltele.com
+44 (0)20 7608 7077
greg.hitchen@terrapinn.com
OtHER PuBlIcatIOns
Online: www.totaltele.com
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© 2010. all rights reserved.
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power shift - Total Telecom

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