DIGESTS://Telecoms, Internet, Media: May 22-26, 2006

TELECOMS

COMPANIES:

PTT:
· PT: acquires 34% of MTC (Namibia), $160m; Sonaecom has 1% of PT
· DT: sells IT-units of T-Systems in Denmark and Sweden (150 employees) to ST Denmark
· BT: DT rumoured to plan bid, 300 p/share = GBP 25 bn (Wirtschaftswoche, Independent)
· Eircom: accepts takeover bid from Babcock & Brown, 2.20 EUR/share = EUR 2.42 bn
· KPN: acquires Enertel (business IP, data center; excluding WLL license and Worldmax; including 200 hotspots) from Greenfield, EUR 10m
· Telkom Kenya: plans IPO (34%) April 2007

MOBILE:
· Vodafone: scraps plan to sell Arcor (Times)
· Orascom: plans bid for third license Sausi-Arabia
· Econet acquires 65% of ST Cellular (Burundi)
· Telekomunikacja Kolejowa (= PKP) scraps plan to become #4 operator in Poland
· China Mobile acquires Millicom, $4 bn

ALTNETS:
· AOL (Time Warner) launches ‘AOL High Speed Powered by Covad 6.0’ (6 Mbps)
· Vonage sets issue price at $17 (range 16-18), 31.25m shares = 20% = $550m; first price $17.00

MOBILE/ALTNETS:
· Orange (Wanadoo) UK to launch free broadband with 2-year mobile subscription, June 1 (Guardian)


TRENDS:

FIXED:

Copper, xDSL, LLU:
o BundesNetzAgentur prohibits DT’s ‘DSL NetRental’ (wholesale, with higher margins for larger resellers)
o OPTA requires open access to all-IP network and requires alternative to MDF access

FTTH:
o Seattle issues RfI for ‘Seattle Broadband Initiative’
o UPC threatens legal action against Amsterdam ‘Citynet’ (excavation has started, cable roll-out from May 29) (Parool)
o Tasmanian Collaborative Optical Leading Testbed (state) plans trial 06Q4 (100 Mbps, 1k homes in Hobart)

CATV:
o RCN launches ‘Mach 20’ (20/2 Mbps)
o EC launches Framework for Partnership 6 (FP6) project ‘CODMUCA’ (COre Subsytem for Delivery of Multiband Data in CATV Networks) to bridge the gap between DOCSIS 2.0 (up to 40 Mbps) and 3.0 (1 Gbps)

WIRELESS

WiFi:
o Hardware:
. Wavion launches MIMO-based AP for better coverage
. Strix launches indoor router to connect to outdoor mesh network
o Roaming: AT&T deal with WeRoam (10k hotspots in Europe)
o Muniwifi:
. Dunedin (Fla) orders gear from Strix
. Ontario orders network from MetroFi
. Salem (Ore) postpones as ‘the technology isn’t there yet’

Cellular:
o Licenses, spectrum, auctions:
· Telecom Invest Georgia wins third 3G license in Georgia
· Powercom (= Telenor, NamPower) wins second mobile license Namibia
o Content & services:
. Internet, data: Verizon Wireless launches Motorola ‘Q’ (smart phone, exclusive; push email technology from Good Technology) May 31 ($200 with 2-year contract)
. TV: Modeo (= Crown Castle) orders equipment from Penthera for DVB-H network (wholesale)

WiMAX:
. Intel Capital forms joint-ventures with Orascom (Orascom Telecom WiMAX: Middle East, Asia) and Enertel (Worldmax: Netherlands; has 80 MHz of nationwide spectrum in the 3.5 GHz band)
. National Taiwan University launches trial with Nortel
. Entel Chile plans network with Alvarion
. MSC Management Services (= Multimedai Development Corp) plans networks in Malaysia (with Air Broadband Comms)
. Wateen Telecom (= Warid) orders Pakistan network (‘Motowi4’: 802.16e) from Motorola, operational from 06H2
. 22 cos plan setting up a WiBro & mobile WiMAX Community (WMC) within 6 mo (roaming, interoperability, information sharing)
. H1 (Croatia) plans network (with Samsung)
. Bulgaria plans awarding licenses in the 26 GHz band
. Infocom launches in Uganda


CONVERGENCE:

VoIP:
o Technology:
. Skype partnership with Spirit DSP (embedded voice conferencing engine ‘TeamSpirit’)
. SIPphone launches Gizmo Project 2.0
o Deployments: Plaxo (address book, calendar) adds click-to-call (technology from Jajah: web-activated VoIP)

IPTV: BT adds soccer from B Sky B to BT Vision from 07/08


INTERNET

COMPANIES:

· eBay: Auction Wireless Alerts launches alerts for sellers; StreamCast (Morpheus) sues for denying right of first refusal to buy ‘FastTrack’ technology (P2P) when acquiring Skype, claims $4 bn
· eBay, Yahoo: form exclusive 3-year partnership around (Yahoo to provide graphic ads and search; Yahoo to use PayPal; co-branded toolbar; click-to-call through Skype and Yahoo! Messenger with Mail)
· Google: deal with Dell (toolbar, homepage pre-installed)


TRENDS

SEARCH:
· Market shares US April 2006: Google 43.1% (+0.4 pp mom, +6.6 pp yoy), Yahoo! 28% (stable mom, -2.7 pp yoy), MSN 12.9% (-0.3 pp mom, -3.2 pp yoy) (comScore)
· Contextual: Google plans adding video to AdSense ads
· Vertical: Reed Elsevier launches Zibbsearch.nl (for businesses, beta), technology from FAST

WEB 2.0:
· Social networking:
o aSmallWorld.net (invitation-only, 130k subs) attracts funding from Wiensteins, Pittman
o Bebo gets $15m funding from Benchmark; Abebooks.com (retailer) buys 40% of LibraryThing.com
o MySpace (News Corp) plans ad deal (distribution) with Google or Microsoft (Financial Times)



MEDIA

COMPANIES:

B2C:

Entertainment:
o CBS: sells Paramount Parks (5 theme parks) to Cedar Fair, $1.24 bn cash
Cable/satellite:
o Adelphia agrees with TWC (Time Warer) and Comcast over speeding up restructuring
Publishing:
o Tribune acquires ForSaleByOwner.com (real estate)
o Telegraaf: BasisMedia (Sp!ts) acquires 50% of Info Pinnacle (Yourfuture.tv, Scholieren.tv)

B2B:

Advertising:
o Expedia.com puts account ($170m) in review, currently at Deutsch (will not defend)
o Omnicom: Gillette consolidates non-US account ($20m) at BBDO
o WPP: ‘interested in Vietnam’; Kimberly-Clark moves creative account ($200m) from Ogilvy to JWT (both WPP)


TRENDS:

STM: AAP (Association of AMeican Publishers) is opposed to Federal Research Public Access Act (S. 2695)

CABLE:
· Hutchison (Rep) introduces bill ‘Franchise Reform Act of 2006’ (S. 2989) allowing cablecos statewide video-franchise

VIDEO DISTRIBUTION:
· Brightcove: Online Broadcasting Service uses Brightcove service; About.com (= NYT) adds video player; partnership with Limelight Networks (internet content delivery network)
· Orb Networks: releases ‘Orb VideoMail’ (videomail for Mozilla Thunderbird or Microsoft Outlook users)
· Sling Media: intros SlingPlayer Mobile compatible with Windows Mobile smartphones
· Sling Media, Orb, Sony: talk with Sprint Nextel to enhance mobile entertainment with place-shifted content

OBSERVATIONS://KPN acquires Enertel, Enertel launches Worldmax

Another smart acquisition from KPN: this time it's business CLEC Enertel.
Some observations on the KPN side:

• Take out a competitor (albeit small) and add to the business IP market. Similarly:
• KPN acquires just about anything that doesn't bring them into regulatory problems, even if it's close sometimes: Telfort (cellular), Nozema (broadcast services, DVB-T, DVB-H), casaNet (FTTH network), several ISPs (Speedlinq, hcc!net, Tiscali subs, Cistron subs, Freeler, Trefpunt), hotspots (Attingo at Schiphol, HubHop), Kral (stores), parts of KPNQwest.
• Other, small acuisitions: E-Zorg (health services) and eYe-Display/NN Solutions (narrowcasting). Also, expect KPN to expand its ICT portfolio.
• If OPTA's mission is to reduce KPN's size (as far as KPN isn't doing this itself: moving to IP, integrating and laying off), this strategy could prove a double-edged sword: if KPN is growing at the revenue side (volume), something must be taken away at the tariff side (price).
• KPN does not buy the WiMAX part of Enertel, presumably because it expects regulatory issues? (see also Telefonica's attempts at buying Iberbanda).

Having a pre-WiMAX network in the 5 largest Dutch cities, Enertel Wireless (now Worldmax, a Greenfield/Intel joint-venture) will focus on WiMAX. Targeted is a nationwide roll-out in 1-3 years (depending on demand as well as availability of equipment and handsets). This news came out only yesterday.
Some observations on the Worldmax side:

• Worldmax can move into higher gear. WiMAX is an exciting opportunity. Mobility and VoIP can be included.
• The company can live up to its original promise of having a nationwide network (even if 2006 is a stretch).
• It is still unclear what Casema plans to do with the WLL-license it recently bought from Versatel/Tele2. It expires next year.

DIGESTS://Telecoms, Internet, Media: May 15-19, 2006

1. TELECOMS:

COMPANIES:

PTT:

TeliaSonera: acquires 82.3% of NextGenTel (altnet Norway: DSL, WiMax), 65.5 NOK/share (premium 45%) = NOK 1.54 bn
BT: Q4 in line with expectations
Telefonica: Mediaset interested in Endemol (denies) (Corriere della sera)
Belgacom: denies planned state sale
KPN: appoints Scott McKenzie CSO for mobile
Telekom Malaysia plans IPO of Spice Telecom (India) late 2006
CamTel plans launch of Cameroon Mobile Telecomms (#3 wireless)
Maltacom: Tecom and DIG acquire 60%, $283m
Jordan Telecom: Jordan plans reducing stake (41.5%) by selling 11% to FT (has 40%)
Embarq (Sprint spin-off) down 3.6% on first day of trading

MOBILE:

Vodafone: rumoured to sell 45% of VZW to Verizon, $48 bn + $8 bn debt (Observer); alliance with SoftBank (develop and procure mobile technology and content)
NTT DoCoMo: considers diversification (e.g. finance) to offset slowing growth in mobile
Telekom Kolejowa (= PKP) wins fourth GSM license Poland, PLZ 510m = $168m
Serbia receives 10 offers for Mobi 63 (formerly Mobtel) from Telenor, DT, FT, Mobilkom Austria (= Telekom Austria), TeliaSonera, Tele2, Orascom, Cellcom, Etisalat, OJSC Mobile; short list May 19, winner late July
Sony BMG plans MVNO for Christians with Integrity Media

ALTNETS:

QSC: Q1 sunrise (TDC Switzerland): plans managed services for SMEs (‘sunrise 1com’: DSL, VoIP, security, VPN, WiFi), plans 145 job cuts (5.7% of 2524)

MOBILE/ALTNETS:

Wind (= Orascom, Weather) plans IPO late 2006 or early 2007 to raise EUR 2 bn for 20-30%


TRENDS:

FIXED:

Copper, xDSL, LLU:
Uganda Telecom launches DSL service (90-300 $/mo for 64-256 kbps)

FTTH:
Erenis (FTTB for MDUs in Paris) deploys VDSL chipsets from Ikanos (up to 100 Mbps)
Naya Tel orders gear from Alcatel for Islamabad network (30k subs)

CATV:
BigBand and Netgear partner to develop DOCSIS 3.0 products
Motorola’s BSR 2000 (broadband services router) receives DOCSIS 1.1 and 2.0 certification

Regulation:
Kenya plans tender for SNO (second national operator), award license early 2007
Tanzania awards SNO license to BOL (Benson Informatics Ltd)
Nigeria awards 4 integrated licenses to Multilinks, Starcomms, Intercellular, Prest Cable & Satellite Comms

WIRELESS

WiFi:
Deployments: BT plans 12 citywide mesh-networks in the UK
In-home: Ruckus Wireless’ ‘MediaFlex WiFi’ router system ordered by Ayersville Telephone (Ohio), Monroe Telephone (Ore), Wilkes Telecomms (NC), Panhandle Telephone Coop (Okl), CC Comms (Nev)
Muniwifi: Houston approves citywide network, 5 bidders: EarthLink, Redmoon Broadband, Convergent Broadband, nextWLAN, Houston WiFi

Cellular:
International roaming: TeliaSonera starts talks over lowering wholesale rates
Mobile termination: E-Plus (KPN) proposes alternative fees (5 c/min for T-Mobile and Vodafone, 9 c/min for E-Plus and O2) as opposed to plan from the other operators (9 and 11.5 c/min; currently 11 and 12.4 c/min), asks for regulation
Content & services:
Internet: KDDI and China Mobile plan adding Google search
TV: KT launches T-DMB service over WiBro with KBS; CellularVision (= Speedus) sues Verizon Wireless over technology; PCCW launches service on CMB (Cell Multimedia Broadcast) technology (up to 250 users/cell) from Huawei; Telcel (Mexico) launches (downloads only, no streaming)
GPS: Disney Mobile family locator service powered by Autodesk

WiMAX, WLL, BWA, BFW, Flash-OFDM, xMax, UMTS TD-CDMA, iBurst:
IPO: NextWave Wireless (‘WiMAXplus’: 802.16e; chipset, spectrum covering 93m pops, PacketyVideo for software for handsets) plans IPO and trial in Henderson (NV)
Spectrum, licenses: Woosh Wireless acquires usage rights to New Zealand Telecom spectrum in the 2.3 GHz band; Versatel (= Tele2) sells license to Casema (= Carlyle, Providence, GMT)
Deployments: TT&T to invest THB 6 bn for roll-out in 2006, launch late 2006

CONVERGENCE:
VoIP:
Deployments: Skype (eBay) launches promo through 2006: SkypeOut free in N-America (guidance unchanged: revenue $200m in 2006); AOL (Time Warner) launches AIM Phoneline (PC-to-PSTN, free phone number)
IPTV: AT&T plans expansion to 15-20 markets by end 2006; DT: deal with Premiere (Bundesliga matches over IPTV from 06/07 season)
F/M: sunrise (TDC) plans dual-mode handset (GSM/WiFi) autumn 2006; FT plans dual-mode phone 06Q4; Kineto wins fifth operator customer for UMA gear



2. INTERNET:

COMPANIES:

eBay: Supreme Court sides with eBay against MercExchange, overturns Appeals Court (which judged that the trial court should have issued an injunction)
Amazon: plans electronic soul mate (similar buying pattern, to enhance recommendations); launches ‘Print-on-demand’ for book publishers with BookSurge
Yahoo: Analyst Day, Alibaba plans IPO

TRENDS:

SEARCH:
Technology: Yahoo! launches Yahoo! Answers (out of beta) and new homepage; Snap.com relaunches (with previews, ads inserted and pay-per-action: only if transaction is completed)
Local: Planet Discover acquired by Gannett
Comparison shopping: ShopWiki launches Mobile Search (beta)
Enterprise: Microsoft launches Knowledge Network

WEB 2.0:
AOL (Time Warner) launched social network ‘AIM Pages’ for AIM users and AOL UnCut (beta) for user-generated video (Flash 8 format), with mobile uploading (technology: VideoEgg)



3. MEDIA:

COMPANIES:

B2C:

Entertainment:
Vivendi: Q1 final, raises 2006 guidance (net income +16%), introduces 2011 guidance (adjusted net income EUR 3.5-4.0 bn, 2006-2001 operating profit CAGR 8-10%); rejects Sebastian Holdings proposal to dismantle; denies offer from Sebastian, 33.50 EUR/share
Univision: Haim Saban, Madison Dearborn, Providence, Texas Pacific and Thomas H. Lee plan offer
Bertelsmann: plans autioning off BMG Music Publishing (revenue 2005: $372m), early June ($1.7 bn)
Sony: ‘Da Vinci Code’ earns $77m at box office over first weekend
DreamWorks Animation: ‘Over the hedge’ earns $37m over first weekend

Cable/satellite:
XM sued by RIAA over ‘Inno’ (device from Pioneer: portable satellite radio with storage)
Cablemas (Mexico) postpones IPO (low demand)

Publishing:
Gannett acquires Planet Discover (local search)
Telegraaf acquires Keesing (puzzle books; 2006E: revenue 55m, EBITA-margin 20%) from NPM, EUR 81.3m, management to have 5%

B2B:

Advertising:
WPP: Campbell Soup consolidates media account ($300m) at Mediaedge:cia; Wrigley reviews UK media account (GBP 13m), currently at MediaCom; WPP plans more acquisitions in China (Financial Times); Groupe Danone places media account ($75m) in review (currently at MediaCom)
Publicis: Miller Brewing keeps media account ($300m) at StarCom (bested Carat (= Aegis))
Mediamark Research Inc pulls out of RfP for radio ratings system, leaving Arbitron and Media Audit
Bridgestone Firestone invites 7 (Arnold (= Havas), Cramer-Krasselt, Leo Burnett (= Publicis), The Richards Group, Foote Cone & Belding (= Interpublic), The Kaplan Thaler Group (= Publicis), Grey (= WPP)) to compete for media/creative account ($25m)
Arbitron: CBS orders PPM service for radio ratings, 7 years
VNU: Knight Vinke gives up resistance against offer; VNU: offer declared irrevocable (78.7% tendered, extended to June 9)

Publishing:
Reed Elsevier: rejected offer from Cinven et al (Candover?) for Reed Business, GBP 2 bn? (Times)


TRENDS:

STM: Humboldt-Universitaet (Berlin) joins ‘Berlin Declaration on Open Access to Knowledge in the Sciences and Humanities’

CABLE: McCain (R) plans US bill incentivising a la carte by reducing franchise fee (5% of revenues) for CATV and national franchise for IPTV

MUSIC DISTRIBUTION: MTV (Viacom) and Microsoft plan launch of ‘Urge’ May 17 (10 $/mo for download to PC, 15 $/mo for downloads to handhelds, permanent downloads 1 $/track)

VIDEO DISTRIBUTION:
MySpace plans selling Fox TV shows (both News Corp)
Orb Networks: deal with MeeVee (video search)
TiVo and Blockbuster rumoured to plan marketing partnership (30 $/mo for Blockbuster’s 3-movies deal + TiVo Series2 DVR)
AOL (Time Warner) acquires Lightningcast (ad inserts)

OBSERVATION://First WiMAX, then xMax, now AIDAAS

WiMAX is gaining momentum (all sorts of deployments come hot on the heels of product certification; Clearwire and NextWave are preparing IPOs), but new technologies keep popping up.

A while ago there was xMax, and this week three more initiaves could be added to the list.

AIDAAS = DVB-S + DVB-T = 3T
A new technology comes out of Malaysia and the Ukraine, bernama.com reports: Advanced Information Delivery and Access Solution (AIDAAS). This is a 'last-mile solution', for both broadband and digital video broadcast. It uses satellite technology for Terrestrial Transponder Technology (3G). Put differently, it combines DVB-S (satellite) and DVB-T (terrestrial) technologies.
"It outstrips WiMAX and what WiMAX promises to deliver in 2008, AIDAAS can deliver today."
Range: up to 60 km. Minimum capacity per end-user: 10 Mbps. And it would lower costs.
Telekom Malyasia is set to trial the technology, using its spectrum.
It sounds exciting, but one has to be a little skeptical. Will it actually work? Can they live up to their promises? How many end-users can be supported? How about network gear and CPE availability? Will it support mobility? In which spectrum band will it perform best? etc.

M2Z
Om Malik wrote about this 'third option'. M2Z is backed by some high-profile VCs and is proposing to the FCC to be given spectrum. In return it will build a nationwide (US) network (in 10 years!). Of a high-end broadband offering, 5% of the income would be given to the US government. A 512 kbps service will be free and ad-supported.
With Auction 66 coming up, this sounds a trifle naive. And it is not clear which technology will be used.

Cyren Call
This is the name of a venture proposing to build a US emergency network, DailyWireless.org writes. Again, the technology is unclear. It would use the 700 MHz band, to be auctioned off in 2008. Cyren Call proposes to be allocated a slice of 30 Mhz.

FACTOID://One billion people online

According to eMarketer, the number of people online has reached 1 billion.

OBSERVATION://Amazon's Soul Mate

Amazon.com's Jeff Bezos launched the idea of an 'electronic soul mate': a customer who has the most similar purchasing history.

An interesting way to take the recommendations system one step further. Or is it Amazon's first foray into creating a social shopping network?

OBSERVATION://NTT DoCoMo weighs diversification

"If DoCoMo is a mobile phone company in five years, our growth will be limited." Reason for Takeshi Natsuno, VP of multimedia services, to weigh diversification. Finance could be option #1.

DIGESTS://Telecoms, Internet, Media: April 25 - May 12

Telecoms:

• Vodafone could be bidding for Vivendi to take control of SFR, which in turn is interested in a larger Neuf Cegetel stake. Also, Vodafone will probably hang on to Arcor and may be going after MTS. Selling the Verizon Wireless stake could be as early as next week. In short, a pan-European convergence operator coming? Look out for the May 30 announcement.
• Roaming deals in the UK, the EU, the US.

Internet:

• eBay expanding its auction territory right up to Google's.
• Click fraud: no cheap settlement for Google?
• Web 2.0 at Google and MSN.

Media:

• Internet-to-TV: Brightcove + TiVo or simply a new Sharp BB set. And a new Dave.tv service.
• Open Access to research to be demanded from federal US agencies.
• After the NYT relaunched its site with a paper-look font, it now plans an on-screen reader from Microsoft. An unusual step, for a company that seems to understand the digital world. It wants to hang on to the look-and-feel of the print edition.

OBSERVATION://Build or buy web apps

Two of Google's 4 new products raise the company's profile in Web 2.0 applications: Google Co-op (shared search) and Google Notebook (shared bookmarking).

Co-op sounds a lot like the Eurekster Swickis (I created one too), Rollyo and Plum.
Notebook (to be launched next week) of course reminds of Yahoo!'s del.icio.us, LookSmart's Furl, Spurl, Rojo or Wink.
So far Yahoo! was the champion of Web 2.0, but Google is getting closer. As usual, it remains to be seen how popular and user-friendly these services are, and if they will ever leave beta.

With so many alternatives around, one can wonder: why build instead of buy? To keep engineers busy? To tie the new apps into the existing ones?
I suppose existing services either demanded too much money from Google, or their technological lead was too narrow and only offered a limited time-to-market advantage.

OPINION://Placeshifting over wireless

Electronic News writes about the dilemma facing the wireless industry: accepting placeshifting technology and services (to drive 3G) or blocking it (to protect their own video services).

I wrote about placeshifting many times and addressed this same issue a few months ago. My opinion is blocking is not the way to go, it is not sustainable. Why not cooperate and take some video content out of a proprietary (but not spectrum abundant) network like DVB-H and allow it to travel over your 3G network?

FACTOIDS://Music in the air

Finally, two reports that link telecoms to music - contemporary music, that is.

Keith McMahon reported on a new book by Rob Walters. Stunning material, linking wireless technology (spread spectrum) to composer George Antheil and actress Hedy Lamarr. Keith concludes it is movie material. It could pass for April's Fools Day material as well.

The Guardian had a review of a London Sinfonietta concert, with Salvatore Sciarrino's Archeologia del Telefono. The piece contains the ghastly Nokia ringtone.