Friday, December 16, 2011

KPN is reversing its position versus the OTT market

A very disappointing turn of events is taking place at KPN. KPN has been a champion of the European incumbents for a long time, with an open view to the realities of the over-the-top market and open access networks.

Ad Scheepbouwer himself developed in a very positive way, during his 10 years at KPN. Back in 2003, he was quoted saying that companies such as Tele2 are "like parasites on our network". However, in his last days as CEO of KPN, Ad Scheepbouwer was quoted as follows:
Meanwhile, Scheepbouwer is dismissive of suggestions from rivals, such as Telefonica's CEO Cesar Alierta and Vodafone Group PLC's CEO Vittoria Collao that the biggest generators of network traffic, such as Google Inc., should pay for the benefit of reaping a huge amount of revenue from infrastructure in which they have invested. "The Internet is open and free for all to use and the solution isn't to start charging Google money. Then we should have invented Google ourselves."
(Total Telecom, April 5, 2011).

We thought that the A.T. Kearney report (for DT, FT, Telefonica, TI) claiming the opposite of what Scheepbouwer was saying, had been thoroughly buried by now, by Communication Chambers, Plum Consulting, and over here as well. In October, at a Fiber Summit in Amsterdam, Alcatel-Lucent's Ben Verwaayen left no doubt about where his company stands in this discussion: it is firmly behind DT, FT, Telefonica and TI. And we all know where Alcatel-Lucent, and its CEO, are going.

The turn of events at KPN is not only disappointing , but also points to conflicting views within the KPN management. The current director of Wholesale & Operations dismissed the concept of Google et al contributing only a week ago. When an Alcatel-Lucent worker (!) asked him how he planned to start charging Google et al, he replied: 'we want to join in, ring fencing is pointless', which seemed to suggest that he is firmly on Scheepbouwer's side.

Wednesday, December 14, 2011

Dish Network goes OTT and LTE

Dish Network has an interesting strategy, further expanded under its new CEO Joe Clayton. Since it doesn't have a fixed-line network, it apparently needs a work-around. This comes in two forms:

  • LTE. The company owns 40 MHz of nationwide spectrum (and some). There are TD-LTE plans (probably for a fixed-wireless solution), but a cooperation seems more logical - such as making an offer for T-Mobile USA.
  • OTT. Since it has nationwide content rights, why not piggy-back on somebody else's infrastructure? It is a loyal Google TV partner, has the Blockbuster business (including Movie Pass) and could even go further.

Monday, December 12, 2011

Wireless solutions help maintain the digital divide

Can wireless replace wireline? The obvious answer is 'no', but it is remarkable to see that a growing number of companies is trying to answer 'yes'. Some instances:

  • Vodafone Germany: migrating DSL subs to LTE.
  • Verizon will not expand FiOS beyond the currently planned 18 million homes, instead relying on LTE and the new spectrum it is buying from cable companies (and perhaps also to safeguard peace with those very same cable companies).
  • Chinese investors are invading Belgium on the back of a 4G license for TD-LTE spectrum.
  • NSN has introduced outdoor CPE for TD-LTE based service.
  • O3b is building a global satellite network for 'the other 3 billion'.
  • SES (Astra2Connect) and WildBlue Communications are raising speeds (to 10 and 12 Mb/s) and lowering prices (to 28 EUR/mo and 50 USD/mo) for BB-over-satellite.
  • On the positive side: These solutions are for underserved areas (whether third world or rural) and will provide rather basic needs only.
  • On the negative side: These investments will reduce the direct need for fiber to rural areas, which may lead to an ongoing digital divide between rural areas (speeds up to 10 or so Mb/s, but in reality probably a lot lower and possibly capped) and denser areas (to be served by true FTTP, which is gradually moving to 1 Gb/s).

Tuesday, December 06, 2011

The thin line between following the market leader and collusion

The offices of the three Dutch MNOs, KPN, Vodafone NL and T-Mobile NL, were raided by the antitrust authority NMa on suspicion of price arrangements (collusion) and carving out distribution (retail) channels. The three aren't denying, but guaranteeing full cooperation. KPN stated that five employees have been singled out for the investigation. The NMa stated that they have official statements from two whistleblowers.

There are speculative reasons to believe both sides (it's an investigation, and pending the results no one is guilty):

Speaking for the operators:

  • Price arrangements would be stupid because of the PR risk. The operators have only recently been convicted for similar charges dating back to 2001.
  • Price arrangements also appear to be unnecessary in the light of the oligopolistic market, where Voda and T-Mo follow KPN - which is not illegal.
  • There was a direct reason for all operators to move quickly and raise prices during 11Q2: a rather sudden change in consumer behavior from late 2010, embracing IM/chat/VoIP apps. This put pressure on voice/SMS income. Moreover, charging for these data comms apps was made impossible because of the new net neutrality laws.
Speaking for the whistleblowers:
  • They, and the NMa, appear to be very serious.
  • The operators are not denying.
What may have been the case?
  1. The allegations are true. In this case, consequenses will be severe, both in terms of fines and in terms of regulation. NPS numbers will go down the drain.
  2. The allegations are not true. The whistleblowers are in fact disgruntled employees - or so. Naturally, they approach right-wing media and populist politicians, such as the neo-fascist PVV party supporting the current government.
At this point it is impossible to say which is true. Perhaps the whistleblowers speak the truth. But if they cannot see the difference between 'following the market leader' and 'making illegal price arrangements', then the charges may very well be untrue.

Friday, December 02, 2011

B4RN is a go - Gigabit fiber coming to Lancashire

Lindsey Annison kindly allowed us the scoop on B4RN reaching its first target. Wonderful news, and Lancashire will likely be connected to gigabit fiber over the next few years.

Here is the entire press release:

B4RN (Broadband 4 the Rural North) has passed its target, in a mere three months, to gain enough interest to proceed with the project to connect 8 parishes in rural Lancashire to a community designed, built, owned and operated gigabit FTTH network. Full details of the project are available on the website
There are Press Passes available for the launch event on Dec 15th at 2pm at The Storey, Lancaster.

Thank you for all your support. 
FOR IMMEDIATE RELEASE - 1st December 2011

Residents in North Lancashire launch Fibre Optic Broadband Company

An exciting community initiative, initially across eight parishes of rural Lancashire, to deliver a world class hyperfast fibre optic broadband network is being launched at The Storey in Lancaster on 15th December at 2pm.

Broadband has become essential for every sector of the community and increasingly important for our daily lives. Government and the large telecom companies plan to upgrade broadband to ‘superfast’ but not in many rural areas, where limited internet and mobile coverage affects  businesses, homes and farms. The difficulty is reaching economic viability when private companies’ costs are so high and subscriber numbers are low.

Broadband for the Rural North (B4RN) plans to lower the costs, both in the building of the broadband network and to the end user, by using local contractors and the community. “Farmers and local people have the skillset we need for this project. They know the land and people, and have been offering to work for shares, which means the digging for the core network can start early in 2012. We expect this to be completed in approximately 3 months, weather permitting, and then we will begin to connect the first users,” stated Professor Forde. Shares will be available from 15th December - further information and application forms will be available on the website on that date.

B4RN’s plans are for a hyperfast broadband network fit for purpose far into this century. A 1 gigabit (1000Mbps) connection will ensure that any interaction with the Internet will be quick and easy. Television, films, cheap phone and video calls over the Internet, the ability to extend local mobile phone networks to cover black-spots, local security, telehealth and medicine applications - all will become possible. B4RN will be initially be providing the broadband connection and VoIP telephony, with further services to follow as the network rolls out over the coming years.

Barry Forde, B4RN Chief Executive, will explain the project and launch the share offer in the company to raise the necessary capital required over the next few months. Representatives from the first phase communities of Melling, Arkholme, Quernmore, Abbeystead, Wray, Tatham,
Roeburndale, Wennington and Caton with Littledale will be at the event as well as local dignitaries and celebrities.

B4RN is a community benefit company, owned by its shareholders. Income made will be re-invested in the service and spent within the communities the company serves. The shares are being made available under the EIS (Enterprise Investment Scheme) that offers 30% tax relief, with a minimum investment of £100 and maximum of £20,000.

B4RN hopes to attract the support of local, national and international investors, whilst remaining a truly community-run business, bringing fast, future-proof, sustainable Internet access to the rural uplands, for this generation and those to come, leaving a lasting legacy for the area.


1. B4RN has been more than three years in the planning and development stage. The B4RN project will bring a state of the art, fibre optic broadband connection to the rural communities long before most of the urban areas. Rural Lancashire plans to be a world leader in “hyperfast”.

2. Professor Barry Forde (B4RN Chief Executive) is a networking expert with many years experience of designing, building and operating high performance networks. He was responsible for the CLEO network which provides connectivity to over 1000 schools and public sector sites across Lancashire and Cumbria. Bios are available for Professor Forde and the Management team

3. The full business plan is available on the website, along with details of the pricing and payment structure for local residents and businesses. This includes bonuses of free install and connection for 12 months with a £1500 investment, three further free months for early bird investors, and payment in shares for involvement in the deployment of the project.

4. A target of 662 registrations of interest were required for a green light and this was passed in just three months. The project moves one step closer to implementation with the launch of the Share Issue. “The phased network will be built by the community over three years for the seven phases. Now we have passed our target of over 700 registrations of interest in investment and taking a service at £30/month for 1Gbps, we can proceed to raise the capital required for Phase 1,” said Barry Forde.

5. B4RN will initially provide internet and telephony with further services in the future. Each home will have a battery backup so telephony over the fibre means landline connections are no longer required.

6. Christine Conder, a farmer’s wife and rural broadband pioneer, who successfully dug and installed the first rural fibre cable to her farm in Wray in 2009, knows it can be done and sums up the enthusiasm and ethos of B4RN, “If we don’t do it ourselves then it will never get done, so B4RN is the answer, let’s all JFDI.”

6. Photos (to be accredited to B4RN) are available at

Contact details:

Professor Barry Forde,
Christine Conder,
Lindsey Annison,

Telephone: 01524 221588 or mobile: 07952 503253 / 07967 670759
Twitter: @dig2agig
JFDI (Just Farmers Doing IT)