Week 47 in Telecoms, Internet, Media

CORPORATE

• TIM: Bloomberg: KKR considers raising offer [see 211121] - Report: CEO Luigi Gubitosi willing to step down - Moody's: potential credit negative (leverage rises from 4.2 to 5.8x if debt funded and assigned to TIM)
• NJJ/Iliad:
• Eir: 21/22Q1
• Salt: 21Q3; no IPO plan; ComCo decision (and FAC corroboration) block roll-out of Layer 1 access to Swisscom fiber
• Telenor: Telenor SE sells Open Universe (wholesale platform, 200k HP) and SDU fiber networks (14k HP) to GlobalConnect (= EQT), SEK 3b
• VOO:
• Orange BE: Enters final exclusive negotiations with Nethys to acquire VOO (75% minus 1 share), EV (enterprise value 100%) EUR 1.8b = 9.5x EBITDA (before synergies)
• Telenet: Drops out of final exclusive negotiations for VOO, to be acquired by Orange BE - May become wholesale customer of Orange/VOO in Wallonia/Brussels
• CK Hutchison: Avi Gabbay and Shlomo Rodav offer $300m for CK Hutchison's 27% stake in Partner Comms (Israel)

NETWORKS, FIBER, MOBILE

• General:
• New gvt DE targets nationwide open FTTH and 5G
• NKOM (NO) sets discount rate (WACC) 5.33% for fixed & mobile price regulation, consultation until 211217, final decision 22Q1
• ANCOM (RO) report 21H1: average FBB (Orange RO, RCS&RDS, Telekom RONextgen Comms, Vodafone RO) download 429 Mb/s, upload 280 Mb/s; average MBB download (Orange RO, Vodafone RO, Telekom RO, RCS&RDS (Digi)) 31 Mb/s, upload 11 Mb/s
• Mobile:
• Tutela report on BE MNOs (226k tests, 13m measurements during May-Oct 2021): best quality Orange, best coverage Proximus, best video experience Proximus & Orange
• Tutela report on NL MNOs (409k tests, 23m measurements during May-Oct 2021); best experience T-Mobile, best video experience Vodafone & KPN, best 5G coverage Vodafone, best overall coverage T-Mobile
• Copper switch-off: NKOM (NO) proposal to ensure predictability for wholesale customers in the copper network, consultation until 211206
• Liberty Global: To keep investing in HFC & Docsis 4.0, do FTTP on case-by-case basis; may considers IPOs for Sunrise UPC (2022), VodafoneZiggo, Virgin Media O2 (2024); plans wholesale in UK, Virgin Media O2 to add 7m HP; "Convergence works in Europe – it’s critical, The fixed mobile businesses are all about driving scale and growth and taking market share and ultimately driving massive free cashflow"; Liberty’s ventures portfolio is “now too big to ignore” - John Malone: "The biggest threat has always been the stupid guy with a lot of money coming into your business. They might not end up with a lot of profitability, but they sure as hell can damage the profitability of the incumbent."; "we are not empire builders, we decided we had to get smaller to get bigger” (building fixed-mobile champions in key markets and withdrawing from those where it lacked scale)
• Proximus: Starts EV charging trial in Mechelen (8 chargepoints), with Fluvius: up to 3500 in Flanders (total max 7k) street cabinets (of 28k) doubling as chargepoints
• Wind Hellas (= United Group): Establishes Hellenic Open Fiber (Hellenic Openfiber; FTTH & FTTO, OA, passive & active (Wind Hellas to own active layer for mobile), to invest EUR 150m by 2026 for 600k premises; 3379 km of fiber at start (o/w 595 km to be built), valuation EUR 70m
• Primevest: Plans fiber for NDIX datacenters in DE
• Allianz Capital Partners: Establishes Österreichische Glasfaser-Infrastrukturgesellschaft (öGIG; owns 75% of Niederoesterreichische Glasfasergesellschaft (noeGIG)), to invest EUR 1b; target 1m premises (non-urban) by 2030

SERVICES

• Walt Disney: Plans to spnd $33b on content (originals, licensed content, sports rights) in 21/22 (20/21: $25b)
• NBCU: Considers pulling content from Hulu to add to Peacock early (2022) or at when bought out of Hulu by Disney (2024); considers longer window for TV content after airing on NBC (from 1 day to 1 mo)
• Netflix: Acquires Scanline VFX (special effects studio), to close 22Q1; to remain standalone business
• Amazon: Rumor: interested in NFL’s media properties (NFL Network, RedZone, NFL.com), to acquire 49%
• Viaplay: Plans launch in NL March 2022
• Ericsson acquires Vonage (cloud-based comms, CPaaS for enterprise customers, enables communications applications to be integrated into business systems via APIs, 1m app developers, 120k customers; also cloud-based VoIP and UC), 21.00 $/share = $6.2b (enterrise value) cash, to close 22H1, accreditive to FCF & EPS from 2024 - Moody's downgrades outlook (Ba1) to stable (EV = 30x EBITDA 2021E) - Synergy Research report on CPaaS market: Twilio 38.0%, Vonage 11.8%, Sinch 8.1%, bandwidth 6.5%, MessageBird 5.6% (rest 30.0%)

SPECRUM

• PTS (SE) opens application for local 3.7 GHz (3760-3800 and 26G Hz (24.25-25.1) bands (for industry, mining, ports, warehouses, hospitals)
• Belgium gvt approves auction plan, to facilitate newcomer (#4) in 5G auction 22Q2, expects to raise EUR 800m; Citymesh/Cegeka focus on B2B, may expand to B2C
• ANCOM (RO) raises EUR 43m from auction, 2 winners: RCS&RDS (DIGI) EUR42.7m for 2×5 MHz in 800 MHz band (EUR 22m), 4 2×5 MHz blocks in 2600 MHz FDD band (EUR17.2m), 1x15 MHz unpaired spectrum in 2600 MHz TDD band (EUR 3.5m), all valid from 220101 until 290405; Invite Systems EUR 0.7m for 1x5 MHz block in 3400 MHz-3600MHz band, valid from 220101 until 251231

INTERNET PLATFORMS

• Google:
• Google Ireland settles tax claim, pays EUR 345m
• Agrees CMA and ICO (UK) oversight of Privacy Sandbox (alternative for tracking cookies for targeting ads based on cohorts (FLoCs)), consultation until 211217
• Facebook: Gizmodo to publish all Facebook Papers (edited with NYU, UMass Amherst, Columbia, Marquette, ACLU)
• Microsoft: Sued by Nextcloud (DE; privacy-friendly alternative to other file-hosting/storage services), supported by others, over bundling/pre-installing OneDrive, Teams, other with Windows 11
• Apple: Sues NSO Group (Pegasus spyware), seeks permanent injunction (for violating Computer Fraud and Abuse Act), NSO to delete all data, disclose entities it shared data with - To donate $10m + any dmages from lawsuit to organizations pursuing cybersurveillance research and advocacy
• General
• EDPB proposes ban on tracking, child profiling, real-time biometrics (facial recognition), consumer classification based on ethnicity, gender, politics - EDPB publishes draft guidelines on the interplay between the application of GDPR Article 3 and its provisions on international transfers in Chapter V, direct collection of personal data by non-EU companies is not a "data transfer" under GDPR; consultation until Jan 2022
• AGCM (IT) fines Apple (134.5m) & Amazon (68.7m) EUR 203m over collusion in sale of Apple products (barred resellers from using amazon.it)
• AGCM (IT) fines Google & Apple EUR 10m each for not giving information aboujt collection and use of data; plan appeal
• EP Committee on the Internal Market and Consumer Protection (IMCO) approves DMA [see 211118] - EP plenary vote follows Dec 2021, negotiations with EU governments to start 22H1
• 193 countries (incl China, excl US) adopt UNESCO’s recommendation on AI ethics (ban social scoring and the use of AI for mass surveillance; AI developers should conduct ethical impact assessments; governments should put in place strong enforcement mechanisms and remedial actions
• New gvt DE plans to ban biometric facial recognition and restrict the usage of mass surveillance tools
• EU Council approves DSA & DMA; to discuss in trilogue with EC and EP 22H1 (issue: which regulators will have the right to levy fines: EC vs NRAs; EC to be sole regulator for VLOPs), to become law probably 2023
• EC proposes rules on political advertising: scope (ads by, for or on behalf of a political actor as well as so called issue-based ads), transparency (clearly labelled as such and include information such as who paid for it and how much), targeting (banned when using sensitive personal data (race, political opinions, religious beliefs, sexual orientation, health conditions, trade union affiliation) without explicit consent), fines (to be set by National Data Protection Authorities) - EC proposes update to EU rules on funding of European political parties and foundations - To be discussed with EP and EU Council, to be implemented spirng 2023