Tuesday, June 21, 2022

Results of the Belgian multiband auction of June 2022

BIPT raises EUR 1.20b (reserve price total EUR 431m) from multiband 5G SMRA auction after 46 rounds, valid 20 yr until 400506

Winners to cooperate on spectrum positions by 220705 (final round if no agreement)

1.4 GHz band auction to follow, 3 bidders, total reserve price EUR 46.5m5 winners:

  • Citymesh Mobile (Citymesh 51%, RCS&RDS (Digi) 49%; reserved spectrum for newcomer, plans to be MNO #4 for business market, Digi for consumer market) 2x5 in 900, 2x15 in 1800, 2x5 in 2100, 2x5 in 700, 50 in 3600 (total EUR 83.3m). Targets 20% coverage by 2023 allowing national roaming for launch, targets market share 10%.
  • Network Research Belgium (= Ethias, for business market) 20 in 3600 (EUR 11.0m)
  • Orange BE 2x10 in 900, 2x15 in 1800, 2x15 in 2100, 2x10 in 700, 100 in 3600 (total EUR 322m for 200 MHz; to phase out 3G from mid 2023 to 2025, phase out 2G by end 2028)
  • Proximus 2x10 in 900, 2x25 in 1800, 2x25 in 2100, 2x10 in 700, 100 in 3600 (total EUR 491m)
  • Telenet 2x10 in 900, 2x20 in 1800, 2x15 in 2100, 2x5 in 700, 100 in 3600 (total EUR 264m)

Wednesday, June 08, 2022

Structural seperation advancing in telecoms, esp. in Italy

After a bad example in Australia (the NBN debacle), good ones in New-Zealand (Chorus and Spark) and Czech Republic (CETIN, PPF), a formal one in Denmark (TDC NET and Nuuday still in the TDC Holding structure - waiting for Nuuday to be offloaded) and nearly one in the UK (Openreach still in full BT ownership), structural separation may now happen in Italy. Ireland (eir, NBP, SIRO) also looks like a candidate (esp. now that Virgin Media Ireland is becoming a SIRO customer).

Here is what is going on at TIM:

  • 21 Nov. 2021: KKR considers a friendly offer of 0.505 EUR/share (equity valuation EUR 10.8b). Net debt was EUR 22.5b.
  • 7 and 17 Dec. 2021: Management changes.
  • 15 Dec. 2021: Profit warning.
  • 26 Jan. 2022: Industrial Plan draft.
  • 14 Feb. 2022: Industrial Plan update.
  • 2 Mar. 2022: Q4 results and Industrial Plan 2022-2024 (NetCo and ServCo). CVC and Iliad have shown interest in buying a stake in ServCo.
  • 4 May 2022: Q1 results, plans Capital Markets Day 7 July.
  • 29 May 2022: NetCo (incl. FiberCop) spin-off and Open Fiber merger proposal; NetCo valuation EUR 20b (rumor); CDP Equity to own 70-77%, KKR 12-15%, Macquarie 10-13% (rumor).
  • 1 June 2022: Vivendi (24%) objects to valuation (current market cap EUR 5.9b, net debt EUR 17.7b).
  • 7 June 2022: 1,200 job cuts by Nov. 2022.
  • 20 June 2022: Vivendi demands NetCo valuation of EUR 31b, to take on EUR 10b debt


Monday, April 11, 2022

T-Mobile Netherlands: 3 scenarios for value creation, annual return 25% at base case

Three scenarios for value creation in the takeover of T-Mobile Netherlands, based on a number of assumptions:

  • TMNL's 2021 results
  • Not paying taxes.
  • Not paying dividends, instead reducing debt.
  • Slowing revenue growth; EBITDA growth 2x revenue growth (margin expansion); Capex growth 0.9x revenue growth (Capex-to-Sales declining).
Three scenarios:
  • Base case: return CAGR 16.5%. FCF generation is insufficient to prevent a multiple contraction. The enterprise value increases from EUR 5.1 to 5.5 billion.
  • Stable multiple case (8.0x): return CAGR 25.3%. EV increases from EUR 5.1 to 8.1 billion.
  • Expanding multiple (to 11.0x): return CAGR 32.2%. EV grows from EUR 5.1 to 11.1 billion.

(EUR millions)2021202220232024202520262027
LBO debt redux scenario 1: multiple contraction
rev growth (%)5%5%4%4%3%3%
EBITDA AL6346977678298959481005
EBITDA growth (%)10%10%8%8%6%6%
EBITDA margin (%)30.6%32.1%33.6%34.9%36.2%37.3%38.4%
Capex growth (%)4.5%4.5%3.6%3.6%2.7%2.7%
Capex/Sales ratio (%)13.2%13.2%13.1%13.1%13.0%13.0%12.9%
Oper FCF360411468519574619667
Oper FCF/Sales ratio (%)17.4%18.9%20.5%21.8%23.2%24.3%25.4%
Net debt3750354632822950255420861554
Net FCF204264332396468532602
Net FCF/Sales ratio (%)9.9%12.1%14.5%16.7%18.9%20.9%23.0%
Net FCF cumulative2044688001196166421962798
Equity value1350161419462342280933423944
Enterprise value (EV)5100516052275292536354285498
LBO debt redux scenario 2: multiple stabilisation
Enterprise value (EV)5100561061716665719876308088
Equity value1350206428893715464455446533
LBO debt redux scenario 3: multiple expansion
Enterprise value (EV)51005928690478718948995911059
Equity value1350238236234921639478739505

Sunday, January 30, 2022

Week 4/2022 in Telecoms, Internet, Media


  • Orange: BoD appoints Christel Heydemann (Schneider Electric; formerly BCG, Alcatel, Alcatel-Lucent) CEO from 220404; Stéphane Richard to remain Chair until successor found
  • Telecom Italia: CEO Pietro Labriola presents guidelines for industrial plan 2022-24 to BoD (full plan 220302):
    • transformation of consumer services, focus on enterprise services (cloud, IoT, cybersecurity), cost control, stable long-lasting growth outlook for the network infrastructure
    • to explore strategic options to maximize shareholder value ("with specific reference to the Group’s infrastructure assets, including solutions that go beyond vertical integration")
    • committee analysing KKR's plans constinues work with financial advisors
  • Telia
    • To sell of 49% stake in towers (3800 sites) FI & NO (2021 rev SEK 649m, EBITDA SEK 398m) to Brookfield & Alecta [see 210630] at EV SEK 11.224b (28.2x EBITDA 2021), cash proceeds SEK 5.500b, to close 22Q3; plans SBB or extraordinary dividend
    • 21Q4
  • Vodafone: Cevian Capital (activist) acquired stake
  • Altice Europe: Reuters: dropped plan to sell Altice PT (wanted EUR 7b, highest bid EUR 6b)
  • AT&T: 21Q4
    • WarnerMedia rev +15%, HBO Max ARPU US $11.15; expects to close WarnerMedia/Discovery merger 22Q2, expects to win back lost customer after leaving Amazon Channels after merger with Discovery
    • outlook 2022 (incl WarnerMedia & Xandr): rev growth LSD, adj EPS $3.10-3.15, gross capital investment (inc vendor financing ($4b), excl FirstNet reimbursements) $24b, capex $20b, FCF $23b; 2022 contibution from WarnerMedia & Xandr: rev $37-39b, EBITDA $6-7b, FCF $3b
    • plans to deploy C-band (3.45 GHz) with one-climb strategy
    • plans to reduce fiber cycle (from engineering to commercialisation) from 12 to 9 mo, target 30m FTTH HP YE 2025
    • plans analyst event early March 2022
  • Verizon: 21Q4
  • Comcast: 21Q4, rev Universal Pictures Home Ent $392m (+31%), content spend NBCU + Sky ~$20b in 2021; Comcast lost 349k pay-TV subs, Sky lost 198k subs, Peacock 24.5m MAU, >9m paid subs + 7m free subs via cable subscriptions; plans to double content spending for Peacock to $3b in 2022, to $5b in couple of years; plans BB coverage expansion 
  • Google: Acquires 1.28% stake in Bharti Airtel, $700m (734 INR/share); to invest $300m in development 
  • Facebook: EC approves Kustomer (CRM software) acquisition, with conditions for 10 yr: non-discriminatory access to APIs for messaging channels to competing CRM software providers, omproved features of Messenger, Instagram messaging, WhatsApp to be made available to Kustomer's rivals
  • Microsoft: 21/22Q2
  • Apple: 21Q4


  • Eir: Establishes 51/49 JV Fibre Networks Ireland with InfraVia to add 50k HP/annum, 250k YE 2023; to sell exclusively via Open Eir (= Eir Wholesale); combined coverage target 1.9m premises YE 2026
  • Virgin Media O2: Rumor: plans to establish fiber JV, to invest GBP 1b 
  • Infopact: Established Fiber Crew (Jonaz Wholesale): unbundles KPN FTTP, max 10 Gb/s, reaches 250k HP (incl 50k in Hilversum); customers: Fiber.nl, Freedom, Greenet, Jonaz, Netrebel, Plinq
  • KPN complies with free modem choice regulation for FTTH [see 210727] - Ziggo and T-Mobile NL provide specs  
  • T-Mobile NL raises BB prices: 100/100 Mb/s for 35 EUR/mo, 400/400 Mb/s for 40 EUR/mo, 1/1 Gb/s for 45 EUR/mo (60 EUR/mo in KPN/VULA areas); promo: first 4 mo 30 EUR/mo for each; add-ons: TV 12.50 EUR/mo, FT 2.50 EUR/mo; discount 5 EUR/mo for mobile subs (T-Mobile or Tele2); T-Mobile claims wholesale pricing KPN ~20 EUR/mo for ODF access (in P2P/AON areas), 36 EUR/mo for VULA access (in P2MP/PON areas); expands 1 /1 Gb/s coverage to 3.3m addresses; targets to become #1 fiber provider
  • Proximus plans to starts switching off copper (VDSL, 27.50 EUR/mo) March 2022 in Brussel (Anspachlaan), to charge same price temporarily for fiber subscription (from 42.50 EUR/mo)
  • Community Fibre expands roll-out plan to 2.2m HP (= 61% of 3.5m) in London YE 2024 (currently 435k) [also owns Box Broadband (Surrey, West Surrey)]
  • AT&T raises max speed to 2/2 (110 $/mo + tax or 225 $/mo for businesses) and 5/5 Gb/s (180 $/mo + tax or 400 $/mo for businesses) in parts of 70 metros (max lab speed 10 Gb/s); scraps annual contracts, equipment fees, data caps; adds ActiveArmor (security), next-gen WiFi, HBO Max to fastest tiers (free)
  • MetroNet (= Oak Hill Capital, KKR) to merge with Vexus Fiber (Texas, NM, Louisiana; = Oak Hill Capital, Pamlico Capital)

Networks, Vendors

  • KPN launches Digitenne (DVB-T2) CI+ module with antenna V6 (free for Digitenne subs)
  • DVB and 5G Media Action Group partner to develop broadcast (DVB-I) over 5G
  • Folded 2014; founder wanted combination with Starry (FWA)
  • BAI orders datacenter space in London from BT Wholesale to support neutral host network (incl colocation for MNOs) in London Underground (20 yr concession from Transport for London) for mobile & WiFi coverage
  • Ericsson 21Q4
  • BT plans Open RAN trial in Hull, with Nokia
  • Signify (formerly Philips Lighting) acquires Telensa (smart streetlights, PLANet platform manages 2m streetlights in 400 cities) from Plextek Group
  • Sigfox (LP-WAN for IoT) in receivership (as result of pandemic-related slowdown and chips shortage)
  • FCC (US) establishes 6G Technological Advisory Council of 44
  • Facebook: Plans AI Research SuperCluster (RSC) supercomputer to train content-moderation systems, develop new AR tools, help build the technology necessary to power the metaverse; to launch mid 2022 - To change reporting from 21Q4 (Family of Apps, eality Labs)


  • Deutsche Telekom: Discontinues MagentaGaming [see 200825]
  • MTG: Sells ESL Gaming (91.46% stake) to Savvy Gaming Group (SGG), $960m, at EV $1.05b, plans special dividend, to close 22Q2 
  • Vodafone PT launches Smart Home Hub (Nevo Butler), manufactured by Universal Electronics Inc (UEI), with voice control
  • AdlC (FR) starts investigation of cloud market, plans consultation summer 2022, final conclusions early 2023
  • Bloomberg: Diem Association plans to sell IP - WSJ: sells to Silvergate Capital, $200m
  • DPG Media: Raises EUR 100m debt from EIB (part of EUR 244m digital investment project)
  • Salto asks authorities to deal with asymmetry of remote controls having direct access buttons for US streamers (Netflix, YouTube, Amazon) only  X, Sky Ticket; CH & IT to follow
  • Viaplay: Distr deal with Ziggo, promo: first 4 mo for EUR 20, then 10 EUR/mo - And with KPN: promo 10 EUR/mo until 220801 for existing subs, first 9 mo free for new subs - Not with SKV: refers to Viaplay app (14 EUR/mo) or F1 TV Pro app (8 EUR/mo or 65 EUR/yr) 
  • Disney+: Plans expansion to 42 new countries + 11 territories in Europe, W Asia, Africa summer 2022: Albania, Algeria, Andorra, Bahrain, Bosnia & Herzegovina, Bulgaria, Croatia, CZ, Egypt, Estonia, GR, HU, Iraq, Israel, Jordan, Kosovo, Kuwait, Latvia, Lebanon, Libya, Liechtenstein, Lithuania, Malta, Montenegro, Morocco, N Macedonia, Oman, Palestine Territories, Poland, Qatar, RO, San Marino, KSA, Serbia, Slovakia, Slovenia, ZA, Tunisia, Turkey, UAE, Vatican City, Yemen + Denmark’s Faroe Islands, France’s French Polynesia, French Southern Territories and St Pierre & Miquelon Overseas Collective, Finland’s Åland Islands, the Netherlands’ Sint Maarten, Norway’s Svalbard & Jan Mayen, UK’s British Indian Ocean Territory, Gibraltar, Pitcairn Islands & St Helena
  • Discovery+ plans launch in DE & AT summer 2022 on Sky platforms (X, Q, Glass)
  • YouTube: Update 'Our 2022 Priorities' (Annual Letter); Shorts [see 200625] reached 5t all-time views, to integrate shopping in Shorts; 2021: >50m subs (incl trials) for YouTube Music/Premium, gaming content during 21H1: 800b views, 90m hr of live streaming, 250m uploads; channels earning 10k $/yr up 40%, total 10 ways to make money, channel memberships 110m (new & renewal); Oxford Economics report: supported >880k jobs globally in 2020; plans expansion in podcasts & new tech (NFT, Web3)


  • Google: Privacy Sandbox to end FLoC (Federated Learning of Cohorts) trials for tracking, to replace with Topics: lets advertisers target users online based on select topics (Google Chrome generates 5 topics from users' browser history (out of total 300) with participating websites, stored for 3 weeks then deleted) - German media groups oppose cookie phase-out
  • Apple: ACM rejects payment solution [see 211224], fines EUR 5m (max 50m): no alternative payment system available
  • RTL
    • M6: Association of Advertisers (UDM): TV advertising and digital advertising not substitutable
    • ACM starts in-depth investigation (data analysis) of Talpa merger (RTL & Talpa required to apply for license); focus on advertisers (will prices rise?), producers (fewer outside productions?), distributors (higher carriage fees?)
  • Spotify: 
    • Neil Young pulls music from Spotify protesting podcaster Joe Rogan (anti-vaxxer) - Spotify maintains support for Rogan - Joni Mitchell also pulls all music
    • To add a content advisory to any podcast episode that includes a discussion about COVID-19, to improve transparency [see 220126]
  • CMA (UK) starts study of UK streaming music market
  • Film windows France:
    • Netflix: New film window to be reduced to 15 mo in FR under new agreement (to invest 40m EUR/yr to produce 10 indie movies to be owned by producers & creators)
    • Canal+ (Vivendi): New film window to be reduced to 6 mo in FR under new agreement (formerly 8 mo), total availability 16 mo (based on Canal+ investments in film)