Wednesday, April 27, 2011

KPN takes a leaf out of Telefonica's book

There are some striking similarities between KPN's recent profit warning (April 21), Telefonica's Investor Days (13-14 April) and Telefonica's report on dropping voice and SMS income (January 11). This may lead to speculation over two things:
  1. Details of KPN's Investor Day (May 10).
  2. The possibility of a merger (again).
As to #1:
  • Revenue CAGR: Telefonica 1-4%, KPN tba.
  • EBITDA-margin: Telefonica high 30s, KPN tba.
  • Revenue mix: Telefonica voice + access from 75 to 64%, BB from 8 to 25%, VAS from 5 to 9%. KPN tba.
  • Home market job reductions: Telefonica 20%, KPN 20-25%.
  • Focus for both: fixing mobile broadband propositions, differentiating tariffs including VoIP, chat, email, socail networking, browsing.
As to #2:
  • Telefonica said that "LTE is a three-player market". This suggests that it feels that E-Plus in Germany isn't there to stay.
  • KPN's previous CEO Ad Scheepbouwer said that only two companies could logically launch an offer for KPN: Telefonica and France Telecom. The latter seems out of the question: it is cozying up to Deutsche Telekom (network sharing UK and Austria, joint procurement, more to come) and wouldn't want to start competing on the German market (DT left the French market years ago). Also, that wouldn't reduce the number of mobile players to 3.
  • Conclusion: an offer from Telefonica still makes sense.

Tuesday, April 12, 2011

Buy the Global Connected TV report and get a free pass

The Global Connected TV 2011 report is out. Its origins trace back to a presentation we did for the European salesforce of Intel in Antwerp, last autumn. This 30+ ppt first grew into a 100 slide draft version, before being turned into a more traditional report. There are 57 pages, 12 chapters and 179 footnotes. The personal edition comes with a free pass to the Connected TV 2011 conference, April 27 in Utrecht.

Directly or indirectly, there is an impressive list of operators involved in the conference:

  • Direct:
  • - Reggefiber
  • - Deutsche Telekom
  • - Mobistar
  • Indirect:
  • - NSN: Belgacom, KPN, others
  • - Amino: Telecom Italia
  • - Intel: Liberty Global
  • - Oregan: Telefonica
  • - Wyplay: SFR, Vodafone Spain
And we are having people talk about major recent product launches and standards as well:
  • NPO, Deutsche Telekom: HbbTV
  • Irdeto: ActiveCloak for Media
  • NSN: Ubiquity Multiscreen TV Platform
  • Cisco: Videoscape
  • Amino: Freedom, Freedom Jump
  • Technicolor: MediaEncore
  • Intel: Groveland
We just updated this post for further reference to Market Commentaries and Research Briefs on Connected TV.

Monday, April 04, 2011

Dual track started for selling off Ziggo

Warburg Pincus and Cinven apparently have entered the dual track: besides shopping Ziggo to Liberty Global, they are now also looking at an IPO. The company's value could be around the rather familiar EUR 7 billion level. Liberty Global is out of cash, after buying KBW, and may be forced to sell more assets before it could turn to Ziggo.

Sunday, April 03, 2011

Fiber wars in the Netherlands

The town of Heeze-Leende is now planning a cooperative-owned FTTH network, for fear that Reggefiber/KPN would skip farms and other rural locations. In other towns, things have gone rather more hostile:
  • Eersel: similar situation as in Heeze-Leende, except that Reggefiber has already begun assessing demand. Opponent is the Buurtcomite Glasvezel Eersel.
  • Vught: again, a similar situation. Reggefiber is in the process of assessing demand, while (owned by entrepreneur Jan Schuurmans) is starting to roll-out on its own.
  • Harderwijk: the local cable company, CAI Harderwijk, has stated that it will replace its network with FTTH, but not all too soon. It will be a very gradual process. In the meantime, CIF (Communication Infrastructure Fund, run by Bouwfonds with around EUR 1 billion from several pension funds) has apparently knocked on its door, but the city doesn't want to sell. Now CIF is threatening to start rolling out FTTH on its own.
In this order, these are increasingly aggressive tactics to bring fiber to a town. Harderwijk especially could turn into a bloody mess, because who could wish to duplicate a network?

Will Reggefiber give in and blanket entire municipalities, including rural areas? Will CAI Harderwijk give in and sell to CIF? Will CIF revert to buying other cable assets (such as Delta Kabel, Cogas Kabel, Rekam, etc.)? Will it be forced to shop abroad? Is the time getting ripe for coops to enter the market?

Why Google picked Kansas City (KS) for Google Fiber

This article in the Kansas City Star provides some background on the Google Fiber for Communities deal with Kansas City (KS):
  • "The local electric provider — a key player in sharing utility poles and buried conduit — is publicly owned".
  • The deal was closed "between the megacorporation, the Unified Government and the Board of Public Utilities".
  • Google will get a “single point of contact”.
  • "The plan could mean tens of millions of dollars invested in Kansas City, Kan., by the company, and without any of the usual corporate demands for tax breaks".
  • "We felt we could offer a track record of showing how that idea of public-private partnerships can become reality".
  • "For a city of 150,000, we’re very diverse, physically, economically and racially,” he said. “We talked about the Kansas City, Kansas, schools and their reform efforts and their willingness to adopt technology to address education, their laptop program where every high school student gets a laptop".
  • "Kansas City has long been a railroad hub. And rail right-of-ways have been prime places for running fiber-optic wire".
  • "Wyandotte County also still counts on the trusty old utility pole. While more vulnerable to bad weather, it’s also cheaper and quicker to tie another line to a telephone pole than to bury the lines underground".
  • "We were interested in going somewhere we could build quickly".