Charles Dunstone

As the 1990s came around, UK entrepreneur Charles Dunstone had recently started selling ‘car phones’ from his flat in London’s Marylebone. Two decades later and Carphone Warehouse is one of the UK’s great success stories, established as a major high street brand with overseas expansion in place through Europe to the USA.

But Dunstone, who remains co-founder and CEO of Carphone Warehouse, is humble about the firm’s origins and maintains that “generally what happens in the mobile business is anything that wasn’t anticipated.

“To understand the mobile industry you have to understand the history of it,” he says. “I didn’t really have any insight when I first started out in the business, I was really just stumbling around trying to make a living.” And if Dunstone is saying that his success was sheer fluke, he shares a similar attitude to other ‘accidentally’ successful players in the business.

“All through the history of mobile, everyone has failed to understand its potential and then they’ve failed to capitalise on it,” he says. “Yet the mobile business has succeeded in spite of the incompetence of the people running it.”

Going back to the early days of Carphone Warehouse and the arrival of his first business opportunity, Dunstone highlights Vodafone predecessor Racal, one of the UK’s first mobile licensees. “When the first mobile licences were awarded, Racal said it anticipated that one day there would be around 600,000 mobile phone users in the UK. Even the government thought they were being recklessly optimistic.” Today that number is close to 80 million, at nearly 130 per cent penetration.

The next thing to astonish was the success of SMS. It’s an oft-quoted story that the original spec for GSM was designed by engineers who thought it would be useful for the networks to be able to communicate with their customers. SMS fit the bill in this instance. “But one of the senior guys at Nokia revealed to me that when they first made a GSM phone they could not conceive of why anyone would ever use SMS,” Dunstone says. “But the engineers couldn’t decide whether the inclusion of the technology was optional, or a mandatory part of the spec, so they included it anyway just to be safe. So text messaging is 100 per cent accidental.

It’s unbelievable that SMS is so light in usage of the network, yet operators can charge so much for it. SMS was the start point for data pricing.” And again, the industry failed to capitalise on it until much later. “The success of the Blackberry is a great reflection of this. People couldn’t use data until a company came along and said ‘look here’s a device that lets you do email really well from a handheld’.” Yet Dunstone finds that this model is becoming increasingly challenged. He likens devices that are good at one thing to the Wang of the PC market. When the PC first arrived on the scent it couldn’t do word processing, so Wang filled the gap with an electronic word processor. As the PC evolved users moved away from devices that did just one thing really well and gravitated towards multi purpose gadgets.

“There’s been a transformation in the last three to four years. Fundamentally the incumbent players in the market have squandered their opportunity to such an extent that there’s a whole new tier of people that are now the most influential in the market. It’s the people who develop the operating systems, not those who operate the networks or provide the hardware,” says Dunstone, citing the impact of Apple and Google. “It’s a sad reflection on everyone else that it’s taken these new entrants to come in and show everyone else how to sell mobile data.”

The use of the mobile as a payment mechanism is a battle Dunstone believes the operators should be able to win as they are used to thousands of micro transactions. “But Apple has shown that if you can let people spend money so easily that they barely notice they’re doing it, they can pick your pocket £1 at a time. Whoever can consolidate on some kind of one click transaction, whether it’s Amazon or Apple or whoever is winning an enormous prize.”

And he believes more change is to come: “Fundamentally, mobile-only platforms feel like they’ve had their day. Today people want to use their phone to get to the service they want and the days of the mobile operator being able to force people to do things their way has been very much discredited.

“Users of smartphones are not just users of phones, they are users of every other type of technology too. We’ve found that 52 per cent of people calling into a call centre are already browsing the site of the company they are calling on another screen. So you have to understand that when someone’s talking to you they’re also checking your site and your competitors’ sites at the same time. And we all have inconsistencies in the way we present information via different channels. You have to have a homogenous service offering across all the different channels,” he says.

“Mobile is complementary to the desktop internet experience and it’s commonly used by savvy and high tech users. You get very targeted responses from people because they are not just browsing, they are looking for something specific. So conversions over the mobile more valuable than those from desktop. The only way to succeed in this industry is via experimentation—and fortune favours the brave.”

The new service will be rolled out initially to 187 stores

US electronics giant Best Buy, which co-owns a retail business with Carphone Warehouse, is to launch a location-based in-store service for smartphone owners, allowing them to receive and process discount coupons and special offers from their handset while in the firm’s retail outlets.

The firm has developed a smartphone application dubbed ‘shopkick’, which will shortly be available for iPhone, with an Android version to follow, that will register the user’s arrival in its stores. The customer then receives digital coupons called ‘kickbucks’ that it can either redeem immediately or divert into a loyalty points account. Best Buy has also integrated the shopkick solution into its point of sale software.

The solution is available from Tuesday in 187 Best Buy stores in San Francisco, San Jose, New York City, and Chicago, with an additional 70 stores in Dallas, Minneapolis-St. Paul and Miami scheduled to come on line by OCtober 1st.

“We think consumers have more opportunities than ever to bridge their digital and physical shopping experiences, particularly through smart phones and mobile technology,” said Matthew Smith, vice president for marketing services at Best Buy. “We intend to explore ways we can use the power of location-based technology to personalise a Best Buy shopping experience, from check-in to check-out, with rewards and offers delivered right on a customer’s smart phone.”

Best Buy created Best Buy Europe through a deal with Carphone Warehouse in 2008. The firms said at the time that they plan to launch 200 electronics retail stores in Europe by 2013.

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TalkTalk will now be able to offer mobile telephony alongside its fixed line broadband offerings in the UK

UK internet service provider TalkTalk, which recently demerged from the Carphone Warehouse, said Monday it had struck a deal with Vodafone wholesale over the launch of an MVNO.

TalkTalk will now be able to offer mobile telephony and internet alongside its fixed line broadband offerings in the UK. The first offerings will be available in the autumn, the company said.

Carphone Warehouse already has an MVNO set up with Vodafone under the TalkMobile brand.

The UK has six main MVNOs led by Virgin Mobile with just over three million subscribers at the end of June, while Tesco Mobile and LycaMobile are both fighting it out with around two million users. BT, Carphone and IDT Mobile all have considerably less subscribers.

BT to take over O2's core network

UK carrier BT must be feeling like its gone back to 2001, as it announces a five year, multi-million pound managed services agreement to run O2’s mobile and fixed core networks.

BT Wholesale will consolidate O2’s mobile and fixed core networks onto its next generation 21st Century Network (21CN) platform, allowing the mobile operator to deliver a range of next generation services and better cope with the explosion in mobile data usage.

BT already provides core network management support for O2 mobile as well as a managed network service enabling O2 to provide fixed and broadband services to the UK enterprise market.

From March, O2 will also start selling fixed line phone services to its fixed line broadband customers, marking the first time O2 has gone head to head with BT since it was spun out of the incumbent carrier in 2001.

Commenting on the managed services deal, Nigel Purdy, head of networks at Telefónica O2 UK said: “As we move to an all IP world and as data traffic volumes increase, the consolidation of our fixed and mobile core networks is a common sense approach that will help future-proof our business and provide the best possible service for our customers. BT Wholesale continues to impress O2 with its ability to deliver highly complex solutions.”

In related news, high street retailer the Carphone Warehouse is understood to be looking at launching mobile phone and fixed line TV services and is in the market for a wholesale provider.

Carphone is currently looking at a demerger of its fixed line voice and broadband business –TalkTalk- from the rest of its operations .

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Could Carphone become an IPTV player?

European retailer Carphone Warehouse may be reconsidering its position following the acquisition of Tiscali UK in May.

With the £236m acquisition of the Italian ISP’s UK operation, Carphone has bought itself a technically sound IPTV platform, but analysts wonder whether that is enough to justify a foray into the TV space.

Multiplay bundles have been noted by analysts for their ARPU (average revenue per user) increasing potential and it seems plausible Carphone chief Charles Dunstone is at least considering adding IPTV to his cheap broadband and fixed line telephony offerings.

Tiscali acquired the platform from HomeChoice, a UK-based IPTV pioneer that failed to make a go of the business—a scenario that didn’t change with Tiscali in charge.

And industry analyst Ovum reckons the odds aren’t good for Carphone to make a go of the IPTV business either. The UK pay TV market is already very competitive and dominated by Sky and Virgin Media, with much of the rest mopped up by BT.

“For Carphone Warehouse to succeed it will basically have to develop a strategy that would shake up the UK TV industry as it did with the UK broadband industry, which is a much harder proposition,” said Michael Philpott, principal analyst at Ovum.

But Philpott noted that Carphone has also made public its intention to spin off TalkTalk once the financial markets pick up, which leads to the consideration of whether a triple play company would be more valuable, or would the investment required to make the TV part successful mean that Carphone Warehouse would be better to sell that part off separately now? “A tough decision, and we suspect Dunstone may edge for the latter,” said Philpott.

Read telecoms.com’s analysis of the acquisition of Tiscali UK by Carphone Warehouse

Vodafone, Carphone friends again

Vodafone, the world’s biggest carrier by revenues is back together with UK retailer Carphone Warehouse after a three year split, as it tries to boost its share of the UK market.

On Thursday, the UK-based operator said that from July 7, consumers would be able to sign up for mobile phone contracts and mobile broadband as well as prepay offers.

Vodafone announced a shock decision to sell monthly contract mobile phones only through Carphone rival Phones4U in late 2006. At the time it was thought the company was simply trying to reduce costs in a market where profits from voice calls are in decline. Carphone continued to sell prepay packages after it lost the postpay deal, however.

Perhaps to keep Phones4U sweet, Voda has also extended its agreement with that retail outfit and will boost its offerings by allowing Phoes4U to sell Vodafone mobile broadband connections.

Of late, the rumour mill has identified Vodafone as a potential suitor for T-Mobile’s floundering UK operation, adding the Big V to a list already featuring Orange and 3 UK.

Consolidation in the mature UK market has long been expected, and a goodwill writedown of €1.8bn for the German-owned carrier in the first quarter fuelled speculation that T-Mo is looking to offload its UK operation.

In a market with more than 125 per cent penetration by the end of March, 2009, O2 UK is the market leader with over 28 per cent market share, while Orange, Vodafone and T-Mobile all hover around the 21 per cent mark. 3 on the other hand, which has also been identified as a good fit partner for T-Mobile UK, lags behind with just over six per cent of the market.

Anyway, the Informer was reminded of his bruising formative years this week when a press release from Nokia’s UK consumer team popped into his inbox revealing the UK launch strategy for the long-awaited N97 flagship. The release breezily informed readers that the phone will be available from June 19th on contract with 3UK, Vodafone, T-Mobile, Orange and Carphone Warehouse. It will be sold SIM-free by Nokia for a cool £499. O2 was nowhere to be seen.

The Telefonica-owned carrier, which with more than 22 million customers has the largest subscriber base in this green and pleasant land, offered only the most perfunctory of comments when the Informer called to ask why this was. “We have no plans to sell the Nokia N97 through our direct channels,” company-lined a spokesperson, adding: “We offer a range of handsets through our product portfolio, which is regularly reviewed to meet the demands of our customers.”

Unless, of course, you’re an O2 customer who wants the N97. There are some out there, the Informer knows, because three people have already written to him pledging to leave the carrier. Not a huge number, granted. Probably not what you’d call a groundswell. The tip of the ice cube, perhaps.

O2′s response to the Informer may have been blunt but it was made to look like a work of epic and embroidered poetry by Nokia’s refusal to comment full stop. Clearly something is up between the two firms.

Consensus among the analyst chums that the Informer contacted was that it was probably related to O2′s existing handset strategy, which is tethered to the iPhone as tightly as Ulysses was tethered to his mast as he sailed past the sirens in a story that offers rich pickings for anyone required to execute some Freudian literary criticism.

There were various theories from various analysts at Informer Telecoms & Media, Ovum and Gartner. One was that O2 simply lacks the subsidy budget for another superstar handset, given its commitment to the iPhone (a new version of which is widely expected to be unveiled next week) and the possibility that it may be set to offer Palm’s Hail Mary phone the Pre. Another suggested that Nokia is concerned that the N97 would be given insufficient marketing space in a stable that already has a thoroughbred. A third had Nokia miffed at O2′s initial decision not to offer the N96 (it is now available from O2 but only on very expensive tariff commitments that can be broken only by the death of the subscriber).

Whatever it might be, something’s up and the Informer can’t help but feel it’s bad news for both parties. Nokia has a UK market share that reflects its global dominance (around 40 per cent) and O2 has a third of all Britain’s mobile subscriptions. While the phone will be available on O2 through Carphone Warehouse, it will not, crucially, be available to existing O2 customers. The launch strategy will be interesting to watch in other European nations, as it might give us more of a clue as to the issues at play here.

In other handset news, Sony Ericsson is trying a different tack to divert attention away from its struggles in the rankings by announcing a new CSR initiative that it says will see it cutting carbon dioxide emissions across internal operations by 20 per cent by 2015. In addition the company pledged to reduce ‘full life cycle’ emissions for its products by 15 per cent, which takes into account the mining, production and consumer usage of the handsets. The Informer applauds this kind of optimism (the green stuff, he means, not the firm’s belief it will still be in business in 2015. But that’s good too.)

Tying this in with its historically core business of selling phones, Sony Ericsson announced two new ‘Greenheart’ products the C901 and the Naite. The phones come with an electronic manual and less packaging, use recycled plastics and low-power chargers and have a light sensor that reduces power consumption, the firm said. They also use environmentally friendly paint. A couple of onboard gimmicks will allow users to calculate their own carbon footprint reductions.

Steering clear of the tried and tested handset vendor strategy of talking up their handsets’ actual functions, Sony Ericsson roped in a couple of carriers to air kiss its newly green cheeks.

“With growing public concern about climate change and increased competition for natural resources, TeliaSonera welcomes more “green” and sustainable choices for our customers like the new GreenHeart phones from Sony Ericsson,” said Indra Åsander, at TeliaSonera.

And:

“We are fully supportive of Sony Ericsson’s GreenHeart^TM initiative because it is so closely aligned with Telefonica O2 UK’s own ambitions to make Sustainability central to our business strategy,” says Bill Eyres, head of CSR at O2 UK.

This threw up yet another theory as to why O2 isn’t offering the N97. Perhaps the new Nokia will be delivered to customers in a Hummer, and comes fitted with a chainsaw for chopping down trees.

Sony Ericsson also jumped on the app store bandwagon this month, which hopefully is powered by electricity rather than petrol. On Thursday the firm announced plans to distribute mobile applications via its PlayNow arena. By teaming up with independent app store GetJar, Sony Ericsson will expand its mobile content offering with a library of over 45,000 free applications that will complement a series of premium apps from the firm itself.

GetJar now claims to receive over one million downloads a day across more than 200 countries, with over 200,000 developer accounts under its belt. The app store caters to Java-based devices and targets Symbian, Windows Mobile, iPhone, Palm, BlackBerry, and Flash Lite-compatible phones.

Meanwhile, Taiwanese electronics manufacturer Acer has confirmed plans to launch a range of smartphones based on the Android platform in the fourth quarter of this year. In the wake of its foray into the mobile space with a line-up of Windows Mobile devices, Acer this week announced it has joined the Open Handset Alliance, “demonstrating its support for Android as an open mobile platform and its commitment to Android’s commercial success”.

Acer did not give details on how many devices it would be launching and would only say the first gadgets would be available towards year end.

Speaking of IT players moving into mobile, Intel announced the purchase this week of software developer Wind River Systems. The purchase, said Intel, “will deliver robust software capabilities in embedded systems and mobile devices, both important growth areas for the company.”

Intel’s bid to establish itself in the wireless world has thus far been centred on WiMAX which, in India this week, has had a bit of a knock. Indian state-owned fixed and mobile operator carrier BSNL’s WiMAX has been forced to reissue a WiMAX tender in the wake of somewhat suspect dealings.

The original tender was dogged by controversy with BSNL facing allegations of non-transparency in the bidding process to select its WiMAX franchisee partners.

More than 20 companies made a bid earlier this year to act as a WiMAX partner to BSNL in a number of ‘circles’ (or regions) across India. Five of the companies believed to have made the BSNL shortlist, however, were said to be ‘fake’ in that they were not really individual entities at all. Each, for example, had identical corporate details, including the same date of incorporation and even the same email contact address. The five companies in question were: WiExpert Communications, SV Telecom Systems, Digitelco Communications, Spectrus Communications and Technotial Infoways.

Moreover, according to local reports, each of the five companies was floated by Sanjay Kapoor, who is said to be a ‘confidant’ of telecoms minister A. Raja. The five companies were also believed to be staffed, in part, by relatives of Kapoor.

Kuldeep Goyal, CMD of publicly-owned BSNL, announced last month that the WiMAX franchisee tender was still under evaluation by the original designated panel. But Goyal’s reassurances failed to quell the controversy surrounding the tender.

Now, under the new tender, BSNL says each interested bidder must have a turnover of at least 100 Rs crore ($21m) for the last two financial years. The tender document, which is available from 12 June 2009, will only be issued after a submission of proof on turnover. The deadline for the tender submission is 4th August 2009.

BSNL had to make an embarrassing cancellation of its original WiMAX tender, as exclusively reported by telecoms.com, as the bidding process became embroiled in allegations of nom-transparency. Some of the bidding companies in the original tender were believed to be fronts for individuals with close connections to the government.

The publicly-owned operator intends to run a franchise model to roll out WiMAX services at 2.5GHz across India. It is already using US-headquartered Soma Networks as a mobile WiMAX franchisee in the three lucrative circles of Gujarat, Maharashtra (including Goa) and Andhra Pradesh. Under the franchise arrangement, Soma pays for the WiMAX kit in exchange for access to BSNL infrastructure (such as tower sites and backhaul facilities) and a revenue-sharing deal on WiMAX services. Soma struck a 70-30 revenue sharing deal with BSNL in the kit-maker’s favour, although BSNL is reportedly considering a 75-25 revenue-sharing arrangement with franchisees in other circles.

Critics of the Soma award point out that BSNL did not issue an EOI for the tender in the three circles Soma won its WIMAX concession. It also irks the WiMAX Forum that Soma is deploying mobile WiMAX in FDD format, which is not yet a recognised WiMAX standard. The new EOI invitation makes it clear, however, that the new bidders must deploy Wave 2 certification 802.16e kit in TDD mode.

Staying in India for a while, the official award of 3G wireless spectrum there may now be delayed until the end of 2009, and possibly even later. The auction of 3G spectrum, originally due to take place at the end of 2008, had been postponed due to ongoing disputes between the government and the regulator. The latest delay is related to a potential increase in the minimum licence fee and to give time to enact tax breaks for local Indian equipment vendors, local press reports say.

Will Draper, analyst at investment firm Execution Ltd. commented: “According to Vodafone, India will definitely complete its auction of 3G wireless by end 2009 but given that this is the second delay, we can’t be sure the new deadline will be met. The delay however represents good news for Vodafone since demand for 3G licences is falling each month as potential new entrants fade away and consolidation reduces the number of incumbent bidders, which in turn means the price of spectrum is coming down.”

And while we’re talking of postponements and cancellations, let’s round up this week in Jordan, where the 3G auction has been canned. There was only one bidder – Orange – but even in a field of one the France Telecom owned firm was unable to triumph, failing to present its financial stake according to the Jordanian regulator.

Take care

The Informer

Ps, If anyone’s interested, that film quote was indeed from Harry Callaghan, but not from the film that bore his name. It was in fact from the third in the series, The Enforcer. Well done to Valery Schwarz at Bulgarian operator Globul for looking it up on IMDB.com.

O2 will not stock the N97

Telefónica’s British operation O2 will be the only carrier not to offer Nokia’s new flagship the N97 when it launches in the UK on June 19th.

While the Carphone Warehouse will be selling the handset with contracts to O2′s network, the N97 will not be available in O2′s stores, or from its online shop.

Vodafone, Orange, T-Mobile and 3UK will all be offering the handset, which Nokia will sell SIM free for £499. The N97 will be the first Nokia handset to launch with one-touch access to the Finnish vendor’s app store, the  Ovi Store, which launched last month.

An O2 UK spokesperson effectively ruled out any chance that the firm would sell the handset. “We have no plans to sell the Nokia N97 through our direct channels,” she said, adding: “We offer a range of handsets through our product portfolio, which is regularly reviewed to meet the demands of our customers.

Nokia, meanwhile, refused to comment on why the largest carrier in the UK will not be stocking what is arguably its most important new product since the iPhone shook up the high end handset market two years ago.

Analysts have speculated that it is the iPhone – and specifically O2 UK’s exclusive distributor status for the Apple product – which has led to the carrier’s exclusion from the N97 launch. Dave McQueen, principal analyst at Informa Telecoms & Media, said it was believed that O2 had exhausted its subsidy budget with the costly iPhone and had been unable to offer the N96, when that launched, as a result.

The current situation could simply be a continuation of that problem, he said, given O2′s ongoing commitment to the iPhone and the carrier’s reliance on the product for driving its consumer data traffic. iPhone users are renowned as far more data-hungry than users of other handsets. “In addition, it is very likely that O2 can’t commit to marketing budget for N97 as they are likely to have to co-market the iPhone in June / July, most probably when  a new iPhone comes out,” McQueen said.

Alternatively, this latest development could be decision taken by a disgruntled Nokia based on O2′s decision not to offer the N96.

Tony Cripps, a handset market analyst at Ovum suggested that Nokia might be concerned at how much fanfare O2 would be able to give the N97 in its marketing strategy. “Perhaps Nokia thinks that going through O2 with what will be its flagship handset for some time may not get it the attention it thinks the phone deserves,” he said. He added that a good deal of the prospective market for a high end smartphone like the N97 among O2 users would already be iPhone users.

Nonetheless, O2 will doubtless have a substantial number of Nokia loyalists on its customer books and it may run the risk of losing those to competitors who want the latest product from the Finnish market leader.

The acquisition will reduce to five the number of ISPs at the top end of the UK broadband market, comprising BT Retail, Virgin and the big LLUOs. This group accounted for 72% of the market three years ago. It now accounts for over 92%.

Simple maths puts the Tiscali subscriber base at 1.44m at the time of acquisition, based on: Carphone’s announcement of a new combined subscriber base of 4.25m and Carphone’s Q109 results, which showed TalkTalk with 2.809m. On this evidence, Tiscali has been in deep trouble for months, losing some 600,000 broadband subscribers since its peak of 2.02m subscriptions at Q307. Worryingly, even its LLU customer base has started to decline.

More simple maths (£236m divided by 1.44m) gives a premium per broadband customer of £160. Compare this to the premium per broadband customer of £250 paid for AOL UK in October 2006. Carphone will have its work cut out to prevent further decline in the valuation of this asset and faces another lengthy period of integration, to realise fully the cost-savings and economy of scale rationales which lie at the heart of this acquisition. It took two years to complete the integration of AOL, which had roughly the same number of subscribers at time of acquisition and roughly the same number of LLU lines.

In its acquisition statement, Carphone is consistent in its belief that in the LLU world, TalkTalk broadband is a business of scale: the bigger the subscriber base, the lower the fixed cost per subscriber, which allows TalkTalk to keep the monthly price of double play bundles pretty low. Whilst the acquisition makes TalkTalk the biggest single broadband ISP in the UK, it is Sky which has grown like topsy: 657,000 net adds in the 12 months to Q109, versus TalkTalk’s 93,000. Even Virgin has added 228,000 net new on-net subs in the same period.

This raises the question of whether brute size will win against multiplay bundlers like Sky and Virgin, particularly at a time when subscribers appear to be looking for the increased value which full triple play brings. And it’s not as if Tiscali’s foray into the TV market provides TalkTalk with a way in. It looks unlikely that TalkTalk will make any risky push into triple play for now, preferring instead to maintain its simple proposition as a cheap broadband-access-plus-voice provider. In terms of a long term growth strategy, with acquisition targets pretty much exhausted, TalkTalk will surely have to bite the triple play bullet at some point. In the investor webcast Charles Dunstone even hinted that the deal will bring the necessary scale to make investments in fibre viable.

The biggest immediate casualty will be Orange. Its position looks increasingly weak: a weak fixed/mobile proposition, a subscriber base which has now dropped below one million for the first time in three years, its inability to enter the TV market and its less than top-class reputation for customer services is not a great platform for survival.

Carphone buys up Tiscali UK

UK retailer the Carphone Warehouse has snapped up internet service provider Tiscali UK for £236m in cash, ending years of speculation.

On Friday, Carphone Warehouse’s broadband and fixed line operation, TalkTalk, announced the deal, which will leave it with a total of 4.25 million consumer subscribers and coverage of 25 per cent of all UK households.

The possibility of such a move has generated plenty of speculation over the past two years. Tiscali has for some time been looking to raise substantial cash with two mutually exclusive goals in mind: either investment in the Italian market, where there is still enormous growth potential; or investment in alternative markets where there is significantly more growth potential than in the UK.

Analysts at investment firm Execution said Thursday that £250m “would be a good price”, although the researchers also noted that: “The offer is well below the range apparently sought by Tiscali, but the company is on its knees and may have little option but to accept.”