Ericsson, At&T, Sprint and Etisalat posted first-quarter results

Ericsson, AT&T, Sprint and Etisalat have all posted earnings statements for the first quarter of 2012, achieving varying levels of success.

Ericsson’s first quarter sales dropped four per cent to total SEK51bn ($7.55bn). The firm blamed an expected major decline in CDMA sales as well as lower operator network spending in regions with macro-economic or political uncertainty.

The vendor’s net profit, however, doubled to SEK8.8bn due in part to the one-off gain from selling its 50 per cent stake in handset joint venture Sony-Ericsson to Sony. The firm’s operating income, which excluded the gain from the Sony-Ericsson divestment, fell sharply from SEK6.8bn in 1Q11 to SEK2.8bn in 1Q12. This was partly due to a drop in gross margin which fell from 38.5 per cent to 33.3 per cent year-on-year.

“Sales of high-performance mobile broadband developed well in North America, Japan and Korea, while other regions such as Europe including Russia, parts of Middle East and India were weaker,” explained Hans Vestberg, president and CEO of Ericsson.

“CDMA continued its expected decline in the transition to LTE and our services business showed continued momentum.”

US operator AT&T saw its consolidated Q1 revenues rise 1.8 per cent to $31.8bn.Operating expenses rose year-on-year to $25.7bn for the quarter, up from the $25.4bn sent in 1Q11 but operating income margin increased to 19.2 per cent from 18.6 per cent.

First-quarter 2012 net income attributable to AT&T totaled $3.6bn, or $0.60 per diluted share, up from $3.4bn, or $0.57 per diluted share, in the year-earlier quarter.

During the quarter, AT&T also began repurchasing shares under its outstanding 300 million share buyback authorisation. The company repurchased 67.7 million of its shares for $2.1bn.

“We continue to capitalize on our terrific momentum in mobile Internet,” said Randall Stephenson, AT&T chairman and CEO. “Smartphone and branded computing device sales continue to set a record pace, mobile data revenues were up nearly 20 per cent, and we achieved this growth with expanding margins. These results add confidence in our outlook for the year.”

Rival Sprint didn’t perform quite so well, reporting a net loss of $863m, almost double the net loss of $439m it recorded in 1Q11.

The carrier attributed the increase in losses partly to depreciation of approximately $543m, which was accelerated due to the expected shut down of the Nextel platform. However, it saw a one-off gain of $170m due to the termination of its spectrum hosting contract with LightSquared.

The company posted wireless service revenues of $7.2bn during the quarter, an increase of more than seven percent year-over-year, and reported its best ever postpaid ARPU increase for the Sprint platform – which stood at $4.03, or 6.9 percent, year-on-year.

“The continuing revenue growth on the Sprint platform, which represents the future of our company, driven by record ARPU improvement and strong net subscriber growth, contributed to our adjusted operating income/(loss) before depreciation and amortization (OIBDA) performance of $1.2bn,” said Dan Hesse, Sprint CEO.

UAE-based Etisalat saw its first-quarter revenues increase by two per cent year-on-year to reach AED8.204bn ($2.23bn). Net profit declined by 0.5 per cent, however, to AED1.809bn. The rise in sales was due to an increase in revenue from international operations, which more than offset the decline in revenues from domestic operations.

The firm’s international revenues increased by 21.3 per cent in 1Q12 to AED2.275bn. Meanwhile domestic revenues decreased by 2.64 per cent to AED6.085bn, reflecting a competitive environment in the UAE market.

Stephen Bye, is CTO and vice president of technology development & strategy for Sprint

Stephen Bye, is CTO and vice president of technology development & strategy for Sprint, the third largest wireless operator in the United States. Ahead of his appearance at the LTE World Summit, taking place on the 23-24 May 2012 at the CCIB, Barcelona, Spain, we speak to him about Sprint’s LTE launch plans, the progress being made on its Network Vision plan and how Sprint is moving forward without LightSquared.

What are the main milestones you have reached with relation to your LTE deployment?

We have executed against our major 3G and 4G technical milestones. The detailed deployment and resource plans have been completed by our three vendors and they have been staffing up to meet the build-out demand. We are well under way on leasing, zoning and tower construction on our 38,000 sites, with a goal of having 12,000 higher density sites on air by the end of the year. In addition, we expect that approximately 9,600 Nextel platform sites will be decommissioned by the end of 2012 and we expect that the build will be largely completed by the end of 2013. Our agreements with the major tower companies were also finalized in Q4.

During the fourth quarter, our first true multi-modal permanent site went on air. Additionally, the first cluster of cell sites launched and they are meeting our performance and coverage targets. Overall, the development and deployment of the network is proceeding within our budget targets.

Since January we announced six major markets scheduled to launch LTE in the first half of 2012. In addition, we announced our first three LTE device launches which are expected to launch during the first half of 2012, and we have been launching phones that are 800 band class 10 compatible since the middle of last year. This means that as we redeploy our 800 spectrum, many of our customers should get an immediate and very noticeable benefit.

What are the main challenges you have faced, or expect to face, as you roll out LTE?

The main challenge we see is more related to the need to build out 3G capacity to meet the continuing growth in 3G usage, while we are in the process of deploying LTE. We would like to move the majority of this growth over to LTE as fast as we can to take advantage of this capacity and the improved spectral efficiency of LTE.

As with all network builds, site zoning and approvals pose some execution risk.  Considerable progress has been made on Network Vision.  Since being announced in December of 2010, Sprint and its vendors have achieved many technical milestones (e.g., test calls, field integration testing, etc.), begun work on cell sites, solidified tower company agreements, launched Sprint Direct Connect on the CDMA network and prepped for new device launches, including the iPhone.

How will you be moving forward with your Network Vision programme without LightSquared?

The termination of our LightSquared agreement has no impact to Sprint’s current customers and is not material to Sprint’s ongoing business. LightSquared was neither a critical component of our Network Vision program nor a dependency for our LTE strategy to be successful.

Where do you stand on the issue of OTT players contributing to the costs of deploying networks?

We have been a long-time advocate of open networks and systems. The OTT players have brought tremendous product and service innovation to wireless and they have certainly stimulated the significant growth in usage we have seen in recent years. It is definitely a challenge and this represents an Apollo 13 moment for service providers like us. This is where innovation and creativity are required and for engineers like me, we welcome such challenges.

To what extent can LTE provide an insurance against declining revenue streams from voice and SMS?

As a proponent of simplicity, convenience and unlimited data, we see LTE primarily as a faster, more efficient radio access technology and the key to meet demand more cost effectively. There are other core technologies and systems we are deploying in conjunction with LTE, which will enable us to open up access to more network services and APIs. This should help to unlock opportunities for additional revenue streams.

Is there a place moving forward for unlimited data tariffs? Are they sustainable?

Yes, we believe in focusing on the customer experience. Simplicity, convenience and unlimited data are key to meeting our customers’ expectations.  Unfortunately, many analysts focus only on selected network related costs. It is important to look at the end-to-end customer cost of not offering unlimited. There are real incremental costs related to billing, customer care and service credits.

What’s your view on FDD vs TD-LTE spectrum?

We support the use of both. Their use is linked to specific spectrum allocations. We are using FDD-LTE with Band 25 and Band 26, while we are also working very closely with Clearwire on Band 41 TDD-LTE.

Do you think that VoLTE will have an impact and if so in what time frame?

It is still in the early days for VoLTE. These types of technology changes inevitably take longer than many expect. It is a significant change to the voice networks, devices and services we have all deployed.

Is there enough innovation occurring in the mobile network industry? Can you provide some examples?

As we look at the impact mobile services may have on many consumers and businesses there is even more opportunity for innovation.  A January 2012 Rutberg & Co. analysis stated that in 2011, over US$6bn of venture capital funding was invested worldwide in the mobile technology and services sector and increased materially from 2010. We continue to see hundreds of start-ups in this sector, which is very exciting. Key for us is to be open and enable new business models, innovations, and products and services to be brought to market by our partners. Some carriers have suggested creating a toll gate for developers and that is a misstep towards stifling innovation in this industry.

What changes would you hope to see in the industry in the next five years?

We would like to see more cost effective spectrum made available for our LTE deployments as this will enable us to meet the needs of our customer demand for data services.  We would also like to see even more open services, devices, networks and systems to unlock opportunities for greater value.

The LTE World Summit is taking place on the 23-24 May 2012 CCIB, Barcelona, Spain. Click here to register your interest.

LightSquared's struggle is increasingly uphill

US carrier Sprint has officially broken up with troubled LTE wholesale opportunist LightSquared, ending the spectrum hosting agreement signed in June 2011. As part of the break up, Sprint has repaid $65m to LightSquared, for expected costs that have not been incurred.

The money could come in useful; LightSquared’s future is looking increasingly shaky as it struggles to beat regulatory constrictions in an effort to actually launch its network. Last week, the firm hired well-known solicitor Theodore Olsen in a final bid to save its seemingly doomed terrestrial LTE project. Olsen’s main claim to fame was helping George W. Bush claim a victory in the 2000 US election in the Bush v. Gore Supreme Court case.

The move is a last gasp attempt by LightSquared to force the FCC to reverse its decision to revoke the waiver that gave approval for LightSquared to operate a terrestrial LTE service using its satellite spectrum, a move that essentially grounded LightSquared’s plans.

The FCC revoked the waiver after strong pressure from the GPS community after numerous technical tests claimed that LightSquared proposed L-band terrestrial spectrum would cause widespread interference with GPS equipment.

Under the agreement terminated with Sprint, the US carrier had agreed to deploy and operate an LTE network capable of utilizing the 1.6GHz spectrum available to LightSquared. The agreement contained contingencies related to possible interference issues with LightSquared’s spectrum, including Sprint’s right to terminate the agreement if certain conditions were not met by LightSquared.

Sprint is leaving the door open however. “Sprint has been and continues to be supportive of LightSquared’s business plans and appreciates the company’s efforts to find a resolution to the interference issues impacting its ability to offer service on the 1.6 GHz spectrum. However, due to these unresolved issues, and subject to the provisions of the agreement, Sprint has elected to exercise its right to terminate the agreement announced last summer. We remain open to considering future spectrum hosting agreements with LightSquared, should they resolve these interference issues, as well as other interested spectrum holders,” Sprint said.

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Vodafone, Sprint and Telstra have totalled up their figures for the quarter ending Dec 31, 2011

With a host of businesses posting quarterly earnings results today, Telecoms.com takes a look at how operators around the world are faring.

In the US, Sprint Nextel posted disappointing full-year results. For the fourth quarter of 2011, ending December 31, the company recorded a huge loss of $1.3bn, which is a greater loss than the $929m loss that the company posted in the same quarter of 2010.

This was despite net operating revenue reaching $8.7bn, higher than the $8.3bn recorded in the same period of 2010.

For the full year, the operator posted revenues of $33.7bn, 3.4 per cent up from the $32.6 it recorded in 2010. Its net loss for the full-year was $2.9bn, an improvement on the $3.4bn loss made in 2010.

Sprint CEO Dan Hesse opted to highlight the company’s reported total net subscriber additions of 1.6 million during the quarter; its strongest quarterly subscriber growth in six years.

“Our strong fourth quarter performance illustrates the power of matching iconic devices like the iPhone with our simple, unlimited plans and industry-leading customer experience,” he said.

“During the past year, Sprint added more than 5 million net new customers and grew wireless service revenue by more than 5 per cent, including 17 per cent for the Sprint platform. This momentum gives us confidence as we execute our network vision upgrade and 4G LTE roll-out.”

Vodafone Group, meanwhile, posted a 2.3 per cent drop in group revenue for the quarter ending December 31, 2012, to see sales total £11.6bn ($18.4bn). However, the company said that its organic growth for the quarter stood at 1.6 per cent. The company does not post its net profit figures until the end of the financial year, which will be March 31 2012.

The group blamed economic conditions in southern Europe for the decline in revenue it saw in Italy and Spain, where revenues dropped by 4.9 per cent and 8.8 per cent respectively.

There was progress in Germany and the UK though, where revenues increased modestly; by 0.7 per cent and 1.1 per cent respectively.

However, in India, the company reported strong service revenue growth of 20 per cent, and in Turkey it saw a 23.5 per cent growth.

Vodacom, the group’s South African subsidiary, also posted an increase in service revenue of 8 per cent, up from the 6.7 per cent growth it saw in Q2. The firm attributed this to faster growth in Vodacom’s markets outside of South Africa. In South Africa growth remained stable at 4.9 per cent.

The group also noted that it saw continued strong growth in its US associate, Verizon Wireless, where service revenue grew by 6.8 per cent, and overall, revenue from data services increased by 21.8 per cent.

“Despite the further deterioration of the southern European economic environment during the quarter, our broad geographic mix is delivering a resilient overall performance,” said chief executive Vittorio Colao.

“Our improved value perception, strong cash generation and healthy balance sheet give us confidence that we can continue to execute well.”

Telstra also posted its earnings results for its second quarter of the fiscal year, which ended December 31, 2011. The Australian operator saw its revenue increase by a modest 1.1 per cent to reach AU$12.4bn (US$13.4bn), while net profit jumped by 22.9 per cent, or AU$274m to AU$1.47bn.

The company said that it continued to attract new customers in the half year, adding 958,000 domestic mobile customers, including 338,000 postpaid handheld and 436,000 mobile broadband customers, as well as 106,000 fixed broadband customers.

“Last year we recorded one of our best years for customer growth. This momentum has continued into the first half of fiscal 2012,” said CEO David Thodey.

“We are also seeing improvement in Telstra’s customer service with TIO complaints down 24 per cent over the year, though we still have more work to do.”

He added that the firm will continue to focus on improving customer satisfaction, growing customer numbers, simplifying the business and taking advantage of new growth opportunities.

Verizon's CFO Fran Shammo has said the carrier has no objections against the propsed merger of AT&T and T-Mobile

Leading US Carrier Verizon Wireless has no concerns over the proposed merger of AT&T and T-Mobile USA, as long as it does not result in increased industry regulation. The company’s CFO Fran Shammo made the revelation to a Morgan Stanley conference in Spain last week, according to a report by Rethink-Wireless.

Shammo admitted that he did feel that the US wireless carrier industry did need consolidation, but not at the expense of increased interference from US regulator the FCC.

The FCC is currently debating the proposed $39bn merger, and has raised the ire of other players in the market such as number three US carrier Sprint Nextel, and also the US Department of Justice, which claimed that the deal would “substantially lessen competition”.

For its part AT&T has said that if the merger goes through it would create 5,000 jobs, though Sprint has countered with a report that claimed that this was unfounded.

AT&T wants to merge with the struggling T-Mobile USA, owned by Deutsche Telecom, in order to gain access to its wireless spectrum and improve its LTE spectrum coverage. The move would make it the largest player in the US market.

Verizon Wireless currently offers LTE in 179 cities markets, covering a population of 186 million, compared to just 15 markets for AT&T. It said it plans to cover 70 million people with LTE by the end of the year.

At the conference Shammo also said that Verizon wants to see changes in the device eco-system, no doubt as a response to the growing power of the device OS manufactures, namely Apple and Google. This would mean welcoming a third player in the market, most likely Nokia’s Windows Phone powered devices, with RIM’s Blackberry struggling to retain market share.

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Stephen Bye, CTO, Sprint

US carrier Sprint officially announced plans to begin offering LTE services to more than 250 million potential customers in early October. As the industry’s worst kept secret the move came as no surprise, but what did raise eyebrows was the firm’s target launch date of mid-2012 with a view to full network build out by 2013. A full two years sooner than anticipated.

We caught up with Stephen Bye, chief technology officer of Sprint, just a few days after the announcement, and spoke to him about the challenges ahead and the groundwork that has already gone into the programme.

Bye moved to Sprint from US cable carrier Cox Communications, which had been dabbling with LTE as a platform for rolling out services over wireless. But Sprint represented a whole new set of challenges. As well as the WiMAX network at 2.5GHz, it also runs a CDMA EVDO 3G network at 1900MHz as well as Nextel’s legacy iDen network, operating at 800MHz. Operating all these technologies together makes for a large, bulky and relatively inefficient macro base station set-up, a challenge that has already been addressed by the firm’s Network Vision initiative, which is a universal rebuild of the network on a next generation multi mode cabinet architecture.

While the announcement on October 7 was the news everyone had been waiting for, Sprint’s CTO is eager to highlight the importance of the Network Vision project, unveiled in December 2010, as the foundation stone for the network upgrade.

“October 7 wasn’t the ‘now let’s begin’ point of our network upgrade. A lot had already happened by then, work had been going on for months, to develop the roadmap for the technology and make sure there was a device ecosystem,” Bye says. “In fact, a much bigger announcement was the Network Vision initiative that came out almost a year ago.

“This is the real network modernisation plan. We’re rebuilding the network with multimode base station capabilities. This is what really laid the foundation for us, so the LTE announcement is really just the next chapter of that, the next step along that continuum.”

An overhaul of the operator’s basestations packs more equipment into a smaller space and replaces ageing, signal degrading coax with fibre. Multimode cabinets allow Sprint to use different RF technologies on different frequency bands, so the firm can have a combination of CDMA, LTE or WiMAX across different radio bearers, be it 800MHz or 1.9MHz. The idea is to make the addition of new technologies much smoother, but Bye is careful to avoid the term “rip and replace” for the network upgrade.

“No, it’s not a rip and replace strategy. We already have over 50 million customers on our network and a sustainable and solid business with infrastructure in place today. But we recognise the move forward will need us to modernise that network, so Network Vision enables us to deploy a next generation platform in parallel with our existing business and then as that platform turns up we migrate those customers over and at a future point in time we will take down the legacy iDen network,” Bye says. “The key here is that we can manage that transition very gracefully. It’s not like we have to rip and replace, we complete the migration then take down the other network and reduce a lot of costs we’ve had to bear with that previous network. It alters our cost structure fundamentally, but allows us to migrate and upgrade going forward.”

The legacy iDen network, Sprint inherited as part of its merger with Nextel has been both a boon and a burden. It’s been a success with many vertical customers, but is now outdated and adds further complexity to the multi-0technology network. Hence it’s eventual decommissioning.

“We still have vertical segments that like the Push To Talk (PTT) functionality of iDen and we need to preserve that relationship by giving them something better than they have today. But this upgrade also allows us to take down the iDen network and the costs associated with it. It’s been a burden but as we turn up the new network we are recreating the PTT experience on CDMA with better performance and coverage. In fact, we launched our first CDMA PTT phone on October 2, which is just the start of a portfolio we will use to migrate users over to CDMA,” says Bye.

The device ecosystem is something Bye considers as of the utmost importance. The operator plans to launch dual mode CDMA/LTE devices by mid-2012, with approximately 15 devices—including handsets, tablets and data cards—set to hit shelves throughout the year. The CDMA/WiMAX devices that Sprint currently offers, such as the Nexus S 4G, will continue to be sold throughout 2012.

According to Bye, the biggest challenge in the industry right now is how many spectrum frequencies you can squeeze into a device, in order to ensure global roaming, capacity and keep the device cost effective. A tall order in a world that is moving from being one dominated by voice to one dominated by data.

“It’s a moving target that presents a technology challenge for all of us in the industry,” says Bye. “Not long ago people were struggling to put dual band radios together, now we’re talking about hexaband. “But it’s a good thing that devices are getting bigger,” he says referring to the tablet trend. “It was more challenging when devices were getting smaller but now we have more real estate to play with. These devices are more of a mobile computing device than a cellphone.”

As an industry we will continue to be challenged by the data demands on the network and will continually be looking for ways to improve spectral capability and network performance. In the past when voice was king, it was these demands that drove the network model. “Voice is deterministic. People would talk in minutes and it was easier to plan for capacity. Networks were semi static,” Bye says. “But with data, we are moving to a supply constrained model. If you put in capacity, users will take advantage of it. We have moved from feature phones to mobile computing devices and usage on those devices is taking advantage of the capacity available. This makes life very challenging as a network planner as you have a more dynamic load,” he says.

“To build and manage a network today is now an order of magnitude more complex than it was for voice. So in order to deliver a satisfactory experience we’ve got to make sure the network can support that data but we cannot forget about voice as this is still the biggest indicator to the customer of the quality of the network.”

An oft quoted phrase in this industry is that the customer experience counts more than anything. So as an engineer, Bye’s task is to deliver the experience the customer expects but to do it cost effectively. “It’s easy for us to get to enamoured by technology,” he says, “But customers don’t care. Our job is to hide that complexity and give customers what service they expect regardless of what the pipe is.

“If you peel apart the acronyms: LTE; WiMAX; whatever, you’re fundamentally talking about an OFDM technology. So that’s what you’re putting on chipset. While the acronym has shifted from WiMAX to LTE, we already have a lot of learning on the OFDM front as the first carrier to launch WiMAX,” he says.

“So last year, Network Vision, was the beginning of that journey. Our next generation, multi mode basestation technology. Adding LTE is a much smoother migration than it would have been otherwise. Other carriers are essentially building out a new network, but we’ve said no, lets go back and rebuild and re-engineer our CDMA network onto a new platform that now makes it easier for us to upgrade to LTE or whatever might come next in terms of LTE Advanced or future releases. We now have a much more future proof platform that we had before.”

Sprint's LTE service will begin in 2012, with Network Vision to be launched shortly after

US carrier Sprint has announced plans to begin offering LTE services on its 1900MHz spectrum by mid-2012. The company said it will cover more than 250 million people across the US when the network build-out is completed, which is expected by the end of 2013.

The operator plans to launch dual mode CDMA/LTE devices by mid-2012, with approximately 15 devices—including handsets, tablets and data cards—set to hit shelves throughout the year. The CDMA/WiMAX devices that Sprint currently offers, such as the Nexus S 4G, will continue to be sold throughout 2012.

Sprint also announced plans to accelerate the deployment of Network Vision; its plan to consolidate its multiple network technologies into one network to increasing efficiency, network coverage and data speeds for its customers.

The company said it had concluded trials of its multimode technology and is on course to complete its deployment by the end of 2013 – two years sooner than originally scheduled. Network Vision could cost up to $5bn but is expected to deliver $10bn to $11bn in net economic value to the company between 2011 and 2017.

“Over the long term, continued execution on Network Vision as well as other improvements to our core operations are expected to result in overall margin expansion, improved return on invested capital, and, ultimately, increased value for our shareholders,” said Joseph Euteneuer, chief financial officer at Sprint.

Sprint needs partners to help it compete with its larger rivals in the US mobile market, particularly if AT&T’s planned acquisition of T-Mobile USA is approved. For Sprint, which just reported a net loss of $847m in the second quarter, the deal brings a welcome injection of $9bn in cash over 11 years, which will help the operator modernize its network and launch LTE. In addition, the deal gives Sprint an option to buy up to 50 per cent of LightSquared’s LTE capacity, which could help Sprint reduce the cost of its expected LTE deployment.

For LightSquared, the deal is vital and expected because its initial business plan was not viable, which the group realized as it struggled to land enough funding to build a new nationwide mobile network from scratch in a mature market such as the US. Doing a deal with an existing operator was always on the cards because it would dramatically reduce the cost and time of its deployment, by using the mobile sites and equipment of an existing operator. That was confirmed in today’s announcement that the deal with Sprint could slash LightSquared’s network deployment costs by more than $13 billion over eight years.

But the deal also brings risks. For Sprint, a strategic partnership with 4G LTE wholesaler LightSquared will complicate its existing relationship with and investment in 4G WiMAX wholesaler Clearwire. The deal also complicates – and may delay – Sprint’s transition to LTE, partly since it will now have to spend time and energy building LightSquared’s LTE network.

For LightSquared, the deal calls into question its relationship with Nokia Siemens Networks, which it tapped last year in a $7bn deal to deploy and run its nationwide LTE network. LightSquared will now pay Sprint to deploy its LTE network, and Sprint recently signed other vendors – Ericsson, Alcatel-Lucent and Samsung – to overhaul its network in the runup to LTE.

Finally there is a significant risk for both Sprint and LightSquared that the deal will fall apart, if LightSquared cannot resolve concerns that its L-Band service may interfere with other services such as GPS.”

The Informer thought he was having a senior moment on Thursday when news broke that US wholesale player LightSquared has tapped Sprint Nextel to deploy an LTE network on its behalf. It’s an interesting one: LightSquared will pay Sprint up to $11bn in cash over an 15-year period to deploy and operate a nationwide LTE network using L-band spectrum, but as a wholesale only player, LightSquared will then sell the capacity back to US operators, including Sprint.

But what becomes of the $7bn deal LightSquared made with Nokia Siemens Networks in July of last year? LightSquared had approved an eight-year deal with NSN to deploy, install, operate and maintain the nationwide 4G network amounting to around 40,000 cellular base stations.

The actual details are a bit hard to verify. The Informer is sure he remembers a press release that came out on July 20, 2010, yet it does not appear to be on either the NSN or LightSquared websites. Perhaps it’s a senior moment. But then the Ministry of Truth appears to have been at other parts of the LightSquared site as well. A few days ago the network info page harped on about an “agreement, the largest of its kind for the U.S. wireless industry,” with NSN, but today that same page reads quite differently, only mentioning Sprint.

At the time, Martin Harriman, EVP at LightSquared told the Informer: “It’s an extraordinarily complex deal as we try and capture an eight-year partnership that pretty much does everything. We’ll get there, but it’s a big, big deal, both for us and for NSN.”

Not any more. NSN confirmed that it would no longer be involved in the running of LightSquared’s radio access network, with that now in the hands of Sprint Nextel, which will “use its own vendors.”

However, an NSN spokesperson assured the Informer it was still involved with LightSquared through a new deal for the design, installation, testing and systems integration of the core network. But the value of this latest contract has not been publicised and the suggestion is that NSN might be significantly out of pocket over the reversal. That’s gotta hurt.

But the Informer feels for the 2,000 staff a little further north, which have gone missing from Canadian firm RIM’s roster. The company is to slash more than ten per cent of its workforce, as “a prudent and necessary step for the long-term success of the company.” The firm’s flagship tablet product, the Playbook, was launched to a mixed reception earlier this year and is not exactly starting fires in the market.

The BlackBerry maker said its workforce has quadrupled over the past five years as the company has enjoyed rapid growth, but since RIM has been faring less well it’s time to trim some of the bloat. During the second quarter, net income came down to $695m from $934m for the same quarter in 2010. The costs of the 2,000 redundancies will not be revealed until September 15th.

People have been disappearing at UK network operator Everything Everywhere too, but this time they’re on the customer side. Although the joint venture, which runs the Orange and T-Mobile network, increased its contract subscriber base during the second quarter, it still lost 390,000 users during the year to end-June as fickle prepay users took their leave. As a result, revenue took a slight dive from £1.7bn last year to £1.6bn in the second quarter of this year. Not bad going and the company seems to be cutting dead weight. The Informer recently met with Andy Sutton, chief network architect at Everything Everywhere who mentioned that when the company started capping data usage, it lost around 2,000 subscribers instantly. But those 2,000 subscribers were responsible for something like seven per cent of network data traffic. Good riddance, he probably thought.

There might also be some chicanery going on in Greece too, where second and third placed operators Vodafone and Wind Hellas have been put at risk of losing their 900MHz spectrum.

The country’s national regulator, the EETT, has issued a proposal for the re-auctioning of GSM spectrum licenses, which are due to expire in 2012. The move is controversial because it is an unusual renewal process, but also because the authority has set reserve prices at more than double the European average.

The obvious conclusion is that the Greek Government wants to use the auction to squeeze as much cash as possible out of the market’s operators in a bid to dig the country out of its financial black hole. A reserve price of €46.6m for each 5MHz block in the 900MHz GSM frequency band has been called “excessive” by one operator.

But one person close to the situation told the Informer there are machinations at work to ensure ex-state owned incumbent Cosmote – seen as the only nationalistic choice by Greek citizens whose alternatives are Vodafone and Weather owned Wind – gets its hands on some valuable 900MHz spectrum.

As it stands Cosmote owns 25MHz of 1800MHz spectrum, while Vodafone and Wind hold 20MHz apiece of 900MHz spectrum. It is this 900MHz spectrum that will go under the hammer first. The reallocated spectrum would also be awarded on a technology neutral basis, giving operators the opportunity to deploy 3G or any other technology in the 900 band.

It has been suggested by Stefan Zehle, CEO of spectrum auction specialist Coleago Consulting, that the operators could boycott the auction and choose not to bid in order to protest against the pricing. A similar situation arose during the French 3G allocation in 2001 when, the G fixed the price at a high level, based on the amounts that were paid for 3G licences in the UK and Germany. While SFR and France Telecom bought a 3G licence, Bouygues Telecom refused. As the government wanted to preserve at least three operators in France, it was forced to substantially reduce the price of the 3G spectrum licence.

In Greece, there is, theoretically at least, the potential for new entrants to come into play during the auction process, although the state of the country’s economy should be enough of a deterrent.

On the other side of the scale, Vodafone’s economy is doing better, £2.8bn better in fact, after the operator received its first windfall from its 45 per cent stake in Verizon Wireless since 2005. Head honcho Vittorio Colao was on hand to say that the money would be used to pay a sizeable dividend to shareholders, while the company speculated that it could get an annual payout of a similar sum from its investment. Vindication at last for Voda’s dogged resistance to offloading the Verizon stake.

The Big V was also on hand this week to announce a partnership with social butterfly Facebook, introducing the world’s first ‘official’ Facebook phone targeted specifically at the prepay market. At a London press conference, the Informer got to chat with Vodafone’s group terminals director, Patrick Chomet, who explained that the device, which is manufactured by Alcatel (the French vendor’s brand was acquired by Chinese vendor TCT Mobile in 2004) and runs a proprietary OS, took an in house team a year to develop.

In dedicating this level of resource to the programme, the operator clearly expects a strong return on its investment. Chomet pointed to Vodafone’s second quarter results, announced last week, which revealed that data revenue grew by 24.5 per cent year on year to £1.5bn, representing 13.7 per cent of group service revenue. More importantly, this growth brought about an inflection point where income from data services for the first time offset the decline in voice revenues.

In a bid to harness this trend, the Facebook phone will be used to capitalise on the opportunity afforded by data usage in the prepay sector, by deeply integrating the social networking experience with the device. Upon activation, users are presented with the option to either sign up or sign into a Facebook account, after which the user’s Facebook friends list becomes integrated with the phonebook. Automatic updating is user definable at a granular level enabling users to keep costs down, which for Vodafone delivers an opportunity to cash in on data usage from a relatively untapped sector, and for Facebook opens up the opportunity to increase its user base in rural, emerging markets where fixed line internet is nonexistent.

Kumar Ramanathan, chief marketing officer for Vodafone Essar, flew in from India to give his perspective on the device launch in his market, which he believes will be an easy pitch for both urban and rural areas due to Facebook’s popularity in the Indian market. “We have 60 million mobile internet users in the country and around 40 per cent of those use Facebook on mobile. We have a huge number of young people and social networking will drive growth in the mobile space,” said Ramanathan.

Speaking of emerging markets, Swedish giant Ericsson, no doubt gloating over NSN’s US mishap, has scored a major deal from Bharti Airtel, through a five year managed services contract for its African operations. Under its first multi-country managed services deal in Africa, Ericsson will manage and optimise Airtel’s mobile networks across 16 countries in the region, while under a separate two year agreement, Ericsson will also modernise and upgrade Airtel’s mobile networks for 3G.

Bharti bought Zain’s African operations for $10.7bn in 2010 and rebranded, making Airtel the master brand for all the group’s 19 operations in Asia and Africa covering over 200 million customers. In its second quarter results announced last week, Ericsson said managed services sales were down for the first time ever, compared to the second quarter 2010. Managed services sales decreased by 16 per cent year-over-year to SEK4.7bn and were down four per cent sequentially. Yet “The underlying fundamental growth drivers for the services business remain and customer interest is high,” the company said.

There’s a couple of other developments before the Informer toddles off on his holidays. Taking a leaf out of Google’s Chrome-book, Mozilla has unveiled plans for a web-based operating system of its own that will be targeted at mobile and portable devices. Oh joy, just what we need, another Linux-based OS.

Boot to Gecko (B2G) is designed to be a “complete, standalone operating system for the open web,” and will be based on the lowest level elements of the Android platform – the kernel and device drivers. However, the dev team will use as little of the actual Android code base as possible and the finished platform will not run Android compatible apps. For now though, this vague reference is all you get, although the team referenced recent work done on the development of HTML5, which goes towards making it a superset of PDF, and added: “We want to take a bigger step now, and find the gaps that keep web developers from being able to build apps that are — in every way — the equals of native apps built for the iPhone, Android, and WP7.”

Meanwhile, UK operator BT has been charged with the seemingly insurmountable task of policing the internet for copyrighted material. As many people feared, a high court judge has ruled that BT must block all access to Newzbin 2, a link aggregation forum which provides many links to pirated material. While the intention is sound, BT will be forced to use CleanFeed, the inspection software it currently uses to sniff out child abuse sites. But as the Internet Service Providers’ Association notes, at present CleanFeed is policing a rural road in Scotland, turning it onto its new task would be like policing a major motorway – something the software was not designed to do. That, and Newzbin 2 has threatened to sabotage CleanFeed if it is used against it.

But more worrying is the ruling, which seemingly makes network operators responsible for hunting down illegal content. It’s a slippery slope…

But not as slippery as the one that Zhang Chunjiang, a former deputy general manager at China Mobile, is on. Zhang has been sentenced to death by the Chinese state, having been found guilty of corruption. The bribes he confessed to having received amounted to $1.16m in between 1994 and 2009 when he held senior positions at the Liaoning Provincial Postal Administration, China Netcom and lastly China Mobile. That’s $77,000 per year. It doesn’t seem worth it to the Informer. On the bright side however, the death sentence is suspended for two years and may be commuted to life imprisonment pending good behaviour, because Zhang confessed to the crimes, and the money was returned. Death, or life in a Chinese prison. Crime certainly doesn’t pay.

Righto, that’s it for this week. The Informer is off on his holidays now and wishes all those of you following suit a safe trip.

See you in September,

The Informer.