Two days later and Huawei’s bragging to all and sundry about its superior performance. Thumb on nose and fingers waggling in Ericsson’s general direction, the Chinese vendor sent out the following message:

“Please find the media advisory below that Huawei in Oslo for TeliaSonera reached 96 Mbps, as compared to a rival network in Stockholm that recorded speeds of only 43-44 Mbps.” Oooohhh! The release quotes an interview with TeliaSonera’s CTO Lars Klasson in Swedish technology publication Ny Teknik. Klasson’s quotation somewhat takes the sting out of Huawei’s gloating.

“Ericsson’s network runs at 10MHz, while Huawei’s network in Oslo uses 20MHz.”

Pretty silly, really. Still, that’s not all that Huawei’s been ribbing Ericsson about, as the vendor also announced an LTE win this week with Telenor/Tele2 joint venture Net4Mobility on Ericsson’s domestic turf of Sweden. This one seems to have hit home, with Ericsson moved to issue a statement proclaiming its disappointment to have missed out on a deal with local customers. But, the firm said, it just couldn’t compete with the Chinese player on price.

“We are of course disappointed that we did not manage to reach an agreement with Net4Mobility, joint venture by Telenor and Tele2 in Sweden. We would very much liked to have delivered this LTE network in our home market.

In the negotiation process we went as low as we could in terms of price but it was not enough.”

And Huawei was also on the case here in the UK. Telefonica-owned O2 said this week that it had carried out a successful trial of LTE in the UK, pumping out a cell peak downlink rate of 150Mbps, while showcasing high definition video streaming, mobile gaming, high speed file transfer and video conferencing.

The trial is part of Telefonica’s far reaching pilot project announced in October. The European carrier is to roll out LTE test projects in six countries, with a view to selecting technology providers for its 4G deployments. The suppliers Telefónica has chosen so far are Alcatel-Lucent, Ericsson, Huawei, NEC, Nokia Siemens Networks and ZTE, all of which will start rolling out the equipment necessary for testing the technology during the coming months.

The project will take place over six months and will consist of field tests and the installation of base stations at Telefonica’s branded operations in Spain (Telefonica), the UK, Germany and the Czech Republic in Europe as O2, and Brazil and Argentina in Latin America as Telefonica Moviles.

In other news, Telefonica has set up an international M2M division that it hopes will enable it to gobble up substantial parts of a market that Gartner forecasts to be in the region of 200 million cellular modules by 2012.

Retail behemoth Tesco’s MVNO Tesco Mobile piggy-backs on the O2 network and the supermarket this week started offering the iPhone, at the lowest monthly contract price in the UK market. Users can have the phone for just £20/month on a year-long contract, but they’ve got to stump up more than ten times as much – £222 – to get the handset in the first place. And it’s not a fuel injected 3GS, either, it’s just the little 8GB 3G run-around.

If you want the latest model, then it’s a whopping £60/month tariff for 24 months. Hardly the kind of pricing you’d expect to appeal to a supermarket MVNO demographic. On this tariff you get the 32GB 3GS for £50 up front and you’ll be committing to a spend of £1,490. You’d have to be mental.

In other iPhone news Apple has overhauled the interface for its iTunes-based App Store platform, making it more graphically intensive. With over 100,000 apps now available in the store, the biggest problem developers face is discovery of their creations, a problem this new approach seeks to address.

Meanwhile, Google has confirmed the existence of a home grown Android-based device that is being tested within the company. In a blog posting, Mario Queiroz, vice president of product management at Google’s mobile division, said Google employees worldwide are testing “a device that combines innovative hardware from a partner with software that runs on Android”.

Queiroz said that the aim of the project is to establish a mobile lab, “to experiment with new mobile features and capabilities”, which actually makes it sound more like a software testing platform for Google’s in house Android-based developments and less like a bit of Google-branded hardware that might make its way into consumer hands.

In other handset news, Christmas came early for Research In Motion this week, with the news that the firm saw Q3 profits jump almost 60 per cent year on year to $628.4m. Revenue was up 41 per cent year on year to $3.92bn, with 82 per cent coming from handset sales, 14 per cent from service, two per cent from software and two per cent from other areas.

RIM has benefited from a push into the consumer market and the firm said that more than 80 per cent of its new customers were consumers rather than enterprise users. Two years ago corporate customers accounted for half of the firm’s users, it said. Today that number has dropped to less than 20 per cent. RIM sold more than ten million BlackBerry handsets, up from its previous record (in the second quarter) of 8.3 million units.

Unfortunately US firm Palm isn’t doing so well, but at least it’s trending in the right direction. Palm’s net loss for the three months to the end of November hit $81.9m, compared to a loss of $509m in the same period last year. Revenues, however, did slide to $78m, from $191m in the third quarter of 2008.

The problem, it seems, is that Palm isn’t shifting the units as fast as it needs to be, despite the high profile launches of its Pre and Pixi devices. The company shipped a total of 783,000 devices during the quarter, down five per cent sequentially, but up 41 per cent year on year, which actually suggests it’s doing something right with regard to its product line up.

Indeed, according to figures from Informa Telecoms & Media’s upcoming Future Mobile Handsets report, Palm is one of a handful of high-end players that are seriously threatening the volume market leaders like Nokia, Samsung, LG, Motorola and Sony Ericsson.

These challengers will continue to steal market share in 2010, with figures released Wednesday predicting that the market share of the four underdogs will jump to 35 per cent of all smartphones sold in 2009 from 32 per cent in 2008 and just 24 per cent in 2007.

It’s no secret that while sales in the mobile handset space in general are in decline, the smartphone segment is actually growing and has turned into the most profitable segment of the mobile handset market. Informa forecasts that volume sales of smartphones are to grow by 33.5 per cent year on year in 2009 and by 36 per cent in 2010 to account for 27 per cent of the total number of handsets sold in 2010.

Incidentally, smartphones will also represent over half (55 per cent) of the value of the total mobile handset market and almost two thirds (64 per cent) in terms of profitability.

Informa analyst Malik Kamal-Saadi said that key to the success of these new entrants and smaller players is the adoption of new operating systems that have been built from scratch and better reflect the realities of modern mobile device requirements. In addition, they are not burdened with the support of a long legacy of devices and content already in market.

“Volume market leaders have responded, with a multitude of me-too iPhones offering multi-touch and an enhanced internet experience but true innovation is still lacking from many incumbent OEMs’ portfolios,” Kamal-Saadi said. “Some players (Motorola, Sony-Ericsson, and Samsung) have responded by opting for Google’s Android as key OS to bring innovation to their smartphone portfolios.  These changes will completely transform the smartphone market landscape and could potentially lead to the emergence of new leaders in the mobile handsets market,” Kamal-Saadi added.

We’ll have to wait until 2010 to see how this pans out, because the Informer is off on his Christmas break now.

All the best to everyone, have a happy break and a peaceful and prosperous 2010.

Take care

The Informer

Tesco iPhone undercuts on price

UK supermarket Tesco began selling the Apple iPhone on Monday, at the lowest monthly contract price in the UK market.

Tesco is offering the device for just £20 per month on a 12 month contract – a first for the iPhone retailers. The trade off however, is that consumers will have to fork out £222 up front, and that’s for an 8GB 3G (not 3GS) device.

On this tariff, rather than going down the all you can eat data and bucket of voice minutes every month, Tesco will give iPhone owners £60 in flexible credit to spend as they choose each month.

But the 8GB 3G and the 16GB 3GS will also be available for free with unlimited calls, texts, and browsing, on a 24 month contract, for £60 a month. On this tariff, the 32GB 3GS will be available for £50 up front.

Tesco Mobile is a 50:50 joint venture MVNO with O2 UK and the supermarket claims some 42 million shopping visitors a week.

In other iPhone news Apple has overhauled the interface for its iTunes-based App Store platform, making it more graphically intensive. With over 100,000 apps now available in the store, the biggest problem developers face is discovery of their creations, a problem this new approach seeks to address.

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No doubt Apple is pleased that the phone will be available to so many people, but the Informer can’t help but feel that there will be some reservations at the firm’s Cupertino headquarters about its brand being tossed about among the great, unwashed masses.

To balance out this social descent, a new version of the iPhone has been created, by a UK luxury goods firm called Goldstriker. This phone, built for an anonymous Australian gold magnate, cost $3.2m. Yup, three point two million dollars – for a phone. The diamond set as the home button on this grotesque creation is 7.1 carats. In total there are 68 carats of diamonds on the front of the handset. Truly wealth and taste do not always go hand in hand. No wonder the customer wants to stay anonymous, he’s probably acutely embarrassed.

There are no plans for this phone to be made available at Tesco. Yet.

O2, which plays host to Tesco Mobile and was the first UK carrier to offer the iPhone, announced this week that it is to bulk up its network with the deployment of 1,500 new cell sites starting immediately and continuing throughout next year. The rollout, which will see 200 new sites in London alone, is necessary because of the popularity of data centric handsets like the iPhone and the usage patterns they’ve inspired, said O2′s CTO Derek McManus. By way of illustration, he said, watching a youtube video on a smartphone can be equivalent to sending 500,000 text messages simultaneously.

O2 says its 3G network covers more than 84 per cent of the UK population and is 100 per cent HSDPA enabled. And earlier this year O2 and Vodafone announced a pan-European network sharing agreement that in the UK will see both companies focus on joint building of new sites and the consolidation of existing 2G and 3G sites.

O2′s competitors Orange and T-Mobile announced earlier this year their intention to merge their UK operations and Orange revealed a similar deal in Switzerland this week. Orange owner France Telecom and Danish incumbent TDC, which operates Swiss carrier Sunrise said they will combine the operations, creating a new fixed and mobile player.

Figures from Informa Telecoms & Media for the end of Q3 this year show that the two carriers combined mobile customer base was 3.41 million, 38 per cent of the market but some way behind incumbent Swisscom, which had 5.54 million customers at the end of September. The new player would also have 1.1 million fixed and broadband customers.

The merger, if completed, would leave just two mobile carriers in the Swiss market. Under the deal, the French incumbent will pay €1.5bn to TDC and will become a 75 per cent shareholder in the combined entity, while TDC will hold the remaining 25 per cent. The firms predict synergies of €2.1bn.

The move may presage TDC’s eventual departure from Switzerland, as it will have the right to sell its stake to third parties from the second year or launch an IPO from the third year.

Over the border in Austria, there’s been an unusual development in the telecommunications industry this week. Austria’s one of those countries where you can’t make civil servants redundant, where bureaucracy remains very much a job for life. Because Telekom Austria used to be state owned, its staff have civil servant rights, which makes things tricky for TA when it wants to make like the rest of the industry and cut a few heads.

The firm’s found a novel way to sidestep this issue, though, and has transferred 500 staff whom it no longer needs to the Austrian police force. You can have a job for life, it seems, they just don’t specify which job. It’s a brilliant idea, because there’ll always be crime, so there’ll always be a need for police. Although it must make for a strange transition, leaving your job at a telco, being given a badge and a gun and being told to go and shoot some criminals. Although perhaps they’re going to work on the administrative side…

TA’s former head man Boris Nemsic, who looks like he’d make quite a good hard- boiled detective himself, oversaw some handy results at his new employer Vimpelcom this week. The firm’s subscriber base grew by 1.7 million during the third quarter, reaching 65.4m. Net profit more than doubled to RUB13.51bn, while the firm also successfully launched its Beeline brand into Vietnam, and struck a deal to enter the Laotian market.

The Nortel sell-off came closer to its natural conclusion this week, with Ericsson and Ciena picking over the carcass. Ciena paid $769m for the Canadian firm’s optical networking and carrier Ethernet business on Monday after an auction that ran through last weekend.

Ericsson nabbed “certain assets of the Carrier Networks division of Nortel relating to the GSM business in the US and Canada,” the firm said, stumping up just $70m, while the GSM-R business and other bits and pieces outside of North America went to Kapsch, an outfit making its debut in A Week in Wireless this week. For Ericsson the deal represents is a relationship builder with Nortel customers AT&T and T-Mobile.

“Along with our recent acquisition of Nortel’s CDMA and LTE assets, the transaction emphasizes Ericsson’s commitment to the North American market and strengthens our position as a leading provider of telecommunications technology and services in the United States and Canada,” said Hans Vestberg, incoming president and CEO of Ericsson.

Ericsson may well be the world leader in managed services, but that didn’t sway MEA carrier Zain, which this week outsourced its East African network operations to Nokia Siemens Networks. Under the agreement, NSN will pick up five-year management contract in Kenya, Tanzania and Uganda, with an eye to optimising, modernising and managing 3,000 plus multi-vendor mobile sites catering to nine million customers. Upgrades to energy efficient technologies and off grid power solutions will be a key component of the deal.

It’s NSN’s biggest multi-vendor outsourcing deal in the region and is also one of the first such deals of its kind in Africa, the firm said. As part of the agreement, approximately 350 Zain employees will be transferred to NSN. Zain will no doubt hope this will help with the financial drain its African operations are putting on the firm’s coffers.

Finally, off to the world of crime, and the news that a UK prison inspector has recommended that phone jamming technology should be used in Brit clinks given the spread of mobiles among inmates. They’re not supposed to have phones, but they are routinely smuggled in by visitors hiding them in their underwear, corrupt prison officers, or even thrown over the walls. They are also, if you believe certain sources, taken by visitors into prisons secreted in what might most politely be described as ‘nature’s pocket’.

Last year 7,000 phones were seized from prisoners, although inspectors reckon three times as many are in circulation. They change hands for around £400 a pop. That sounds like a niche MVNO business model if ever there was one. It could be called Cell-cell. Or Con-comm. Or, if there’s a business to be had providing jamming services to prisons, it would have to be called Cell Block.

Take care

The Informer

The iPhone will be available in Tesco

iPhone exclusivity is well and truly over, in the UK at least, with the news that supermarket Tesco is to stock the device and might even do so in time for Christmas.

It might be that Tesco Mobile, which is a 50:50 joint venture MVNO with O2 UK, had something of an edge in the negotiations, given that O2 has had iPhone exclusivity for the past two years.

O2’s advantage was brought to an end however with Orange’s recent launch of the device, and news that Vodafone will sell the handset after Christmas. So it looks like Tesco might even beat Vodafone to the punch, allowing consumers to buy an iPhone 3G or 3GS whist picking up the turkey. There’s no detail on pricing however, although telecoms.com doesn’t reckon the much talked about iPhone price war will happen, especially in light or Orange’s offering.

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On Monday, the supermarket chain said that it has struck a deal with UK mobile VoIP provider Mobiboo Mobile, to launch the tovo mobile internet phone.

The tovo t450g PocketFone and the tovo t1000 HomeFone Plus are available on both contract and prepay tariffs from today at 19 Tesco stores in the UK.

By making calls over wifi, Mobiboo reckons consumers can save an average of 30 per cent on their mobile charges and up to 50 per cent on fixed line charges. Typical Mobiboo charges for prepay users are £0.02 per minute for local calls with international tier 1 calls costing £0.05 per minute. Monthly package customers get from free UK, mobile and international calls. Calls between Mobiboo users are free.

As well as making calls over a users home wifi network, customers can also make calls at wifi hotspots. Earlier this year, UK-based wireless network provider The Cloud announced a partnership giving Mobiboo customers the ability to use their Mobiboo phones at any of The Cloud’s UK hotspots.

The tovo t450g PocketFone also goes one better. It is a dual mode device which will accept a standard GSM SIM card as well and will switch to a cellular network when out of the range of wifi.

When telecoms.com first got wind of this announcement back in May, the fact that users would probably end up carrying both the wifi VoIP device and their regular mobile handset was seen as one of the major drawbacks of the service. But it looks like Mobiboo and Tesco have heeded the warning with the introduction of the t450g.

Tesco serves 5 million visitors a month in the UK and will be pushing the offer through its Tesco Telecoms arm which runs Tesco.net.

In a statement, the companies said: “Any mobile internet user from a small business manager to writers and students will be able to access the internet on the move from the 7,000 UK hotspots, including city centre hotzones across the country, without having to worry about time limits or escalating costs.”

The package is also available for £4.50 for an hour’s pay-as-you go use and £11.99 a week on a pay-as-you-go basis. www.tesco.net customers will also benefit from an exclusive 10% off discount when they sign up to a year contract.

George Polk, CEO, The Cloud said: “The Cloud is committed to working with the best partners in order to make great value WiFi available to as many people as possible. We are introducing this service in response to the growing demand for always on internet connectivity at a low daily price.”

The service is being launched at the same time as The Cloud is switching on a number of city centre hotzones across the UK, starting with Manchester which went live earlier this month.

Manchester will be followed by networks in City centres in Birmingham, Cambridge, Edinburgh, Leeds, Liverpool, Nottingham and Oxford, along with the London boroughs of Kensington and Chelsea, Camden and Islington. The Cloud is also currently building Europe’s largest wifi enterprise zone for the City of London.

Julien Grivolas, analyst at Ovum, believes The Cloud’s move could trigger “a price war” for wifi. He explained: “The Cloud has a very significant customer base in the UK, and consumers will be very happy that they will be paying more than 50 per cent less than BT’s offering.”

Grivolas, who is based in France, believes The Cloud’s partnership with Tesco is ideal for now but in the future partnering with “more closely linked telecoms companies” is more likely, particularly in other European states. “This kind of strategy will work for The Cloud and Tesco in the UK but if you look at say Sweden or Germany where they have far fewer hotspots, it would not be successful. But in the UK where they are so dominant, I think this will do very well.”