Big money

In a week dominated by events as profoundly sobering as the Haitian earthquake and its aftermath, the news that the mobile industry will turn over more than $1 trillion for the first time in 2013 is given serious context. Aid agencies that are calling for donations in the stricken Caribbean nation report that £50 can buy a food parcel that will feed a displaced family for two weeks.

January 15, 2010

7 Min Read
Big money

By The Informer

In a week dominated by events as profoundly sobering as the Haitian earthquake and its aftermath, the news that the mobile industry will turn over more than $1 trillion for the first time in 2013 is given serious context. Aid agencies that are calling for donations in the stricken Caribbean nation report that £50 can buy a food parcel that will feed a displaced family for two weeks.

The industry prediction comes courtesy of Informa Telecoms & Media, which projects that spiralling voice revenues will be offset by the continued data boom. Data revenues should exceed £330bn worldwide in 2013, the firm said, up from $208bn in 2008.

While we’re on the topic of major-league moolah, here’s some news that lends more than a dash of irony to the phrase ‘slim pickings’: America Movil’s top man Carlos Slim, currently mending and making do as the third wealthiest man in the world, may be jumping a couple of spaces up the rich list on the back of a move to consolidate his empire.

The proposal, announced Thursday, would see America Movil take full control of three other telecoms firms in which Slim owns major stakes. The offer is a two-for- one share swap made to the shareholders of Carso Global Telecom, which would give America Movil ownership of 59.4 per cent of the outstanding shares of Mexican fixed line operator Teléfonos de México (Telmex), and 60.7 per cent of the outstanding shares of Telmex Internacional.

America Movil has also offered to purchase of all of Telmex Internacional’s shares that are not already owned by Carso (39.3 per cent).

If successful, Slim would de-list both Carso Telecom and Telmex from their respective trading indices and create a regional behemoth. America Movil had 194.3 million wireless subscribers and 3.8 million landlines in the Americas at the end of September 2009, with operations in 15 Latin American countries, as well as Jamaica and the US. The consolidation would give it over 250 million customers in the Americas.

And as Forbes notes, the move would mean Slim’s fortune would change by billions of dollars every time America Movil stock moves just a few dollars.

Slim ranks alongside the likes of Sunil Bharti Mittal and Saad Al Barak in the mobile industry as the leader of a developing market powerhouse that could well upset the established order in the operator community. In fact, earlier this week, Mittal’s operation, Indian operator Bharti Airtel agreed to acquire at 70 per cent stake in Bangladeshi service provider Warid Telecom backed by an investment totalling $1bn.

That’s a lot of food parcels.

Swedish vendor Ericsson ticked its CSR boxes, meanwhile, with the announcement that it is sending an emergency GSM network and four specialist volunteers to Haiti as part of the UN programme to enable communications on the ground. The vendor has a permanent relief team called Ericsson Response that was established in 2000.

On more familiar territory for the Swede, it was revealed as one of the winners in TeliaSonera’s LTE rollout. Ericsson will provide the common core LTE network in Sweden and Norway and will share the radio network deployments across both markets with Nokia Siemens Networks. It was one in the eye for Huawei, which was baiting Ericsson at the back end of last year as the two firms competed for headlines over their respective metropolitan LTE deployments in Oslo and Stockholm.

This was on the back of the Chinese vendor winning the right to provide network kit to Telenor/Tele2 JV Net4Mobility in Sweden. Ericsson was so upset to lose out on this home market opportunity that it was moved to issue a statement which ran along the lines of the marital and parental classic: “I’m not angry, I’m just disappointed.” Swedish contracts for Swedish firms is the result this week.

It’s not seemly for large companies to crow openly, so Ericsson opted instead to send out a couple of paragraphs penned by a Swedish journalist, which appeared in a Swedish magazine. The journalist in question was quoting a Swedish analyst house called Market Action Point. This firm’s research, according to the article that Ericsson punted out, “showed clearly that Ericsson’s LTE equipment (4G) is technically superior [to] Huawei.”

The report continued: “It seems as if Huawei have so far not launched a commercial LTE solution, and they are using proprietary solutions for each client. This makes the system technically unstable and unwieldy.” Not that Ericsson itself would make such a claim, of course…

In other Chinese flavoured news, it appears that Google has had an attack of conscience. I know, who’d have thought it? The search giant revealed this week that Gmail accounts belonging to Chinese human rights campaigners had been hacked, prompting it to rethink its position on operating in China based on its commitment to ‘freedom of speech’. The upshot is that it is now refusing to censor its web searches in China as it agreed to do when it launched there in 2006, when freedom of speech was somewhat less of an issue.

Google’s statement this week contained no suggestions as to who it might think was guilty of the hack, and included some upbeat puff about the achievements of the economic reforms of what it called “this great nation”. But given that the firm’s reaction to the hacks is to dissolve the agreement it made with the Chinese government, it seems conceivable that Google believes state forces must have been at play.

You can understand Google’s concerns about the Chinese Government. After all, we’re talking about a ruthless and deeply secretive, totalitarian regime with seemingly limitless resource and ambitions for world domination. And that regime does not want its customers’ email accounts getting hacked by anyone, government or not.

Chinese vendor ZTE, meanwhile, has announced that it is joining the Open Handset Alliance, the industry grouping that develops Google’s Android mobile operating system. “With the growing trend and popularity of Android smartphones, ZTE is committed to invest in this innovative platform to meet the market demand,” said Lin Qiang, general manager of ZTE Smartphones.

“To accommodate this trend, ZTE has invested heavily in the research and development of Android smartphones during the last year. In the first quarter of this year ZTE will launch smartphones based on the Android platform,” he added.

And ZTE isn’t the only one. Korean vendor LG has got the Android bug real bad. The firm said this week that half of the 20-odd smartphones it plans to launch in 2010 will be Android based. At the very end of last week, meanwhile, long after the Informer’s deadline had passed, LG was at the centre of an Intel announcement from CES in Las Vegas.

Intel president and CEO Paul Otellini unveiled a beta version of the Intel AppUp center, which is targeted at netbook devices. The storefront is being supported by devices manufacturers Acer, Asus, Dell and Samsung and will support Intel-based devices, which will presumably run on Intel’s homebrew Linux-based operating system, Moblin – unless the company starts supporting Android on the Atom, that is.

Otellini was also showing off the LG GW990 smartphone, based on ‘Moorestown,’ Intel’s next-generation platform for handhelds and smartphones. The GW990 is based on Moblin and boasts a sizeable 4.8″ display, making it a little more than pocket sized. With a touchscreen, five megapixel camera, 16GB of storage, HD video, wifi and HSDPA, the device may give a glimpse of mobile form factors to come.

And we’ll finish on some more handset news this week. The compound adjective ‘coke-fuelled’ is, in the Informer’s experience of reading the less intellectual British newspapers, usually followed by words like ‘rampage’, ‘orgy’ and ‘Aerosmith’. It has never, until now, been followed by the words ‘mobile phone’. But all that has changed with the news that a bright Chinese spark has apparently invented a handset that can be powered by sugary soft drinks such as Coca Cola.

Take care

The Informer

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