The Informer learned about politics at an early age. At school, in fact. Nail your colours to a mast and you will learn to live with the consequences in perpetuity. At the Informer's first school, you see, everybody played the recorder. At the next school he went to, playing the recorder was an open invitation to ridicule, humiliation and, in some cases, violence.

June 5, 2009

10 Min Read

By The Informer

The Informer learned about politics at an early age. At school, in fact. Nail your colours to a mast and you will learn to live with the consequences in perpetuity. At the Informer’s first school, you see, everybody played the recorder. At the next school he went to, playing the recorder was an open invitation to ridicule, humiliation and, in some cases, violence. It was the Informer’s profound misfortune that the first person he met on his first day was the only other person at that school who played the recorder. Flashing his own descant like a badge of honour, a commitment was made that was to prove long lasting, more’s the pity. It was a lonely five years, truth be told, but boy oh boy, could the informer make that recorder sing. That’s school politics. Real politics, as Gordon Brown is finding out this week, is a lot less concerned with sticking to your commitments.

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.


“We are fully supportive of Sony Ericsson’s GreenHeartTM 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.

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