About this weblog

What you need to know: This weblog captures key data points about the global telecoms industry. I use it as an electronic notebook to support my work for Pringle Media.

Thursday, October 27, 2022

Meta Tries to Keep Long-Term Focus

Meta, owner of Facebook, reported a 2% rise in revenue (on a constant currency basis) to 27.7 billion US dollars for the third quarter. Meta flagged "weak advertising demand, which we believe continues to be impacted by the uncertain and volatile macroeconomic landscape."

CEO Mark Zuckerberg described messaging as a "major monetisation opportunity." He said one of Meta's fastest growing products is Click-to-Messaging ads, which let businesses run ads on Facebook and Instagram that start a thread on Messenger, WhatsApp or Instagram Direct so they can communicate with customers directly. The product generates a 9 billion dollar annual run rate. "This revenue is mostly on Click-to-Messenger today since we started there first, but Click-to-WhatsApp just passed a 1.5 billion dollar run rate, growing more than 80% year-over-year."

Zuckerberg pointed to paid messaging as another opportunity. "We're putting the foundation in place now to scale this with key partnerships like Salesforce, which lets all businesses on their platform use WhatsApp as the main messaging service to answer customer questions, send updates, and sell directly in chat," he added. "We also launched JioMart on WhatsApp in India and it's our first end-to-end shopping experience that shows the potential for chat-based commerce through messaging."

Mete has just started shipping its new Quest Pro VR headset, which is designed to deliver "high-resolution mixed reality so you can blend virtual objects into the physical environment around you." 

"There are 200 million people who get new PCs every year, mostly for work," Zuckerberg added. "Our goal for the Quest Pro line over the next several years is to enable more and more of these people to get their work done in virtual and mixed reality, eventually even better than they could on PCs....There's still a long road ahead to build the next computing platform, but we are clearly doing leading work here. This is a massive undertaking and it’s often going to take a few versions of each product before they become mainstream. But I think our work is going to be of historic importance and create  the foundation for an entirely new way that we will interact with each other and blend technology into our lives." Source: Meta statement

Tuesday, October 25, 2022

Alphabet Sees Serious Slowdown

Alphabet reported a 11% year-on-year increase (at constant currencies) in consolidated revenues for the third quarter to 69.1 billion US dollars. That's down from 39% a year earlier. 

With growth slowing, Alphabet has "started our work to drive efficiency, by realigning resources to invest in our biggest growth opportunities. Over the past quarter, we’ve made several shifts away from lower priority efforts to fuel higher growth priorities," said Sundar Pichai, CEO of Alphabet and Google. "Over a decade ago, focusing the company’s efforts on mobile helped us to build and grow our business for the shift to mobile computing. We’re at a similar point now with AI, another transformational technology. Our investments in AI and deep computer science mean that we can deliver a wide range of breakthroughs across our products and services, to help people, businesses, and communities."

In October, Alphabet's unit Waymo announced Los Angeles will be the next city to be served by its ride-hailing service, joining Phoenix and San Francisco. "We’ll begin driving autonomously in several central districts over the coming months as we prepare to serve Angelenos," the company said. "We’ll deploy a round-the-clock service that provides more accessible and dependable mobility options to all residents of LA." Waymo said Los Angeles represents a market opportunity of 2 billion dollars in 2022. 

"Waymo remains the only company operating a fully autonomous, commercial ride-hailing service for passengers round the clock in Phoenix’s East Valley – no NDAs, remote operators or pre-defined pick-ups." it added. "We’re the first and only company in the world providing autonomous ride-hail trips to and from an airport (Phoenix’s Sky Harbor), and we drive more fully autonomous miles in the U.S. than any other company." Source: Alphabet and Waymo statements.

Wednesday, October 19, 2022

Netflix Moves Beyond Membership

Netflix forecast year-on-year revenue growth of 9% (in constant currency terms) for the fourth quarter of 2022, as it anticipates that growth in paid memberships will fall to just 2.6% from about 9% a year ago.  

In the third quarter of 2022, Netflix's revenue rose 13% to 7.9 billion US dollars, excluding the impact of foreign exchange movements. 

Netflix said: "As discussed in previous letters, we are increasingly focused on revenue as our primary top line metric. This will become particularly important heading into 2023 as we develop new revenue streams like advertising and paid sharing, where membership is just one component of our revenue growth."

Netflix is also trying to expand its year-old games proposition: "We now have 35 games on service (all included in every Netflix subscription without in-game ads or in-app purchases) and we’re seeing some encouraging signs of gameplay leading to higher retention. With 55 more games in development, including more games based on Netflix IP, we’re focused in the next few years on creating hit games that will take our game initiative to the next level. More generally, we see a big opportunity around content that crosses between TV or film and games." Source: Netflix statement

Friday, August 12, 2022

Deutsche Telekom Cranks up High-Speed Connectivity

Deutsche Telekom reported a 4.3% organic rise in service revenues for the group year-on-year in the second quarter of 2022. 

DT said it now passes more than 11 million European homes with FTTH (fibre-to-the-home) networks, while its "ultra capacity" 5G network passes 235 million U.S. homes and is on track of 260 million by year-end.  Source: Deutsche Telekom collateral

Tuesday, August 9, 2022

Autonomous Taxis Go Commercial in China

Internet company Baidu said it has secured the first permits in China to offer commercial fully driverless robotaxi services to the public on open roads. Its Apollo Go ride-hailing service has been authorised to collect fares for robotaxi rides - without human drivers in the car - in specific districts in Chongqing and Wuhan. 

The regulatory decision marks "a key turning point for the future of mobility in China, leading to an eventual expansion of driverless ride-hailing services to paying users across the country," Baidu said.

Having received the permits, Baidu plans to provide fully driverless robotaxi services in the designated areas in Wuhan from 9 am to 5 pm, and Chongqing from 9:30 am to 4:30 pm, with five Apollo robotaxis operating in each city. The areas of service cover 13 square kilometers in the Wuhan Economic & Technological Development Zone, and 30 square kilometers in Chongqing's Yongchuan District.

Baidu said its autonomous driving system is supplemented by monitoring redundancy and remote driving capability (enabled by a 5G cellular connection) and a robust safety operation system.

Baidu said Apollo Go is the world's largest robotaxi service provider, recently reaching the milestone of more than one million orders. Source: Baidu statement

Friday, July 29, 2022

Orange Bank Sees Modest Growth

Orange said its mobile financial services activities continued to grow in the first half of 2022.  At June 30, 2022, Orange Bank had nearly 1.9 million customers in France and Spain, up from 1.6 million nine months earlier. In Africa, where it has launched a new microcredit service, Orange Bank Africa had 845,000 customers at the end of June, up from 600,000 at the end of September.

Orange Bank reported deposits of 1.06 billion euros in special savings accounts and 718 million euros in current accounts.  That was set against overdrafts of 844 million euros and housing loans of 994 million euros.  Source: Orange statements

Amazon Expects Stronger Sales Growth


Amazon said its net sales increased 10% to 121 billion US dollars in the second quarter, excluding the negative impact of year-over-year changes in foreign exchange rates.

It expects net sales to grow between 13% and 17% in the current quarter, compared with third quarter 2021. This guidance anticipates an unfavourable impact of approximately 390 basis points from foreign exchange rates.

In central London, Amazon has launched its first "micromobility" hub, which will coordinate local deliveries by e-cargo bikes (see pics) and walkers.

Amazon also said it has filed legal action against the administrators of more than 10,000 Facebook groups that attempt to orchestrate fake reviews on Amazon in exchange for money or free products. "These groups are set up to recruit individuals willing to post incentivised and misleading reviews on Amazon’s stores in the U.S., the UK, Germany, France, Italy, Spain, and Japan," the company said. "Amazon will use information discovered from this legal action to identify bad actors and remove fake reviews commissioned by these fraudsters that haven’t already been detected by Amazon’s advanced technology, expert investigators, and continuous monitoring." Source: Amazon statement

Telefónica Ups Guidance Slightly

Despite the uncertain macro economic environment, Telefónica said it now expects revenues in 2022 to be at the high-end of its guidance for low single digit growth in 2022.  That guidance relates to organic growth and includes 50% of its joint venture with Virgin Media in the UK. 

In the second quarter of 2022, Telefónica's revenues rose 5.2% in organic terms, up from less than 4% in the previous quarter, with growth across all the group's markets. It said that service revenue and handset sales grew by 3.9% and 17.4% respectively. Group revenue in the second quarter was 10.04 billion euros.

The Madrid-based group continues to look for opportunities in adjacent markets. In June, for example, Repsol and Telefonica España launched Solar360, a new joint venture to "develop the solar self-consumption business."  Solar360 plans to serve private customers, communities of neighbours and companies, SMEs, and large companies. Telefonica said it brings distribution channels, technological capacity and "IoT capabilities to provide the installations with a differential connectivity in the market." Source: Telefónica statement