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.

Tuesday, October 30, 2012

TMT Winners and Losers in Q3

Scale in technology, media and telecoms is crucial. The above graphic shows how some of the major TMT players fared in the third quarter in terms of year-on-year revenue gains or losses in millions of dollars. The graphic uses organic figures, where available.

Monday, October 29, 2012

China Telecom Sustains Fast Growth

China Telecom said that its operating revenues rose 15.1% year on year in the first three quarters of 2012 to 209.98 billion Chinese yuan (33.64 billion US dollars), marking a slight acceleration over the 14.8% growth in the first half. Operating revenues excluding mobile device sales rose 11.1% year-on-year to 191.57 billion yuan.

China Telecom reported its mobile subscribers at the end of September were almost 153 million compared with 117 million a year earlier, while 3G subscribers climbed to almost 60 million from 28 million. Wireline broadband subscribers at the end of September were almost 87 million up from 74 million a year earlier. source: China Telecom statement

Communications Cliques: Control or Chaos?

This post is sponsored by the Enterprise Mobile Hub and BlackBerry.
The proliferation of communications apps is creating cliques and confusion
Don’t call me, I’ll [something] you: Among twentysomethings, the communications hierarchy is roughly this – Facebook first, text second, email third and only call as a last resort. That is, of course, a gross over-simplification – members of Generation Y actually use many alternatives to Facebook, SMS, email and old-fashioned voice calls.
In fact, the rise of the smartphone has been accompanied by an explosion in IP-based communications and messaging apps, such as BlackBerry Messenger, FaceTime, iMessage, TextMe, TextNow/Touch, Twitter, Viber and WhatsApp. These mobile pretenders are slugging it out with longer-standing communications apps, such as Facebook, Google Talk (now merging into Google+), Skype and Yahoo! Messenger, as well as conventional circuit-switched phone calls and SMS.  
For CIOs, the recent proliferation of communications options is a double-edged sword.  IP-based apps should cut telecoms costs, but they can also create communications silos (read cliques) within an organisation. Although some of these services are interoperable in some scenarios, in many cases, they can’t communicate directly with each other, often defaulting to email to alert a user to an incoming message. While some employees might be WhatsApp devotees, others might prefer Skype or direct Twitter messages.
So, should a CIO and his or her team intervene and mandate the use of specific communications services or should they let the market run its course? Anyone contemplating the latter approach, may have to be patient. A quick review of how these various communications services are doing suggests the market will be fragmented for several years yet.
  • Facebook claimed 552 million daily active users on average in June 2012. It has also said that there were 600 million monthly active users of its mobile products in September 2012.
  • In May, Skype claimed 250 million monthly users, according to a report on Engadget. Skype users logged 115 billion minutes of calls over the second quarter, according to a report on Techcrunch — that equates to about 1.3 billion minutes a day.
  • WhatsApp was handling 10 billion messages a day in August, according to a report on The Next Web.
  • Although Apple doesn’t disclose how many people are using its FaceTime and iMessage services, Techcrunch reports Apple has sold more than 400 million devices running the iOS operating system. The latest version, iOS 6, supports both FaceTime and iMessage over cellular networks, as well as Wi-Fi.
  • Twitter had approximately 170 million active users in July 2012, according to a report on Techcrunch.
  • Google claimed in September that Google+ is used by 100 million people each month, according to a report on CNET.
  • BlackBerry Messenger (or BBM) is used by more than 60 million people worldwide, according to RIM. More than 60% people of this group are using BBM daily, RIM says.
  •  Viber said in July it had hit 90 million users, adding 20 million in just over two months. Those users are now spending more than 1.5 billion minutes on calls and sending over two billion text messages each month, according to a report on GigaOm.
  • Enflick claims that both its Touch and TextNow services are used by millions of people worldwide and are growing rapidly. In March of 2011, TextNow sent its billionth message, according to Enflick. TextNow ranked fourth among the social networking apps in the U.S. version of Apple’s App Store on October 29th  2012.
  • TextMe claims more than 5 million downloads, with 750,000 active users, according to a May 2012 report in VentureBeat.
Of course, the list above is far from exhaustive – there are many more social networking/messaging/voice calls apps out there (see graphic showing the top social networking apps in the App Store on October 29th). Even some mobile operators, such as Telefonica, are launching their own so-called over-the-top apps, such as TUMe. There are also social networking services, such as Yammer, that are designed specifically to be used within enterprises. Some people rely almost exclusively on email!

For CIOs, this all may look like communications chaos, but it is clearly far too early to bet on which services are going to win out.  Although it is tempting to break down the cliques and force employees to use specific apps, such as Yammer or Skype, to contact colleagues, that probably isn’t practical in a bring-your-own-device (BYOD) culture for several reasons:
  • Some services are tailored for specific devices.
  • You might make the wrong bet - disruptive new services may have better features and functionality than the services you mandate  
  • Different tribes like to communicate in different ways and will work round top-down mandates – many people simply won't give up BBM, WhatsApp or Facebook.
But the cliques won't last forever. In time, the weaker services will be weeded out and people will surely gravitate towards a handful of communications platforms – a survival of the fittest.
CIOs need to let evolution run its course.
This post is sponsored by the Enterprise Mobile Hub and BlackBerry.

Friday, October 26, 2012

Sprint Revs Up Wireless Revenues

Sprint said that its revenues rose 5% year-on-year in the third quarter of 2012 to 8.8 billion US dollars, "primarily due to higher wireless service and equipment revenues, partially offset by a reduction in wireline revenues."
Sprint said its capital expenditure was 1.5 billion dollars in the quarter, compared to 760 million dollars a year earlier.  The Kansas-based telco has "launched 4G LTE in 32 cities and expects that 4G LTE will be available in more than 115 additional cities in the coming months." Sprint also said it has launched or announced 13 4G LTE devices to date. source: Sprint statement 


Growth slows at América Móvil

Lifted by mobile data and pay TV revenues, América Móvil said its revenues in the third quarter were up 6.1% year-on-year to 193 billion Mexican pesos (14.81 billion US dollars) at constant exchange rates. Revenue grew 8.7% in 2011. The pan-Latin America telco reported that its mobile data and pay TV revenues climbed 35.3% and 21.0% respectively, while fixed-line voice revenues declined 7.2%. source: América Móvil statement

Growth Prompts DOCOMO to Up Targets

NTT DOCOMO, Japan's largest mobile operator, said it now expects to generate revenues of 4.52 trillion Japanese yen (56.26 billion US dollars) in the year ending March 31, compared with 4.24 trillion the previous year. In the quarter ending September 30, DOCOMO's operating revenues rose 6.5% to 1.135 trillion yen.

The Tokyo-based telco also increased its target for subscriptions to its Xi LTE service to 41 million for the year ending March 31, 2016 from its earlier target of 30 million. It had 6.2 million LTE subscribers at the end of September.

DOCOMO also said it is aiming to earn 1 trillion yen in revenues from new businesses in the financial year ending March 31, 2016, compared with 400 billion yen in the year ending March 31, 2012. source: NTT DOCOMO presentation

Galaxy SIII Fuels Sales Surge for Samsung

Samsung Electronics said that its IT and mobile communications division increased sales by 67% year-on-year in the third quarter to 29.92 trillion Korean won (27.25 billion US dollars).  Samsung said that "it saw a substantial increase in revenue/profit QoQ driven by rising sales in high-end smartphones, enhanced product mixes, etc." It added: "Smartphone shipments increased significantly due to global expansion of GalaxyS III and reinforced line-ups of mid/low-end products." source: Samsung presentation

Ericsson Sees Sales Slip Again

Ericsson said that its sales in the third quarter for comparable units, adjusted for FX and hedging, decreased 4% year-on-year to 54.6 billion Swedish krona (8.14 billion US dollars). The leading telecoms equipment maker said networks revenues fell 17% year-on-year, primarily due to weaker sales in parts of Europe, China, Korea and Russia, as well as continued decline in CDMA equipment sales. "This was partly offset by strong development in North America," Ericsson added. 

Hans Vestberg, CEO of Ericsson, said: "We believe that the fundamentals for longer-term positive development for the industry remain solid. There are now one billion smartphones in the world and the number is expected to reach three billion in 2017. ....However, at the same time, we see a continued macroeconomic slow down and political unrest in parts of the world, which has led to more cautious operator spending..."

However, Ericsson's Global Services division increased revenues 16% year-on-year on a like-for-like basis and represented 45%  of group sales in the third quarter compared to 44% in the second quarter. source: Ericsson statement

Apple Forecasts A Sharp Slowdown

Apple said that its revenue rose 27% year-on-year in the quarter ending September 29 to 35.97 billion US dollars. It sold 26.9 million iPhones in the quarter, representing 58% unit growth over the year-ago quarter, and 14 million iPads, a 26% unit increase.  In the current quarter, Apple said it expects revenue of about 52 billion dollars, which would represent a rise of 12% year-on-year. source: Apple statement

Thursday, October 25, 2012

AT&T Talks Up LTE

AT&T said that its revvenues grew 2.6% in the third quarter on a like-for-like basis to 31.5 billion US dollars. It attributed the growth to a 6.6% increase in wireless revenues. AT&T also reported that its LTE network now covers 135 million people.source: AT&T presentation

France Telecom on Downward Trend

France Telecom said its revenues in the third quarter fell 3.5% year-on-year on a comparable basis to 10.76 billion euros. The Paris-based group said that regulation was to blame for 2.4 percentage points of that decline. Revenue declined by 5.4% in France and 5.5.% in Poland. source: France Telecom-Orange presentation

Wednesday, October 24, 2012

Facebook Begins to Monetise Mobile

Excluding the impact of changes in foreign exchange rates, Facebook said its revenue in the third quarter rose 38% year-on-year to 1.26 billion US dollars. Revenue from advertising was 1.09 billion dollars, while payments and other fees revenue for the third quarter was 176 million dollars. Facebook added that 14% of advertising revenue during the third quarter was "from mobile", compared with almost nothing in the same period of 2011. source: Facebook statement

Monday, October 22, 2012

China Mobile's Growth Slows Slightly

China Mobile's operating revenue in the third quarter of 2012 rose 6.2% year-on-year to 142.01 billion Chinese yuan (22.8 billion US dollars), as its connections climbed to more than 698 million at the end of September from 683 million at the end of June. In the second quarter, its revenues grew 6.6% year-on-year.

China Mobile said it had more than 75 million 3G customers at the end of the quarter, up from 67 million at the end of the second quarter. source: China Mobile statement

Friday, October 19, 2012

How Google's Business is Changing

Google's revenues from its own sites rose 15% year-on-year in the third quarter of 2012, while revenues from "partner sites" were up 21% year-on-year. Google's "other revenues" climbed almost 73% year-on-year. Google povides little information about these revenues. source: Google statement

Thursday, October 18, 2012

Verizon Sees Strong LTE Growth

Verizon, one of the largest telcos in the U.S., said its consolidated revenue rose 3.9% year-on-year in the third quarter to 29 billion US dollars. Wireless revenue was up 7.3% year-on-year as wireless retail connections rose 5.7%.

Verizon said that it sold 4.5 million 4G LTE devices in the third quarter (compared with 3.2 million in the second quarter) and that more than 35% of its total data traffic is now on its 4G LTE network. In Verizon's landline business, consumer revenue growth accelerated to 4.6% thanks to growing adoption of its fibre-based services. But enterprise revenues fell 3.6%. The telco also noted that its capital expenditure was down 9.8% year-on-year in the first nine months of 2012. source: Verizon presentation

Nokia Sees Sales Plummet in China

Nokia said its net sales fell 23% year-on-year on a constant currency basis to 7.24 billion euros in the third quarter of 2012. On the same basis, net sales in Nokia's devices and services division were down 36% and sales at Nokia Siemens Networks were down 3%.

Nokia's devices and services sales fell 78% in Greater China and 51% in North America. Nokia said: "The sequential decreases in net sales and volumes in North America were primarily due to lower operator and distributor demand for Lumia as well as our efforts to prepare the distribution channel for the upcoming sales start of new devices.....Net sales in China decreased sequentially primarily due to lower net sales of our Lumia and Symbian devices, primarily reflecting competitive pressures."

Nokia said it expects the fourth quarter to be "a challenging quarter in smart devices, with a lower-than-normal benefit from seasonality in volumes, primarily due to product transitions and our ramp up plan for our new devices."

However, Stephen Elop, Nokia CEO, noted: "In our mobile phones business, the positive consumer response to our new Asha full touch smartphones translated into strong sales. And in Q3, our mobile phones business delivered a solid quarter with sequential sales growth and improved contribution margin." source: Nokia statement

Tuesday, October 16, 2012

Bring Your Own Downloads….

….but only if they have had a stamp of approval 

This post is sponsored the Enterprise Mobile Hub and BlackBerry.

When it comes to apps, how do you tell the wheat from the chaff? If you are an enterprise CIO and your employees are bringing their own devices (BYOD) to work, that is the kind of question that could keep you up at night.

A rogue or poorly-designed app could steal or delete important data, paralyse an employee’s device or compromise privacy and security. Moreover, some apps, particularly those offering cloud-based storage, could fall foul of data protection laws: EU data protection legislation, for example, prohibits the transfer of data to countries whose laws are more relaxed than those in the EU.

So, what’s the solution? At a recent event in London, a senior IT strategist at a major pharmaceutical company noted that a lot of people in his organisation are using cloud-services apps with zero involvement from the IT department. He called on telcos to begin certifying such apps, providing some kind of assurance of quality and security.

The worry for CIOs with a BYOD policy is that many of the hundreds of thousands of apps available are sold through lightly-curated distribution channels. And people are downloading these apps on a scale unimaginable in the PC market. There will be more than 45 billion app downloads in 2012, of which more than 40 billion will be free, according to Gartner (see table).

It would be completely impractical for an IT department to test all the possible apps that could end up on employees’ handsets. And reading the reviews on application stores won’t bring peace of mind – they tend to be patchy and sometimes confusing.

Instead enterprises need an independent third-party to test and certify apps on their behalf - CIOs could then insist that employees only download apps that have had an official stamp of approval. But the certifier may have to be prepared to test thousands of apps – employees aren’t going to suffer a scheme that severely limits the apps they can use on personal devices.

Clearly, the programme would need a sustainable business model – enterprises could subscribe to the service, developers could pay a fee to carry the certification logo on their apps or the programme could be bundled into a broader mobile enterprise management software offering.

Should telcos take on the job?
Whoever performs this task will need to have economies of scale and, therefore, scores of existing enterprise customers.  Although systems integrators or IT services companies, such as IBM, Infosys or Accenture, could do the job, telcos have a broader interest in providing such a service – they need to understand which apps hog network capacity and which are relatively frugal. If they could minimise the use of apps that soak up network resources, telcos would be better placed to provide enterprise customers with an assured quality of service, particularly for mission-critical cloud-based services.

Of course, certification schemes are open to abuse – logos and web sites can be copied and faked. Moreover, there may be conflicts of interest - a telco or systems integrator will surely end up having to evaluate apps provided by business partners and even customers.

But without a stamp of approval, the bring-your-own-downloads phenomenon could be accompanied by serial security scares and many more sleepless nights for CIOs.

This post is sponsored the Enterprise Mobile Hub and BlackBerry.

Monday, October 8, 2012

HTC Sales Sliced in Half

HTC Corporation, a leading maker of smartphones, said that its revenues in the third-quarter of 2012 were 70.2 billion Taiwanese dollars (2.4 billion US dollars), down 48% from 135.82 billion dollars in the third quarter of 2011.  source: HTC statement

Friday, October 5, 2012

Facebook Claims One Billion Users

Facebook said it reached one billion monthly active members on Sept. 14 - double the number it had two years ago.Facebook didn't specify whether the one-billion figure includes fake accounts: In August, Facebook said fakes constituted 8.7% of its users. source: Wall Street Journal article

The Top Ten Mobile Operators

source: Wireless Intelligence statement