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.

Friday, February 26, 2016

Telefónica Sees Opportunities Aplenty

Telefónica forecast that group revenue will rise by more than 4% in 2016 and that capex will account for 17% of sales - a similar figure to 2015. For the fourth quarter of 2015, Telefónica reported organic year-on-year growth of 3.3% to 11.9 billion euros, lower than the organic growth rate for the year of 4%.

In Latin America, a key growth engine for the group, organic revenue growth slowed slightly to 3.4% in Brazil in the fourth quarter and 8.1% elsewhere in the region. Telefónica said that revenue from digital services (such as video, cloud and M2M) rose 15% year-on-year to 1.07 billion euros, compared with 24% for the year as a whole.

César Alierta, executive chairman, said: "The Digitalisation of the economy is now a reality which is already bringing about significant changes in society; changes that will accelerate in the next years. The growth of connections, data traffic and innovation is going to be exponential and is going to translate into real improvements in terms of productivity, employment and economic growth and, ultimately, into important social progress. The telecom sector is at the centre of that revolution, however new skills are required to capture its full potential.

We must adapt the commercial offering in order to satisfy the growing needs of our customers, characterised by increasingly higher data consumption (data traffic increased by 40% in 2015 and mobile data traffic by 48%, boosted by video usage). In this respect, in 2015, our fibre customers increased by 30%, LTE customers tripled, smartphones advanced by 29% and pay TV by 12%. This translated into higher value customers, both in terms of higher average revenue per access and increasing loyalty, and, therefore, into revenue growth acceleration to 4.0% organic in 2015.

In 2016 growth and data monetisation will accelerate, while we maximise the efficiencies from integration and simplification, and we boost our innovation and big data capabilities. We expect that all of this will be reflected in improvements in the key financial figures: revenue growth higher than 4%, margins stabilising while we maintain strong levels of investment, recover full-cash dividend payment (75 cents per share) and strengthen financial flexibility." source: Telefónica statement

Thursday, February 25, 2016

Deutsche Telekom Plans Sales and Capex Growth

Deutsche Telekom forecast an increase in revenues in 2016 following a rise of 10.5% in 2015 to 69.2 billion euros. In organic terms (i.e., adjusted for exchange rate effects and changes in the composition of the Group) revenue increased by 3% last year.

In the fourth quarter, however, revenues in Germany slipped 1.1% year-on-year to 5.7 billion euros, dragged down by a 1.6% decline in fixed-line revenues. Although broadband revenues rose, the group continued to see a decline in telephony revenues. In the U.S., revenues rose 1.2% year-on-year to 8.2 billion US dollars in the fourth quarter.

Deutsche Telekom expects to increase group capex to 11.2 billion euros in 2016, up from 10.8 billion euros last year. The Bonn-based company said: "The core element is the build-out of the network infrastructure in terms of population coverage and increased transmission bandwidths. In addition, the switching to a consistent, IP-based infrastructure is being driven forward in Germany and the integrated subsidiaries in Europe." source: Deutsche Telekom statement

Thursday, February 18, 2016

VimpelCom Battles Emerging Market Headwinds

VimpelCom reported a 1% year-on-year increase in revenues to 2.3 billion US dollars on an organic basis for the fourth quarter of 2015. The organic growth rate for the whole calendar year was also 1% with annual revenues of 9.6 billion dollars.

VimpelCom said the slight uptick was driven by a positive performance in Pakistan, Bangladesh, Ukraine, Uzbekistan and Kyrgyzstan, partially offset by negative performances in Algeria
and Kazakhstan.

VimpelCom, which operates in 14 markets including Russia, Italy, Algeria, Pakistan, Uzbekistan, Kazakhstan, Ukraine, Bangladesh, Kyrgyzstan, Tajikistan, Armenia, Georgia, Laos, and Zimbabwe, forecast that service revenues will be flat or see slight growth in 2016. source: VimpelCom presentation

Wednesday, February 17, 2016

Ericsson Foresees Fourfold Rise in LTE Subs

Source: Ericsson Mobility Report

Brazil Slump Drags Down Telecom Italia

Telecom Italia reported a 6.7% year-on-year decline in revenues to 4.8 billion euros for the fourth quarter of 2015. That is a steeper fall than the 4.6% decline across 2015 as a whole. Revenues in Italy were down 2.6% in the quarter, while slumping 20% in Brazil.

Telecom Italia attributed the 12% decline in revenues in Brazil across 2015 to lower usage of messaging and voice calls, and cuts in regulated mobile termination rates, compounded by the economic crisis in Brazil.

Setting out its strategic plan for 2016-2018, Telecom Italia said: "Convergence continues to be central to the group's growth and innovative investments strategy. Using its network infrastructure, the group aims to offer premium services to customers via a single integrated platform. By 2018, the number of "converged" customers with high quality content is expected be around 1.5 million.

"The plan provides for the position in multimedia entertainment, which includes activities, among others, in the field of video, music, gaming and publishing, to be strengthened." source: Telecom Italia presentation

Tuesday, February 16, 2016

Orange Edges Onwards and Upwards

Orange reported a 0.1% year-on-year increase in revenues to 10.4 billion euros for the fourth quarter on a comparable basis. A decline of 5% in Poland and 0.7% in Spain was offset by growth of 2.8% in the Middle East and Africa.

Stéphane Richard, CEO of the Orange Group, said: "The number of 4G customers, which reached 18 million, has doubled in a year and we have 1.9 million fibre customers, three times more than at the end of 2014. We also have 110 million mobile customers in Africa and the Middle East, up 4.1% year on year on a comparable basis.

"This commercial momentum is the reward for our accelerated investment, which increased 9.3% to 6.5 billion euros...In Europe, our focus remains on fixed-mobile convergence, as in Spain where the integration of Jazztel has exceeded our objectives and has enabled us to create the most dynamic convergent operator in the market. As for the Africa and Middle East region, this represents a growth area for us and one in which we continue to develop and invest through our new holding company, Orange Middle East & Africa. This can be seen through our increased participation in Médi Telecom in Morocco and our recent acquisition projects in Burkina Faso, Liberia, Sierra Leone and the Democratic Republic of the Congo.

"Strengthened by our strategy and the commitment of our teams, we intend to continue this good momentum, targeting further growth in restated EBITDA in 2016 on a comparable basis." source: Orange presentation

Friday, February 12, 2016

América Móvil Flatlines Again

América Móvil said its fourth quarter revenues were up 0.6% year-on-year to 231 billion Mexican pesos (12.2 billion US dollars). At constant exchange rates, however, service revenues were down 0.6% from the year-earlier quarter, the same rate as in the third quarter.  The pan Latin America telco said data service revenues expanded on both the mobile and fixed platforms—10.3% and 7.9% respectively— as did PayTV revenues, which rose 6.6%. source: América Móvil statement

Cisco Sees Slight Slowdown

Cisco reported a 2% year-on-year revenue increase on a like-for-like basis in the quarter ending January 23rd to 11.8 billion dollars. That is slower than the 4% growth in the previous quarter. The network equipment provider said product revenue was up 2% and service revenue was up 3%.

Revenue in Cisco's Security product line increased 11%, and NGN Routing and Collaboration increased 5% and 3%, respectively. Wireless was flat, while Switching and Data Center declined 4% and 3%, respectively, Cisco added. Source: Cisco statement

Thursday, February 4, 2016

Gartner Sees Strong Smartwatch Growth

Infographic: Analysts Bullish on Smartwatches, Cautious on VR Breakthrough | Statista
Source: Statista

Enterprises Give Vodafone a Boost

The Vodafone Group reported a 1.4% year-on-year increase in service revenues in the quarter ending December 31st on an organic basis. That is up from 1.2% growth the previous quarter.  Vodafone added that the data traffic on its networks rose 68% year-on-year, fuelled by a 4.7 million increase in 4G subscribers during the quarter, taking the total to 34.8 million.

Vodafone's top line was also lifted by growth in its enterprise division, which now accounts for 28% of group revenue. source: Vodafone presentation

Tuesday, February 2, 2016

Mobile Search and YouTube Drive Google

Alphabet, the group that owns Google, reported a 24% year-on-year increase in revenues (in constant currencies) for the fourth quarter of 2015 to 21.3 billion US dollars. Alphabet said the growth was driven by mobile search, YouTube and programmatic advertising. The number of paid clicks on adverts brokered by Google jumped 31% year-on-year, but the aggregate cost per click paid by the advertiser fell 13%.

Google said "the movement in Google Sites paid clicks and cost per clicks primarily reflects the continued growth in YouTube TrueView." TrueView is YouTube's brand name for video advertising formats that give the viewer more control over what they see.

On a call with analysts, Sundar Pichai, CEO of Google, said: "On our last call, I shared that six of our consumer products, Search, Android, Maps, Chrome, YouTube, and Google Play, all have over a billion monthly active users each. I'm pleased to share that Gmail now joins those ranks, crossing that number last quarter."

Ruth Porat, CFO, added: "We're now delivering about three times the compute power for the same amount of power or dollars we did five years ago. And that's an important point because it explains some of the slower capex in 2015. But given our commitment to have the most potent infrastructure, we do expect to increase capex in 2016." Sources: Alphabet statement and call transcript

Monday, February 1, 2016

BT Heralds Big Consumer Quarter

Leading UK telco BT Group reported a 3% year-on-year increase in revenue for the quarter ending December 31 to 4.59 billion UK pounds (6.6 billion US dollars). “BT Consumer had a standout quarter, increasing its overall line base for the first time in well over a decade and capturing 71% of new broadband customers," noted Gavin Patterson, BT's CEO. "Good customer growth in broadband, TV and mobile helped to grow ARPU by 7%. Customers like what we’re offering, whether that’s superfast broadband, Champions League football or mobile data bundles. BT Global Services also did well with good revenue growth in continental Europe and Asia." source: BT statement