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Eurobites: Liberty Merges Euro Operations

Ray Le Maistre
7/29/2014
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Also in today's EMEA regional roundup: Orange to cut costs further as profits slide in H1; Nokia Networks teams up for wide-area 4G broadcast trial; Vodafone brings Chromecast to the UK high street.

  • Cable operator giant Liberty Global Inc. (Nasdaq: LBTY) is merging its businesses in Austria and Switzerland from August 1 to create a single operation that will be run by the current managing director of Swiss operator UPC Cablecom Eric Tveter, who will become CEO of Liberty Global's 'Swiss and Austrian region.' Thomas Hintze, the current managing director of UPC Austria, will report to Tveter as a "senior advisor." (So don't expect him to stick around too long.) Both operations are the largest cable operators in their respective markets: The Swiss unit has 1.4 million video customers, 675,000 broadband users, and 463,000 voice subscribers; the Austrian operation has 526,000 video customers, 440,000 broadband users, and 355,000 voice subscribers. Combined, the two units have an annualized revenue rate of about US$1.84 billion, about three quarters of which is generated by the Swiss operations. Liberty Global says the move will provide "economies of scale" and provide "opportunities to explore further regional cooperation." Liberty Global has a number of other operations Central and Eastern Europe, namely in the Czech Republic, Slovakia, Hungary and Romania, so they'll be wondering if consolidation is going to come their way too. Liberty Global's stock was largely unchanged on the news, dipping by just 0.3% to $42.38.

  • Ongoing intense competition in its home market weighed on the latest financials from French giant Orange (NYSE: FTE), which reported a 3.6% decline in group revenues to €19.6 billion ($26.3 billion) for the first six months of the year, and a 26.3% dip in net income to €891 million ($1.2 billion). Now the operator plans to cut costs further to boost profitability. "We remain focused on lightening Orange's cost structure, allowing us to stabilise our margin rate in the first half and to confirm our annual targets for 2014. We are continuing our efforts in this area and have increased our target for lowering indirect costs and now aim to achieve a reduction of more than 300 million euros in 2014." For more details, see this Bloomberg report.

  • Nokia Networks has teamed up with multiple partners in Austria, Germany and Switzerland to trial wide-area TV broadcasting over 4G LTE using eMBMS (evolved Multimedia Broadcast/Multicast Service) capabilities. The trial, taking place in Munich, Germany, is using part of the 700 MHz band to broadcast over an area of 200 square kilometers. LTE Broadcast has become a hot topic during the past few weeks… (See Verizon's Multicast LTE Video to Arrive in 2015, EE to Trial 4G Broadcast in Scotland, AT&T Investing in LTE Video Despite Capex 'Freeze'?, and eMBMS: Revolutionary Technology or Alphabet Soup?.)

  • Vodafone UK has become the first British operator to offer the Chromecast video streaming device to the content-hungry public, making the device available through its 375 high street shops. See this announcement for more details.

  • Subscribers to Telefónica SA (NYSE: TEF)'s Movistar TV service now have access to more than 350 hours of online personal recorded content through their set-top boxes following the deployment of a Cloud DRVR system from Alcatel-Lucent (NYSE: ALU). (See Telefónica Deploys AlcaLu Cloud DVR Tech.)

  • Publicity-seeking Mayor of London Boris Johnson looks set to jump on the 5G bandwagon with a pledge that the UK capital will have the next generation of mobile broadband services by 2020, according to a report in City AM. By 2020, of course, Johnson won't be London's mayor, and so won't be accountable for such projections. Instead, there's every chance he will be the UK Prime Minister, a prospect more frightening than a Freddie Krueger convention for us Brits at Eurobites Towers. But that's just the way we roll…

    — Ray Le Maistre, Circle me on Google+ Follow me on TwitterVisit my LinkedIn profile, Editor-in-Chief, Light Reading

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    SachinEE
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    SachinEE,
    User Rank: Light Sabre
    7/31/2014 | 10:37:40 AM
    The Merger
    The bold move by Liberty Global incorporated to merge its businesses in both Switzerland and Austria is sure to earn them a great profit. By creating a single operation by the merger, they are cutting on costs that they use as an organization thereby channeling the remaining finances on the business.
    SachinEE
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    SachinEE,
    User Rank: Light Sabre
    7/30/2014 | 2:38:01 PM
    Re: very bold
    This is some very bold talk from the mayor of London and the keen UK public will definitely hold him to account come the year 2020. Though it's rather shallow to think that he wont be accountable for any failures come that time since he wont be the mayor considering that he may very well be the UK prime minister at that time. Recent events have taught his predecessors that the UK public rarely forgets failures, though if he does succeed then they may forget by 2020.
    SachinEE
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    SachinEE,
    User Rank: Light Sabre
    7/30/2014 | 2:37:25 PM
    Re: Vodafone UK
    This is a very interesting development and one that I definitely can wait to see how it plays out and how the move is going to affect Vodafone UK's overall sales and popularity especially considering the fact that the company has not had a particularly great year so far. Haven't had the time to read the full advertisement yet and am particularly anxious about the initial price for which it will be sold since this will definitely impact its overall performance.
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