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Euronews: Tide Turns Against Handset Subsidies

Paul Rainford
5/25/2012

Vodafone Group plc (NYSE: VOD), Telefónica SA (NYSE: TEF) and Huawei Technologies Co. Ltd. proffer something for the weekend in today's visit to the EMEA telecom news salon.

  • Vodafone and Telefonica are using Spain as a testing ground for a new business model that sees an end to the sort of generous handset subsidies that have kept sales of top-end smartphones buoyant, reports Reuters. The big question is: Will consumers be prepared to pay the true price of their fancyphones? (See Do Big Subsidies Have Big Staying Power?.)

  • Pressures in the Spanish market have prompted Standard & Poor’s to downgrade Telefónica's rating from 'BBB+' to 'BBB' and Moody's Investors Service to place the Baa1 rating of Telefónica on review for a possible downgrade. (See Euronews: S&P Cuts Telefonica's Rating.)

  • Huawei has filed a complaint with the European Commission against InterDigital Inc. (Nasdaq: IDCC) in which it urges the Commission to intervene to end what it sees as InterDigital's "abuses" of its 3G patents. According to the Chinese vendor, InterDigital's demand "manifestly breaches" the policies of the European Telecommunications Standards Institute (ETSI) relating to "fair, reasonable, and non-discriminatory" (FRAND) licensing practices by patent holders. (See InterDigital Sues Nokia, Huawei, ZTE.)

  • Alcatel-Lucent (NYSE: ALU) has teamed up with Orange France , SFR and Bouygues Telecom to launch YouConnect, a service that is intended to make it easier for those accessing e-commerce sites from their mobiles to enter their required personal information. In theory, one tap on their handsets will give permission for their e-commerce "personal profile" to be accessed by the relevant online retailer. (See AlcaLu, French Carriers Launch YouConnect.)

  • Croatian cable operator VIPnet is claiming a world speed record with data transmission rates of 4.3 Gbit/s on its EuroDocsis 3.0 network. That's almost as fast as a Goran Ivanisevic serve

  • The son of billionaire telco tycoon Carlos Slim, who goes by the handle Carlos Slim Domit, has been telling Bloomberg that his dad sees this time of European economic turmoil as a "good moment" to invest in the continent. Slim the Elder's América Móvil S.A. de C.V. is currently bidding to increase its stake in Dutch incumbent KPN Telecom NV (NYSE: KPN). (See Euronews: Slim Picking at KPN.)

    — Paul Rainford, Assistant Editor, Europe, Light Reading

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