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Mobile services

Eurobites: Hutch, VimpelCom's Italian Job Gets EC Blessing

Also in today's EMEA regional round-up: SoftBank's Tanaka to head ARM; Nokia unveils 4.5G Pro technology and a 4.9G plan; Orange cosies up to Iran's MCI; Telecom Egypt forks out on 4G; Equinix expands in Brexit-land.

  • In uncharacteristically investor-friendly behavior, the European Commission (EC) has finally given its blessing to a merger between 3 Italia and Wind Telecomunicazioni SpA , the Italian mobile subsidiaries of Hong Kong's Hutchison Whampoa Ltd. (Hong Kong: 0013; Pink Sheets: HUWHY) and Russia's VimpelCom Ltd. (NYSE: VIP). That doesn't, however, mean Italy is about to become a more settled three-player mobile market with juicier margins. The M&A-averse EC has approved the deal only because the merging players have agreed to sell some of their assets to French enfant terrible Iliad (Euronext: ILD), which is set to become Italy's fourth mobile operator. Iliad has wreaked havoc in France since entering its mobile market in early 2012, and continues to put pressure on its bigger rivals. Hutchison and VimpelCom -- as well as current market leaders Telecom Italia (TIM) and Vodafone Italy -- should be very afraid. For more on the latest developments, see this story from our sister site Telecoms.com. (See Telecom Italia Tanks on Iliad Mobile Threat and Wind, 3 Eye Sale of Italian Assets – Report.)

  • Japan's SoftBank Corp. appears to be getting ahead of itself, appointing a new general manager at ARM Ltd. before its takeover of the UK chip designer has even been finalized. Ren Tanaka has been named general manager of the ARM business in a filing on SoftBank's website that includes details of several other executive appointments. Believing ARM has a pivotal role to play in the Internet of Things market, SoftBank announced a $32 billion takeover of the business in July. But it has yet to requisite regulatory and shareholder approvals. Hermann Hauser, one of the founders of ARM, has expressed concern that a UK technology champion will lose its independence if the deal goes through. Tanaka's current role remains unclear. (See SoftBank Muscles In on ARM in $32B Deal.)

  • It's Nokia's turn to unveil its latest radio access network technology as the major mobile vendors outline their 4G-to-5G evolution roadmaps. Nokia Corp. (NYSE: NOK) appears to have a few more steps on the way to 5G, though... It has unveiled what it calls its 4.5G Pro, based on its AirScale radio platform, and offered up 4.9G, which apparently is "the next step on the path to 5G." (We are waiting to hear what happened to 4.6-4.8G.) According to Nokia, 4.9G technology will deliver "significant capacity and data rate enhancements and network latency reductions," and will "comprise features to further increase capacity and speeds to several gigabits per second." There are a lot of details to take in, all of which are in this press release. As far as Eurobites can tell, Nokia is alone (currently) in using the 4.9G term. Nokia's news comes in the same week that Ericsson made a similar announcement -- let the battle commence! (See Ericsson Kickstarts 5G RAN Arms Race.)

  • French telecom incumbent Orange (NYSE: FTE) is said to be in discussions with Iran's MCI about a potential business tie-up, according to a report from Reuters. The story does not elaborate on the nature of the tie-up but comes shortly after the Wall Street Journal reported that Orange had entered into preliminary talks with MCI about buying a stake in the company. A subsidiary of TCI, Iran's state-controlled fixed-line incumbent, MCI ranks as the biggest mobile operator in the country. Orange already has a major presence in several Middle Eastern countries and regards the broader Middle East and Africa region as key driver of its sales growth. (See Orange Aims for 20% Sales Growth in Africa.)

  • Fixed-line incumbent Telecom Egypt has splashed $806 million on a 4G license that will allow it to enter the country's mobile market in its own right. The state-controlled player holds a 45% stake in Vodafone Egypt -- which it will be allowed to retain -- but has seen previous attempts to launch its own mobile business upset by legal challenges from other service providers, which also include Orange Egypt and Etisalat Misr . According to a report from Bloomberg, Egypt's regulator has offered 4G licenses to existing mobile operators but asked them to pay half the license fees in US dollars. Orange Egypt is said to have complained that concessions are overpriced.

  • Data center company Equinix Inc. (Nasdaq: EQIX) has spent $42 million on expanding its UK facilities in Slough. The move -- which doubles the operational capacity of the data center, to 2,770 cabinets -- is aimed at catering to rising data-center demand in the UK's cloud, enterprise and financial-services sectors, said the company. The expansion could help to salve some of the anxiety about the impact on investment activities of the "Brexit" referendum, in which British voters opted in favor of leaving the European Union. (See Brexit: It's Hard to See an Upside.)

  • As unveiled by Eurobites in June, Erzsébet Fitori is the new Director General of the FTTH Council Europe , starting today. For the past eight years Fitori has been Director at the European Competitive Telecommunications Association (ECTA) , a not-for-profit trade association that promotes market liberalization and competition in the region. Fitori is part of the new top team at the Council: In April, Ronan Kelly, CTO for the EMEA & APAC Regions at Adtran Inc. (Nasdaq: ADTN), was appointed as its new president.

  • Virgin Media Inc. (Nasdaq: VMED) has launched what it says is the "UK's first broadband tier designed specifically for online gamers." The VIVID 200 Gamer service offers download speeds of up to 200 Mbit/s and upload speeds of 20 Mbit/s. For more details, see this report at our sister site Telecoms.com and this press release.

    — Iain Morris, Circle me on Google+ Follow me on TwitterVisit my LinkedIn profile, News Editor, Light Reading

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    [email protected] 9/1/2016 | 10:07:06 AM
    Iliad - does it have secret sauce? There's clearly an expectation that Iliad is going to stir things up in Italy just like it has done in France -- and with plenty of justification.

    So - why Iliad? Why hasn't someone else done the exact same thing? Is Iliad's business plan just streets ahead of any other challenger? What is it that makes Iliad the market entrant that can successfully take on incumbents, seemingly against the odds?

    And... France? Tick. Italy? Getting ready. So where next?
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