Russian MTS looses USD 26.1 million in Q4
www.WirelessFederation.com/news: Net loss of USD 26.1 million for the fourth quarter has been reported by Russian and CIS mobile operator MTS because of one-time charges for its takeover of fixed-line operator Comstar-UTS.
The company made an investment of USD 368 million and another USD 86 million was taken for obsolete equipment and expenses related to the acquisition of Comstar and tax provisions. MTS finished 2009 with USD 2.5 billion in cash and its net debt increased to USD 5.59 billion. 10.1 percent decrease in the OIBDA going down to USD 1.19 billion has also been posted.
However, a rise in the subscriber base has been enjoyed which increased from 101.37 million in September 2009 to 102.36 million users at the end of the fourth quarter. For the future, the company has expressed its optimism regarding economic upturn predicting mid to high single-digit revenue growth in local currencies. Increased number of fixed and mobile subscribers accompanied by increased sale of handsets in its home market in Russia has been attributed as a reason behind the profitable future.
Safaricom to test LTE later this year (Kenya)
www.WirelessFederation.com/news: Testing of Long Term Evolution (LTE) services on the network has been planned to be started by Safaricom which is Kenya’s largest cellco by subscribers.
According to Michael Joseph, the reason why the company is looking at testing 4G is because it is a natural technology growth from 3G to 4G. No timeframe has yet been revealed for when Safaricom hopes to start tests but it is expected to start later this year.
The company also hopes that some 4G spectrum will be obtained but there are possibilities that it might be insufficient to launch a commercial service immediately.
Orange to strengthen its advertising foothold in Europe
www.WirelessFederation.com/news: In order to strengthen the advertising capabilities, Orange is set to take two moves- first one is to create what it claims is Europe’s first online advertising exchange and the second one is to add interactive ads to its fixed-line TV services.
By allowing firms to bid for advertising space in a real-time auction, the main aim of Orange Ad Market is to change the way online advertising space is sold throughout Europe. By the end of 2011, market for online advertising tipped to be worth $15 billion is seeked to be tapped by Orange.
The Ad market will be initially launched in UK and France this quarter and will later include other countries as part of a multi-year deal with advertising technology provider Open X. According to Orange, it will leverage its position as Europe’s largest advertising network to get publishers on-board Ad Market, which it states has a global reach of 343 million unique monthly users.
Tata launches GSM service in Himachal Pradesh (India)
www.WirelessFederation.com/news: GSM service of Indian telco Tata Teleservices has been launched by the operator in the Indian state of Himachal Pradesh under the Tata Docomo brand. Currently, Airtel, BSNL, Idea-Spice, Aircel, Vodafone and S. Tel are the operators providing network facility to the people of Himachal Pradesh.
According to Rajeev Narayan, the company’s vice-president, corporate affairs, the company is offering per second tariff structure for every service.
286 towns and 4,342 villages in the state have Tata Teleservices connection.
France Telecom & ETC sign management deal
www.WirelessFederation.com/news: European giant France Telecom (FT) has finally got the authority over the management of Ethiopian Telecommunications Corporation (ETC), Ethiopian state-owned fixed line incumbent. The deal between the two companies was signed a week ago. The deal, however, has yet to be sent to the Council of Ministers for approval.
The control of the telco will go in the hands of the France Telecom on behalf of the Egyptian government for the period of three-year. Annual management fee will be paid by FT, although there are possibilities of revenue sharing from enhanced services.
FT will now be tasked with implementing the government’s ambitious plans to expand telecom services nationwide. According to the state, it wants basic telecom services made available within a radius of five kilometres to 100% of the population by the end of 2010.
USD2 billion has been kept aside by the government over a two-year period to expand the infrastructure, aiming to boost the number of Points of Presence (PoP) it has from 1,900 at end-2006 to 17,000 by end-2010. Increase in the number of fixed line subscribers to four million and mobile customers to 8.5 million is also aimed by ETC.
Bharti, Ericsson sign network expansion contract (India)
www.WirelessFederation.com/news: USD1.3 billion network expansion contract has been signed between Indian telecom operator Bharti Airtel and Swedish vendor Ericsson. As per the contract, the latter will expand and upgrade the company’s Indian mobile network in 15 circles.
Ericsson’s portfolio of energy efficient 2G/2.5G radio base stations, circuit and packet core, microwave transmission and Intelligent Network will be supplied by the company as a part of the contract.
Besides, Ericsson will also ensure that the core and transport network of Bharti is 3G-ready which will help to reduce time to market and enable the fast rollout of 3G services at a later date.
Bharti to use brand name to build on Zain Africa acquisition
www.WirelessFederation.com/news: Besides focusing on the reduction of costs, Bharti is also planning to use its endearing brand to build on its acquisition of Zain Telecom’s African operations. As a result of $10.7 billion acquisition, Zain will be replaced by Bharti Airtel to become the brand of the combined entity in each of the 15 countries in Africa.
According to Manoj Kohli, who will head Bharti’s African operations, Bharti Airtel has been the number one endearing brand in India and its objective is to repeat the same positioning in the African states, too so the Airtel brand will be the key to its business success in these countries it will be positioned as a global brand. However, in its implementation, Airtel will use a lot of vernacular language, looking at local needs.
Procurement, information technology network, call centers, and data centers have been described as some of the key areas of synergy and the organizational structure of the company will include employees of Zain, expatriates from Bharti and new recruits into the international team.
The shares of Bharti Airtel closed at Rs 312 per share, rising 0.35 per cent. Recovery in the shares has been noticed after the Zain Bharti deal was declared for the first time reflecting that not only there is positive response towards the Zain- Bharti deal; the market is also doing well.
Bharti Airtel hails $10.7-billion deal with Zain Africa
www.WirelessFederation.com/news: The cat is out of the bag. The most talked about deal of the season has been consummated. And India is truly established as the first post-Independence multinational. The highly developed telecom sector of India has now come to the forefront of the world business model.
By signing the final $10.7-billion deal with Zain Africa for all its African assets, Bharti Airtel has finally got the big ticket global acquisition. According to Bharti Airtel CEO, Sunil Bharti Mittal, as soon as the regulatory approvals fall in place, $8.3 billion will get transferred and the remaining $700 million will be transferred after one year.
It has also been revealed by Sunil Mittal that Airtel will rebrand Zain in Africa within months of closing the deal. The company made it clear that there is no need of strategy for the turnaround for Zain. The company has been really doing well occupying the top slot in 10 countries, second in four countries and fourth in just one country i.e. Ghana. Besides, the company has $4 billion of top line and $1.2-billion EBIDTA.
Zain has also been making investments year on year and has invested $600-700 million and even $800 million in capex at times.
Manoj Kohli who has been heading the international operations outside South Asia will take the charge of the new operations in Africa as CEO. Operations of the firm will be led by the Africans and supported by key members of the Indian team who will move from India to Africa.
On the failure of the deal with the Africa’s top mobile operator MTN, Sunil Bharti opined that the deal with Zain is a bigger one as it provides Bharti Airtel to have its own brand, its own management, its own low-cost model and its outsourcing model. If the deal with MTN would have materialized, the company would have only got participation rights and co-management rights in the company.
