3 Italia service revenues increase by 4% in 2010 (Italy)
3 Italia has reported that its services revenues increase by 4% in 2010 to US$2.39 billion.
Prepaid revenues plunge by 16% to US$483.42 million, while postpaid sales rose 10% to US$1.91 billion. Average revenue per user (ARPU) was almost flat year-on-year at US$33.25.
The postpaid customer base slightly decreased by 1% in 2010, while the prepaid base increased by 4%. 3 Italia served nearly 9.1 million customers at 28 March, of which 5.8 million were prepay users and 3.2 were contract subscribers. 3 Italia achieved EBIT positive operating results in the second half of 2010.
3 Italia reported turnaround of 121 percent to EBIT of US$135.26 million in 2010. Full-year total EBIT includes a one-time substantial benefit of US$205.71 million, related to the assignment of two blocks of 5MHz of 1,800 MHz spectrum.
Safaricom Plans to bank on its lead in 3G infrastructure
Kenya’s biggest mobile-phone company, Safaricom Ltd. is planning to capitalize on its lead in 3G infrastructure by selling laptops and offering services to new and existing customers.
The company is the only operator of a 3G telecommunications network in Kenya. According to Chief Executive Officer Bob Collymore, in the first half of its fiscal year, Safaricom became the biggest importer of laptops in the country as it seeks to boost Internet access in the East African country. The company has mobile data; the other companies don’t have mobile data. So what they have to do is take advantage of that lead. The company thinks they have about an 18-month lead before they catch up to the point where they are.
Most of the mobile operators like Safaricom, Bharti Airtel Ltd. (Kenyan unit ) and Telkom Kenya Ltd. are becoming more dependent on data for revenue after the industry regulator in August halved the rates that operators charge each other to connect calls across networks to US$0.03. That generated a round of cuts in call costs by companies to less than US$0.02 per minute and in some cases free calls during off-peak hours.
Collymore added that the so-called interconnection costs may be reduced further. In July the company will see a further cut in interconnection tariffs to less than US$0.02. Average revenue per user in the company’s voice business fell 13 % to US$4 million in the first half.
Operators are betting that increased data traffic will make up for the lower voice revenue and are offering customers laptops, net books or smart phones to attract new clients.
According to Informa Telecoms & Media, a London-based research group, by 2015, there will be 265 million mobile broadband subscriptions in Africa, up from about 12 million at the end of September.
As per Collymore, Safaricom imported 40,000 laptops in the last six months till September. The company reported 15% increase in first-half profit and also bought 400,000 data-enabled handsets, or smartphones, and sold 45,000 data modems.
Collymore noted that customers using Safaricom’s data services surged 92% to 3.61 million people in the six months through September from a year earlier. About 839 base stations, or 37% of the total, are enabled to transmit 3G signals, which enable faster Internet browsing and downloading. Safaricom intends to increase that ratio to 50% within two years. Safaricom will also seek more licenses to provide additional services to its more than 16.7 million customers.
Safaricom is 40% owned by Vodafone Plc, the world’s biggest mobile-phone operator. Vodacom Group, the largest provider of mobile phone services to South Africans, is 65% held by Vodafone.
Telecom Egypt Q3 net profit down by 7.3%
State-owned Telecom Egypt revealed its Q3 results. As per the results net profit fell 7.3% to US$133 million from a year ago as seasonality hit the company’s retail business.
According to the company, the timing of Ramadan this year (coinciding with August) has had some effect on retail services. Earnings per share for the three months ended Sept. 30 stood at US$0.07 compared with US$0.08 in the year earlier period. The average revenue per user for the third quarter declined 12.5% to US$9.21.
According to Ahmed Adel, telecoms analysts at Naeem Holding in Cairo, third-quarter retail revenues suffered from Ramadan high promotional activities, and were down 5% quarter on quarter and 11.2% year on year. This is a reasonable decline, given the severe competition with cellular operators and challenge from mobile substitutions.
As per the company, nine-month net profit reached US$469.48 million, up 6% compared with the same period a year earlier, while revenue for the period rose 1% year on year to US$1.3 billion. Fixed-line subscribers reached 9.7 million by the end of September, the operator added.
Fitch affirms Etisalat at A+ with a Stable Outlook (UAE)
www.WirelessFederation.com/news: UAE-based state-owned Emirates Telecommunications Corporation’s (Etisalat) Long-term foreign currency Issuer Default Rating (IDR) has been affirmed at ‘A+’ with a Stable Outlook by Fitch Ratings. Fitch’s expectation is reflected in the ratings affirmation that the company’s management will maintain a conservative financial policy, with a maximum gross debt/EBITDA of 2.5x and continue to generate substantial majority of group EBITDA from the local UAE market by 2012-13.
According to Fitch, the company recorded a net cash position over the last five years and that Etisalat’s credit metrics will continue to be strong in the short to mid-term even with possible investment plans in 2010-11 and it sees the free cash flow generation capability of the local UAE business as supporting the company’s international expansion plans in the medium-term.
Government support is also considered integral to the company’s target of becoming a major global telecoms operator by the agency. Fitch’s assessment of the sovereign’s creditworthiness is also reflected in the rating due to Etisalat’s strong operational and strategic ties with the UAE.
With a 215% mobile penetration rate, the Stable Outlook reflects Fitch’s view that the UAE’s mobile telecommunications market is mature now. The company’s international mobile operations in India, Egypt and Nigeria are also expected to provide its major source of expansion. Though entry of a third mobile operator is not expected by Fitch, falling average revenue per user (ARPUs) and operating margins in the local market due to competition has been noted.
Potential downward pressure could be experienced by the rating from any change in the sovereign’s creditworthiness, or evidence of a significant weakening of the parent/subsidiary linkage. Etisalat’s risk profile on a standalone basis would increase if EBITDA derived from the UAE fall below 50% of the consolidated EBITDA or any large debt-financed acquisition is done without governmental financial support. However, Fitch considers this unlikely over the medium-term, and the agency would consider the legal, operational and strategic links before taking any rating action.
The agency’s top-down rating methodology – takes into account the assumed government support in line with Fitch’s criteria report: ‘Parent and Subsidiary Rating Linkage (Fitch’s Approach to Rating Entities within a Corporate Group Structure).
Reliance Com expects 25-30 percent increase in subscriber base (India)
www.WirelessFederation.com/news: 25-30 per cent jump in the subscriber base has been expected by Reliance Communications on monthly basis in Punjab, Haryana and Himachal Pradesh. Launch of a new scheme offering unlimited calls for CDMA users has been cited as the reason behind the increase in the subscriber base.
According to Reliance Communications CEO (Punjab, Haryana, HP and J&K) Arvind Kumar, the company anticipates that there will be growth of 25-30 per cent per month in its customer base with the introduction of the new offer.
Punjab market generates highest average revenue per user at Rs 325 for Reliance. The average revenue per subscriber of Punjab is still lower than that of metro cities
Brazil’s TIM revenue to be accounted by data & VA services
www.WirelessFederation.com/news: 20% of Brazilian mobile phone company TIM Participacoes SA’s revenues will be accounted by data and value-added services within the next 18 months, compared with 11% at present. According to the head of the Brazilian subsidiary of Telecom Italia SpA, data is becoming an increasingly important revenue line, but the industry should not present data as an alternative to voice traffic.
The mobile data market accounts for BRL6 billion to BRL7 billion while the voice market is worth 56 billion Brazilian reals ($31.9 billion). A net profit of BRL30 million for the first quarter has been reported by , TIM, Brazil’s No. 3 cellphone operator reversing a BRL165.2 million loss a year earlier.
However, if competitive market is taken into consideration, the company’s first quarter average revenue per user fell 8.6%. Prices are been lowered by all the operators in the pursuit of lower-income users in this increasingly developed market.
Turkcell reports 25.8% drop in net profit
www.WirelessFederation.com/news: The first quarter net profit of Turkey’s biggest mobile phone company by subscribers, Turkcell has gone down by 25.8% in the first quarter ended March 31, 2010, due to the loss of subscribers to rival Vodafone Group. Net income fell from TRL562.7 million a year earlier to TRL417.6 million (USD271.9 million) and revenue rose 7.1% to TRL2.25 billion.
The customer base of the company also fell from 35.4 million at the start of the year to 34.3 million at the end of March with 3.1% loss. The post-paid segment reported a 1.1% fall to 9.3 million while the pre-paid segment declined 4.2% to 24.9 million.
Average revenue per user climbed from USD10.4 per month in Q1 2009 to USD12.8 in the same period of 2010. As per the claim of the operator, it has 62 million customers across all its subsidiaries, of which 11.9 million were in Ukraine, 7.5 million in Kazakhstan and 1.4 million in Belarus
Kenyan operators outsource services to cut employee cost
www.WirelessFederation.com/news: The customer service and Network management operations of the telecom operators in Kenya are being outsourced in order to remain competitive in the long run. Following the footsteps of Telkom Kenya and Zain, Essar Telecom Kenya, operating under the Yu brand, announced an outsourcing agreement with Aegis.
In an effort to keep its employee costs low, the customer care services and Network management of Zain Kenya has been outsourced to Nokia Siemens while Telkom Kenya has outsourced its customer care operations to local BPOs Horizon and Kencall.
According to analysts, the initial focus for the firms was to grow their top lines, but now the executives are looking both at the top line and costs while the falling ARPU will put downward pressure on earnings growth. Incidentally, due to increased competition, ARPUs (average revenue per user) have declined significantly in recent years and it has resulted in reduction in mobile tariffs across the board.