Initial valuation of 4G services at US$3.3bn (Italy)
The Italian government has reportedly received early offers totaling $ 3.3 billion for its 4G mobile frequencies to be auctioned this week. 4G technology provides a comprehensive and secure IP (Internet Protocol) solution, allowing users to access high quality video streaming along with voice and data at a much higher speed than previous generations.
As per reports, some of the operators that have put in their offers include Telecom Italia SpA, Vodafone Group Plc, Wind Telecomunicazioni S.p.A of VimpelCom Ltd. and Hutchison Whampoa Ltd.’s 3 Italia.
TIM Brazil Q4 net profit raises
Brazilian mobile phone Company, TIM Participacoes SA has announced that its net profit more than quadrupled in the fourth quarter as revenue increased and a non-recurring gain boosted the bottom line.
The Brazilian unit of Telecom Italia SpA reported fourth quarter net profit of $1.13 billion, increased from US$249.10 million a year earlier.
The company registered a one-time gain of US$838.32 million in the period due to a fiscal credit. TIM’s results include Intelig, a local long-distance operator acquired by TIM in 2009.
The company’s net revenue rose to US$2.33 billion from US$2.09 billion a year earlier.
According to TIM, earnings before interest, taxes, depreciation and amortization,(EBITDA), rose 10.66%. The EBITDA margin ended the fourth-quarter at 30.6%, up from 30.4% in the fourth-quarter of 2009.
TIM ended the period as Brazil’s third-largest mobile phone operator with a total of 51 million clients and a market share of 25.1%. By comparison, in the year ago period, the company registered 41 million clients and a market share of 23.6%.
Telecom Italia sells stake in Cuban Etecsa for $706 million
Italy’s largest telecommunications company, Telecom Italia SpA has sold its 27% stake in Cuba telecoms operator Etecsa for $706 million to Cuban company Rafin, continuing a reorganization that aims to cut debt and refocus its operations.
According to Telecom Italia Chief Executive Franco Bernabe, this deal completes the sales process, reaching the targets set three years ago. A new phase now starts for the Italian operator, which will focus on Brazil and Argentina operations, with a strong expansion potential.
The sale of the Etecsa stake, which was widely expected, is the latest in a series of measures under Bernabe’s 2010-2012 industrial plans to reduce Telecom Italia’s debt pile and to focus on growth markets in Argentina and Brazil and its domestic operations.
Apple, Google asked to pay as operators face data overflow
The European mobile operators have stated that Google Inc., Apple Inc., and Facebook Inc. need to set in to help pay for the billions of dollars of network investments needed for their bandwidth-hogging services.
As mobile and Web companies add videos, music and games, operators including France Telecom SA, Telecom Italia SpA and Vodafone Group Plc want a new deal that would require content providers like Apple and Google to pay fees linked to usage.
As per France Telecom Chief Executive Officer Stephane Richards’ previous statement, service providers are flooding networks with no incentive to cut costs. It’s necessary to put in place a system of payments by service providers as a function of their use.
Richard has joined Telecom Italia CEO Franco Bernabe and Telefonica SA CEO Cesar Alierta in what could turn into a cold war with Web companies. As more consumers access the Internet on mobile devices, the cost of building bigger networks may outstrip revenue growth for wireless operators, slicing their return on investment.
According to Bernabe, the mismatch between investments and revenue is set to compromise the economic sustainability of the current business model for telecom companies.
According to research firm Canalys, while the number of mobile data connections in Western Europe will rise by an average of 15% a year to 270 million in 2014, overall end-user revenue will decline about 1% a year, Interactive Data Corp. estimates. In the same period, operators’ annual spending on network gear will surge 28% compared with last year to about $3.7 billion.
Italy regulator raises unbundling tariff
AGCOM, Italy’s telecommunications regulator will raise unbundling tariffs in 2011 and 2012 by less than previously planned on the request from the European Commission.
The commission had asked the Italian regulator to review the tariffs, which Telecom Italia SpA charges its opponents to access its fixed-line network, claiming it had applied the pricing model erratically.
Alternative operators, including FastWeb SpA and Vodafone Group PLC’s Italian unit, had complained that AGCOM’s proposed tariff increases could hamper competition and discourage investment in new broadband technology.
The new increase approved by AGCOM is US$0.16 lower than previously proposed for 2011, bringing the tariffs to US$12.28 a month; and US$0.27 lower for 2012, when the tariffs will reach US$12.64 a month.
However, there was no change in the planned increase to unbundling tariffs for 2010, and the current tariff of US$11.56 a month will be raised to US$11.85 a month.
Italy telcos ink MOU for High-Speed broadband infrastructure company
As per Industry Minister, Paolo Romani, Italian telecoms operators have signed a memorandum of understanding (MOU) for the formation of a new company to build a high-speed broadband infrastructure.
According to Romani, the new company will be responsible for building a basic fiber-optic infrastructure, avoiding duplications and coordinating investments by Italy’s seven leading operators. The companies include Italy’s largest operator Telecom Italia SpA, Fastweb SpA, Wind SpA, Vodafone Italia, Tiscali SpA, BT Group PLC’s Italian unit, and 3 Italia.
The new company, which will be based on both public and private funds, will have an executive committee chaired by the Industry ministry and will include one representative from each of the seven telecoms operators. The committee will be in charge of defining the new company’s governance and business plan within the next three months.
Romani confirmed that state-controlled fund Cassa Depositi e Prestiti (CDP) will play a role in the new broadband infrastructure company, providing the company’s capital or loans.
Telecom Italia , Chief Executive Franco Bernabe has welcomed the agreement among the operators stating that it will contribute to the re-launch of broadband in Italy.
According to Fastweb’s board member Stefano Parisi, the new company was an important step forward, but added its success will be influenced by the action of Italy’s telecoms regulator AGCOM, which will have to set clear rules.
TIM Chief Luciani believes Mobile Data Sales will double in 3 Years
As per Tim Participacoes SA Chief Executive Officer Luca Luciani, Brazil’s third-biggest wireless carrier will double its revenue from data services such as text messages and Internet access over the next three years, helping discourage rivals Telefonica SA and America Movil SAB.
According to Luciani, the carrier, controlled by Telecom Italia SpA, is betting that high-speed Internet service over mobile devices will be more attractive to Brazilians than the landlines connections its bigger rivals have acquired. Tim is spending US$4.21 billion this year through 2012 to improve its network for data service.
He further explained that to encourage users to spend more on data, Tim is offering its users Web access on mobile phones for 30 cents a day. That might help Tim compete against landlines Internet providers, who only offer high-speed service over about 20% of the nation’s fixed phone connections. The company is already offering, even to prepaid customers, access to the Internet for everybody. It is a much more competitive platform.
According to Luciani’s estimates, Tim, based in Rio de Janeiro, will have about 50 million customers by the end of the year, including 10 million possessing handsets compatible with its 30-cents-a-day Internet access plan.
Telefonica & Telecom Italia together will Reach the desired Goal
Telefonica SA, Europe’s second- largest phone company, alleged its association with Telecom Italia SpA will congregate a target to generate US$1.7 billion in savings in the three years through 2010.
According to Telefonica’s chief operating officer, 55% of the savings will go to Telecom Italia while the rest will benefit the Madrid-based company, Julio Linares.
Regulator opens probe against Telecom Italia
www.WirelessFederation.com/news: Probe against Telecom Italia SpA has been opened by Italy’s antitrust regulator for possible abuse of a dominant position. The investigation started after domestic peer Fastweb SpA filed an official complaint against Telecom Italia.
According to AGCM, the Italian regulator, the Italian telecommunications company is trying not to pass information and details to other companies competing for contracts with Enel SpA as well as Consip, a state controlled IT and telecommunication company.
EUR1.3 billion is the worth of the Consip offer while Enel’s is worth at least EUR240 million. It also has a “strategic value” for telecommunications operators. Telecom Italia has described FastWeb’s hypothesis as groundless as there has been no discrimination in favor of Telecom Italia’s commercial departments.
Telecom Italia Q1 profit rises 31%
www.WirelessFederation.com/news: 31% rise in first-quarter net profit has been reported by Italy’s largest telecoms operator Telecom Italia SpA. The profit has been attributed to the improved margins and the turnaround in the revenue trends for the Italian business. Telecom Italia has targeted annual average revenue growth of around 1% for the three years in its 2010-2012 strategic plans.
0.7% fall in the first quarter revenue has been reported, improving from a 6.8% drop in the previous quarter. Due to growing competition in its core markets and focuses on reducing its debt burden, full year revenue is seen down 2% to 3%.
The first quarter net profit of the company has gone up from EUR460 million a year earlier to EUR601 million and analysts’ consensus of EUR511 million. The EBITDA grew 3.2% to EUR2.83 billion.
According to Telecom Italia Chief Executive Franco Bernabe, these results demonstrate that the company is on the right track to relaunch the group and it is confident that the next quarters will continue to meet the commitments made in the industrial plan.
