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Tag: operator

  • T-Mobile and Orange Merge to Create the UK's Largest Mobile Carrier

    Deutsche Telekom and France Telecom are planning to merge T-Mobile UK and Orange UK. The companies have entered into exclusive negotiations to combine T-Mobile and Orange in a new 50:50 joint venture company.

    If the negotiations are successfully accomplished (the deal is expected to be completed by the end of October), the new joint venture will create the UK’s leading mobile operator. It will have a combined mobile customer base of around 28 million, representing approximately 37 percent of UK mobile subscribers.

    The companies assure that this combination will result in expanded network coverage and better customer proximity through a larger network of own shops.

    Obviously, the other aim of the new enlarged business is to compete more effectively with the other two large UK operators – O2 and Vodafone.

    “By combining our operations in the UK, we anticipate the long-awaited consolidation in one of Europe’s most competitive markets. This will reinforce fair competition and will provide strong benefits for our customers through improved coverage, quality of service and an enhanced capacity to develop new services and technologies,” said Gervais Pellissier, CFO of France Telecom.

    “Our shareholders will benefit from higher profitability and an immediate cash flow per share accretion without impacting the overall indebtedness of the parent companies.”

    The business will have pro forma 2008 revenues of approximately £7.7 billion. The merger and integration of the operators should generate estimated synergies with a net present value in excess of £3.5 billion, as the companies claim.

    Estimated opex-based synergies should reach an annual run rate of over £445 million from 2014 onwards.

    The operators predict that the key areas for the opex synergies of the joint venture will be network & IT – large-scale site rationalisation leading to savings notably in site rental expenses, network operations and maintenance expenses – and distribution and marketing – higher proportion of sales through own shops, resulting in lower distribution costs and savings in marketing costs primarily post roll-out of a new branding strategy.

    “We will become market leader,” stated Timotheus Höttges, CFO of Deutsche Telekom.

    “Our customers will benefit in many ways, for example from the best mobile broadband offer in Britain. In the second-biggest market in Europe, which is undoubtedly one of the toughest and most competitive, we are giving T-Mobile UK a clear and strong future.”

    The joint venture expects to invest £600 to £800 million in integration costs over the period from 2010 to 2014. Those costs would primarily relate to the decommissioning of mobile sites, the rationalisation of the network of retail stores and the streamlining of operations.

    The Board of the new joint venture company will have balanced representation from both firms. The management team would be led by Tom Alexander, currently CEO of Orange UK, as CEO and Richard Moat, currently CEO of TMobile UK, as COO.

    The T-Mobile UK and Orange UK brands will be maintained separately for 18 months after completion of the transaction.

  • Threat To Gaming If Operators Don't Follow Apple's Lead


    Mobile game sales are "flatlining" across North America and Western Europe despite increased interest from consumers, according to a report from Juniper Research.

    It says that unless more operators adopt an Apple-like approach to rewarding games publishers, they will be driven away from the sector – and the number and variety of games available will decline.

    The report highlights the "universally positive" response with which mobile games publishers and developers greeted the arrival of the iPhone, but adds that the volume of paid-for mobile game downloads has nonetheless levelled off across North America and Western Europe.

    It found that although the retail value of the global mobile games market is expected to rise from USD $5.4bn in 2008 to more than $10bn in 2013, the potential for growth in many key markets is being dampened.

    This is attributed to a combination of limited on-portal revenue share for publishers – meaning that some are exiting the mobile games industry – and poor games marketing.

    According to report author Dr Windsor Holden, the revenue share offered by Apple to games publishers is incredibly attractive.

    "The danger is that if operators do not respond with a similar business model, publishers faced with low margins may simply exit Java completely, thereby reducing consumer choice in the longer term," he said.

    The report also found that while ad-funded downloads have increased markedly in popularity, the revenues accrued from advertising are unlikely to be sufficient to provide developers or operators with a primary revenue stream.

    It argued that, with cost per mille (CPM) rates likely to fall in the face of pressures on advertising budgets, advertising would be largely employed by most publishers as a means of monetising older content.

    On a more positive note, the Juniper study remained optimistic about prospects for growth in regions such as the Indian Sub Continent, Africa/Middle East and South America.

    It reports that in those regions, the combination of increased mobile adoption and low levels of penetration of both games consoles and fixed Internet means that the mobile handset has already become the de facto gaming device.

    Other findings from the Juniper report include:

    • China and the Far East will remain the largest regional market for mobile games throughout the period covered by the report.
    • Global revenues from in-game advertising will rise significantly from 2008 to 2013.
    • Operators need to reduce data charges further for out of bundle customers to encourage casual mobile Internet usage and thereby stimulate the mobile entertainment market

  • Vyke Announces Mobile VoIP For Windows Smartphones


    Vyke Communications has announced a beta version of its mobile VoIP software and service for all Windows Mobile 6.0 and higher based smartphones.

    The solution is based on Vyke’s stand-alone proprietary mobile VoIP technology, which the company claims allows it to provide high quality voice service while circumventing any operator handset tampering issues.

    Jan Berger, chief marketing officer, Vyke Communications, said the mobile VoIP software addressed the significant portion of the enterprise market that is Windows Mobile based.

    "As this stand alone software is compatible with a wide cross section of business orientated mobile handsets, it adds significantly to our potential customer base and will be an important tool in helping our enterprise sales team reach its goals," she said.

    While primarily intended for the enterprise sector, Vyke said the beta software will also be available for consumers to download before the end of November.