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  • 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.

  • HSBC Fined $5.2 Million in UK for Data Loss


    Three units of HSBC Group have been fined GBP 3.185 million (USD $5.2 million) by Britain’s financial regulator for failing to protect consumer data from loss or theft.

    The Financial Services Authority (FSA) said all three firms had been warned by HSBC Group Insurance’s compliance team about the need for robust data security controls in July 2007.

    But in February 2008 an unencrypted CD containing the details of 180,000 policy holders was lost in the post.

    The FSA said HSBC Life UK Ltd was fined GBP 1.61 million, HSBC Actuaries and Consultants Ltd was fined GBP 875,000 and HSBC Insurance Brokers Ltd was fined GBP 700,000.

    HSBC said that no clients had reported losses as a result of these failures.

    It said it found that large amounts of unencrypted customer data had been sent by post or courier to third parties.

    Confidential information about customers was left on open shelves or in unlocked cabinets, and staff were not given sufficient training on identifying and managing risks like identity theft, the regulator said.

    Margaret Cole, the agency’s director of enforcement, said all three firms failed their customers by being careless with personal details which could have ended up in the hands of criminals.

    "It is also worrying that increasing awareness around the importance of keeping personal information safe and the dangers of fraud did not prompt the firms to do more to protect their customers’ details," she said.

    The largest previous fine for data protection failures was the GBP 1.26 million pounds assessed against Norwich Union.

    HSBC said it had contacted customers who were potentially affected, and said 33,500 employees had received data protection training.

    "We hold ourselves to the highest standards, but it is clear that in these instances we have fallen short, which we sincerely regret," said Clive Bannister, group managing director of HSBC Insurance.

  • 02 Secures Exclusive UK Rights to Palm Pre


    O2 has beaten rival operator Orange to secure the exclusive rights to the Palm Pre when it is released in the UK.

    Palm and O2 are expected to make the announcement next week almost a month after the launch of the handset in the US.

    The deal strengthens O2’s position in the smartphone market since it is already the exclusive carrier for the iPhone in the UK.

    There are no details yet on Pre costings and tariffs for the UK.

    News of O2’s deal with Palm was reported in The Guardian, which described the competition between O2 and Orange as "fierce".

    Apple recently announced that the iPhone 3GS sold over one million units in its first weekend of its availability.

    Sprint, the only wireless carrier to offer the Pre in the US, has not revealed sales numbers – although it appears to be doing reasonably well.

    Estimates of its sales range from 150,000 to 300,000 units.

  • Blackberry Offered As Pay-As-You-Go


    Orange UK is to offer a pay-as-you-go Blackberry – the first carrier in Europe to launch a PAYG RIM device.

    The move underlines RIM’s intention to re-position itself as a provider of handsets that appeal to the consumer market as well as its traditional enterprise stronghold.

    The smartphone will be an exclusive indigo-colored BlackBerry 8120 that will cost £145.

    An estimated two-thirds of UK mobile customers use PAYG.

    To take up the Orange offer customers must take out one of the operator’s existing PAYG Animal packages before taking a PAYG BlackBerry Internet Service for just £5 per month, on a monthly rolling subscription.

    This will give them access to email, messaging and the web.

    An Orange statement said the new offering was a result of the growing demand for a BlackBerry smartphone with PAYG service.

    The BlackBerry Pearl 8120 has a 2 megapixel camera with LED flash, Bluetooth, Wi-Fi and media player.

  • UK Gets HD Programmes For AppleTV


    Apple has announced that the first HD show is available for download from the iTunes store for AppleTV owners in the UK.

    The first offerings in high def are episodes of the current series of ABC’s Lost, which will be sold for £2.49 each.

    This compares to the standard USD $2.99 rates charged for HD downloads on the US version of the Apple digital store.

    A season pass will be £41.99.

    A free five-minute HD trial is available from the store to give UK users a flavor of what’s on offer.

    Apple chief executive Steve Jobs announced the arrival of HD TV shows last September – without mentioning that it would take a bit longer before they arrived in the UK.

    Worth waiting for? Please let us have your opinions.

  • Apple Devices Dominate Mobile Wi-Fi Use


    iPhone owners are the single largest source of mobile WiFi data traffic worldwide, particularly in the US and UK, according to AdMob.

    In the US, the Apple handset represents 50.6 per cent of all requests from handhelds of any kind, followed by the iPod touch, which accounts for 28 per cent of the requests.

    The best non-Apple device, Sony’s PSP, only manages 13.1 per cent of this traffic.

    Even further down the scale come the T-Mobile Dash, G1 and various BlackBerries, which each have less than one per cent of WiFi use.

    UK figures are similarly weighted and give the iPhone the lead at 46.1 per cent, followed by the iPod touch at 21.8 per cent and Nokia’s N95 at 16.7 per cent.

    The Apple device is also more than twice as likely to be used on Wi-Fi than other devices and is used 42 per cent of the time on these hotspots in the US rather than EDGE or 3G compared to no more than 10 to 20 per cent for competitors.

    In the UK, this reaches 56 per cent.

    The phone’s presence helped roughly double the use of mobile WiFi to 8 per cent in both countries between October and November.

    Increasing numbers of smartphone users are taking advantage of WiFi to make voice calls over IP networks.

  • Boost for mobile broadband as T-Mobile UK improves photo and video upload speeds


    Mobile operator T-Mobile UK has deployed HSUPA technology on a nationwide basis to improve upload speeds for users.
    The operator has promised the change will result in an improvement of to fivefold in the time it takes to upload photos and videos to web sites at speeds of up to 1.4Mbps.
    T-Mobile claims it is the first UK carrier to have committed to the data access protocol.
    The company said it is also upgrading the download capability of its HSDPA 3G network to 7.2Mbps, initially within the M25 zone encircling London but rolling out to other major cities during the second half of the year.
    T-Mobile is also trying to drive data usage, by cutting data roaming charges 80 per cent, to £1.50 per MB while travelling in EU member countries.
    Customers signing up for Mobile Broadband before October will also receive a £5 discount, knocking the price down to £10 per month.
    An online ‘postcode checker’ also allows potential customers to gauge the coverage and strength of 3G signal at their home.
    Jim Hyde, T-Mobile UK’s chief executive, said: “Mobile Broadband has come of age.
    “Today, 25 per cent of new contract customers are signing up and we expect to quadruple our user base in 2008.”