Vodafone Ireland gains 27,300 customers in third quarter

Vodafone Ireland gained over 27,300 customers in the third quarter of this year and increased its contract base by 10.6 per cent on the same period in 2012.

The company has retained its position as Ireland’s biggest telecommunications provider, with a total customer base of 2.4 million at the end of September, which includes 2.1 million mobile customers.

The Vodafone group announced an additional £1 billion (€1.19 billion) investment in its global networks today following the recent $84 billion (€62.8 billion) sale of VerizonWireless in the US, one of the biggest corporate deals in history.

The mobile phone giant had previously pledged to spend £6 billion under Project Spring, which included plans to roll-out its 4G networks to ensure 90 per cent coverage in its five main European markets, including Ireland, by 2017.

The company announced today that the investment would be increased to £7 billion by March 2016.

The company’s interim management statement also revealed the impact of difficult trading conditions in Europe, as service revenues fell 4.9 per cent in the six months to the end of September.

Vodafone has been squeezed by increasing price competition in its major European markets of Germany, the Netherlands and the UK, where service revenues decreased by 4.4 per cent.

Adjusted operating profits for the group were 8.3 per cent lower at £5.7 billion but Vodafone said it remained on track to meet its full-year forecasts.

Chief executive Vittorio Colao described trading conditions in Europe as “very tough” but said he was encouraged by signs of economic recovery and potential regulatory support for greater industry investment and consolidation.

source: http://www.irishtimes.com/business/sectors/retail-and-services/vodafone-ireland-gains-27-300-customers-in-third-quarter-1.1592130

Eircom looks at outsourcing operations in bid to cut costs

Eircom is looking at outsourcing its transport and logistics operations in the latest measure to drive down costs at the telecoms firm where sales are slumping.

Releasing first-quarter results yesterday, Eircom said its revenue in the three months to the end of September fell 9pc to €323m, while earnings before interest, tax, depreciation and amortisation (EBITDA) slipped 1pc to €119m.

In the first quarter of the last financial year, revenue fell 7pc and EBITDA declined 10pc year-on-year.

Eircom has been slashing its workforce and aims to reduce it by 2,000 by next summer. About 800 have already left and, of another batch of 830, a chunk will leave by the end of December.

The telco said that its operating costs fell 13pc to €204m in the latest quarter.

Speaking to the Irish Independent, chief financial officer Richard Moat said the company was keeping every part of its cost base under review but EBITDA had continued to stabilise.

He confirmed that part of that review included possible outsourcing of the company's transport and logistics function.

Eircom underwent the largest examinership process ever in Ireland last year. Senior lenders took control of the business under a deal that saw the telco's debts slashed from about €4bn to €2.3bn.

US private equity group Blackstone was one of those that took a hit on its investment in Eircom under that deal. However, the group has since boosted its stake in Eircom to slightly under 25pc. A debt-equity agreement, which meant post-examinership that any investor taking an equity position in Eircom had to also assume debt, ends next year. That will make it easier for other investors to buy stakes in Eircom.

In Eircom's fixed-line arm, revenue fell 10pc in the first quarter to €249m and EBITDA declined 6pc to €111m.

Mr Moat said Eircom's fixed-line business was shouldering the bulk of revenue declines.

NETWORK

Eircom is spending over €400m rolling out a high-speed fibre network, while it has also launched a 4G mobile network and a pay TV service.

The company's chief executive, Herb Hribar, said that those new services would start to have an impact on revenue. He said there had been a "really good" response to the new 4G network, while Eircom had also been investing heavily in trying to attract higher-spending postpay mobile customers. The company owns the Meteor mobile brand.

Mr Moat said the planned takeover of O2 Ireland by 3 wouldn't receive regulatory approval until next spring and would probably take between 12-18 months after that to bed in. He said that gave Eircom "some runway yet" to secure more mobile customers.

Revenue at Eircom's mobile division fell 5pc in the quarter but its EBITDA rose to €8m from €2m in the first quarter last year.

source: http://www.independent.ie/business/irish/eircom-looks-at-outsourcing-operations-in-bid-to-cut-costs-29796929.html

Vodafone reports H1 earnings of stg£6.6bn, Irish customer base reaches 2.4m

Vodafone Group’s financial results for the first half of this year are in line with the company’s expectations, while figures from Ireland position the brand as the mobile market leader.

Vodafone Group plc’s half-year results for the period ended 30 September 2013 report EBITDA (earnings before interest, taxes, depreciation, and amortisation) on a management basis down 4.1pc to stg£6.6bn.

Adjusted operating profit on a management basis rose 0.5pc to stg£5.7bn, while free cash flow on a management basis reached stg£2bn.

Vodafone’s full-year guidance forecasts adjusted operating profit of around stg£5bn and free cash flow between stg£4.5bn and stg£5bn.

An interim dividend per share of 3.53 pence represents an increase of 8pc year-on-year, and the company announced its intention to pay full-year dividends per share of 11 pence.

Group revenue on a statutory basis increased by 2.5pc year-on-year, driven by the acquisition of CWW and TelstraClear in the prior year, to stg£19.1bn, with service revenue of stg£17.5bn (a decline of 2.3pc on an organic basis). On a management basis, group service revenue was stg£20.0bn, a decline of 4.2pc on an organic basis.

Profit for the financial period from continuing operations on a statutory basis increased by stg£20bn to stg£15.7bn.

Mature market challenges

“Our emerging markets businesses are performing very well, driven by rapidly increasing smartphone penetration and data usage,” said group chief executive Vittorio Colao.

“In mature markets, our performance reflects more challenging conditions, which we continue to mitigate through ongoing actions to improve our operating model and cost efficiency. This rigorous approach, plus our substantial investments in Vodafone Red, 4G and unified communications services – including our recent acquisition of Kabel Deutschland – are laying strong foundations for the future,” he added.

In terms of consumers, Vodafone now has 7.5m Vodafone Red customers and expects this to grow to 11m-12m by March 2014. Smartphone penetration in Europe is now at 39pc and and data usage continues to grow, with average usage per device now at 400MB per month.

Vodafone has also launched 4G services in 14 markets, with Ireland recently joining that line-up.

Vodafone Ireland

With a total customer base of 2.4m, Vodafone Ireland is the mobile market leader in Ireland, with 2.1m mobile customers.

The number of customers using smartphones on the Vodafone network in Ireland increased by 4.3pc compared to the previous quarter, and almost 70pc of all Vodafone Ireland customers are now using mobile data services.

As well as starting its 4G roll out, Vodafone Ireland completed a network enhancement programme in the south-east in this quarter, and this nationwide programme will eventually see all areas where there are currently voice services receive data, too. The programme also includes voice enhancements to cater for High Definition Voice and advanced coverage.

source:http://www.siliconrepublic.com/business/item/34809-vodafone-reports-h1-earning

MCMC moving in right direction

KUDOS to the Malaysian Communications and Multimedia Commission or MCMC for checking on what the operators have been doing on 3G deployment.

The commission seems to be moving in the right direction in checking on the quality of services, which is a concern, and said to be lagging behind Hong Kong, Seoul and even China.

Over two months ago, the regulator did an audit check and came up with some interesting news. It found out that most of the 3G operators have not been using the 2,100 megahertz (MHz) spectrum fully to roll out 3G services. Instead, some have been using the lower bands, 900MHz and 1,800MHz, to roll out the services. It’s more economical to do so. They have been providing 3G coverage but not real 3G speed and capacity.

3G is meant to give you higher speeds just like 4G can give you super-fast data speed.

3G has been in the country for nearly a decade. The first two blocks of 2,100MHz spectrum were awarded to Celcom Axiata Bhd (then part of Telekom Malaysia Bhd) and Maxis Bhd in 2002.

Four years later, in 2006, Time dotCom Bhd (TDC) and MiTV Corporation Sdn Bhdgot two more blocks of the same spectrum. MiTV’s spectrum is used by sister company U Mobile, while TDC, as soon as it secured the spectrum, sold it toDiGi.Com Bhd for a handsome profit.

To be fair, 3G has never taken off despite the hype. In Europe, operators paid hefty sums for the spectrum, while here, it was for a small fee.

But a decade later, finding out that the operators are still on a bandwidth that is lower than 3G and claiming to be offering 3G services makes us wonder if we have been overcharged.

This, perhaps, explains why there have been complaints about the 3G service; the speed and capacity have not been there, and it has been patchy and unreliable for most users.

There is no denying that the operators have been investing. It is not easy for them, as they have to deal with all kinds of challenges and authorities to get the service to the customer. However, when they claim it to be 3G service, it should be 3G service.

Two weeks ago, the operators were issued a stern warning to make the change or face hefty fines. One operator is rushing to do so, while the others are still waiting. They have till the year-end to face the regulator.

It is also unfortunate that it has taken the regulator so long to find out, as now the march is towards 4G and consumers will never find out how much extra they would have paid for the 3G service if it is not 3G speed and capacity they are getting.

But then, had the regulator not found out, consumers would not have found out, too. This tells us a lot about the state and quality of services, the promises and marketing pledges made, the pricing, the spectrum usage and all the money paid by consumers for what they had thought were 3G services.

However, as consumers, what do we benchmark our 3G services against? The onus is on the regulator to both set the benchmark and make sure it is adhered to. When we pay 10 sen for a product, we do not expect a five-sen product.

This is unfortunate, especially since our operators make among the highest earnings before interest, tax, depreciation and amortisation margins in the world. When they make so much, they should not compromise on service in the pursuit of profits.

Consumers should get a fair deal for what they are paying for. If indeed there has been any inconsistency, then the parties involved should be gracious enough to admit it and compensate the consumer.

source: http://www.thestar.com.my/Business/Business-News/2013/11/29/MCMC-moving-in-right-direction.aspx

Aircel likely to elevate COO Kaizad Heerjee to CEO’s position

NEW DELHI: Aircel, a debt-ridden mobile phone operator, is likely to shortly elevate chief operating officer Kaizad Heerjee to the chief executive officer's position, two people aware of the development told ET.

The company's former CEO, Sandip Das, left the company about eight months ago to join Reliance Jio Infocomm, the mobile broadband venture of billionaire Mukesh Ambani, and Aircel hasn't had a top officer since.

Heerjee joined the mobile phone company in August of 2012 from U Mobile, a Malaysian telecom services provider where he was the CEO. Chennai-based Aircel is 74% owned by Malaysia's Maxis while Apollo Group owns the rest.

According to one of the people, Aircel has already sought security clearance from the telecom department, as per rules, for Heerjee's appointment since he holds a Singapore citizenship.

Aircel declined to comment while Heerjee couldn't be reached for comment.

The mobile phone operator, with licences to offer services in all of India's 22 circles, was once gunning for top three status by number of users. But, caught in a vicious circle of cash and credibility for the past nearly three years, it has been languishing for several months now at number seven with some 64 million users, a far cry from leader Bharti Airtel which has around 200 million subscribers.

Heerjee's move to the top comes amid the company's struggle to service its Rs 24,000-crore debt, due in January 2014. According to people aware of the company's financial details, the telecom operator was losing aroundRs 1,680 crore annually at the operating level till last fiscal year ended March 31.

ET had earlier reported that the company had tied-up loans for Rs 8,000 crore from a clutch of Indian and foreign banks to refinance the debt that it accumulated while purchasing third generation (3G) and fourth generation (4G) airwaves in auctions held three years ago.

Aircel paid Rs 9,937 crore for 3G airwaves — in 13 service areas — and broadband wireless, in eight circles. While it has launched 3G in different circles, its plans to launch high speed broadband 4G services have not taken off for the want of investments of around $1.5 billion and development of the handset ecosystem.

The company though recently conducted 4G LTE trials in Andhra Pradesh, but said it doesn't have immediate plans of launching services.

The company also faces major regulatory challenges in India on account of a CBI investigation into the circumstances under which Maxis acquired the shareholding of serial entrepreneur C Sivasankaran in the company in 2005.

Aircel's struggles have given rise to talk that the company is up for sale. Maxis had segregated the Indian operations back in 2011, indicating the group's intention to put the company on the block. At various points, there has been speculation about Aircel dialing Tata Telesevices and Sistema Shyam TeleServices for a merger. All three companies haven't previously confirmed any discussions.

India's rules on mergers and acquisitions are expected to be announced before the end of the month, which may trigger much wanted consolidation in the fragmented sector with more than 10 players in some circles.

source: http://articles.economictimes.indiatimes.com/2013-11-28/news/44547056_1_maxis-aircel-phone-operator

YTL CEO Wing Lee bets on 4G in Malaysia

There's probably no single, simple path. But in the case of YTL Communications in Malaysia, the answer combines aggressive construction of a 4G network, a government boost for new network operators, and a business that embraces the services that many carriers don't like.

That's according to Chief Executive Wing Lee, who sat down to talk with CNET News' Stephen Shankland during a visit to Europe. Lee, who previously worked for 15 years at Sprint and Clearwire, was named CEO of YTL Communications in 2009. He expects the company to become profitable a year and a half from now.

An entrepreneur wanting build a developed country's next Vodafone or Verizon might not be able to take the same route: YTL can attract customers to its wireless service because Malaysia's fixed-line broadband options -- cable, phone, and fiber-optic lines -- aren't as widespread as in many countries.

YTL got its start building its network along highways outside Malaysia's major cities, but the company got an unusual opportunity: a contract to supply Malaysia's 10,000 schools not just with network access but also with a countrywide online education system for students and teachers. YTL brought Google in as a partner, and now it's the largest deployment of Google Chromebooks, Lee said. Lee is a fan of 4G, which he's lived and breathed for years. YTL and his former employer, Clearwire, embraced the WiMax network standard that mostly proved commercially unsuccessful, but YTL soon will begin installing LTE technology, too.

But Lee believes there's a 4G honeymoon period that will come to end as consumers encounter its shortcomings. To hear his thoughts, read this edited transcript of the interview.

Malaysia has a fairly progressive education blueprint that calls for the transformation of learning to prepare the next generation for the workforce. Toward that end, we dived into this private-public partnership with the government. 1BestariNet is a project that's a part of this blueprint. Its focus first and foremost is to deliver Internet to all public schools in Malaysia. There are 10,000 public schools. Malaysia has a population of 28 million, so some of the schools are quite small -- 40 or 50 people in small villages -- to 2,000-plus people in big cities. The total enrollment is about 5 million students. Delivering connectivity to the school is just a starting point. We just happened to have this 4G network, which gave us a tremendous advantage when it comes to deployment speed. The alternative would take years to complete. That's why we can deliver broadband to over 85 percent of the schools in 18 months' time. We target to complete all 10,000 schools by the end of this year.

source: http://news.cnet.com/8301-1035_3-57611479-94/ytl-ceo-wing-lee-bets-on-4g-in-malaysia-q-a/

Pakistan might remain the only country in South Asia without 3G for a while longer

India has 4G wireless service in a handful of cities, Afghanistan has 3G nationwide, Bangladesh is rolling out a nationwide 3G network, and even Nepal has 3G in major cities. That leaves Pakistan as the only country in South Asia without a high-speed mobile network. The country’s notoriously activist supreme court is trying to force the government into holding the spectrum auction needed to launch 3G services in early 2014—but the country’s equally notorious bureaucracy looks likely to delay things.

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Pakistan, with a population of 180 million and 125 million mobile subscriptions, has come close to holding the spectrum auction several times over the last five years. Each time proceedings have been delayed on a technicality.

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Warn-torn Afghanistan managed to avoid such a quagmire by simply not holding an auction—it simply distributed spectrum licenses to the providers. The government argued that the economic boost from acquiring 3G was more valuable than the one-off windfall from an auction that could become marred in controversy.

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Bangladesh gave a 3G license to the state-owned mobile provider, Teletalk, in 2012, and held an auction for the other mobile operators in September 2013. BTRC, Bangladesh’s telecom regulator, has been applauded for not allowing the government’s fiscal concerns to hijack the agenda and set the reserve price for the auction too high—the mistake made in India.

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But the Pakistan Telecoms Authority (PTA), the regulator, has been without a chief since the last time a spectrum auction was scheduled, in 2012. Plans came to a halt when the PTA said the telecoms operators and other interested bidders had failed to submit an expression of interest in time. The mobile operators, who have been long dogged by fickle government policies and strong competition, said they were never invited to bid.

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The then-chairman of the PTA lost his job over the incident. His nominated successor was challenged by the opposition parties last October, and the two other members of PTA’s committee retired at the start of this year, effectively leaving the telecoms industry in a state of anarchy. Now a public-interest case currently in the supreme court has pushed the government into some semblance of action. It finally appointed an acting chairman and new PTA members early last month to oversee the auction, and set a February 2014 deadline for holding it.

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However, more delays are possible. The government has now put out an advertisement for an international consultant to help with the auction. Case lawyer Ali Raza says that’s an unnecessary delaying tactic; he argues that everything is ready to go, and that the auction needs to happen quickly to avoid special interests marring the process. The next likely stumbling block is where the money from the auction will actually go. The finance ministry wants it to flow directly into the exchequer—a windfall that was somewhat prematurely written into the 2013-14 budget, announced in June. However, by law the money is meant to go to a universal service fund, set up as part of the 1996 telecoms policy (pdf) to make sure remote areas of Pakistan get telecoms service. The wrangle over that could occupy the courts for a good while.

source: http://qz.com/142923/pakistan-might-remain-the-only-country-in-south-asia-without-3g-for-a-while-longer/