Research firm Omdia has revealed South Korea is the clear global 5G leader, and unfortunately for everyone else, it doesn’t even look to be that close a race.
Although Omdia stressed 5G progress is not a race between countries, it is very difficult not to measure success between the different countries and regions before deciding on a winner. Like 4G, 5G could inspire economic growth, but this will be disproportionately distributed to those who can cultivate a 5G era more successfully than others.
As it stands, South Korea is the leader in the 5G world, with Kuwait and Switzerland completing the podium, though it is not exactly a close race currently.
“Limited coverage, device availability and cautious launches has limited take-up in other global markets,” said Stephen Myers, Omdia Principal Analyst. “However, expansive coverage rolled out by Sunrise and Swisscom in Switzerland, Ooredoo and Vodafone in Qatar and Kuwait’s three service providers has rivalled Korea for breadth of market coverage.”
The results were calculated by weighting five different elements of the 5G industry; spectrum availability, service launches, network coverage, 5G adoption and the development of a supporting ecosystem. In every area, South Korea has exceeded expectations bountifully, a trend which should continue over the next few years in light of the Government’s intention to make a further 2,640 MHz of bandwidth available for 5G networks by 2026.
Again, this might seem like nothing more than posturing, but there is credibility to the idea of first being better.
The number of subscriptions in a market generally matters very little, though scale does offer opportunity to create, validate and fine-tune 5G-specific products and services. A scaled domestic 5G market offers a springboard to launch into the international markets.
When you consider how profitable Silicon Valley is thanks to domination in the 4G-era, this is so much more than political and technological posturing.
Facebook, Uber, Google, AirBnB, Netflix and numerous other companies benefitting from the US’ early drive towards 4G. These companies underpin growth in the economy today, create future-proof jobs and encourage further investment in the US. Most importantly, however, is these companies had a head start over international rivals to ensure their offering was successful in international markets.
Now, all the profits from Netflix subscriptions around the world, Uber’s journeys, Facebook’s hyper-targeted ad campaigns and Google’s promoted search results find their way back to the US. This compounds investments in new areas, creates new jobs and adds further growth to the US economy with an industry which will only get bigger and more profitable.
4G was a catalyst to compound US dominance on the global economy over the last decade, and a leadership in the 5G era could offer the same economic advantages.
Social media giant Facebook continues to walk the tightrope on censorship, this time adding warning labels to posts that originate from media outlets it considers to be under state control.
“We want to help people better understand who’s behind the news they see on Facebook,” the announcement explained. “…we believe people should know if the news they read is coming from a publication that may be under the influence of a government.” Additionally Facebook will also be labelling ads from such publications and banning those ads in the US, for fear they’re used to manipulate this year’s Presidential election.
While labelling posts is a form of censorship, this move from Facebook should be placed at the mildest end of the scale. It could be argued that making its users aware of the provenance of a piece they’re reading is merely a benign service. However, the clear inference of the label is that the material is compromised and not to be trusted, so there is definitely an element of censorship.
Nonetheless the emphasis on empowering the user to make their own decisions rather than taking the matter out of their hands by removing the material entirely is positive, and in keeping with Zuckerberg’s assertion that social media companies should not be the arbiters of truth. He has faced a lot of resistance from his own employees for this stance, but has stood firm.
The tricky bit with this policy, as with any censorship, involves who determines whether or not something is state-controlled and what their methodology is. Again Facebook seems to be adopting the least bad method, by providing plurality (65 ‘experts’), transparency and an appeals process. Here’s what it has to say about methodology:
We look at several factors that may indicate editorial control by a government, including:
Mission statement, mandate, and/or public reporting on how the organization defines and accomplishes its journalistic mission
Ownership structure such as information on owners, stakeholders, board members, management, government appointees in leadership positions, and disclosure of direct or indirect ownership by entities or individuals holding elected office
Editorial guidelines such as transparency around sources of content and independence and diversity of sources
Information about newsroom leadership and staff
Sources of funding and revenue
Governance and accountability mechanisms such as correctional policies, procedure for complaints, external assessments and oversight boards
If we determine that there are enough protections in place to ensure editorial independence, we will not apply the label. Publishers looking to prove their independence must be able to demonstrate at least:
A statute in the host country that clearly protects the editorial independence of the organization
Established procedures, processes, and protections at the media organization to ensure editorial independence
An assessment by an independent, credible, external organization finding that the statute has in fact been complied with and established procedures have been followed
We also consider country-specific factors, including press freedom and we consult open-source research conducted by academics and leading experts.
If an organization believes we have applied the label in error, they can submit an appeal. Through the appeal, they can provide additional documentation, which we will review against our definition.
As we roll these labels out to more publishers over time, we welcome feedback and will continue to consult with experts and refine our approach.
The matter of state-controlled media is a tricky one. Most people probably don’t know that any newspaper headquartered in mainland China is, by default, under the influence of the state. The same applies to any other non-democratic state as despotic rulers tend to look unfavourably on media that criticizes them. Whether we like it or not, some countries are actively attempting to corrupt the democratic process and combating that constitutes a rare justification for censorship.
Law firm Boies Schiller Flexner has filed a $5 billion class action lawsuit against Google in the Northern District of California for continuing to collect data while privacy mode is activated.
Alleging Google violated the Federal Wiretap Act, the California Invasion of Privacy Act and the Fourth Amendment, the law firm is suing on behalf of millions. Although $5 billion is a significant financial penalty to be fearful of, Google should perhaps be more worried of precedent as losing this case could open the door for other lawsuits in States with their own privacy laws.
The ruling of this lawsuit will boil down to one question; did Google illegally mislead users by overstating the privacy protection afforded when users activated ‘Incognito’, a mode which supposedly acts as an opt-out for data collection and analysis.
“Google tracks and collects consumer browsing history and other web activity data no matter what safeguards consumers undertake to protect their data privacy,” the lawsuit states.
“Indeed, even when Google users launch a web browser with ‘private browsing mode’ activated (as Google recommends to users wishing to browse the web privately), Google nevertheless tracks the users’ browsing data and other identifying information.”
Should the lawsuit be successful, the team would like to award $5,000 in damages to every user who has used Google’s ‘Incognito’ mode since June 1, 2016.
‘Incognito’ mode was first introduced to Google search functions in 2008 and is designed to allow users to browse the internet without Google Chrome remembering the activities. Although it sounds promising, what should be noted is that Google has always stated it is not an absolute protection from online tracking.
Chrome won’t save your browsing history, cookies and site data, or information entered in forms. Files you download and bookmarks you create will be kept. Your activity isn’t hidden from websites you visit, your employer or school, or your internet service provider.
The contentious issue is how much ‘Incognito’ mode was oversold to the user, with the Boies Schiller Flexner legal team believing Google misled users. Through applications and functions such as Google Ad Manager and Google Sign-In, the claim is that browsing information was still collected by the search giant despite assurances to the user it wouldn’t.
Of course, what is worth noting is that there is serious incentive for the collection of personal information. According to estimates (albeit, old estimates) from Tim Morey of digital strategy firm Frog, the value of different data segment vary quite significantly:
$240 – Social security number
$150 – Credit card information
$57 – Internet browsing history
$38 – Health history
$5.7 – Online purchasing history
$4.2 – Contact information
The question which is being asked today is whether all of these data collection and analysis strategies are being done legally.
One trend which is becoming increasingly more obvious is the desire for more privacy.
Earlier this week, Brave, a privacy-orientated search engine, said that monthly active users (MAUs) passed 15 million for the first time in May, a 125% increase year-on-year. These browsers also tend to be more engaged, with click-through rates of ads were as high as 9%.
Perhaps it is the dangers of the digital economy hitting home, finally, but users are becoming much more aware of their privacy rights. This is not good for business for the likes of Google and other internet giants where business models are moulded around information, but it does raise a few questions about the suitability of existing privacy laws:
Telecoms.com Poll – Should privacy rules be re-evaluated in light of a new type of society?
Yes, the digital economy requires a difference stance on privacy
The user should be given more choice to create own privacy rights
No, technology has changed but privacy principles are the same
One question which has not been properly addressed is whether the privacy rules which are being enforced today are suitable for the digital era?
The EU’s General Data Protection Regulations (GDPR) were passed in 2018, ensuring rules in Europe were fit for purpose, but many countries are dictated by privacy rules and regulations written in a bygone era.
In this lawsuit against Google, the three laws mentioned could certainly be considered out of date:
The Federal Wiretap Act was actually written in 1968 and largely replaced by the Electronic Communications Privacy Act of 1986
California’s Invasion of Privacy Act was first legislated in 1967, though there have been numerous updates, including the California Consumer Privacy Act in 2018
The Fourth Amendment was written in 1789 to protect the rights of citizens and prevent warrantless searches of their homes
Although all of these laws are theoretically in the same ballpark, they have been designed for analogue societies. Legal documents are full of nuances and loopholes and taking an example slightly out of context can create all sorts of problems. Today’s digital society is fundamentally different from the analogue era, making it difficult to apply existing laws perfectly.
A donkey might have four legs, a tail and eat hay, but that does not mean it will be at home in the starting gate at a racecourse.
There are plenty of ways the lawsuit against Google can fall apart, most notably as the lawyers on the offensive will have to demonstrate an extensive knowledge of the intricate operations within the search engine business to prove their points. This is an issue.
What you can also guarantee is that Google will throw plenty of legal resources at the case. These are seasoned professionals who have become very well accustomed to defending the internet giant.
Google will of course not want to pay the $5 billion penalty which is being sought by the lawyers championing this class action suit, a bigger consequence is precedent. If lawyers are successful in suing Google for breaking California laws, who is to say another firm would not raise the alarm in any one of the other 49 States which make up the USA.
The USA is a highly litigious country and precedent is a very powerful force in this community.
There aren’t many telecom operators in the world that have not yet realised the importance of digital transformation. However, too often we have seen piecemeal measures being taken, which almost invariably lead to unsatisfactory results.
To succeed in digital transformation, telecoms industry stakeholders need to collaborate and embrace a holistic approach, building from platform up, reaching out to partners beyond the conventional telecoms domains to develop an ecosystem that can address changing market demands, and continuously delivering the most up to date solutions to enable customer value creation.
It is a valid statement that every telecom operator is different from the next one, because the customers they are serving are different, by geography, by segment, or by demographics, often by all of these factors. On the other hand, there is also strong commonality between operators, because the fundamental requirements to support digital service provision that most of the customers demand are the same. These include data collection, storage, governance, and cross-domain data analysis, frictionless handling and delivery of content and service, accurate billing, payment settlement, and many more.
This makes it a classic scenario where the 80:20 principle should apply. In other words, about 80% of a typical customer’s demand to power their digital services can be satisfied by a strong unified platform. Such a platform should be able to satisfy most use cases, carry out common tasks like network planning, construction, maintenance, optimisation, and operations, and should be equipped with the full AI suite, including AI algorithm engine, one-stop AI development environment, and AI service operation.
The platform should also have the flexibility to enable partners to develop or customise their own use cases. This is where the other 20% of customer requirement should be addressed. Despite the strong commonality between operator demands, no single platform can satisfy all the different requirements, and these are better served by a vibrant ecosystem gravitated towards the platform. Such a “pull” effect can be achieved with the platform’s capability to enable, to certify, to support, to incentivise, and so on.
When it comes to incentives to attract more partners to the ecosystem, different revenue sharing schemes can be implemented. For example, if the customer’s demand can be satisfied by a partner’s standard solution, in other words, if the partner does not need to customise its solutions for the customer, revenues may be split equally between the platform and the partner. In cases where partners need to customise their solutions to meet customer needs, the partners should have a bigger share of the revenues. The platform can also set up an “application marketplace” to host apps developed by partners. In such cases, dominant revenue sharing models used by leading consumer and business application stores, for example Salesforce AppExchange should be applied.
One operational characteristic that has separated internet companies from conventional telecom operators is that internet companies would undergo continuous delivery of new features and functions while telecom operators’ networks and services are more static. This needs to change if telecom operators’ digital transformation is to succeed. Such continuous reinvention is not limited to functions and technologies of the digital platform either, it should also continuously improve the enablement of the ecosystem that the platform orchestrates. Equally important is that such continuous delivery of improvement should not only be frequent but also discreet, without interrupting customers’ business operation.
As we can see, successful interaction between the three key elements, the platform, the ecosystem, and the continuous operation, to create values for customers relies heavily on the strengths of the platform.
Huawei’s General Digital Engine (GDE) is such a unified big data platform. It is built with the company’s expertise accumulated and refreshed from over three decades’ experience of serving telecom operators and other customers around the world. Such expertise has been with our engineers but with the GDE platform, it is now digitised and can serve all the customers in a broad range of service scenarios. It is also equipped with Huawei’s artificial intelligence and machine learning capabilities to help customers cope with and predict market and business demands that go beyond the capability of manual calculation.
Such expertise and capability are continuously being updated, to make the platform more powerful and able to meet more customer needs, therefore simplifying the transformation, shortening the time to market, and optimising lifetime total cost of ownership. Huawei will keep updating the platform, at least twice a year, to enable partners to deliver customisation more easily.
The platform is also the anchor point of a broader ecosystem, working with operator customers to first engage qualified existing partners, then to recruit new partners.
Moreover, the platform, the ecosystem, and the continuous operation mode all live by these values:
Agility: always ready to adapt to new market and customer needs and opportunities
Openness: open-minded approach to new technologies and new approach to solve problems
Equality: treating all partners in the ecosystem equally and fairly
For the most of us, the coronavirus pandemic has forced a new way of working, but for some businesses, there could be drastic consequences as societal behaviour and attitudes are shifted.
One segment which should be seriously worried is the sharing economy, a rapidly developing sub-sector of the technology industry which is currently dominated by the likes of Uber and AirBnB. Consumers are certainly less accommodating of the concept of ‘sharing’, perhaps critically undermining this ecosystem.
A big question which needs to be asked is whether the sharing economy can survive COVID-19?
What is the sharing economy?
The sharing economy is an incredibly varied ecosystem, with numerous different business models, usually involving a platform connecting buyers and sellers. Some examples include:
Uber and Lyft: Ride-hailing services powered by an app to connect customers and taxi drivers in the local area
AirBnB: A platform to connect holiday-goers with informal accommodation, sometimes a spare room in a family home or a flat which is vacant for the weekend
JustPark: Residents can sell access to private parking spaces in busy urban areas
Zipcar: Short-term car rental entirely powered through an app, with cars left in designated parking spots throughout the city
Hubble: Flexible office space on short-term contracts, connecting businesses with landlords and commercial space providers
This is one segment of the platform economy coming to life. None of the companies mentioned above actually own the assets which define their business, but simply act as an intermediary connecting one party to another.
Most importantly, the reason these businesses survive is because of confidence. These powerful and respected brands act as collateral, inspiring trust and confidence in the service provided. Uber, AirBnB or Zipcar is a mark of trust in the service, but success also relies on the idea that people are open to sharing, a concept which will be challenged over the coming months.
What’s the problem?
The original idea of AirBnB was to make use of spare rooms in a random individual’s homes, while Uber is effectively a private taxi company and Zipcar is for short-term rentals, as little as an hour.
In today’s society, where the pandemic rules all, the idea of sharing is a toxic one.
To use Uber, customers would have to trust the driver is healthy and the vehicle had been appropriately disinfected following the exit of the previous customer. If you are to sleep in an AirBnB, some would want the room to have a hospital grade cleaning regime. Zipcar will face even bigger challenges as the underlying concept is that the car exists without the need for employees to be near it.
COVID-19 has forced a change in attitudes for the general public, one which will does not necessarily fit in with the way these companies’ function. Consumers that don’t want to share will not want to spend money with these companies.
What is the risk?
When asking Telecoms.com readers what they thought would happen to the sharing economy, 23% of respondents believed the sub-sector would collapse as people will hate the idea of sharing post-coronavirus. 30% stated it would survive but transformation would be needed and 18% said there would need to be market consolidation.
At the moment, we don’t understand the consequences because it is too early, and Governments have not introduced regulation to prevent a second wave of infections. As the lockdown continues to ease, new standards for cleanliness might make it impossible for these companies to make money, here are two examples:
Transport for London (TfL) suggests taxi drivers should disinfect door handles, window winders, seat belts, card payment devices, the rear of the front seats and other surfaces passengers may have touched between every journey. Uber is a company which loses a lot of money already, but if its drivers become less efficient due to new cleaning standards, how much more money will it lose?
AirBnB has introduced an ‘Enhanced Cleaning Initiative’ for its hosts, but will this be enough to restore confidence, and considering the effort required to ensure potential customers are put at ease, how many hosts will decide it is not worth the effort? Should hosts start disappearing because its not an easy way to make extra cash anymore, can AirBnB survive?
The approach to cleanliness is voluntary for the moment but considering the damage to society and the economy which a second wave of infections could inflict, we would not be surprised to see these rules make official through industry regulation or government legislation.
Is there a ripple effect?
Behind every one of these industries is a push towards greater automation to improve profitability. The most obvious example is autonomous driving.
Some have said Uber will never be profitable until autonomous vehicles are present on the roads, and it does make sense for this business model. However, the less money it is making, the less it will spend on already very expensive R&D pursuit.
But dents to the ride-hailing and sharing segment go deeper than Uber and Lyft R&D budgets. General Motors, Ford and numerous other car manufacturers are also venturing into this field with a belief that self-driving vehicles and intelligence route planning could be the future of transportation within cities. Should the sharing economy become less attractive to consumers, these manufacturers would also pull back R&D spend.
The sharing economy is not simply about the money which is being made upfront, but also the technological breakthroughs of tomorrow which are being enabled by these companies. Ride-hailing and sharing is a significant usecase for the autonomous vehicles segment, therefore a decline in interest in this area poses a risk for this technology.
Money is going to be needed
Realistically, these are not bad ideas, just ones which are being undermined by a very unique trading environment. However, is highly unlikely all of these emerging businesses will survive.
The champions of this industry, the likes of Uber, AirBnB and Zipcar for example, have investors and links to financing. The industry is likely to go dry over the coming months, thanks to shifting consumer attitudes, it will take cash injections for these businesses to survive and perhaps find alternative revenues streams. This is where the challenge lies for the smaller players.
Some companies do not have the backing of venture capitalists or other financing measures, as they do not have sufficient scale or a unique enough business model. In normal trading conditions they might survive, but under such severe pressure best case scenario is being acquired, worst case is simply going out of business.
This is an industry which will survive. Consumer behaviour might well come back sooner than we think, but the sub-sector might be a lot smaller by that point.
With the difficulties presented by COVID-19, the 5G roadmap might not have progressed as planned, but growth has remained steady for mobile core deployments.
There might be a few vendors nursing headaches as RAN deployments have not scaled as some would have expected, but some consolation can be found in the network core segment. Over the last twelve months, the segment grew 10% to nearly $8 billion with several high-profile deals inked, most notably in China.
“Our outlook has become more positive, especially since the Chinese service providers accelerated their plans for 5G Core deployments,” said David Bolan, Senior Analyst at Dell’Oro.
“China Mobile and China Unicom have completed their 5G Core tenders, and plan to launch 5G service early in 3Q20. We expect other Chinese service providers will follow very soon. This has raised our outlook to an anticipated growth of 14 percent year over year for the trailing four quarters ending in 1Q21.”
In April, China Mobile selected Ericsson, ZTE and Huawei to deploy 5G network cores across the country, while Nokia saw a minor victory by securing a contract for core deployments with China Unicom. With China Telecom and China Broadcast Network, the newly created fourth telco, undergoing their own tenders, there could be some PR wins on the horizon.
While China is surging forward with its network deployment strategy, it is not alone. In Germany, some activities might be inhibited by the on-going coronavirus pandemic, however Telefonica Deutschland has awarded the contract to deploy its own network core to Ericsson.
“As a network operator serving the most mobile customers in Germany, we have a special social responsibility to provide secure networks,” Telefonica Deutschland CEO Markus Haas said.
Work should be completed on the network core during 2021, with the team targeting network slicing and edge computing services.
“With our cloud compatible 5G core network, we are entering a new technology era,” said Mallik Rao, CTO of Telefónica Deutschland. “Gigabit data rates, real-time communication and massive IoT – these visions are now becoming reality.
“We have a clear plan for the further development of our network infrastructure towards a standalone 5G network that can handle the massive data streams of the future and open up new digital business models for all our customers. In doing so, we are relying on the latest network technologies that the market has to offer.”
Similar to other European nations, German telcos have made the decision to remove Huawei, and other vendors who would be deemed high risk, from network cores. Interestingly enough, this trend does not seem to have had too much of a material impact on Huawei’s business. Dell’Oro estimates Huawei and Ericsson combined for over half of the market, while Nokia, ZTE, and Cisco more than 25%.
Although the network core elements of 5G is not the most financially rewarding for the infrastructure vendors, it is a very good sign for the industry. Although widespread installation of 5G base stations are an easy boast, 5G services cannot be delivered in earnest without a 5G network core, enough fibre in the ground and a dispersed cloud network where enough attention has been given to the edge.
Progress in the core is progress for 5G as new services, such as network slicing and automation, can be more effectively delivered. It might not be the most profitable part of the industry, but perhaps a more material indicator of 5G progress. 5G RAN offers a speed upgrade, somewhat of an aesthetic benefit, but the core offers the opportunity to deliver services which were not realistic in the 4G era.
Facebook has renamed its digital wallet Novi as it takes another incremental step forward with its Libra digital currency.
Despite there being much criticism and scepticism surrounding the ability of Facebook (or whether it should be allowed) to run a digital currency, the team has been taking tentative steps towards the launch.
Announced to much fanfare in 2019, Facebook lead a coalition of companies in an attempt to create a new digital currency which would be anchored to commodities to prevent volatility. It certainly seemed like a positive idea, but Facebook’s track record on privacy and data protection tarnished ambitions. Partners dropped out, regulators cast doubt on the operations and ambitions were scaled back.
Against the odds, the Libra digital currency survived, and the team persevered in a much more low-profile manner.
In April this year, the Libra Association announced it had entered into the first stage payment system licensing process, but the digital currency would be pegged to local currencies. It adds more stability but removes flexibility for the team. The creation of a new digital wallet is the next step in making the currency a commercial reality.
“Today, we’re excited to introduce Novi – the new name and brand for the digital wallet that will help people send and hold Libra digital currencies,” said David Marcus, Head of Novi at Facebook.
“While we’ve changed our name from Calibra, we haven’t changed our long-term commitment to helping people around the world access affordable financial services. Whether you’re sending money home to support the family members who supported you, or you’re receiving money from your friends no matter where they are, the Novi wallet will make money work better for everyone.”
Some might wonder why Facebook is interested in digital currencies, and while there are of course many reasons, there are two which we think are most important.
Firstly, why not?
Facebook is a company which likes making money, and when there is an opportunity to make money, why shouldn’t it try. Entering into the financial services market would diversify revenues to create a healthier business. Every organisation wants to branch out into new areas, these are capitalist organisations after all.
Secondly, it adds more opportunity for the social media platform.
With Western markets largely reaching saturation point for advertising on Facebook’s core social media platform, new revenues will have to be sought from new regions. Some of those were there is potential lack traditional banking infrastructure. If they have access to digital infrastructure however, the introduction of digital currency means Facebook can make money off these users without traditional banking facilities.
The Libra mission is gradually making progress, and while it might not be the biggest of celebrations from Facebook, perhaps that is the best strategy. Fanfare brought unwelcome attention last year, so maybe it is a better idea to quietly go about business and make a fuss when the ‘point of no return’ has been passed.
Russian operator MTS saw revenues grow 9% in Q1 but believes the whole-year performance is likely to be flat.
MTS has delivered a financially solid Q1 with a total revenue of RUB 119.6 billion ($1.7 billion), up by 8.9% year-on-year. The company’s OIBDA grew by 1.6% to RUB 51.5 billion ($730 million), while net profit improved 0.8% to RUB 17.7 billion ($250 million) compared to the same period of 2019. The strongest growth comes out of its mobile and fixed telecom services, but about half of the top line growth comes from the adjacent businesses, including fintech, digital services, and retail.
“…this is an unprecedented time that is impacting billions of people around the world, including millions of our customers and thousands of our employees,” Alexey Kornya, MTS President and CEO, said during the earnings call. “Connectivity has never been more critical and we are proud to be helping our customers stay in touch with their friends and family as well as colleagues and classmates.
“Overall, I am deeply proud of the MTS team and would like to express my appreciation for their professionalism in this challenging environment. Looking ahead, I am cautiously hopeful for the future, and our strategic focus is clear: supporting our customers today while not losing sight of our goals for tomorrow.”
As Russia entered COVID-19 lockdown only at the end of March, its impact was not reflected in the Q1 results. However, MTS does provide a glimpse into the impact on April and the first half of May.
Similar to other operators that have witnessed during COVID-19, MTS has seen increased traffic but a big drop in retail with many shops are closed. Meanwhile, the operator has seen and expects increased digital activities, in communication, media, and in financial product consumption. In mobile, MTS has received the regulatory approval to implement self-registration SIM cards through an app.
“Looking ahead, we plan to prioritize this channel at the key level to lower subscriber acquisition cost,” said Inessa Galaktionova, First VP for Telecommunications. MTS is “also broadening our SIM-based infection tracking across all of our sales channels.”
“Now more than ever, consumers are shifting to digital-first banking from online customer service to virtual cards and contactless payments,” said Andrey Kamensky, VP for Finance, on the earnings call, suggesting there could be greater benefit for MTS.
Looking at the full-year expectations, MTS’s management is more cautious. Citing concerns including reduced number of retail outlets as well as the impact of lockdown on roaming income, the operator projects a 0% to 3% growth in total revenues and -2% to 0% OIBDA move, compared with 2019.
MTS is the latest of telecoms companies to show that the industry has withstood the uncertainties from COVID-19 well enough especially when it comes to coping with surging traffic, but it is certainly not immune to the impact. Factors ranging from reduced retail and roaming income due to lockdown to overall economic weakness are beyond the telecom operators’ control, but have or will have manifested on telecom operators’ quarterly and annual numbers.
Trump needs fodder for the campaign trail, maybe Huawei fits the bill
A thriving economy and low levels of unemployment might have been the focal point of President Donald Trump’s re-election campaign, pre-pandemic, but fighting the ‘red under the bed’ might have to do now.
A thriving economy and low levels of unemployment might have been the focal point of President Donald Trump’s re-election campaign, pre-pandemic, but fighting the ‘red under the bed’ might have to do now.
In 2016, Donald Trump won the Presidential election for numerous reasons, but one very important element was his ability to mobilise the vote of elements of society who wouldn’t have had any interest in politics otherwise. One reason was because of who Trump was and is, a celebrity more than a statesman, but perhaps a more critical element was the message.
Trump ignored political correctness, seemingly appealing to racism and xenophobia as the Make America Great Again slogan was born. He proposed the deportation of all illegal immigrants, the construction of a wall on the US-Mexico border and a temporary ban on foreign Muslims entering the US. The forgotten men and women of the US were the focal point of this campaign.
This campaign, focusing on a single message of foreign people are bad for patriotic US citizens, worked. If Trump is to repeat the success of his 2016 Presidential Election in November, there will have to be another message at the core of the campaign to rouse the masses and build a slogan on.
There has been a suspicion that the success of the economy and low levels of unemployment would have been this focal point. Prior to the COVID-19 pandemic, the economy was on the rise. From Trump’s entry to the Oval office on 6 January 2017, to the final days before lockdown in February, the Dow Jones grew from 19,963 to 29,398, a 47% surge. Unemployment was down to 3.5%, slowly eroding through the three-year period.
The message could have been ‘look what four years of Trump has gotten you, wouldn’t you like four more?’. But then coronavirus hit, and the economy went down the toilet.
The Dow Jones will recover, as will unemployment, but the Trump campaign would be playing with fire by making this the central point of the campaign. Many believe Trump was too slow to act against the coronavirus after spending months claiming it was little more than the common flu. At its worst point, the Dow Jones fell to 18,591 while unemployment is currently as high as 14%, and likely to go higher.
Using the economy as a reason for re-elections is offering ammunition to the Democrat candidate, the opening round of a slug match where Trump can be undermined and embarrassed.
Without this weapon in his arsenal, Trump will have to find a new focal point to build a campaign around; China and Huawei could fit the bill.
Some wacko in China just released a statement blaming everybody other than China for the Virus which has now killed hundreds of thousands of people. Please explain to this dope that it was the “incompetence of China”, and nothing else, that did this mass Worldwide killing!
Trump needs to redirect attention away from his failings as a leader during the pre-coronavirus weeks. People generally need an enemy when times are hard, and the invisible enemy of today will not do; you can’t get people angry about a virus, not in the way that the Trump campaign will want. If Trump can further vilify the Chinese, he can position himself as the hero, the man to champion US values, whatever they might be.
Huawei has been made the proxy of the Chinese Government in the eyes of the US. If the US is scared about the ‘red under the bed’, the idea of communism creeping into democratic societies secretly, the successful telecoms vendor can be made public enemy number one.
This is clearly not a new campaign of hate from the President, but it is one which had quietened off over the last few months. It is an on-going conflict point between the US and Chinese Governments, and fuel was thrown onto the embers last week.
In a new assault from the US Department of Commerce, further efforts were made to inhibit the ability of Huawei to source semiconductor components for smartphones and base stations. The US is perhaps hoping the globalised nature of the technology industry, which has allowed Huawei to thrive, can be weaponised against it as few (if any) companies could operate without a single trace of the US in its supply chain.
“We have survived and forged ahead despite all the odds,” Huawei Rotating Chairman Guo Ping said at a virtual conference this week. “The US insists on persistently attacking Huawei, but what will that achieve for the world?”
Conflict with the Chinese might not sound good for economic reasons, but for political ones, it is fantastic. Trump needs an enemy so he can be the champion of for the forgotten men and women of the US.
While it is clear there are a lot of US politicians buying into the anti-China campaign of hate, we asked Telecoms.com readers how they feel about the on-going aggression towards Huawei:
Telecoms.com Poll: Do you feel the US Government is justified in its action against Huawei?
Yes, it is effectively a pawn for the Chinese Government
Yes, but Government links are not there
Maybe, but show us the evidence of foul play first
No, Trump shouldn’t punish a company just because it is Chinese
No, international competition should be left to sort itself out
Huawei might have enjoyed a brief breather over the last few months, but the signs are there to suggest there might be greater conflict on the horizon. Speaking at the Munich Security Conference this week, Secretary of State Mike Pompeo and Secretary of Defence Mark Esper both drew battle lines.
“Let’s talk for a second about the other realm, cybersecurity,” Pompeo said during his speech. “Huawei and other state-back tech companies are trojan horses for Chinese intelligence.”
“Under President Xi’s rule, the Chinese Communist Party is heading even faster and further in the wrong direction,” said Esper. “More internal repression, more predatory economic practices, more heavy handedness, and most concerning for me, a more aggressive military posture.”
Further sanctions and more aggressive policies against Huawei specifically, as well as other Chinese companies in the international markets, could be on the horizon. Huawei executives have certainly expressed concern, but there are numerous other companies who should also be sitting uncomfortably.
The US Senate recently passed the Holding Foreign Companies Accountable Act (S.945) which could result in numerous companies who do not pass strict criteria being delisted from US stock exchanges. China is of course a target with this legislation.
“The SEC works hard to protect American investors from being swindled by American companies,” said Senator John Kennedy, one of the politicians to introduce the original bill.
“It’s asinine that we’re giving Chinese companies the opportunity to exploit hardworking Americans – people who put their retirement and college savings in our exchanges – because we don’t insist on examining their books. There are plenty of markets all over the world open to cheaters, but America can’t afford to be one of them.”
This legislation would not impact Huawei, it is a private company after all, but it is further evidence of increasing aggression towards China, and suggestions there could be rising tensions.
And while Huawei might be attracting the most attention from US Senators right now, there are certainly more which could fall into the crosshairs. Tencent owns TikTok which has already come under criticism, Alibaba is hoping to expand its cloud computing venture into international markets, while the likes of OPPO and Xiaomi are proving to be quite successful in gaining interest as challenger smartphone brands. These are all companies which would perhaps fall foul of US opinion.
The first Trump campaign rallies will give more of an indication of what will be the focus of his scorn and hatred over the coming months, and where the pent-up frustrations of US citizens could be directed. We suspect Huawei could be in for a rough few months as Trump further vilifies the Chinese Government and looks for an opponent to bureaucratically challenge during the campaign.
Taking down Huawei could be the feather the Trump campaign is looking for in its quest for re-election to the White House.