AT&T in talks to appease Elliott: sources

Reports have emerged to suggest the AT&T management team is attempting to reduce pressure from activist investor Elliott Management.

According to Reuters, AT&T has engaged the vulture fund to understand how demands can be met without causing too much disruption to the business or undermining the long-term ambitions of the business.

Elliott Management is pressing AT&T to cut costs, make changes in the management offices and scale back the wider ambitions of the business. One element to the call-to-action from Elliott Management has been to divest non-core assets.

Aside from saving their own jobs, the management team will want to appease the aggression of the vulture fund. With the acquisitions of both DirecTV and Time Warner, the ambition is to diversify revenues, capturing the excitement being generated in the content world. That said, should Elliott Management get its way the AT&T business would be much more commoditised focused almost exclusively on connectivity.

The AT&T business is an interesting one which has polarised opinion. It perhaps has been too cavalier with the cheque book, but few will dismiss the ambition to chase after new revenues. Every forward-looking telco recognises the threat of ignoring diversification and the slow trudge towards commoditisation, though this does not concern Elliott Management.

For Elliott Management, the objective is simple; increase dividend payments and raise share price. Once these two objectives have been met, the team will sell off its stake and collect the profits. This is a mid-term strategy, and it is effective for money men, but it does present a danger to the long-term positioning of AT&T as an influential player in the digital society.

Elliott Management can cause waves, though the ability of the management to control this disruption will give some sort of indication of what AT&T will look like in the future.

AT&T takes another step towards the global IOT dream

AT&T has signed a partnership agreement with Canadian telco Rogers, to extend LTE-M coverage for IoT customers of both companies, throughout Canada and the US.

Rogers IoT customers will now have the ability to roam on the AT&T LTE-M network, with the same privilege being offered the other direction. With AT&T relying heavily on IOT to drive new engagement with enterprise customers, this is another example of the US telco spreading its wings across the globe.

“More and more of our enterprise customers are launching IoT applications across international boundaries,” said Chris Penrose, President of Advanced Mobility and Enterprise Solutions at AT&T.

“Having access to the Rogers LTE-M network across Canada will help them simplify deployments and scale their North American IoT plans.”

The emerging IOT world is one which offers a huge amount of promise for the ambitious AT&T team. In a briefing at Mobile World Congress this year, AT&T told us the opportunity was not only from connectivity, but to move up the value-chain and create platforms and customisable software solutions for enterprise.

There are of course multiple elements to ensure this dream can be realised, however a network which reaches beyond the borders of the US is critical. The IOT business can survive in a single country, but if you want to work with the big boys you have to be able to offer a network which meets the demands of an international business.

With the Rogers partnership, the trio in Canada has been completed. AT&T has a network in Mexico and also a significant partnership in Europe. The European collaboration offers AT&T access to KPN’s LTE-M network in the Netherlands, Swisscom’s in Switzerland and Orange’s in France and Romania. The European operators also gain exposure on AT&T’s networks in the US and Mexico.

With these partnerships in place in Europe, AT&T can expect to cover a significant proportion of the continent, though there are still some significant holes. Orange plans to fill in some of the blank spots with LTE-M launches in Belgium, Slovakia, Spain and Poland, though there is still some work to do.

This is the challenge which AT&T faces in the IOT world. It might be one of the largest and most profitable telcos worldwide, but it is largely limited to the US. If you look at other operators, Orange or Vodafone for example, the physical presence around the world is much more notable. This will factor into the thinking of a few multi-national customers.

FCC moves to kill off all exposure to Huawei in rural networks

FCC Commissioner Geoffrey Starks has stuck the knife into Huawei at an industry conference, suggesting rural telcos will be given financial assistance to cleanse their networks of the vendor.

Speaking at the Competitive Carriers Association annual conference, Starks targeted the Chinese telecommunications industry on the whole, and Huawei in particular. Not only is the FCC exploring ideas on how to ban the purchase of Huawei equipment entirely, but also the introduction of an initiative which would offer federal dollars to search for, and remove, legacy Huawei equipment which might be in the network.

“Huawei is one of the biggest telecom equipment manufacturers in the world, and although its share of the U.S. telecom market is relatively small, some wireless carriers have purchased Huawei equipment for their networks,” Starks said.

“These carriers bought this equipment, often a decade or more ago, because it was far less expensive than other options, and because Huawei was willing to work with them to create customized networks.

“The Commission is currently examining whether to ban the use of federal support dollars for the purchase of such equipment, but we can’t ignore the problem of the equipment that’s already here.”

Starks is the FCC frontman for a new programme which has been known as ‘Find it, Fix it, Fund it’. The initiative will provide funding to telcos to self-assess networks and identify what would be deemed as ‘suspect equipment’. Currently it is voluntarily, though it does appear there are regulatory changes on the horizon to make the initiative a compliance issue.

In the short-term, the equipment might be allowed to stay in the network, though it would be quarantined. Long-term, Starks is suggesting every piece of equipment would have to be ripped and replaced.

The financial support from the FCC is an interesting element, and it does seem to have been working with the private sector to advance its ambitions.

“Nokia and Ericsson have said that they are willing to create products and financing options geared toward smaller carriers that need to replace Chinese equipment,” Starks said. “They also claim that they have had handled similar replacement efforts with minimal customer disruption.”

The challenge which many of these rural telcos are facing. Financially these companies are under strain. Connectivity is an expensive business and the rural players cannot experience the same economy of scale benefits the national players can. Ripping and replacing prior investments would be a kick in the teeth for already financially tense environments.

This is the reason Huawei has been successful in engaging rural and regional connectivity providers in the US. Not only does it offer a broader range of products, some of which are much more financially attractive, but it has been much more open to customisable deployments than rivals. The US is an incredibly varied geography, there is not a one-size-fits-all opportunity here.

A lack of competition and the removal of the cheapest network infrastructure provider is a massive concern for the rural and regional telcos. However, with the help of federal funding and new business offerings from Ericsson and Nokia, the financial burden of rip and replace regulations might be lessened. This does not mean networks will be better or cheaper in the long-term, but it is a nod from the FCC to the immediate concerns.

Aside from this conference speech from Starks, further evidence of Chinese aggression has emerged from the US.

Senators Chuck Schumer and Tom Cotton have called for a ban for China Telecom and China Unicom to use US networks. China Mobile has already been facing difficulties in obtaining a licence to operate in the US, though this further expands the scrutiny which is being placed on Chinese companies.

In a letter to the FCC, Schumer and Cotton have suggested the two telcos, both of which have direct links to the Chinese Government, could use networks to target US communications. They have also suggested the pair could use the licenses and exposure to US networks to reroute traffic through China.

Perhaps this is an incident which many should have expected, but it does demonstrate the US Government is taking a more comprehensive approach to tackling China, bringing more companies into the fray.

Last month, it was suggested the Department of Justice is attempting to put the brakes on a subsea cable which is being funded by Facebook and Google, as well as a Chinese partner. Dr Peng Telecommunication and Media Group does have ownership ties to the Chinese Government, though two US firms could get hit by collateral damage through this DoJ investigation.

All of these incidents indicate the aggression from the US Government is widening and becoming increasingly complex. The likes of ZTE, Alibaba, OnePlus and Xiaomi should perhaps be wondering when they will be dragging into the conflict.

AT&T sued for massaging DirecTV figures

If there is a headache in the shape of activist investor Elliott Management already, AT&T executives will be reaching for the aspirin once again as investors sue over suspect figures.

Filed in the US District Court for Southern New York, Melvin Gross is the man leading a coalition of investors to sue AT&T, suggesting the management team misled investors over the performance of its DirecTV video products. The massaged figures might be viewed as an attempt to save face (as well as jobs), though the lawsuit also suggests executives were attempting to justify the incredibly expensive acquisition of Time Warner through nefarious means.

“Moreover, several of the Executive Defendants had strong personal interests in promoting the success of DirecTV Now in order to persuade the market of the logic behind the Time Warner Acquisition,” the filing states.

“The failure of DirecTV Now, prior to the closing of the Acquisition, could have jeopardized the transaction, a result that would have been disastrous for the Defendants.”

Through a combination of fake email addresses and additional charges for customers without consent, practises which were allegedly encouraged by managers, AT&T is effectively accused of fraud. Investors are also suggesting the executive team presented misleading numbers down the omission of promotional numbers. 500,000 net adds disappeared once a three month for $10 deal disappeared, though this risk was apparently not appropriately communicated.

By hyping the performance of DirecTV Now, investors might be encouraged to double-down on momentum in the content unit, funding another monstrous acquisition. However, as the lawsuit states, investors might not be buoyed to spend $108.7 billion (including debt) should the 2014, $67.1 billion DirecTV purchase be viewed as a failure.

This is somewhat of a conspiracy theory, though the DirecTV Now numbers were not anywhere near as attractive during the financial earnings call once AT&T was committed to the Time Warner transaction. As you can see from the table below, the timing is a bit suspicious:

Period Net adds (loss in brackets)
Q2 2019 (168,000)
Q1 2019 (83,000)
Q4 2018 (267,000)
Q3 2018 49,000
Q2 2018 342,000
Q1 2018 312,000
Q4 2017 368,000
Q3 2017 296,000

The Time Warner acquisition was first announced in October 2016 and closed in June 2018. In the financial earnings call following the closure of the transaction (Q3 2018), the DirecTV gains started to crumble away.

With the aggressive expansion and success the AT&T executive team was suggesting up-to Q2 2018, investors will of course have been enthusiastic about adding to the momentum. On the other side, you can see why some are reasonably irked by the reality of the situation. It does appear the fact many of these gains were either irresponsibly attributed or unlikely to be anything more than short-term gain.

Although DirecTV is the focal point of the lawsuit, the Time Warner acquisition is the central cog which the saga flows around.

The content strategy from AT&T is relatively simple. The DirecTV acquisition offered a mobile-friendly content delivery model, and the Time Warner purchase offered a horde of content allowing the telco to compound gains. Both, theoretically, work independently, but the combination is more attractive if you have a bank account big enough to fund the expansion.

However, as the lawsuit suggests, investors might be a bit sheepish in giving the greenlight to a $108 billion acquisition if the ROI from the $67 billion purchase are not living up to the original promise. The AT&T theory and business model is theoretically sound, though if the lawsuit is successful, heads may roll due to the route the management team took to get to the finish line.

The content bet from AT&T is already looking suspect, and this lawsuit will not help the situation.

Alongside this filing, the management team is also under attack from Elliott Management, the vulture fund which specialises in restructuring businesses, promoting a shift towards a utilitised business model and realising short/mid-term gains through increased dividends and share price increases.

The activist investor has taken a $3.2 billion stake in AT&T and has recently sent a letter to shareholders attacking the AT&T strategy and competency of the management team. The content business has come under-fire, with Elliott Management pushing for divestments and a more stringent focus on traditional connectivity products. It’s a strategy which could force the telco down the utilitisation path, something which is unlikely to benefit the business in the long-term.

The emergence of this lawsuit certainly aids the Elliott Management case, however we think the timing is more coincidental. Some might suggest the vulture fund is behind the lawsuit, but we think it is more a case of pleasant timing.

For the AT&T management team, this is a potential disaster. Not only do these executives have an aggressive activist investor calling for their heads, they have now been named in the lawsuit, with the complainants suggesting they encouraged under-handed tactics to directly mislead the market. This is turning into a very uncomfortable month for the AT&T management team.

US wearables market surges to $2bn in Q2

After years of letting the industry down, the wearables segment has seemingly finally got its act together, with sales totalling $2 billion in the second quarter of 2019.

According to estimates from Canalys, shipments in the second quarter increased 38% year-on-year to 7.7 million devices, with Apple leading the market share rankings, though homage should be paid to Samsung. The Korean brand saw shipments more than double, 121% year-on-year increase, to roughly 800,000 devices.

“Smartwatch vendors are increasingly getting nearer the bullseye – hitting the right price point in a way that spurs massive demand,” said

“With Samsung’s new Galaxy Watch branding in place, and showing robust performance, the company has moved to cultivate a fitness-focused line-up with the Galaxy Watch Active series, with prices between $200 and $300.

“Packing features into a compact form factor that has an appealing design is challenging but rewarding. Samsung most recently showcased these capabilities with its latest Watch Active 2 series, though other vendors are close behind.”

Of course, this market has offered many false dawns for the excitable industry on the whole, and Samsung has been one of the contributors to this trauma. Despite having a leadership position in the smartphone space, Samsung has struggled to translate this into the wearables market, though these numbers suggest the Korean brand has turned a corner.

Overall, this is a very promising trend to keep an eye on. There is a huge amount of potential for the wearables market, especially now more connectivity and entertainment options can be embedded into the products.

This is perhaps what has stuttered enthusiasm for these products over the last few years. They are functional products, few would suggest smartwatches can compete with traditional time pieces from a fashion perspective, though the functionality was never enough to justify the financial outlay. Introducing stand-alone connectivity and embedded more features is addressing this challenge, while the progress of the voice user interface will add another element.

Interestingly enough, this might just be the tip of the iceberg. The more normalised smartwatch devices become, the more open consumers will be to other connected devices. It might not be too-long before we are talking about LTE-connected glasses or headphones to act as an alternative to communications devices.

HTC debuts eye-tracking with enterprise VR launch

HTC has announced it is bringing its enterprise VR product to North America, after teasing executives at CES in January.

The product itself, Vive Pro Eye, is not cheap, $1,599, but features the latest in eye tracking technology with HTC claiming it is ‘setting a new standard’ for VR in the enterprise market. While the consumer VR segment has been relatively sluggish, despite the incredible promises made by technologists, though there does seem to be a bigger focus on enterprise in recent months.

The Vive Pro Eye follows up HTC’s Vive Pro which is already in the hands of various different enterprise customers throughout the world, introducing new features such as precision eye tracking software, deeper data analysis, new training environments and more intuitive user experiences.

And while some of the features might be considered excessive at the moment, there is always the potential to influence mainstream adoption.

“We’ve invested in VR technology to connect our fans to our game and deliver a new level of engagement through VR game competitions and in-ballpark attractions,” said Jamie Leece, SVP of Games and VR for Major League Baseball.

“By integrating eye tracking technology into Home Run Derby VR, we are able to transport this immersive baseball experience to any location without additional controllers needed. Our fans can simply operate menus by using their eyes.”

This is perhaps where the VR industry has fallen short of expectations over the first few years; cash conscious consumers do not have the funds to fulfil the promise. These are after all individuals who have been stung by various difference financial potholes over the last decade and might be hesitant to invest so handsomely in such an unproven technology.

The focus on enterprise is a much more sensible bet for many of the VR enthusiasts to follow. Firstly, in working with organizations like Major League Baseball, new applications can be created, and experiential experiences can be offered to consumers at the games. This might have a normalising impact for the technology on the mass market.

Secondly, there is a lot more money in the enterprise world than in the individual’s wallet, with decision makers much more enthusiastic about investments when it isn’t linked directly to their bank accounts.

Finally, there are more usecases in the enterprise world. Some of them might be boring, but they are realistic and important for the companies involved. Training exercises are an excellent example.

What this product also bringing into the equation is eye-tracking software, offering an entirely new element for developers to consider.

“Our virtual venues come to life as individual audience members can react with various animations when a user makes direct eye contact with them,” said Jeff Marshall, CEO of Ovation, a company which uses VR to help media train customers in public speaking environments.

“As a developer, there’s just no going back once you’ve seen all that eye tracking makes possible.”

From an experience perspective, the eye-tracking software can also add to the gaming world. Foveated rendering is a graphics-rendering technique which uses an eye tracker integrated which helps reduce rendering workload by reducing the image quality in the peripheral vision. By focusing processing power where it is needed most, the strain placed on the device and experience is lessened.

Many have suggested this technology could be at the forefront of the next generation of VR devices, both in the consumer and enterprise world. Whether this is enough to force the potential of VR from promise to reality remains to be seen, but something needs to be done.

Q&A with David Glickman, CEO of Ultra Mobile, & Sarah Neill, VP / GM at Ultra IoT Connected Lab

As previously reported by the MVNOs Series, it’s been an exciting year for MVNOs in North America. One of the most mature and developed MVNO markets in the world, the region does justice for its reputation of being intensely competitive yet still filled with opportunity. If we look at the US market for example – one of the most diverse, complex and competitive MVNO markets within the region – it has been the home to some of the biggest stories around the North American mobile industry in 2018: the big four carriers’ merger and acquisition announcements.

With only a few weeks until the MVNOs Series takes over Miami with the MVNOs North America 2018, they caught up with David Glickman, CEO of Ultra Mobile, and Sarah Neill, VP and General Manager at Ultra IoT Connected Lab, on the latest developments in the region.

What are your views on the T-Mobile and Sprint merger? Is it a really merger or an acquisition, and will their MVNOs merge too? What the greater market consolidation means for MVNOs in North America?

[David Glickman] It’s technically a merger, but it looks and feels a lot like an acquisition. MVNO’s won’t merge in a direct sense, but the New MNO may decide not to maintain so many relationships, and if they end some contracts, those MVNO’s will need to partner with AT&T or Verizon which is tough, or their customers are going to have to find a new home, which is likely one of the existing MVNO’s. It’s an important year for MVNO’s to show their value and earn their place at the new table.

What are your thoughts on the Lifeline programme? Should MVNOs be responsible for this kind of service instead?

[DG] Lifeline requires a carrier to provide an adequate service to a less profitable segment of the market. To be able to do this, it goes beyond government subsidy and also relies on an affordable business model and aligned resources and priorities. This is always harder for MNO’s who are motivated to look first at the most profitable customers, and this has historically been one of the opportunities that MVNO’s have seized. So, in this same way I think it makes a lot of sense for MVNO’s who can operate on lower overheads and hold a niche strategy and therefore aligned prioritizations to take the lead on this market.

As we look at the North American price discrepancies – more for more or more for less? What works best? How should MVNOs approach this kind of strategy?

[DG] If MVNOs focus on more for more, they start to compete directly with the “hand that feeds them”. An MVNO is rarely going to beat an MNO that is motivated to compete directly. So, I don’t believe an MVNO would ever want to go head to head with an MVNO. The more for more strategy only works for the top of the market that are willing to pay more for more. In this competitive market, there’s an oversupply of service, and a growing base of customers that are willing to get less for less, which initially drove the growing acceptance and popularity of MVNO’s, but now as the MVNO’s continue to improve their own services, off their initial lower base, these customers are getting more for less. It’s still targeting the lower end of the market, which still carves out a divide between the target between MNO’s and MVNO’.

How can MVNOs in North America differentiate themselves? What makes MVNOs different in a sea of voice, SMS and data offerings?

[DG] Domestic voice and text has to be unlimited. It’s so commoditized that it’s no longer just a part of the product mix, it is the base. That leaves the differentiators to be:

  1. data
  2. to a diminishing extend, international voice,
  3. increasingly value-added services like streaming services, free or exclusive content, and
  4. bundling.

MVNOs have started to look at the opportunities in IoT, video distribution, hospitality, education etc. Can you please share what do you consider the opportunities for MVNOs in these sectors? Most importantly, how should MVNOs approach these opportunities? For IoT, for example, should they specialise in one vertical?

[Sarah Neill] 10% of IoT devices will use cellular connectivity, so this is big volume. And with the roll out of 5G, demands on IoT support and connectivity will propel. We are focused on becoming the Ultra-fast implementer for innovative IoT companies. We want to work with companies that are committed to moving from contact to implementation in 30 days. We believe scale, speed, and ease are going to be critical to be a valuable MVNO in the IoT space. And it’s our huge advantage over MNO’s, we don’t need volume commitments, or business plans, we just want companies that are looking to launch quickly. At Ultra Mobile one of our key strengths is agility, execution and speed to market, so we want to take what we do ourselves to partners and open up this B2B pipeline for likeminded business operators.

Meet with with David Glickman and Sarah Neill at the MVNOs North America 2018, taking place at the Downtown Hilton, Miami, 16 – 17 October.

What’s driving growth in the North American MVNO market?

In the commissioned report ‘Shaping the North American MVNO Market’, the MVNOs Series team explores how the winds of change have been blowing through North America’s mobile markets over the past 12 months and the impact that is having on MVNOs.

The North American MVNO market is one of the most mature and developed in the world. It is also one of the most diverse, complex and competitive, with three major markets in three huge countries demonstrating very different characteristics and very different opportunities for MVNOs.

In terms of total number of MVNOs, North America sits third out of all global regions behind Europe and Asia, but in terms of MVNO subscriptions, it is second only to Europe. The region accounts for a significant proportion of new MVNO entrants globally, cementing its reputation for being intensely competitive yet still filled with opportunity.

A closer look at USA, Canada and Mexico

Perhaps it is a matter of perception. The three big North American mobile markets – USA, Canada and Mexico – all pose different challenges to MVNOs. In the US, it is intense competition, in Canada a lack of regulatory support, in Mexico exceptionally low ARPUs and carrier dominance. But that is not to say opportunities do not exist across the region.

In fact, growth prospects for MVNOs in North America are better than average. According to Research & Markets, the North American market will grow at a CAGR of 8.1% to 2022, above the global forecast of 7.4%.

In the US, the world’s biggest consumer of mobile data and by far and away the region’s biggest mobile market, consolidation in the carrier sector is changing the wholesale landscape.

Without a doubt the biggest stories of 2018 in the US mobile industry have been those concerning the Big Four carriers on the merger and acquisition trail. The yet-to-be-ratified merger of T-Mobile and Sprint, the third and fourth biggest operators in the US, represent what many analysts see as a necessary piece of consolidation in an increasingly cramped and crowded market.

AT&T, meanwhile, has already had its $85bn takeover of giant media conglomerate Time-Warner approved. The acquisition puts AT&T in pole position to control the burgeoning market for ‘added extra’ OTT media services such as TV subscriptions, live sports streaming and even movie access being bundled in with mobile contracts, especially as it already owns online TV subscription service DirecTV.

Gregory Gundelfinger, co-founder and CEO of MVNA Telna, shared his insights. “In Canada, the MVNO market is still heavily regulated and controlled by the incumbent carriers,” he said. “The MVNOs are sub-brands of the carriers that offer cheap or no-frills pricing. Virgin Mobile is owned by Bell, Fido is owned by Rogers, Koodo is owned by Telus. The regional carriers have MVNO characteristics such as disruptive pricing, these include networks such as such as Freedom Mobile, Eastlink and Videotron. There are limited growth and disruption opportunities for MVNOs and regional carriers in Canada.

“The US MVNO market has faced unparalleled challenges including uncertainty around government subsidies for the Lifeline program as well significant competition from the MNOs. T-Mobile’s “uncarrier” value propositions and aggressive pricing have caused Sprint, AT&T and Verizon to respond, thereby making it less compelling for customers to utilize MVNOs.

“ARPUs in Mexico are among the lowest in the world, with many MVNOs requiring massive scale to be sustainable. Altan Redes, one of the first mobile operators to launch exclusively as a wholesale network or MVNE, means that barriers for becoming an MVNO have been lowered. This presents new opportunities for entrants into the market,” he concludes.

The Road Ahead

Competition on pricing continues to be a dominant theme in the US MVNO market. This is viewed as both inevitable and a little surprising, depending on who you ask. On the one hand, it is a basic principle of market economics that a crowded supply side will push prices down. On the other, such is the maturity of the US MVNO sector that you might expect intense competition on pricing to have given way to service differentiation a little more than it has so far.

The triple threat of intense pricing competition and the continued incursions of big carriers and big cables into traditional MVNO markets is certainly putting pressure on virtual operators in the US. But how concerned should the sector really be?

We asked Boost’s Peter Adderton to talk us through the challenges and opportunities that lie ahead.

On the entrance of big cable into the mobile market, Peter said: “What it means for the MVNO space is another deep pocketed company looking to grow in a highly saturated wireless market, making it even harder for smaller MVNO’s to compete.”

However, he also warned against pressing the panic button too early, stating that so far it “means very little.”

The bigger picture, however, is that the top of the US mobile ecosystem is seeing a lot of consolidation around the big players, both incumbent carriers and new entrants. Consolidation comes as growth slows and enterprises seek to find new revenue streams. As that trend continues, it is likely that operators and big digital companies entering the market will increasingly target traditional MVNO territory.

Peter argues that the competitive pressure will reach a critical point where MVNO numbers simply have to fall, whether through natural wastage or through their own cycle of consolidation. “My concern is and has always been that MVNOs have never truly been able to operate independently of the host carrier unless they have large enough scale – think Tracfone, and that’s it,” he adds.

For all its complexity and high levels of competition, North America remains a land of opportunity for MVNOs. While a market as mature as the US does not offer the same scope for attention-grabbing levels of growth as some emerging MVNO markets elsewhere in the world, it remains a great place for MVNOs to set up and do business. A well-established wholesale market, regulatory support and a market of 300 million-plus smartphone owners sees to that.

In the full version of the report, you’ll find an in-depth analysis of the North American MVNO market performance – particularly in the US and Mexico. Discover what the opportunities and challenges are, as we look up close at the significant growth in IoT connections, the role technology is playing across the region and the changes in the wholesale and regulatory landscape. The report also examines the potential impact of the US government plans to significantly reduce the Lifeline programme.

 

Download the report ‘Shaping the North American MVNO Market’ and discover why automation and self-serve are tied to MVNOs’ financial growth.

SpaceX hits the skies with the launch of another comms satellite

Elon Musk’s SpaceX completed another successful launch this weekend, delivering the 7,000 kg Telstar 19 Vantage satellite from Cape Canaveral to offer connectivity across the Americas.

The launch, which was partially under threat due to adverse weather conditions, took place on Sunday morning with the satellite deployed 32 minutes after lift-off. Following the separation, the Falcon 9 launch vehicle was successfully landed on the ‘Of Course I Still Love You’ drone ship, an autonomous vessel to allow for recovery of rocket assets, which is stationed in the Atlantic Ocean. The satellite will be owned and operated by Canadian satellite communications company Telesat.

Operating from Telesat’s prime orbital location of 63 degrees West, 22,250 miles above the earth, the Telstar 19 Vantage satellite has two high throughput payloads, one in Ku-band and the other in Ka-band, serving the South, Central and North American regions. In South America, Telesat’s customer Hughes Network Systems has invested to make use of the Ka-band capacity, while the Ka-band capacity over Northern Canada, the Caribbean and the North Atlantic Ocean will be utilised by several different customers including Bell Canada subsidiary Northwestel. In-orbit testing will now commence before services kick-off in the summer, with a 15-year design life.

While the satellite communications segment is certainly a more niche aspect of the overall sector, SpaceX is creating somewhat of a strangle hold on the launch industry with estimates putting Musk’s market share at more than 50%. The trick here seems to be SpaceX’s cash conscious attitude and drive to recycle as much of the assets as possible. While this is the first time this Falcon 9 asset hit the skies, SpaceX has recycled reusable rocket boosters on more than 20 occasions, with the team hoping recovered assets can each be used between 10 and 100 times.

SpaceX has a busy schedule over the next couple of months, with the next launches taking place on July 25 and August 2 for Iridium and Telkom Indonesia respectively.

Telstar 19 Vantage Launch

Example of Falcon 9 landing on recovery vessel

Coverage of Telstar 19 Vantage

Satellite Coverage

Soon there will be another cable populating the subsea superhighway

China Telecom, China Unicom, Facebook, Tata Communications, and Telstra have all teamed up to sign a turnkey contract for the deployment of the Hong Kong-Americas (HKA) submarine cable network.

The Hong Kong-Americas (HKA) consortium, as they are officially known, has signed the agreement with Alcatel Submarine Networks to deliver a submarine cable network which will span more than 13,000km. The new asset will increase connectivity between Hong Kong and the US.

“We are committed to continually investing in our capabilities to meet our customers and partners’ increasing data demands,” said Tata Communications’ CTO, Genius Wong. “Joining the HKA consortium and connecting the new next-generation subsea cable system to our global network means that we are able to offer our customers and partners enhanced speed, diversity and reliability of connectivity between the business hubs of Asia and the US.

“With our growing network – and the cloud, mobility, security and collaboration services which it underpins – as the foundation, our customers and partners are better placed than ever to transform how they operate through new disruptive digital services and expand to new markets with agility.”

“The trust placed upon us by the HKA consortium validates our position as a key player for submarine network infrastructures in the Asia-Pacific region and the reinforcement of our local presence,” said Philippe Piron, President of Alcatel Submarine Networks.

“It also provides a strong platform to further demonstrate our commitment in project management and in the development of local relationships to support operators and content providers for their network and capacity expansion strategies.”

The new cable has promised to deliver greater diversity of connections, enhanced reliability and network efficiency, as well as improving connectivity between data centres in Asia and the US. In terms of the kit being used, Alcatel Submarine Networks has promised it will be top of the line, delivering 80 Tbps transmission capacity.

While it might not be the most glamorous part of the telco space, subsea cables are a crucial one. Google is another company which is boasting about its subsea party, as it announced investment into three new cables recently, one of which will be privately owned by the internet search giant.