US operators belatedly act to protect user location data

AT&T and Verizon announced that they will terminate all remaining commercial agreements that involve sharing customer location data, following a report exposing the country’s mobile carriers’ failure to control data sharing flow.

Jim Greer, a spokesman for AT&T, said in a standard email to media: “Last year, we stopped most location aggregation services while maintaining some that protect our customers, such as roadside assistance and fraud prevention.” Referring to the Motherboard exposé, Greer continued, “In light of recent reports about the misuse of location services, we have decided to eliminate all location aggregation services — even those with clear consumer benefits.”

This is similar to the position T-Mobile’s CEO John Legere adopted when responding to the criticism from the US Senator Ron Wyden (D-Ore.). Verizon also announced that the company will sever four remaining contracts to share location data with roadside assistance services. After this Version will need to get customers’ explicit agreement to share their data with these third-party assistance companies. Sprint, which was also caught out by the Motherboard report, is the only remaining nation-wide carrier that has not announced its plan on the issue.

This is all good news for the American consumers who are concerned with the safety of their private data. On the other hand, mobile operators have hardly been the worst offenders when it comes to compromising the privacy and security of customer data. Earlier, Google was exposed to have continued tracking users’ location even after the feature had been switched off, while Facebook has been mired in endless privacy controversies.

Monetising user data is only a side and most likely insignificant “value-add” business for the mobile operators, because they live on the service fees subscrbers pay. But it is the internet heavyweights’ lifeline. This may sound fatalistic but it should not surprise anyone if the Facebooks and the Googles of the world come up with more innovative measures to finance the “free” services we have benn used to.

Qualcomm pumps Snapdragon 855 in Hawaii

The chipset company Qualcomm just unveiled the newest Snapdragon SoC product to power 5G mobile devices.

On the first day of its annual “Snapdragon Tech Summit” in Hawaii, Qualcomm introduced its first commercial 5G chipset, branded as Snapdragon 855. The system is compatible with Qualcomm’s X50 modem with antennae supporting 5G on both sub-6GHz and mmWave frequency bands. On a 7-nm silicon will also be its 4th-generation multi-core on-device AI engine (said to deliver 3X faster AI performance than its predecessor the Snapdragon 845), Computer Vision Image Signal Processor (CV-ISP) for new photo and video features (“true 4K HDR video capture, cinema-grade photography capabilities”), and 3D Sonic Sensor. The sonic sensor can be used for under-display fingerprint reading using ultrasonic waves (instead of the current optical under-display sensors using light), which, Qualcomm claims, is safer and more accurate.

Qualcomm expects the first smartphones using the new chipset to hit the market in the first half of next year. “The Snapdragon 855 will define the premium tier in 2019,” said Alex Katouzian, SVP and GM of Mobile for Qualcomm, who unveiled the new chipset. Earlier Cristiano Amon, Qualcomm’s President, said he expected to see a lot of phone announcements at CES in January and a lot of actual phone launches at MWC in February.

“Today marks a massive and exciting step forward underscoring how Qualcomm Technologies and ecosystem leaders are driving 5G commercialization, a journey that went from R&D, accelerated standardization and trials, the launch of innovative products and technologies, to the imminent launch of 5G networks and smartphones across the globe starting in early 2019,” said Amon at yesterday’s event. “Together we are demonstrating our role in transforming the mobile industry and enriching consumer experiences with 5G mobile devices on live 5G networks at this year’s Qualcomm Snapdragon Technology Summit.”

Executives from mobile operators including AT&T, EE, Telstra, and Verizon were present at the event, so were representatives from Ericsson, Samsung, Motorola, NETGEAR, and Inseego. The 5G smartphone from Samsung to be launched by both Verizon and AT&T is likely to be the first of its kind to be built on Snapdragon 855.

“At Samsung, we have a vision of a connected world powered by 5G that will benefit consumers, communities, industries and governments,” said Justin Denison, SVP for mobile product strategy and marketing at Samsung Electronics America. “5G will fuel collaboration, connectivity and productivity worldwide, and we’re excited to be at the forefront working alongside partners like Qualcomm Technologies to make the transformation to 5G a reality.”

The event will last three days till Thursday, and Qualcomm promised more announcements and more details will be released.

Mobile data could get even costlier after T-Mobile and Sprint merger

Report by Rewheel showed Americans already have the most expensive mobile data among all four-operator markets. A move to reduce the number of them could make it worse.

According to the 2H2018 release of its mobile data price monitoring report, the Finland-based research firm Rewheel focused on the US market, which is likely to see the proposed merger of T-Mobile and Sprint closing in the first half of 2019. The report showed that among the 41 countries it analysed (OECD34 + EU28, with seven EU countries not being OECD members), the median gigabyte price of a smartphone deal (nominal price + VAT) in the US is among the highest. Rewheel told Telecoms.com that Greece and Cyprus topped the table, followed by Korea and Canada. The median gigabyte price of a mobile broadband deal in the US is the most expensive among all.

Rewheel mobile data prices

The research compared two groups of markets, those with effectively four mobile operators and those with three. The mobile data price in the four-MNO markets is shown to be about half as expensive as the three-MNO markets, but the US is an outlier. The median US mobile data price per gigabyte is four times higher than the EU four-MNO markets, and sixteen times higher than the big EU markets with four MNOs.

To look at it from another angle, a 30€ monthly deal comes with unlimited data plans (and at least 1000-minute talk time) on smartphones in 13 markets (Korea, Mexico, and 11 EU countries) but can only buy 6GB in the US. Similarly, a 30€ monthly wireless broadband deal can buy unlimited data in 11 EU markets but can only get 40GB in the US.

The effect of the “magic four” driving price down is most telling in Italy: after Iliad launched its mobile service, the price per gigabyte fell by 70% in half a year. On the other hand, the research showed data price stopped falling in the Dutch market after the announced merger of T-Mobile and Tele2, and the price drop has visibly slowed down in Austria after it became a three-MNO market.

The researcher therefore argued that the Americans are already paying more than other four-MNO market users, it could get even worse if the US market became a three-horse race. However we can see in the data that North America is generally more expensive, with Canada, a four-MNO market, is as expensive as the US. Admittedly though, Freedom Mobile is still weak.

An additional angle to examine data price is to look at what is offered to contract users vs. prepaid users, which is excluded from the Rewheel research. The discrepancy is probably most obvious in Africa. According to the analysis published by the research firm Ovum, South Africa’s mobile data is among the highest in the world. This is largely down to the high prices PAYG users face when buying smaller data packages. Rob Shuter, the CEO of MTN, corroborated with his comments at the recent AfricaCom that, despite the average price per gigabyte for postpaid users in Africa is comparable to that of the US (around $3), data prices for prepaid users are prohibitive. The large majority of mobile users in Africa and other emerging markets are on prepaid services.

FCC modifies frequency policy to encourage 5G investment

Changes to licence regulations on 3.5 Ghz have been approved by the FCC in an effort to encourage the 5G rollout.

The 150 MHz wide spectrum on the 3.5 GHz (3550MHz to 3700MHz.) band, or Citizens Broadband Radio Service (CBRS), is very busy. Following the rules of the FCC established in 2015, three tiers of users are sharing this band. There are the Incumbent Access Users, in particular the US Navy Radar Operators; the Priority Access Licenses (PALs) which are mainly commercial users like the telcos; and dinally, General Authorized Access (GAA) users which are permitted to use any portion of the 150 MHz frequency so long as it has not been granted to the other two tiers.

FCC Commissioner Michael O’Rielly, who was tasked to lead the review of current regulations and deliberation of new policies with special focus on PALs, claimed the old rules “would not support large-scale deployments, such as mobile or 5G networks… The rules in place favored small-scale, fixed networks, by making it unattractive for any other type of deployment. Basically, the rules were designed so that a select group could get licenses on the cheap.”

The Report and Order published by the FCC on Tuesday October 23 has kept the three tiers in place, but has made modifications to the specific implementations, including:

  • Changes the size of PAL license areas from census tracts to counties;
  • Extends the PAL license term to ten years and makes these licenses renewable;
  • Establishes end-of-term performance requirements;
  • Ensures seven PALs are available in each license area;
  • Allows the use of bidding credits for rural and Tribal entities;
  • Permits partitioning and disaggregation of PALs;
  • Updates information security requirements to protect registration information; and
  • Facilitates transmission over wider channels while maintaining protections for other services

In addition to extending the license term from three years to ten years and changing it from unrenewable to renewable, the new rules also did away with the limitations on the number of PALs a single applicant can have in one licence area (currently capped at four) and the bandwidth a PAL can use (currently limited to 10 MHz).

Ajit Pai, Chairman of FCC, admitted there has been debate on the new size of PAL licence, with different entrenched interest either arguing for maintaining the current census tract-sized licence, or demanding vastly enlarged areas. He had to cite support from Rural Wireless Association and Competitive Carrier Association, which represents smaller carriers, to defend the Commission’s  decision to opt for county-size license.

“We find that county-based licenses are just right,” said Pai. “This compromise will allow most interested parties, large and small, to bid on 3.5 GHz spectrum in order to provide 5G services. License sizes aside, we make other necessary changes today to promote investment and innovation in the 3.5 GHz band, including extending the license terms and giving an expectancy of license renewal.”

Pai also reassured the GAA users that “even after PALs are granted, General Authorized Access users can provide service in the PAL spectrum until licensees deploy. Taken together, these reforms will help make this band a sandbox for 5G and represent another aspect of our comprehensive 5G FAST plan to secure American leadership in the next generation of wireless connectivity.”

The rule modifications might not look revolutionary, but they should prove positive for more aggressive 5G rollout in the US. With the extended licence term and the possibility of renewal the new regulations provide more confidence to investors looking at long term. Meanwhile, it also strikes a balance both to encourage scale and to protect operators with local ambitions only.

Verizon might have launched 5G, but new iPhone pulls subscribers

Verizon published Q3 results, beating market estimates on earnings and subscriber adds.

Verizon published Q3 results today, narrowly beating market expectations. On the wireless side, Verizon Wireless added 510,000 net postpaid smartphone subscribers, with the postpaid churn rate at 0.8%. The strong marketing activities following the launch of the new iPhone, including an offer of up to $750 off new models, has helped attract new subscribers. As an important operation landmark right at the end of Q3, Verizon launched fixed wireless access service on 5G in four cities, therefore could claim to be the first to offer 5G in the country.

“Verizon has posted a third quarter of strong operational and financial performance,” said CEO Hans Vestberg. “With the beginning of the 5G era in this fourth quarter, we expect that trend to continue. We are investing in networks, creating platforms to add value for customers and maintaining a focused, disciplined strategy. Verizon is best positioned to take full advantage of the opportunities offered by the new game-changing generation of technology.”

On the broadband and TV side, Verizon’s Fios gained 54,000 new internet users, slower than the 66,000 it gained the same period last year, and lost 63,000 cable TV subscribers, faster than the 18,000 it lost last year, another indication that the cord-cutting trend shows no sign of abating.

Verizon Wireless continued to make the largest financial contribution. It generated $23 billion revenue (70.5% of group total) and brought in $11 billion EBITDA (90% of group total). The wireline business’ total revenues went down by 3.7% to $7.4 billion. The consumer side of the wireline business largely held at $3.1 billion (-2.1% year on year), with the corporate business dropped by over 5%.

On the group level, the total revenues of $32.6 billion, up 2.8% from last year, beating market expectation by $110 million, with non-GAAP earnings per share of $1.22, beating expectations by $0.03. GAAP EPS of $1.19 was right in line with market expectations.

Like most telecom operators, Verizon is a mature business that does not often disappoint but seldom excites. The management guidance pointed to low-to-mid single-digit percentage of full-year consolidated revenue growth and low single-digit percentage growth in EPS, which makes us pay some attention to another area of interest, Oath, the Media & IoT business mainly comprised of AOL and Yahoo.

If Verizon was to bank on this division to herald its future growth then it might be disappointed. Total revenues went down from $2 billion a year ago to $1.8 billion. More importantly, Verizon does not expect Oath to hit the $10 billion revenue target it set for the division earlier.

Verizon’s share price gained by 1.4% in pre-market trading.

BBWF 2018: Telcos are starting to find their voice through openness – TIM

For years the CSPs have been a fading voice in the telco ecosystem, but control is being wrestled back through the open communities.

The challenge over the last couple of years has been a lack of control. Standards organizations and technological developments are controlled by the vendors, which in turn results in control the industry’s landscape. The CSPs are no-longer masters of their own fate, which is primarily their own fault, but according to Mauro Tilocca of Telecom Italia the open source communities are giving the CSPs a voice.

“We need to blend the strengths of standards organizations and open source communities,” said Tilocca at Broadband World Forum in Berlin. “This is the only way to get to carrier grade solutions.”

It’s amazing to think that in years gone CSPs used to be technologically innovative organizations. But tough market conditions and stress on profitability has seen a trend of outsourcing responsibility. In other words, outsourcing the risk element of innovation.

Speaking to other attendees at this year’s event, there is a feeling the CSPs of yesteryear wanted to be financing organizations. This might explain why there are so many accountants in leadership positions, and such a distaste for risk. Allowing others to innovate and then leaning on the findings is certainly a safer way to conduct business, sitting on the top of the stack realising the advances of others; standing on the shoulders of giants is a common phrase which can be applied here.

But the downside is a loss of influence from a technological perspective and future developments in the industry. This might have allowed the accountants to manipulate spreadsheets to make the financials of an organization healthier, but the standards working groups and research projects are dominated by vendors. The CSPs are having their roadmaps dictated to them because they have lost their voice in the ecosystem.

With open source and white box groups becoming more prominent in the ecosystem, the CSPs are starting to find their feet. Open source and open standards are becoming more regular fixtures of the telco world, and these are the groups which are designed to be led by the CSPs. Of course, these groups alone cannot dictate the terms of the industry, there is still too much knowledge and talent hiding away in the vendor-influenced standards groups, but the balance of power might be shifting towards a healthier position.

The outsourcing trend which handed control of the ecosystem to the vendors was a massive over-reaction from the telcos. Fear took over and too much risk was outsourced. Openness is leading a CSP renaissance, but it is still a bit early to call CSPs innovative.

AT&T and Verizon compete for yet more 5G ‘firsts’

US carriers AT&T and Verizon have completed what they both claim to be the world’s first data transfer to a smartphone form factor device over mmWave 5G live networks.

If we put together all the 5G ‘firsts’ claimed by the industry players it would make a long read, especially if we included cases where similar firsts have been claimed by different companies. In this most recent case, both AT&T and Verizon called themselves the world’s first to successfully transfer data over live 5G networks to purpose-built mobile devices, in Texas and Minnesota respectively.

Temporally, AT&T might have stolen a step ahead of its competitor. The AT&T test took place “over the weekend”, while news coming out of Verizon on Monday declared the success happened yesterday, but they were essentially the same kind of tests. Probably the most intriguing part of the story is that both carriers used Qualcomm’s terminals on networks supplied by Ericsson.

Even the technical details disclosed look very similar. Both tests were using smartphone form factor test devices from Qualcomm integrating the latter’s Snapdragon X50 5G modem and RF subsystem (see the picture), both were going through Ericsson 5G-NR capable radios connected to 3x virtual core networks.

These announcements followed hot on the heels of a couple of other 5G firsts in the last few days: last week Verizon and Nokia claimed to have completed the first over-the-air data transmission on a commercial 5G NR network in Washington DC, though the receiving end was not exactly a smartphone-like device. On Monday Nokia announced its demo with Sprint to conduct the first (in the US though) 5G NR connection over Massive MIMO.

Ericsson and Qualcomm claimed to have completed the first 5G NR ‘call’ to a smartphone-like device (which was pretty similar to the ones used in the AT&T and Verizon tests). That announcement itself came a couple of days after Ericsson announced another similar test with Intel. These two slightly earlier tests were conducted in lab environment while the latest AT&T and Verizon cases were done over live networks, or as AT&T emphatically stressed, “Not a lab. Not preproduction hardware. Not emulators.”

We understand the marketing departments of these companies must be busy generating as big a buzz as possible in the run-up to the Mobile World Congress America (starting tomorrow). Meanwhile we cannot discount that tests and announcements (and claims) like these do show the wider world 5G potentials when the commercial networks roll out in the coming months and years, though at the moment all these firsts still do not mean anything for consumers as no 5G terminals are available yet.

Another interesting angle to look at these tests is how active the US carriers are in pushing ahead 5G on mmWave, which contrast with how slow the European operators and regulators are moving. The European Commission launched a project to look into the feasibility of using mmWave for 5G deployment in the EU. A reporting session was organised in Brussels in June this year. The views were divided, and conclusions elusive. The main doubt from the industry looked to be the lack of compelling business case and the wrangling between the telecom industry and the satellite industry on the utilisation of the lower mmWave spectrum, hence the lack of contiguous bands for 5G buildout.

It may be a worthy reminder that we can never tell with full confidence what new technologies can do. Andre Fuetsch, AT&T Communications’ CTO was bang on when he said “… yet to be discovered experiences will grow up on tomorrow’s 5G networks. Much like 4G introduced the world to the gig economy, mobile 5G will jumpstart the next wave of unforeseen innovation.”

UK media and telco industries demand more red tape for social media content

A coalition of UK media and telco businesses have written a letter demanding the UK government introduce an independent regulatory oversight of the content carried over social networks.

In the letter written to the Sunday Telegraph, the BBC, Sky, ITV, Channel 4, BT and TalkTalk have attacked unregulated tech giants Facebook, Google and Twitter, suggesting the creation of a new watchdog with the purpose of tackling the increasing presence of abuse and misinformation online is the way forward.

“We do not think it is realistic or appropriate to expect internet and social media companies to make all the judgment calls about what content is and is not acceptable, without any independent oversight,” the letter states. “There is an urgent need for independent scrutiny of the decisions taken, and greater transparency.

“This is not about censoring the internet: it is about making the most popular internet platforms safer, by ensuring there is accountability and transparency over the decisions these private companies are already taking.”

Pressure to more closely regulate the newcomers to the communications game is hardly a new phenomenon; the heavily regulated telco industry has been trying to level the playing fields for years. With the introduction of social media platforms such as Facebook or video content sites like YouTube, stress has been placed on the more traditional communications companies. Whether it is being forced to innovate or having core revenue streams destroyed, digital transformation is much more than an industry buzzword, it is a necessity for survival.

Unfortunately for the telcos, they are largely playing to different rules when it comes to how personal data can be used to deliver these services, while also being held accountable for the vast expense of deploying the all-important communications infrastructure. Any opportunity to have a dig at the digital new-boys will be taken, and this is what this letter seems to be.

This is of course a political pain-point for the social media players right now, and the traditional players are taking full advantage of the situation to rain down some red tape. Governments around the world are grappling with the difficulties of how to govern social media platforms, protecting users from abuse while also maintaining free speech. While there are some very obvious examples of what shouldn’t be allowed, the majority of the time judgement on what posts are acceptable and which are not is a hazy line.

In truth, the social media giants have created the problem for themselves. For years, they positioned themselves as curators of content, not owning or taking responsibility for it, but by creating successful algorithms to personalize feeds and suggested content, they have demonstrated an exceptional ability to influence and control content. Some might ask if they can figure out when the best time to position adverts for car insurance or specific holiday add ons is, why can they not tackle the rising tide of abuse and misinformation?

The answer probably lies in the middle of it being incredibly difficult and contentious, and it is more convenient (financial rewarding) to focus on honing the effectiveness of advertising platforms. Work is being done to try and curb the negative impacts of social media, though whether this is enough to convince the government the segment is capable of self-regulation is suspect.

Boresome bureaucrats never usually need a reason to throw around the red tape, though pressure from the telco lobby might just fuel the anti-social media rhetoric which is currently echoing around the Houses of Parliament.

Nokia inks €1 billion framework agreement with China Mobile

A new agreement, valued at €1 billion ($1.17 billion, £0.88 billion), has been signed that covers the delivery of Nokia products and services to China Mobile throughout 2018.

The signing took place in Berlin during the fifth iteration of the inter-governmental economic forum between Germany and China, starring the German Chancellor Angela Markel and Chinese Premier Li Keqiang. This capped a busy week for Nokia’s business updates with China, during which time it also signed MoUs to set up joint labs with Tencent and China Mobile respectively.

Nokia was already one of the key vendors in China when the first its mobile telecom networks were rolled out there in the late 20th century. However, it was only recently, after it bought Siemens out of their joint-venture, then acquired Alcatel-Lucent including the legendary Bell Labs, did Nokia become a credible end-to-end supplier. In this new agreement Nokia’s supplies to China Mobile will include the full range of equipment and services from access, backbone, transport, to network management.

Mike Wang, President of Nokia Shanghai Bell, which will be the front-end implementation entity with China Mobile, saw this agreement “highly significant”, consolidating “Nokia’s position as a leading provider of next-generation technologies and services in China.” Chinese companies are much more aggressive in rolling out 5G in scale than their Western European counterparts.

Orange throws millennials a Pickle

French telco Orange has launched a new TV offering targeting the elusive and lucrative millennials demographic, known as Pickle.

Most organizations around the world will have a wary eye on securing the millennials as customers due to their potential over the next couple of years. A millennial is defined as someone who enters young adulthood in the early 21st century, and over the next couple of years, this group will soon emerge as the powerhouses of consumer spending. Unfortunately for the telcos, this cluster also contains a significant amount of cord-cutters.

The new offering from Orange aggregates different content and will target users aged between 15-35 years old, at an attractive price tag of €4.99 per month. For anyone to gain traction with this audience, the price will have to be low enough as it is generally accepted that millennials are skint, but are they? Some might be and some might not, but this is just like every other generation. The OTTs have brought the price-to-play down to such a level, it is impossible to price any offering at what would be deemed normal to previous generations.

Irrelevant to the reasoning, the price is what it is, and the offering sounds pretty interesting as well, there are some more traditional content genres, but also a couple of more risky bets; it seems quite un-telco, which is nice to see. Some of the channels include:

  • Golden Stories: An unreleased, humoristic and offbeat series
  • ES1: New French channel dedicated to eSport
  • Game One: A channel dedicated to boxsets, mangas (Japanese comics), gaming and news
  • Manga One by Game One: 100% mangas content
  • South Park: Because every millennial love South Park
  • OKLM: Hip-hop and street culture
  • Clubbing TV: Dedicated to electronic music and electro culture
  • Spicee: Channel for documentaries and stories

As you can see from the above, it is far from what we are used to when a telco has a bet on the content market. It certainly will be interesting to see how this works out, but is in keeping with the Orange trend in recent years.

While other telcos have struggled to adapt to the 21st century, Orange has taken a much more adventurous approach. It spent big of fibre across key markets, put forward genuine differentiation with its banking and energy services, and now it’s having a very alternative-crack at content. The traditional telco business model and approach to ‘differentiated’ services can no-longer exist, but it is nice to see Orange have a crack at doing something genuinely different.