Alcatel-Lucent loss widens in third quarter

Joint venture infrastructure firm Alcatel-Lucent said Friday that net loss for the third quarter of 2009 widened to €182m, compared to a loss of €40m in the same period in 2008.

Revenues also fell from just over €4bn in the third quarter of 2008 to €3.7bn in the same period 2009, driven by a shortfall in carrier infrastructure sales, particularly 2G wireless access.

For the third quarter 2009, revenues for the Carrier segment were €2.23bn, a decrease of 14.6 per cent compared to €2.6bn in the year-ago quarter and a decrease of 6.4 per cent compared to €2.4bn in the second quarter 2009.

Wireless 3G growth was offset by a strong 2G decline, optics were impacted by a decline in terrestrial, while submarine networks enjoyed another quarter of strong growth. IP routing revenues were up and fixed NGN and IMS reported strong growth, albeit off a low base.

Chief executive, Ben Verwaayen, said: “We have achieved significant operational progress. We are rapidly reshaping our cost and expense structure, having achieved 80 per cent of our €750m target in annualized savings year to date. Against what remains a challenging market environment, we reiterate our view that our addressable market should be down between 8 per cent and 12 per cent at constant currency and that we will achieve an adjusted operating income around breakeven this year.”

Earlier this week, scientists and military personnel gathered in a Latvian meadow somewhere near the Estonian border and gazed in awe at a ten metre wide crater thought to have been caused by a meteor strike.

The excitement was soon over however, as it quickly emerged that the three metre deep pit, complete with flaming material at the bottom, was a hoax. A hoax carried out by Baltic operator Tele2 as the premise to an ‘out of this world’ marketing campaign. Since then the incident has become an exercise in how not to do PR. Not only did the Latvian government have to fork out to send a specialist military unit to the location to conduct tests for radiation, the prank also caused concern for nearby residents. As a result, the Latvian government, which is a customer of Tele2, will yank its contract. Whoops.

PR go home.

Still, there’s no such thing as bad publicity, and perhaps Tele2 only wanted to draw attention to the fact that it’s not performing too shabbily in the face of the recession. Profits came in at SEK2.2bn (€212m) for the third quarter of 2009, compared to SEK156m in the same period in 2008, although this jump was largely due to impairment charges in the year ago quarter. Sales were up just three per cent at SEK9.8bn.

The industry’s eyes were also turned heavenward to watch the arrival of the Droid – Motorola’s first handset to be based on the Android 2.0 platform. Now Motorola’s results are usually a B movie horror themselves, but this time they were pleasantly surprising. The firm is back, yeah back, back in black. Profit for the third quarter of 2009 swung to $12m, compared to a loss of $397m in the same period last year. Net sales were still down, from $7.5bn in the third quarter of 2008 to $5.4bn in 2009, although things were looking up at the handset unit.

Mobile device sales were down 46 per cent year on year to $1.7bn, but the operating loss shrank from $840m to $183m, also reporting a 28 per cent sequential shift in the right direction. The firm, which shipped 13.6 million handsets, giving it an estimated global handset market share of 4.7 per cent, is betting the farm on Android. The Droid handset will land November 6 on Verizon Wireless’ network, in the wake of a vendor funded advertising campaign pitching the device against the Apple iPhone. This week Verizon reported that net income for the three months to the end of September fell 9.8 per cent year on year to $2.8bn, while operating revenues climbed just over ten per cent year on year to $27bn. Wireless revenues for the quarter were up 23 per cent year on year to $13.5bn, although net adds fell 38 per cent year on year to 1.3 million in the third quarter leaving the company with 89 million subscribers.

In a slider form factor with a full QWERTY keyboard, the Droid boasts a 3.7″ high-resolution capacitive touchscreen, with a width of 854 pixels and more than 400,000 pixels in total. The camera weighs in at five megapixels, with a dual-LED flash and video capture, backed up by 16GB of removable storage. Connectivity is provided by 3G EV-DO, wifi and Bluetooth as well as A-GPS, while the operating system is Android 2.0, supporting multitasking for six apps, and access to more than 12,000 applications via the Android app store. Droid is also the first device to support Google Maps Navigation (Beta), which provides turn-by-turn voice guidance as a free feature of Google Maps and can also be voice controlled.

It sounds impressive, especially for a Motorola device, but probably the most advantageous thing Droid has got going for it is a Webkit HTML5, Flash 10 ready browser, and an ARM Cortex A8 processor, making it roughly twice as fast as existing Android handsets including the recently launched Motorola Cliq/Dext. And perhaps as reward for getting the company back into profit, Edward Fitzpatrick, who has served as acting CFO since February, has been appointed full time chief financial officer, effective immediately.

Not content with taking over your handset, the robots are also taking over your network, with Austrian carrier T-Mobile and Chinese equipment vendor Huawei completing testing of what they claim is the world’s first LTE self organising network (SON). The tests were carried out in Innsbruck, Austria, and demonstrated the technology’s ability to configure and optimise the network and recover automatically. As network topology changes to an all IP infrastructure with migration to LTE, a SON deployment claims to ensure a high level of connectivity and optimisation of performance network wide.

The Austrian tests used T-Mobile’s existing base stations and were conducted to verify Automatic Neighbour Relation (ANR) functionality, and how the SON platform is able to automatically establish and optimise neighbour relations.

Optimising neighbour relations sounds all well and good – the flat next to the Informer’s hovel is presently occupied by students who are apparently taking a night course in Xbox and whooping – but all this intelligent networking stuff makes the Informer’s head spin. Since checking out ex-Symbian employee and ‘futurist’ David Wood’s blog and reading about the Singularity, the Informer’s not so sure intelligent machines are a good idea.

Sticking with Symbian, the Informer was down at London’s Earls Court this week, attending the Symbian Exchange and Expo (SEE) show, where the Symbian Foundation officially launched its application publishing platform – Horizon. The Foundation said that there are now a total of five app stores supporting Horizon. Along with the initial stores – the Ovi Store by Nokia, Samsung Applications Store and AT&T’s MEdia Mall, new additions include China Mobile’s Mobile Market, and Sony Ericsson’s PlayNow arena.

The Informer had a good chat with John Forsyth, whose business card says “leadership team” for the Symbian Foundation. Does this mean he is the team? Sometimes the Informer feels like an army of one so he can sympathise. Anyway, Forsyth explained the Foundation’s strategy and explained that the organisation had a new way of looking at the open source model. He said the idea is to be as transparent as possible in governance of the organisation, adding that most backers of the Foundation, and its concepts, are geeks and are passionate about the Symbian OS.

Well, the initiative is certainly striking some chords. Finnish handset vendor Nokia launched its assault on China’s 3G market this week, introducing its first device built for China’s homegrown TD-SCDMA technology. The 6788 is the result of close collaboration between Nokia and China Mobile, which apparently is a big fan of open source Symbian. “We had meetings with China Mobile, which is very much in alignment with our open source vision – they want an open, independent platform for devices,” Forsyth said.

This might seem like a paradox but Qualcomm’s another one jumping on the open source bandwagon. The US chip shop has announced a shiny new wholly-owned subsidiary focused on mobile open source platforms. The Qualcomm Innovation Center (QuIC) is formed of a dedicated group of engineers, headed up by Rob Chandhok, senior vice president of software strategy for Qualcomm CDMA Technologies. QuIC’s mandate is to use open software to spur the development of advanced services for traditional handsets as well as sophisticated smartphones and mobile computing devices. “Open source and community-driven software development is becoming increasingly important to the wireless industry,” said Chandhok. “These engineers will focus on such important open source initiatives as Linux and Webkit, and on open source operating systems such as Symbian, Android and Chrome.” Check that out.

Android backer Google landed a major coup in the mobile market on Wednesday, when Orange announced a deal to put Google Mobile Apps on the homescreens of customers in Europe. The multi-year strategic agreement will see Orange launch Google apps across its footprint in a phased approach across a large range of Orange Signature phones including those based on Android. Google Mobile App will later be made available across a wider range of Signature devices operating on Symbian S60, RIM (BlackBerry) and Microsoft’s Windows Mobile.

Orange’s big daddy was just about holding the fort meanwhile, with France Telecom reporting that EBITDA dropped 5.4 per cent year on year during the third quarter of 2009 to €4.56bn from €4.8bn last year. Group revenues also took a slight hit, falling 3.7 per cent year on year to €12.7bn, with the weakest performing units identified as Poland and the UK. The company is also setting aside €1bn to fund a stress reduction programme for staff in a bid to tackle the recent spate of suicides affecting its workers.

Ca plane pour moi,

The Informer

Motorola swings back into black

It’s been a good week for struggling vendor Motorola so far, with the company reporting its second helping of good news in as many days.

The US firm swung to a $12m profit during the third quarter of 2009, compared to a loss of $397m in the same period last year. Net sales were still down, from $7.5bn in the third quarter of 2008 to $5.4bn in 2009, although things were looking up at the handset unit.

Mobile device sales were down 46 per cent year on year to $1.7bn, although operating loss shrank from $840m to $183m, also reporting a 28 per cent sequential shift in the right direction.

The firm, which shipped 13.6 million handsets, giving it an estimated global handset market share of 4.7 per cent, is betting the farm on Android.

Yesterday Moto released information on the forthcoming Droid device – its first such handset to run Android 2.0. The Droid will land on November 6 on Verizon Wireless’ network, in the wake of a vendor funded advertising campaign pitching the device against the Apple iPhone.

In a slider form factor with a full QWERTY keyboard, the Droid boasts a 3.7” high-resolution capacitive touchscreen, with a width of 854 pixels and more than 400,000 pixels in total. The camera weighs in at five megapixels, with a dual-LED flash and video capture, backed up by 16GB of removable storage.

Connectivity is provided by 3G EV-DO, wifi and Bluetooth as well as A-GPS, while the operating system is Android 2.0, supporting multitasking for six apps, and access to more than 12,000 applications via the Android app store. Droid is also the first device to support Google Maps Navigation (Beta), which provides turn-by-turn voice guidance as a free feature of Google Maps and can also be voice controlled.

It sounds impressive, especially for a Motorola device, but probably the most advantageous thing Droid has got going for it is a Webkit HTML5, Flash 10 ready browser, and an ARM Cortex A8 processor, making it roughly twice as fast as existing Android handsets.

The firm recently launched the Cliq/Dext Android-powered phone and its social networking focused Motoblur platform.

In related news, perhaps as reward for getting the company back into profit, Edward Fitzpatrick, who has served as acting CFO since February, has been appointed full time chief financial officer, effective immediately.

France Telecom holds fort in third quarter

European carrier France Telecom said Thursday that EBITDA (earnings before interest, tax, depreciation and amortisation) dropped 5.4 per cent year on year during the third quarter of 2009 to €4.56bn from €4.8bn last year.

Group revenues also took a slight hit, falling 3.7 per cent year on year to €12.7bn, with the weakest performing units identified as Poland and the UK.

The group had 189.1 million customers at the end of September, after adding 11.7 million customers over the last year. Mobile customers rose to 128.8 million, up 9.5 per cent year on year, with 3.3 million net adds during the third quarter. At the same time, Orange’s MVNO customer base in Europe rose 35.5 per cent year on year to 3.8 million customers at 30 September 2009 (including 2.1 million customers in France), compared with 2.8 million customers a year earlier.

ADSL broadband services grew to 13.4 million customers at the end of September 2009, up 6 per cent year on year, with 2.9 million digital TV subscribers (up 67 per cent year on year), 7.3 million VoIP subscribers (up 22 per cent year on year) and 8.5 million Livebox subscribers (up 14 per cent year on year).

Yesterday search giant Google got a major boost in the mobile market, when Orange announced a deal to put Google Mobile App on the homescreens of customers in Europe.

The multi-year strategic agreement will see Orange launch Google Mobile App across its footprint in a phased approach across a large range of Orange Signature phones.

The Droid runs Android 2.0

Struggling handset vendor Motorola put an end to the rumours on Wednesday, finally releasing more information on its Droid device – its first such handset to run Android 2.0.

The Droid will appear on November 6 on Verizon Wireless’ network, in the wake of a vendor funded advertising campaign pitching the device against the Apple iPhone.

The device will cost $199.99 with a two year contract after a $100 mail-in rebate, and will need to be accompanied by a nationwide voice plan and an Email and Web for Smartphone plan. Voice plans begin at $39.99 for monthly access for 450 minutes and an Email and Web for Smartphone plan is $29.99 for monthly access.

In a slider form factor with a full QWERTY keyboard, the Droid boasts a 3.7” high-resolution capacitive touchscreen, with a width of 854 pixels and more than 400,000 pixels in total. The camera weighs in at five megapixels, with a dual-LED flash and video capture, backed up by 16GB of removable storage.

The Droid packs an ARM Cortex A8 processor

Connectivity is provided by 3G EV-DO, wifi and Bluetooth as well as A-GPS, while the operating system is Android 2.0, supporting multitasking for six apps, and access to more than 12,000 applications via the Android app store. Droid is also the first device to support Google Maps Navigation (Beta), which provides turn-by-turn voice guidance as a free feature of Google Maps and can also be voice controlled.

It sounds impressive, especially for a Motorola device, but probably the most advantageous thing Droid has got going for it is a Webkit HTML5, Flash 10 ready browser, and an ARM Cortex A8 processor, making it roughly twice as fast as existing Android handsets. It will be interesting to see how it’s received this holiday season.

FROM BIT PIPE TO INTELLIGENT PIPE WITH POLICY AND CHARGING CONTROL 

As communication service providers voice revenues decline, data has become the driver of revenue growth. However future revenues from data are threatened, by the explosion of non-revenue generating traffic, from over-the-top applications and Web 2.0 services.

Efficient ‘bit’ delivery will not be enough. Operators need the means to innovate, to use their key assets, to add more value to their services. Combining Policy Management with real-time charging can change how service providers package and sell data access, bringing subscriber and network data together to:

• Create innovative data plans to differentiate offerings
• Control subscriber usage of network resources and services
• Enable subscribers to personalize services to build loyalty

Policy Management is an emerging area with great promise in meeting operators’ requirements for dynamic, intelligent, and granular control of subscribers, services and networks. Attend this Webinar to understand how policy control and charging are fundamental to an intelligent pipe strategy.

Date: Nov 10th
Time 3pm GMT, 10am EST

	Chris Hoover , VP Product Management, Openet Chris Hoover, vice president product management at Openet, has more than a decade of experience in mobile and networking technologies.  He has worked at Unwired Planet, (later known as Openwave) and was heavily involved with the Ericsson, Nokia, and AT&T coalition defining standards for the first IMS-based application initiative, “Push-to-Talk Over Cellular” (known as PoC).  Prior to that, Chris was manager of the STA network surveillance products at Narus. Chris holds a master’s degree from the University of Maryland at College Park.
	Mark Newman, Chief Research Officer, Informa Mark is Chief Research Officer within Informa Telecoms & Media’s Industry Research division. In his role Mark is responsible for Informa Telecoms and Media’s thought leadership in the converging mobile, broadband and entertainment sectors. Mark has 20 years experience in the telecoms sector as a journalist, analyst and commentator. He is a regular speaker and moderator at international conferences in Europe, the Americas and Asia and is often quoted in the global business press. He also conducts regular briefing sessions with operators, vendors, leading banks and accountancy firms on industry trends and developments.

Orange puts Google on homescreens

Search giant Google got a major boost in the mobile market on Wednesday, when Orange announced a deal to put Google Mobile App on the homescreens of customers in Europe.

The multi-year strategic agreement will see Orange launch Google Mobile App across its footprint in a phased approach across a large range of Orange Signature phones.

Google services will be available from the homescreen on Signature Android handsets, alongside other services such as Orange TV. In the UK and France, Google mobile search results will also include relevant content from Orange’s own mobile portal, combining results from both partners for the first time.

From October, the Orange Signature Android series, including LG Eve (France, Spain), HTC Tattoo (France, UK, Spain) and HTC Hero (France) will also feature specially designed services like the Orange Email Wizard which lets users set up and use their chosen mobile email services – including Google Mail – on the handset.

Google Mobile App will later be made available across a wider range of Signature devices operating on Symbian S60, RIM (BlackBerry) and Microsoft’s Windows Mobile.

Finnish handset vendor Nokia launched its assault on China’s 3G market this week, introducing its first device built for China’s homegrown TD-SCDMA technology.

According to the vendor, the 6788 is the result of close collaboration between Nokia and the world’s largest mobile phone operator by subscribers, China Mobile.

The handset is tailored to the Chinese market, apparently taking inspiration from traditional Chinese furniture and architecture seen in the design elements on the back of the slide mechanism and the battery cover.

As well as 3G TD-SCDMA support, the 6788 slider features a five megapixel camera with dual-LED flash, a 2.8″ QVGA display and 4GB of storage. It is built on Symbian S60, which John Forsyth, of the Symbian Foundation leadership team, this week told telecoms.com is making headway in China.

“We had meetings with China Mobile, which is very much in alignment with our open source vision – they want an open, independent platform for devices,” he said.

The Nokia 6788 is expected to become available at the end of December 2009.

Optimisation to breathe new life into 3G networks

Mobile broadband is fast becoming the key revenue driver for operators, yet key players are providing a sluggish user experience based on webpage size and download performance.

Subscribers to mobile broadband services worldwide reached 186 million in 2008 and that figure is set to soar by the end of 2009 thanks to the adoption of smartphones like the Apple iPhone, Google‘s Android and the Palm Pre. Conversely, the impact of file size and download duration to mobile broadband operator networks is tremendous in their efforts to reduce traffic and increase capacity.

Research released by Informa Telecoms & Media and mobile internet platform provider Bytemobile this week highlights the effect of download speeds and file size on user experience in the UK.

The researcher tested the UK’s mobile broadband networks including O2, Vodafone, T Mobile, 3UK and Orange, and MVNO offerings from BT and Virgin Mobile between June and August of 2009. The research measured total webpage size and download time with Amazon, Facebook, Lycos, Orange, Starbucks and Informa’s homepages using two netbooks when networks were under the most strain across five locations in Greater London.

A selection of urban sites were chosen, including dense office locations during mid-morning hours and lunchtime, residential areas during evening hours and train stations during early morning hours. Netbooks were chosen in favour of notebooks since operators are now bundling them with mobile broadband connections. Moving forward, it is expected that this set up will be one which most users are likely to be using outdoors with a mobile broadband connection.

The majority of mobile broadband connections were made over HSPA (3.6Mbps) albeit this maximum speed was never reached. Some USB dongles actually supported higher speeds (7.2Mbps) but none of the networks measured connected over these faster speeds (theoretical speeds were logged during the actual measurements and were confirmed to be a maximum of 3.6Mbps).

Measurements of the Amazon.com website illustrated consistent webpage size measurements, with T-Mobile, followed by O2, Orange and BT. The Amazon webpage is dynamic and changes each time it is downloaded, explaining the inconsistency in file sizes for the operators following T-Mobile and O2 prepaid. Download duration in these measurements was inconsistent due to several factors, including traffic which seems to have been higher in the Orange network, hence the spike in the graph.

During the tests, T-Mobile, O2, BT and Vodafone – which all use optimisation software for their mobile broadband services -consistently showed a better performance when compared with the rest of UK operators, illustrating that optimisation plays an important role in reducing traffic and indirectly increasing capacity.

Measurements indicate that file size is significantly reduced when optimisation is used, without any noticeable difference in image quality from a user perspective. In several cases where static webpages were measured, file size reduction was as high as 45 per cent, indicating that a significant reduction in transferred data can be achieved. This has an effect similar to that of increasing radio capacity.

File size reduction was up to 52 per cent in several cases with T-Mobile, offering that operator the opportunity to extract additional value from existing radio networks and alleviate capacity bottlenecks without the need for hefty radio infrastructure upgrades. The expenditure required for installing an optimisation solution is an order of magnitude less than actual hardware upgrades – which include radio access and backhaul improvements. Moreover, installing an optimisation solution takes place at the core network instead of the radio access network, thus minimising installation locations and cost. Optimisation solutions can also be integrated without any service disruption.

Informa discovered that the costs of delivering data and subscriber data consumption (including gaming and video) outweigh an operator’s ability to improve network infrastructure as 2 per cent of subscribers consume 50 per cent of network capacity. So how are operators going to address the influx and demand on data? Optimising through packet handing uncovers capacity constraints and compression is not the silver bullet as web content is complex; containing rich animated multimedia images as well as objects like Adobe Flash.

According to Informa, there are three choices available for operators:  experience saturation; upgrade hardware at base station level; or deploy cost efficiencies of optimisation without upgrading infrastructure. So operators must consider new ways to enhance the subscriber’s browsing experience, as mobile broadband optimisation cuts file size in half and creates significant increase in radio capacity, more space for new customers and an enhanced browsing experience without disrupting quality.

Download the full whitepaper