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    Beware the seven deadliest customer experiences – Foundever

    Repetition, ratings and rude robots

    You can tell a CEO who’s spent too much time ‘in the cloud’. They believe their own customer satisfaction surveys. Either that or they are deliberately gas-lighting us. To improve customer experience, Mobile Europe sought simple ‘people pleasing’ advice for telcos from people who really know the customer. In the first of an occasional series, Maria Harju, Foundever’s Chief Revenue Officer for Europe, the Middle East and Africa, describes The Seven Deadliest Customer Experiences and how mobile network operators can avoid them.

    Repetition.

    Repeating your story to multiple people is enough to make 57% of Europeans hang up. Yes, some problems demand escalation, but if you’re moving your customer across an omnichannel platform it’s omni stupid not to move the information from channel to channel too. A CX should systematically do that. This averts another massive frustration, disregard for the customer’s history. How can you pretend to care about the customer experience when you show you are demonstrably oblivious to it? All the information across all channels is captured and should be correctly stored and retrieved so that your agents can do their best jobs.

    Rate your experience.

    OK, we need performance feedback, but customers are suffering from survey overload. Every trip to the toilet now involves an invitation to rate the experience. There are better ways to learn how customers feel about service and how they perceive your brand. Speech and text analytics are instant, less obtrusive and more accurate.

    Chatnots.

    If you don’t acknowledge your chatbot’s limitations, you’re setting your brand up for a CX failure. If your customer knows it’s an automated system, they’ll treat it as such and adjust their expectations accordingly. But when the bot goes beyond its domain intelligence it must hand off to a live representative and pass on the information shared up to that point.

    Chats …. with delayed response. 
    Chat’s rationale is about immediacy and accuracy but long wait times and vague unfocused responses will demolish that advantage. Immediate contextual support can help a customer take action or make a decision. Avoid the temptation to set high chat concurrency targets for agents. The more conversations they handle the less likely they are to resolve complex issues or satisfy each customer. Use your best pre-scripted responses in early conversational stages so that agents have more time to find a resolution. Cross train your CX staff so that they can work across channels based on peaks in demand.

    Undervaluing CX

    If each interaction doesn’t meet expectations it will damage your brand. So stress its value in your proposition. A superior customer experience should be reflected in the price of a product or service. If you’re cheap very hard to hold on to customers, especially in the current economic environment. Here is the value of CX. Three in four consumers will walk after a single disappointing customer experience, yet 42% would pay more for an identical product or service if it were supported by a superior CX. Being in the latter camp starts with understanding who your customers are, their wants, needs and expectations.

    Treating vocal interaction like a necessary evil.

    Test yourself before you test their patience. Voice is about people not managing processes, so IVR should solve customers’ problems, not stress test their patience and short-term memory on the altar of your management processes, said Harju. Most consumers are frustrated by complicated menus then agitated by the agent that takes over. A happy resolution is an uphill battle. An IVR should minimise menu options, as part of the identification or authentication process so that more of the conversation is focused on the customer and their issue, and use it to coach the customer. Rather than playing a message saying the call is important, a message asking if a person has the reference number or other relevant information to hand is going to make everyone’s life easier.

    Network resilience is fundamental to Ukraine’s fight for survival

    Kyivstar’s CEO and CTO talk about the power of grit and operators pulling together

    In a small, quiet meeting room on the sidelines of Mobile World Congress with executives from Ukraine’s largest operator Kyivstar, the discussion was in stark contrast to what was going on at the show. While other European operators talked about fair-share politics and future immersive experiences, Kyivstar provided an update on how it has kept people safe and its network up and running after one year of war. 

    Oleksandr Komarov, Chief Executive of Kyivstar, acknowledged having a somewhat “alien” feeling here as the operator has “very different challenges and priorities” compared to the rest of the industry.

    In an interview with Mobile Europe, Komarov and Volodymyr Lutchenko, Chief Technology Officer at Kyivstar, shared how network resilience challenges have changed dramatically over the last year and how people have pulled together to preserve communications services. (Also see Telecoms in time of war)

    National roaming

    Cooperation among the country’s three operators – Kyivstar, Vodafone Ukraine, and Lifecell – has been “essential” for overall network resilience, and they have been “exchanging capacity and providing equipment to one another,” said Komarov.

    Indeed, one of the first and most important steps the operators took after Russia invaded a year ago was to implement national roaming, so that if network services are down on one network, users are automatically switched to another. National roaming is unusual and difficult, but the Ukrainian operators were able to launch it in about three weeks with support from the national regulator.

    The service is “working well to keep services going,” said Lutchenko. When the country suffered power blackouts in November last year, he said more than 2 million people per day used the national roaming service.

    When the war started, the government also issued additional frequencies free of charge to the operators to give them extra network capacity. Meanwhile, equipment suppliers and local businesses have also rallied to help keep the networks going.

    Komarov cited an example where Ericsson stepped up to support a “very big ambitious project to roll out a national core site in the western part of Ukraine … to mitigate the risks related to the potential loss” of other sites, he said. In peace time, such a project would take 12 to 18 months. But with everyone cooperating, he said they started the project at the start of 2022 and it was completed in early May, taking less than five months for a major deployment.

    Moving targets for resilience

    As the months of war have dragged on, the network resilience challenges have changed. In the first few months, Lutchenko said Kyivstar was engaged in “urgent activities” to keep the network going when the infrastructure was physically damaged by rockets, bombs, mines, and tanks, because the biggest problem is that it is often too dangerous to get to the sites to repair damages.

    “[The sites] could be in occupied territory or on the front line. The area could be under fire or the fields can be mined so that without supervision from the military, you cannot get there … That’s why your network should be very reliable and still work with multiple damages like ours,” said Lutchenko.

    Later in the summer, the resiliency work shifted to “stabilisation” projects. By September, Kyivstar’s network performance KPIs remarkably were “almost on a pre-war level.” Apart from occupied areas where Kyivstar had no access to sites, “the network was really good,” he said. 

    Attacks on energy pose new threats

    The communications resiliency landscape changed in October when Russia started attacking the country’s energy infrastructure. Lutchenko said the challenge is now “really huge” and the “new reality.” In late October, about 20% of Kyivstar’s base stations were affected by power outages. Lutchenko said the worst day was November 24, 2022, when 65% of Kyivstar’s network was without electricity.

    In response, Kyivstar has strengthened energy resilience by adding longer-life backup batteries and diesel-powered generators.

    Here again, cooperation has been vital. In Kyivstar has “crowd-sourced” access to power generators from local businesses, such as a petrol station located near one of the operator’s cell sites. “We asked businesses and invited people to help us with keeping the network up and running,” said Lutchenko, and now more than 600 sites are connected to diesel generators.

    But this is one area where Komarov feels help from the government has been “limited”. Of Kyivstar’s 1500 generators, he said about 40 were provided by the government and the rest were either procured by the operator or acquired from third parties that have “extra power capacity on hand located nearby our sites.” Kyivstar said it has invested around US$5 million just on generators and diesel fuel. 

    Fighting on two fronts

    Kyivstar’s network is under threat from cyberattacks as well as physical attacks. “The Russians want to destroy us not only physically, but virtually as well, so that means we have to fight on two front lines,” said Lutchenko.

    The operator took measures to protect its network by relocating certain equipment away from areas that were likely to come under Russian control. Komarov explained that in occupied territories there was a cyber defense effort underway to ensure that despite not having control of all its network, the operator was not “vulnerable to extra threats.”

    “We streamlined the architecture of our core infrastructure to minimise the number of potential vulnerabilities,” he said. In Kherson, for example, Kyivstar had “just a media gateway and RAN network” and this “decreased the risk of penetration,” he said.

    Restoring liberated areas

    As territories are liberated, Kyivstar works on repairing the destruction to its network. Lutchenko said that about 18% to 20% of the telecom infrastructure in formerly occupied regions is “totally destroyed,” meaning “there is nothing from an equipment or infrastructure point of view.” About 30% to 35% is “heavily damaged” and about 40% has “minor damages.” Kyivstar says it can repair nearly 90% of the network in those areas.

    “We’re waiting for our military to liberate more territory and we are ready to restore everything,” said Lutchenko.

    Losing more than infrastructure

    Kyvistar is worried about losing more county’s critical communications infrastructure: it is also working to keep its 3,800 employees and their families safe. In the initial months of the war, the operator provided instructions for where people could go for safety and converted regional offices into temporary homes with showers and washing machines for displaced families.   

    Around 140 Kyivstar employees have been drafted into the army and thousands volunteer to help the army in various roles. The operator has lost three of its employees in the war and two are missing.

    Kyivstar relies on maintenance and construction suppliers, but their situation is “very much worse” because they cannot protect employees “with the same efficiency as Kyivstar” due to its critical infrastructure status, explained Komarov.

    Lutchenko joined Kyivstar in November 2021 and has been in the telecom industry in Ukraine for more than 25 years. “I don’t think anyone can plan for stuff like this. The most important thing is we have the greatest team in the world.”

    Asked how the war has affected the operator’s business, Komarov said the operator was “in the green” and there is “extremely high pressure on our networks.”

    “But let’s face it, it’s less about business and much more about survival,” he said.

    More techcos step up to support Ukraine

    Microsoft, VMware, Intel, AMD and OneWeb are the latest to stop trading with Russia – and some with Belarus too

    Last week Google blocked Russians’ access to Google Pay and Apple did likewise with its wallet product and product sales in Russia.

    Some have criticised Apple’s move, pointing out it could push people towards using Android phones made in China that are more susceptible to hacking and surveillance.

    However, Apple made the moves after a direct appeal to its CEO, Tim Cook, by the Vice Prime Minister of Ukraine Vice

    Now more big tech firms are following their lead.

    Microsoft has suspended all new sales of Microsoft products and services in Russia.

    The chips are down

    Chip giant Intel said in a statement that it, “condemns the invasion of Ukraine by Russia and we have suspended all shipments to customers in both Russia and Belarus.

    “Our thoughts are with everyone who has been impacted by this war, including the people of Ukraine and the surrounding countries and all those around the world with family, friends and loved ones in the region.”

    Another chip giant, AMD has also stopped shipments to Russia and Belarus.

    VMWare is suspending all its business activities in Russia and Belarus due to the unprovoked attack by Russia. It published a statement that read, “We stand with Ukraine, and we commend the bravery of the Ukrainian people. The human toll is devastating and like other global businesses, we are committed to supporting our Ukrainian team members, customers and partners.”

    It added, “We are also seeking to support non-Ukraine-based employees with family members located in Ukraine with information to access available resources. We continue to support our employees in Russia, as they are adversely impacted by the consequences of their government’s actions.

    “The suspension of operations includes suspension of all sales, support, and professional services in both countries in line with VMware’s commitment to comply with sanctions and restrictions.”

    The board of directors at satellite operator OneWeb has voted to suspend all launches from Baikonur, the Russian cosmodrome in Kazakhstan.

    Social media battles

    Meanwhile social media sites are continuing their battle with Russian authorities, which are keen to control the flow of information and the narrative surrounding the war.

    Facebook, Twitter and YouTube have acted to prevent Russia’s state media making money from ads on their sites. In response, Moscow has said will restrict access to Facebook after its parent company Meta refused to stop fact-checking some Russian media companies’ output.

    TikTok has limited access to Russian state-controlled media accounts in the EU and Reddit has stopped users posting links to Russian state-sponsored media.

    Expect yet more big techcos to act soon.

    MWC14 – Interview with Roman Makarchuk and Ahmed Soliman, Intellias

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    Mobile Europe’s Michelle Donegan speaks with Roman Makarchuk, Senior Delivery Director – Telecom & Media, and Ahmed Soliman, Senior Director – Telecom & Media, at Intellias

    To learn more about Intellias, please visit https://intellias.com/telecom-and-media/

    MWC24 – Interview with Dennis Filler, Intellias

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    Mobile Europe’s Michelle Donegan speaks with Dennis Filler, VP, Head of Telecom & Media for North America, Intellias

    To learn more about Intellias, please visit https://intellias.com/telecom-and-media/

    Europe’s data centre demand continues to outstrip supply – DC Byte 

    Infrastructure investors will keep Europe’s data centre market growing but prices may not fall anytime soon

    Analysts DC Byte, which track almost 7000 data centre developments globally, said EMEA’s Live Supply grew from 4.6GW in 2018 to 8.8GW in 2023 but the region’s growth has fallen behind APAC and the Americas due to the increasing challenges around power availability and the high cost or availability of land.

    In its latest 2024 Global Data Centre Index, DC Byte said the EMEA region is also generally more restrictive in terms of data centre development, whereby planning permission is difficult to obtain and there are more regulations and policies in place. Overall, demand exceeds supply across EMEA, which has been a common theme for the past few years. In turn, this has had a knock-on effect on increasing colocation rental rates, which has been further exacerbated by rising build costs.

    Even so, the largest established FLAP-D markets (Frankfurt, London, Amsterdam, Paris and Dublin) added an average of 450MW of Live Supply each. However, DY Byte found the secondary markets such as Belgium, Denmark, Poland, Spain, Sweden and the UAE have each recorded more than 100MW of Live Supply growth during this time period.

    AI continues to drive data centre growth further and there is an emerging trend of operators and hyperscalers expanding outside of the established clusters where there is a greater offering of land and power to meet the specific needs of AI applications.

    The so-called Pipeline (Under Construction + Committed) Supply measure – a proxy for tangible investment in a market on both supply and demand fronts – demonstrated how much investment is poised to hit European data centre markets.

    The report found that EMEA witnessed the strongest Global Pipeline Supply Growth out of the three global regions reflecting a CAGR of 32.4% despite having the slowest historical growth in Live Supply. Much of this is driven by the appetite of hyperscalers and other enterprises needing capacity in some of the world’s most established data centre markets so that certain requirements are met, particularly from AI applications.

    With this, said DC Byte, demand has grown for capacity across EMEA in the face of a lack of available power and appropriate land across the region. While the number of deals is decreasing, the sizes of these deals have increased, and larger campuses are being built to meet these requirements.

    Early stage growth is solid

    EMEA demonstrated strong growth of Early Stage Supply from Q2 2021 onwards. While the region observed slower growth than the less developed APAC region, growth rates exceed that of the Americas, reflecting a CAGR of 62.4%.

    Supply growth is primed to continue over the next few years with significant industry players announcing data centre developments across the core EMEA data centre markets as well as in the tier two markets of Milan, Madrid, and Berlin and so on.

    Further to this, the MENA region is emerging as a key destination due to experiencing fewer market challenges (land and power constraints) in these locations, combined with the fact that countries such as the UAE and Saudi Arabia occupy strategic geographic positions, have good connectivity, and have observed growing demand in recent years.

    Live supply growth will be sustained

    The report found that Live Supply projections highlight a growth of 13.6% CAGR in EMEA, however DC Byte believes the actual growth is anticipated to exceed the forecasted numbers and start to accelerate going forward.

    This is on the basis that EMEA demonstrated the strongest growth of Pipeline Supply out of all the regions which should start to translate into Live Supply. Live Supply will play a pivotal role in supporting the growing demand for AI and continued adoption of cloud services across EMEA.

    “We expect that supply growth is primed to continue over the next few years with the likes of major real estate funds and hyperscalers announcing billions worth of investment into digital infrastructure,” said the report authors.

    Orange, Telekom step up efforts to tackle scope 3 targets 

    Both operators increase initiatives for handset recycling as supply chain carbon footprints remain the biggest to overcome

    Orange is targeting Net Zero Carbon emissions by 2040, which means reducing CO2eq emissions by 90% and implementing carbon sequestration programs to offset the rest. The operator has already reduced scope 1 and 2 emissions, by 37.4% in 2023, compared to 2015, but it has announced a new push to reduce its greenhouse gas emissions linked to its supply chain – the CO₂eq emissions from suppliers, service providers, and customers, also called scope 3 – because they represent more than 80% of Orange’s carbon footprint.  

    Device manufacturing makes up a major part of the sector’s environmental impact. That’s why Orange is encouraging the recycling and refurbishment of mobile devices, in particular through its “Re” program. In 2023, European countries recorded a collection rate of 25.4% of used mobiles. Orange is targeting 30% by 2025, a figure already reached in France. The operator has also made baby-steps in selling more refurbished devices – these now represent more than 5% of its sales in France, for example. 

    In Germany, Deutsche Telekom senior lifecycle manager Steffen Wasmus said there is no mobile phone that is not worth returning and the operator is encouraging customers to return their old device every time they buy a new one. “According to a Bitkom study, around 210 million old mobile phones are sitting in drawers in Germany. They contain a total of three tons of gold and valuable resources such as platinum or palladium, which are not available in infinite quantities,” he said.  

    Wasmus’s role is to define the sustainability requirements for Telekom’s mobile devices. “The entire catalog of requirements for manufacturers includes more than 2000 points, but there is also a whole chapter dedicated to environmental protection,” he said. “80 percent of the emissions caused by a smartphone throughout its life cycle come from production. So, a significant approach is to motivate manufacturers to improve this.” 

    Telekom wants to reduce its scope 3 emissions by 55 percent by 2030 and Wasmus said that can’t happen without addressing greenhouse gas emissions from the creation of the telco’s products.  

    He also has a message for handset vendors that tend to design technical obsolescence into their handsets meaning software upgrades and support runs out after a few years, making them harder to reuse. “If a device stops receiving updates after two and a half years, refurbishment is not worthwhile,” he said. “So, I intervene in such cases because second-hand products have a one-third smaller ecological footprint than new devices.” 

    Telekom is still only seeing a maximum return rate of ten percent for unused smartphones so the operator recognises more needs to be done to make it more attractive for users to bring in old phones…and more effortless, including with data removal.  

    Beyond handsets 

    To tackle scope 3 emissions, Orange has also launched several initiatives. By 2025, all Orange products will be “eco-designed” to reduce its environmental footprint over its entire lifecycle – such as the Livebox 7, launched at the end of 2023 and certified by Bureau Veritas. Not only does it incorporate recycled materials, but it is also more energy efficient to run, according to the telco.  At the beginning of 2024, Orange also launched a circular economy initiative to help companies reduce the carbon footprint of their mobile fleet through a calculation method certified by AFNOR. 

    Orange’s network equipment also follows circular economy principles. In December 2020, it launched an Oscar (Orange Sustainable & Circular Ambition for Recertification) programme to promote the refurbishment, reuse, and resale of technical equipment to extend its lifespan, with 725,000 pieces of equipment purchased or resold via this marketplace to date.  

    The operator also shares its mobile networks with other operators, limiting the need to build new infrastructure. At the end of 2023, 68% of Orange radio sites were shared, both in terms of infrastructure and energy supply. 

    Europe’s broadband growth begins to flat line 

    Policymakers will be left with fewer levers to pull to stimulate the market

    Declining populations and high fixed broadband penetration mean subscriber growth in Europe will flatline and the total fixed broadband subscriber figure in the emerging markets will almost match that in mature markets by the end of the decade. Western Europe will see the slowest growth, at 4.9% to 2030, despite global growth being forecast to grow by 15% to 1.6 billion in the same period, according to analysts Point Topic.

    Eastern Europe will see 10.8% growth to 2030. The Western Europe growth contrasts with fixed broadband take-up in the Middle East & Africa, which will see 39.4% – the fastest grwth region in the world, albeit from a much smaller base.

    By the end of 2030 Western Europe will have 180 million fixed broadband subscribers leaving it a far-distant second behind Asia at 736m. Middle East and Africa will remain the smallest fixed broadband market with 95 million subscribers. However, this figure is only slightly lower than that forecast for Eastern Europe (101m), not least due to the impact of the Russia-Ukraine war.

    Some mature markets will actually shrink according to Point Topic. “We predict a slight decline in fixed broadband subscribers in China by the end of the decade (-3.9%), given that the country’s fixed broadband market is already highly saturated. Moreover, 5G subscribers there are also approaching 1.5 billion,” said Point Topic. “Finland, another country with high fixed broadband penetration and high 5G availability, will also see negative growth.

    Several countries in the Point Topic’s emerging category – which will see 36.8% growth – have been expanding fixed broadband infrastructure, especially focusing on fibre. “The demand for ultrafast broadband has been increasing at healthy rates in these generally large and growing populations and economies, with Indonesia and The Philippines just a couple of examples. [So-called] youthful countries will see the second highest growth rate at 11.8%,” said the analysts.

    “Here fixed broadband take-up has already grown at high speed and so they will see growth rates slow down. To date, the growth curve of youthful markets has been the steepest, with the likes of China having invested heavily in their broadband infrastructure over the last decade.”

    Compared to its previous forecast, the analyst’s current forecast of global fixed broadband take-up figures by end-2030 is 1.5% higher. This reflects higher than Point Topic previously expected growth in broadband take-up and addressable audiences in several countries. The higher forecast growth in such large markets as India (+26%), Morocco (+21%), and Malaysia (+20%), among others, has boosted the analyst’s global fixed broadband subscriber forecast for this decade.

    Point Topic’s forecasts are based on its quarterly fixed broadband subscriber data up to Q2 2023 and include both residential and business connections.

    Magenta Telekom wins big in Austrian 5G auctions 

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    Regulator Rundfunk und Telekom Regels (RTR) awards 14 packages in the 3600MHz and 26GHz frequency ranges

    Austria’s Telekom Control Commission concluded the third auction of 5G frequencies covering the 26GHz (7 blocks) and 3600MHz (7 blocks) ranges and raising almost €25m. The auction proceeds for the 26GHz range amounted to €16.2 million, while the awarded frequency packages in the 3600MHz range reached around €8.5 million.

    Magenta Telekom is paying over 10 million euros to acquire mobile frequencies. “We are very satisfied with the result, so we continue to secure our national pioneering role in the best network and invest in Austria as a location,” said Magenta Telekom CTIO Volker Libovsky.

    He added: “The acquired national frequencies ensure the best network for future generations. With the additional regional frequencies for Vienna and Carinthia, we are increasing the quality and performance of our 5G networks. Our customers benefit directly from this commitment.”

    A total of 7 blocks of 200MHz each were allocated from the 26GHz range. The minimum bid per block was €1.9m. The frequencies can be used until 31 December 2046. The successful bidders were A1 Telekom, T-Mobile and Hutchison. A1 acquired 2 blocks for a total of around €4.6m; T-Mobile acquired 2 blocks for a total of around €4.6m; and Hutchison acquired 3 blocks for around €6.9m.

    For the first time, in connection with coverage requirements, the regulatory authority is allowing these frequencies to be switched off between midnight and 05:00am, provided there is no reduction in performance compared to daytime operation.

    The frequencies in the 3600MHz range are remaining frequencies from the 5G pioneer band allocation from 2019, which were not allocated in some regions due to a lack of demand from regional providers. The regulator said they serve to connect end customers quickly and easily to the network infrastructure.

    There were 7 blocks up for grabs, each with different frequency configurations for 7 different regions. The minimum bids for the 7 blocks totalled €2,330,500. The successful bidders were A1 Telekom and T-Mobile. A1 Telekom acquired frequencies in 4 regions for a total of around €2.6m. T-Mobile acquired frequencies in 3 regions for a total of around €5.9m. The frequencies can be used until 31 December 2039.

    From a certain point in time, each frequency allocation holder is obliged to operate a certain number of locations using the frequency spectrum allocated to them in this procedure or to fulfil the coverage obligations associated with the allocation. The coverage obligations serve to ensure efficient use of the frequencies. RTR said failure to comply may result in penalties. The frequency allocation usually takes place within one month of the regulatory authority publishing the auction results.

    Poland set to pause mmWave band auctions until 2026 

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    Operators tell regulator UKE the market isn’t ready for 26GHz band and other mmWave bands

    The Polish regulatory authority, The Office of Electronic Communications (UKE), has been told by operators that it is too early to allocate the 26GHz band and should instead push this out to 2026 and beyond due to a lack of network infrastructure that can support it and a lack of devices that can use it.  

    The regulator published submissions to its latest consultation into the 26GHz (24.25-27.5GHz) and 42GHz (40.5-43.5GHz) – which it originally kicked off in 2020. Even then, the analysis of the positions presented at that time showed, first of all, significant limitations in the availability of the required systems and equipment for the commercial launch of services and therefore the “impossibility of ensuring the principle of competitiveness”.  

    Operators called for the UKE to ask in in 2023 and basically, they have given the same answer in their submissions. While operators like the potential uses cases of network densification and industrial automation, they have signalled the market is not yet ready, with some suggested the regulator look at more pressing spectrum like 700MHz.  

    In its submission, T-Mobile proposes to allocate 26 GHz no earlier than after 2027. Orange Polska said its priority is not only to maximise the benefits related to the resources retained as a result of the C-band auction, but also meet the obligations arising from the reservation decision. Achieving this, it said, if it could also utilise 700MHz.  

    The operator said mmWave solutions were not widely available which was a “manifestation of the slower than expected development of the 5G technology ecosystem”. It added that in European markets there were no smartphones available to support this band. Orange says mmWave allocations should occur no earlier than 2026.  

    The operator suggested mmWave deployments will only occur in clusters or single base stations. It reiterated that each operator should be able to secure 800MHz but concedes that to do so, UKE will need to transfer some fixed services to other bands. Orange also warns the regulator that if it follows a similar pricing model to mid-band spectrum, mmWave will be unprofitable without a significant reduction in fees.  

    Play wants it moved further 

    In its submission Play (P4) wants to push the mmWave allocation out to 2027-2028 (or later). It said that currently, the development of user needs does not go beyond solutions that can be addressed within the 5G capacity available in the C band (i.e. 3.4-3.8GHz). The operator suggests that due to mmWave’s high capacity and low latency it will be deployed mainly “in cities that introduce intelligent solutions to support their functioning and in workplaces that decide to automate production, logistics or transport processes.”  

    Play requests the allocation of a minimum of 200MHz in one block, with the indication that the target configuration should provide for the use of a single block or several blocks with a maximum planned width of 400MHz for a single operator. 

    Like Orange Play is looking more at getting mid-band sorted. “The priority remains the allocation of a single block in the 800 MHz band and the 700 MHz band – which, thanks to their propagation properties, will allow the 5G signal to cover most of the territory of the Republic of Poland, fulfilling the EU assumptions regarding the coverage of cities and main routes by 2025 and meeting the obligations arising from reservation decisions in the band. 3400-3800MHz. The next band that should be made available for wireless communication are the n75 and n76 bands, i.e. the range from 1427 MHz to 1517 MHz, i.e. the so-called SDL,” it stated in its submission. 

    Ericsson cuts 1200 jobs in Sweden 

    The vendor adds detail to the statements it made in January about 5G market conditions

    Ericsson announced it intends to cut around 1200 jobs in its home market Sweden as the challenging market conditions, particularly in North America, pervade in 2024. The vendor said it was already seeing “further volume contraction as customers remain cautious.” In January Ericsson warned it expected further declines in 5G gear demand from mobile operators this year including in its key growth market of India.  

    After a few years of high demand for 5G equipment, buying by telecom providers slowed last year, prompting firms such as Ericsson and Nokia to lay off thousands of employees to save costs. Ericsson already said it was looking at further cost cuts this year and that would potentially include layoffs, chief financial officer Carl Mellander told CNBC. 

    Analysts Dell’Oro, recently forecast worldwide RAN revenues to decline at a 1 per cent CAGR over the next five years. Market conditions are expected to remain challenging in 2024 as the Indian RAN market pulls back, though the pace of the global decline this year and for the remainder of the forecast period should be more moderate. New growth areas like private 5G and FWA are too small to change the overall trajectory, they said.  

    To deal with this, Ericsson said it will implement other cost saving initiatives covering various areas such as “reduction of consultants, streamlining of processes, and reduced facilities.” Initiatives to increase operational efficiency will continue during 2024 but will not be announced separately.   

    The vendor did argue it will keep focusing on achieving a higher growth trajectory to reach its long-term margin targets, particularly in mobile but increasingly in enterprise as well. However, at its annual analyst and press briefing ahead of MWC, Ericsson’s speaker backtracked after suggesting that enterprise revenues could be three times those from consumers by 2030. 

    Differentiated connectivity backed by SLAs, slicing, the combination of hardware and software and the perhaps most of all, the critical importance of APIs were the recurring themes at the briefing but the vendor did concede that service orchestration, or lack of it, has hampered market development. 

    APIs are also going to be a difficult market to maintain margins for either operators or the vendors, particularly as this market plays into the companies carrying all of the workload i.e. the hyperscalers. Ericsson did announce it is to develop a global platform to expose network APIs to developers with Amazon Web Services (AWS) but the overall market direction for APIs remains unclear. 

    The company had almost 100,000 employees at the end of last year, according to its annual report. 

    PIMCO raising €750m European data centre fund – report 

    Sources suggest interest in the fund could reach, or exceed, €1 billion

    Real estate investor PIMCO has currently raised around €300m for its first dedicated data centre fund which will build hyperscale data centres in secondary markets across Europe, according to an exclusive report by Private Equity Real Estate (PERE) (registration required).  

    The company – which set up data centre operator Apto last September, stuffed with seasoned executives, to operate its facilities – is targeting €750m for the European Data Centre Opportunity Fund but PERE has discovered that investor interest could see that reach €1bn before closing in the coming months.  

    The report lists PIMCO’s German insurance company owner Allianz Group as a seed investor and suggests other investors originate mostly from Europe, with others from the Middle East, Asia and the US. According to a sustainability disclosure document dated December 2023, new data centre developments will comprise at least 70 percent of the fund’s total invested capital once deployed. In this filing, it also suggests Apto’s data centres will target a power usage effectiveness score below 1.35. 

    “We at PIMCO see data centres as a secular growth theme globally and therefore making both debt and equity investments both in the US and Europe. In Europe, we see the opportunity set as more attractive compared to the US as the market is more under-supplied and lagging US by approximately five years as it relates to the installed data centre capacity in the largest European data centre markets like Frankfurt, London, Amsterdam and Paris,” said PIMCO EVP and portfolio manager Kirill Zavodov (above) when the company launched Apto.  

    “With tier two and tier three markets even further behind. And this is where we see and expect most of the growth opportunity to play out over the coming years,” he said.  

    “I think if you look at many of the major markets are now power constrained, we’re seeing an increase in deployment of low latency applications that need capacity in more geographies and GDPR, data sovereignty is driving increased demand across Europe,” said Apto CEO Russell Poole, previously the long-serving UK managing director at Equinix.  

    Zavodov added: “That’s why we see the opportunity in tier two and tier three markets as the most interesting at the moment as these markets represent a considerable whitespace for developing new data centre capacity… we have been using our on the ground sourcing capabilities to assemble a pipeline of development opportunities in the data centre space of about €4 billion of all-in cost. In fact, we have already acquired our first asset and have started the development works on site.” 

    According to PERE, that site is Madrid. Other markets in PIMCO’s sights include Madrid, these include Milan, Berlin, Zurich, Warsaw, Athens and several cities in Scandinavia. 

    European catch-up time 

    Morgan Stanley’s European telecom team head Emmet Kelly echoed Zavadov’s comments, suggesting that people are under-estimating the size and scope of the potential data centre growth in Europe. He suggested three factors will drive it.  

    “The primary driver of data centre demand today is cloud and digitalisation,” he said. “Cloud represents the lion’s share of data centre growth in Europe on our numbers. Roughly 60% of growth by 2035. The second driver is AI. What’s interesting is training AI models needs to be done within a single data centre and that’s driving demand for large data centre campuses across the globe.” 

    He said the third factor is data sovereignty. “Essentially, consumers want their data to be stored at home, and they want this to be subject to local law,” he said. “A common parallel I’ve received is: would you want your bank account to be stored in a different country? The answer is probably no. And therefore, we believe that data will be increasingly near-shored across Europe.”  

    Kelly also suggests that the various infrastructure constraints like power in some of the so-called FLAP-D markets – Frankfurt, London, Amsterdam, Paris, and Dublin which represent most of the overall European DC market – will mean secondary markets will see growth that will outstrip larger capitals.  

    His team’s data centre market report in February suggests over the next decade the European data centre market will expand fivefold to around 20,000MW which is larger than US growth in that period, albeit a more mature market. Will FLAP-D markets will still be 60% of growth in the next decade the bank suggests secondary markets like Milan, Madrid, Warsaw and Scandinavia will see 22% growth versus 16% in FLAP-D. 

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