From events in Nice and Amsterdam to Vodafone's full-year results and latest mobile phone figures, it's been a rollercoaster week in the telecoms world with several indications that the economic situation has improved for the sector compared to a year ago.
As weeks go, it's been a busy one for the telecoms industry. The infamous Icelandic ash cloud did its best to upset travel plans for the TM Forum's Management World in Nice as well as the LTE World Summit in Amsterdam, but news from the events suggested that most people made it in time.
Meanwhile industry giant Vodafone reported full-year and Q4 results on Tuesday, and both iSuppli and Gartner issued latest Q1 figures for the mobile handset market with some interesting developments in the manufacturer rankings. The Indian and German spectrum auctions came to an end, and Interoute, one of the high-profile victims of the telecoms downturn early last decade, reported strong revenue and profit growth in 2009 as it undercut global service providers on cost.
Vodafone got the news wires buzzing early in the week with its full-year results. The company was able to report some very good news on one hand: it exceeded the £4 billion mark for data revenue for the first time, reported a doubling of net profit to £8.674 billion for the full year, and said it achieved £1 billion in cost savings 12 months ahead of schedule. The slightly less good news was that it was forced to make a £2.3 billion impairment charge on its Indian operations; it's clear that the Indian operation is not currently the apple of CEO Vittorio Colao's eye.
But like all other Indian operators, Vodafone has committed to spending yet more in the sub-continent after it bid for and won 3G spectrum for the sub-continent. The tortuous Indian 3G auction lasted 34 days and raised a total of US$14.6 billion. Aircel, Bharti Airtel, Reliance Communications, Vodafone Essar, Tata Teleservices and newcomer S Tel Pvt all won spectrum. However, not one single carrier was able to win spectrum in all 22 of India's circles, so there is no nationwide Indian 3G provider.
The German sale of spectrum in four frequency bands - 800 MHz, 1.6 GHZ, 2 GHz and 2.6 GHz - also ended on Thursday, raising a more modest €4.4 billion. The four operators that took part in the auction, Vodafone, Telefonica O2, Deutsche Telekom and E-Plus, each won a number of the 41 spectrum blocks up for grabs. Vodafone acquired 12, Telefonica O2 11, Telekom 10, and E-Plus eight.
It's also worth mentioning that France finally wound up the sale of its remaining 3G spectrum - a process that has been ongoing since the country sold its very first 3G licences. After the fourth 3G licence was awarded to Free Mobile in January, two blocks of 2.1 GHz spectrum remained. These were finally awarded to Orange France (4.8 MHz) and SFR (5 MHz) this week, at a total cost of almost €300 million.
Mobile issues generally have certainly dominated this week: as well as major spectrum auctions finally coming to an end, both iSuppli and Gartner issued Q1 updates on the mobile handset market that indicated massive strides are being made by Android and Research in Motion. According to Gartner, the BlackBerry make is now one of the top five handset makers in the world, while Android is now the fourth-largest mobile operating system globally after Symbian, RIM and the iPhone OS and ahead of Microsoft Windows.
The good news is that after handset sales declined by 8.6% in Q1 2009, Gartner said sales grew again by 17% year on year to 314.7 million in Q1 2010. Smartphones remain the growth driver, with sales of the high-end phones increasing by 48.7% to 54.3 million units compared to Q1 2009. Smartphones accounted for 17.3% of all mobile handset sales in the first quarter of 2010, up from 13.6% in the same period in 2009.
On a separate subject but also mobile related, Orange announced the first commercial launch of near field communications (NFC) services in Europe along with a number of partners in Nice on Friday. The move means that people in Nice will be able to use their mobile handsets for contactless payments, ticketing, and so on. It's an interesting milestone in the long process to launch NFC services on mobile handsets - a process that was dogged early on by squabbles between mobile operators and banks over who should have control. Agreement was eventually reached to use the SIM card as the main authentication tool.
To end on a non-mobile note, some good news came from a fixed player that was famously a victim of the "build and they will come" mentality that preceded the huge telecoms crash in 2001-2003. Interoute reported this week that 2009 was its best year ever, with EBITDA up by 62% to €40 million and revenue up by 9% to €269 million. The pan-European network operator still makes around 50% of its business from wholesale, but is focusing increasingly on corporate services such as hosting and cloud services.
The company is now looking to make some acquisitions this year, and hopes to increase its network presence in markets such as France, Germany and the Nordics, while extending its network to markets such as Turkey and Russia.
So that's it for this week folks! Hope you all got back safely from Nice or Amsterdam, and here's hoping that next week will be just as exciting as this one was!