The European restructuring of the still overly regional and fragmented telecoms market continues as the Dutch government has reduced their stake in the counry's leading operator, KPN. They have also agreed to give up their veto rights on ownership, foreign acquisitions etc.
The government halved its stake to 8%, selling 60m shares back to KPN for €500m, which KPN said it would cancel, and 105m shares to ABN Amro, the Dutch bank. It also said it would dispose of its “special share” before the end of the year.
Let's hope the Swiss government follow their lead after the diaboligal fiasco of them blocking Swisscom's attempts to grow through acquisitions abroad. Europe soon needs to get to the point where the market is dominated by less than 10 major players that operate across the whole of Europe. The process is under way and at least it is getting clearer who the obvious contenders are: Deutsche Telekom, France Telecom, Telecom Italia, Telefonica and Vodafone. The rest will need to bulk up rapidly to stand any chance against these guys.
The tier two players that stand the best chance via M&A to join the above list include TeliaSonera, Telenor, BT, KPN and possibly Swisscom, 3 and WIND. But they need to get going fast if they want to keep up with the big guys.
Wednesday, December 07, 2005
Wed - Microsoft's latest anti-trust ruling
South Korea’s antitrust watchdog today ordered Microsoft to pay a Won33bn (US$31.9m) fine and unbundle its Messenger and Media Player from its Windows operating system, a move which might force the software giant to withdraw from the country.
This follows the EU ruling against Microsoft and is yet another blow to the software giant. Microsoft has threatened to pull out of S Korea if the ruling went against them. It will be interesting to see if they have the courage to carry their threat out. I'm not sure it would be the wisest move.
It is also interesting to note how much noise the whole bundling startegy at Microsoft has created world wide, how many fines Microsoft has had to pay and how much bad will it has created with world authorities. Lets see if they continue the practices and how they may translate in an internet services oriented world.
This follows the EU ruling against Microsoft and is yet another blow to the software giant. Microsoft has threatened to pull out of S Korea if the ruling went against them. It will be interesting to see if they have the courage to carry their threat out. I'm not sure it would be the wisest move.
It is also interesting to note how much noise the whole bundling startegy at Microsoft has created world wide, how many fines Microsoft has had to pay and how much bad will it has created with world authorities. Lets see if they continue the practices and how they may translate in an internet services oriented world.
Tuesday, December 06, 2005
Tues - Microsoft launches new CRM software
Microsoft's slow growing business apllications division, one of its seven business units is announcing a new CRM package. It'll need to be strong to stand up to the powerful competition from SAP, Oracle and Salesforce.com.
By tying the software closely to Outlook, the e-mail and calendar software included in Office, the launch also marks a new attempt by Microsoft to win over more users by drawing on the broad use of its desktop software. There are 400M users of Office.
However, the factors that have held back Microsoft’s growth so far in the applications business, where it competes with giants such as SAP and Oracle, could continue to hamper it. Apparently “Microsoft’s biggest problem is its [sales] channel,” according to Bruce Richardson, chief research officer at AMR Research.
Since it sells mainly through partners, the company does not have the close links with customers that rivals enjoy, he said, adding: “The good news is, it has a lot of people selling software; the bad news is, it loses its relationship with the customer.”
Revenues at Microsoft Business Solutions, one of the company’s seven business divisions, grew by only 5% last year, to $793m, or 2% of the company’s total revenues.
This is an interesting tack by Microsoft. They seem to be launching applications where the core benefit is tight integration with Office and an ease of use and GUI similar to Office. I'm not sure yet whether this strategy is more designed to benefit Microsoft or the users.
And it feels to me like these application moves may be better designed to serve the SME market than large corporates. Interestingly so are Microsofts sales channels. Maybe they should take advantage of this focus and worry a little less about the corporate market that SAP, Oracle and IBM serve so well. Just a thought.
By tying the software closely to Outlook, the e-mail and calendar software included in Office, the launch also marks a new attempt by Microsoft to win over more users by drawing on the broad use of its desktop software. There are 400M users of Office.
However, the factors that have held back Microsoft’s growth so far in the applications business, where it competes with giants such as SAP and Oracle, could continue to hamper it. Apparently “Microsoft’s biggest problem is its [sales] channel,” according to Bruce Richardson, chief research officer at AMR Research.
Since it sells mainly through partners, the company does not have the close links with customers that rivals enjoy, he said, adding: “The good news is, it has a lot of people selling software; the bad news is, it loses its relationship with the customer.”
Revenues at Microsoft Business Solutions, one of the company’s seven business divisions, grew by only 5% last year, to $793m, or 2% of the company’s total revenues.
This is an interesting tack by Microsoft. They seem to be launching applications where the core benefit is tight integration with Office and an ease of use and GUI similar to Office. I'm not sure yet whether this strategy is more designed to benefit Microsoft or the users.
And it feels to me like these application moves may be better designed to serve the SME market than large corporates. Interestingly so are Microsofts sales channels. Maybe they should take advantage of this focus and worry a little less about the corporate market that SAP, Oracle and IBM serve so well. Just a thought.
Tues - Sun launches innovative new server line
Sun Microsystems is taking a bold step in its bid to reverse its sliding market share with the announcement of a new line of servers based on an innovative processor that has up to eight “cores”, or brains.
By making it possible to handle more computing tasks on a single chip, while also reducing the electrical power needed to run the machines, the new servers represent a crucial part of Sun’s attempt to stem the loss of customers to the low-cost, standardised servers based on processors from Intel and Advanced Micro Devices.
The "Niagara" servers are a big bet for the company that continues to try and buck industry standard server design and one that desperately needs to differentiate their higher cost servers against the likes of Dell and HP and to try and keep up with the IBM's etc.
Sun are making a lot of bets at the moment and a lot of announcements. Let's hope their fortunes improve for the long term. They certainly are an innovator. I can't help feeling though that they still need a transformative M&A deal to really steer them out of the woods for the long term.
By making it possible to handle more computing tasks on a single chip, while also reducing the electrical power needed to run the machines, the new servers represent a crucial part of Sun’s attempt to stem the loss of customers to the low-cost, standardised servers based on processors from Intel and Advanced Micro Devices.
The "Niagara" servers are a big bet for the company that continues to try and buck industry standard server design and one that desperately needs to differentiate their higher cost servers against the likes of Dell and HP and to try and keep up with the IBM's etc.
Sun are making a lot of bets at the moment and a lot of announcements. Let's hope their fortunes improve for the long term. They certainly are an innovator. I can't help feeling though that they still need a transformative M&A deal to really steer them out of the woods for the long term.
Tues - Ericsson annouces deal with 3 UK
Ericsson has landed one of the largest ever mobile managed service contracts with 3UK, the leading 3G mobile phone company. Ericsson will manage all of 3UK's advanced mobile data network across the country.
Ericsson already have deals in place with 3 Italy and 3 Australia. The 3 Italy deal is worth $1.75-2.5bn. The 3UK deal is apparently larger.
This looks like a smart deal by both parties. As 3 grow internationally, passing the management of the network to a specialist such as Ericsson so that they can focus on services, applications, content and marketing may well be a sensible model for other mobile operators going forwards.
Ericsson already have deals in place with 3 Italy and 3 Australia. The 3 Italy deal is worth $1.75-2.5bn. The 3UK deal is apparently larger.
This looks like a smart deal by both parties. As 3 grow internationally, passing the management of the network to a specialist such as Ericsson so that they can focus on services, applications, content and marketing may well be a sensible model for other mobile operators going forwards.
Tues - UK's online friends network sold to ITV
ITV, leading UK TV network, has won the auction to buy Friends Reunited, the website that helps trace long-lost friends, from its founders and employees for an initial $200M, as it seeks revenue streams outside its core television advertising business.
The broadcaster will make a further $95M payment in 2009 depending on whether Friends Reunited achieve performance targets.
So, TV company buys leading community web site. Convergence between traditional media and the internet just keeps going. It will be interesting to see how ITV develop the business and how they cross-promote and integrate it with their TV channels.
The broadcaster will make a further $95M payment in 2009 depending on whether Friends Reunited achieve performance targets.
So, TV company buys leading community web site. Convergence between traditional media and the internet just keeps going. It will be interesting to see how ITV develop the business and how they cross-promote and integrate it with their TV channels.
Monday, December 05, 2005
Mon - Verizon to sell directories business
Verizon Communications is considering whether to sell or spin off its directory business so it can concentrate more on providing wireless, data and fixed-line services.
Based on similar sales in the past, the Verizon division could sell for $17 billion, or 10 times its 2004 profit before taxes of $1.7 billion. Qwest Communications, the smallest of the four big Bell operating companies, sold its directories business for $7 billion in August 2002.
This seems to make a lot of sense. The directories business is getting more competitive and complicated as specialist directory firms such as Yell vie for market share with the internet companies such as Google, Yahoo and Microsoft. Online is clearly the future.
It will be very revealing to see who buys them. Could it be Google? This looks like the kind of transformative and yet safe deal that might be worth their attention. Verizon is smart getting out now while valuations are high.
Based on similar sales in the past, the Verizon division could sell for $17 billion, or 10 times its 2004 profit before taxes of $1.7 billion. Qwest Communications, the smallest of the four big Bell operating companies, sold its directories business for $7 billion in August 2002.
This seems to make a lot of sense. The directories business is getting more competitive and complicated as specialist directory firms such as Yell vie for market share with the internet companies such as Google, Yahoo and Microsoft. Online is clearly the future.
It will be very revealing to see who buys them. Could it be Google? This looks like the kind of transformative and yet safe deal that might be worth their attention. Verizon is smart getting out now while valuations are high.
Mon - Novell flying
Software maker Novell reported a strong 4th quarter, more than doubling analysts' estimates by posting earnings of $320 million.
Banc of America Securities analyst Kirk Materne credited a robust performance at the company's Linux operating system unit, which grew sales 41% over last year's 4th quarter to $61 million. Materne lifted his 2006 earnings projection, citing expected future cost reductions that figure to improve margins.
Open source is clearly picking up steam and Novell is emerging as an interesting bell weather. This should bode well for Sun Microsystems who is also increasingly betting the farm on open source. Microsoft needs to watch these two very carfully.
Banc of America Securities analyst Kirk Materne credited a robust performance at the company's Linux operating system unit, which grew sales 41% over last year's 4th quarter to $61 million. Materne lifted his 2006 earnings projection, citing expected future cost reductions that figure to improve margins.
Open source is clearly picking up steam and Novell is emerging as an interesting bell weather. This should bode well for Sun Microsystems who is also increasingly betting the farm on open source. Microsoft needs to watch these two very carfully.
Sunday, December 04, 2005
Sunday - NTL to buy Virgin Mobile?
Rumours seem to be spinning around this weekend that NTL, the UK's leading cable group which is planning to merge with Telewest, is in discussions to buy Richard Branson's Virgin Mobile.
Branson owns 72% of Virgin Mobile. Under the terms of the deal, Branson would trade his Virgin Mobile shares for NTL stock, becoming the cable company’s largest shareholder with a stake of about 14%, it seems.
This is yet another sign of media, telecomms and the internet converging. And is Branson likely to allow NTL to use the all powerful Virgin brand across all the NTL offerings? So, the UK could see the awakening of Virgin Cable, Virgin Telephony alongside Virgin Mobile.
This could be a very smart move by Branson. It may well make sense for Virgin Mobile UK. I'm a little more concerned about what happens to Virgin Mobile in countries outside the UK? Would they remain independent? I guess we'll find out soon. And who said the media conglomerate was dead. Oh, we did!! (see businessuncut daily!).
Branson owns 72% of Virgin Mobile. Under the terms of the deal, Branson would trade his Virgin Mobile shares for NTL stock, becoming the cable company’s largest shareholder with a stake of about 14%, it seems.
This is yet another sign of media, telecomms and the internet converging. And is Branson likely to allow NTL to use the all powerful Virgin brand across all the NTL offerings? So, the UK could see the awakening of Virgin Cable, Virgin Telephony alongside Virgin Mobile.
This could be a very smart move by Branson. It may well make sense for Virgin Mobile UK. I'm a little more concerned about what happens to Virgin Mobile in countries outside the UK? Would they remain independent? I guess we'll find out soon. And who said the media conglomerate was dead. Oh, we did!! (see businessuncut daily!).
Friday, December 02, 2005
Fri - Dissidents plan Time Warner break-up
Carl Icahn, Time Warners dissident shareholder speaking for 3% of the group, and Bruce Wasserstein, head of Lazard seem to be concocting a plan to split Time Warner into four separate companies as well as to replace the board with a new set of media lumineries. Their plan still needs to be finalized though.
Carl Icahn has already called for them to spin off 100% of their cable division. But, the suggested break-up at Time Warner would go further, leading to four companies: Time Warner Cable; the AOL internet business; the Time Inc publishing business; and the content business consisting of the Warner Brothers studios and cable channels such as HBO and CNN.
At the very least this will now pit the much respected Parsons, Chairman and CEO of Time Warner, against Icahn. Parsons believes that Time Warner is better off as one, integrated media conglomerate. Icahn clearly disagrees. I can see how Icahn's plan could potentially unclock short term shareholder value, but I struggle a little with the longer term strategic benefits, particularly in the new, more intergrated digital age.
Looks like Time Warner's in for one hell of a fight though. I wonder what will happen to AOL in the short term? There supposed to be negotiating a deal with Microsoft or Google. That seems to have gone strangely quiet. Mind you, I'm sure we'll see Parsons come out fighting soon.
Carl Icahn has already called for them to spin off 100% of their cable division. But, the suggested break-up at Time Warner would go further, leading to four companies: Time Warner Cable; the AOL internet business; the Time Inc publishing business; and the content business consisting of the Warner Brothers studios and cable channels such as HBO and CNN.
At the very least this will now pit the much respected Parsons, Chairman and CEO of Time Warner, against Icahn. Parsons believes that Time Warner is better off as one, integrated media conglomerate. Icahn clearly disagrees. I can see how Icahn's plan could potentially unclock short term shareholder value, but I struggle a little with the longer term strategic benefits, particularly in the new, more intergrated digital age.
Looks like Time Warner's in for one hell of a fight though. I wonder what will happen to AOL in the short term? There supposed to be negotiating a deal with Microsoft or Google. That seems to have gone strangely quiet. Mind you, I'm sure we'll see Parsons come out fighting soon.
Thursday, December 01, 2005
Thurs - Microsoft to launch online listings service
Microsoft is after Google. It's official. After the somewhat over hyped launch of live! Microsoft has now followed Googles launch of Google Base, the online listings service and has announced that they are about to launch their own version called Fremont.
MSN, Microsoft’s online services arm, has been testing a new service that would let internet users enter details of personal items in a specially designed database. Information in the database would then be made search-able by Microsoft’s internet search engine, or could be restricted to a limited group of personal contacts.
The service, code named Fremont, a reference to a Seattle neighbourhood that plays host to a busy Sunday market, has been available in test form to Microsoft employees since last week, and could be set for a public test in the coming weeks.
I'd get increasingly worried if I was any traditional newspaper, national or local. The trend is clear. Online listings, classifieds and directories are moving online. That's the future.
MSN, Microsoft’s online services arm, has been testing a new service that would let internet users enter details of personal items in a specially designed database. Information in the database would then be made search-able by Microsoft’s internet search engine, or could be restricted to a limited group of personal contacts.
The service, code named Fremont, a reference to a Seattle neighbourhood that plays host to a busy Sunday market, has been available in test form to Microsoft employees since last week, and could be set for a public test in the coming weeks.
I'd get increasingly worried if I was any traditional newspaper, national or local. The trend is clear. Online listings, classifieds and directories are moving online. That's the future.
Thurs - Sun embraces open source as its future
Sun Microsystems took another big step towards reinventing itself as an open source software, systems and services company by announcing that key software tools will in the future be provided at no cost to developers and others.
Sun began offering customers its Solaris operating system as free open source software earlier this year, said it will now provide its Java Enterprise System, Sun N1 Management software, and Sun developer tools available at no cost for both development and deployment.
Sun also said it is integrating all of this software along with the Solaris operating system into the Solaris Enterprise System, to form what it claims is, “the only comprehensive and open infrastructure software platform available today.”
This is a head on attack to Microsoft Windows, apps and tools as was as Linux plus apps and tools. This looks shrewd. By getting the sun O/S and development tools, with Java, out to the wider community they should drive greater demand for their enterprise applications as well as their servers. They genuinly could become the open source competitor of choice to Miscrosoft if they move fast and get it right.
My money's on Sun making an interesting transition to a company based more on software and services rather than proprietary boxes. The question deep down is do they have the scale to pull this off. And if not, who should they merge with? How about Google - now there's a curve ball!!
Sun began offering customers its Solaris operating system as free open source software earlier this year, said it will now provide its Java Enterprise System, Sun N1 Management software, and Sun developer tools available at no cost for both development and deployment.
Sun also said it is integrating all of this software along with the Solaris operating system into the Solaris Enterprise System, to form what it claims is, “the only comprehensive and open infrastructure software platform available today.”
This is a head on attack to Microsoft Windows, apps and tools as was as Linux plus apps and tools. This looks shrewd. By getting the sun O/S and development tools, with Java, out to the wider community they should drive greater demand for their enterprise applications as well as their servers. They genuinly could become the open source competitor of choice to Miscrosoft if they move fast and get it right.
My money's on Sun making an interesting transition to a company based more on software and services rather than proprietary boxes. The question deep down is do they have the scale to pull this off. And if not, who should they merge with? How about Google - now there's a curve ball!!
Thurs - Skype launches video calling
Skype, the London-based internet phone call service bought by eBay in September, will add full-screen video from today in a substantial upgrade to compete with features provided by Microsoft, Yahoo and AOL instant messaging systems.
Skype, with 66m users registered worldwide but only 15% of them in the US, has also launched a big push in eBay’s home market. Looks very interesting. Where do I sign up.
Skype, with 66m users registered worldwide but only 15% of them in the US, has also launched a big push in eBay’s home market. Looks very interesting. Where do I sign up.
Thurs - France's top 3 mobile operators fined
France’s top three mobile telephone operators have been fined a record $629.5m by the country’s competition watchdog for market collusion over a six-year period.
The Competition Council said today that Orange France, which is part of France Telecom, Bouygues Telecom and Vivendi Universal-controlled SFR had exchanged confidential commercial information during the period from 1997 to 2003.
Oops, guys!
The Competition Council said today that Orange France, which is part of France Telecom, Bouygues Telecom and Vivendi Universal-controlled SFR had exchanged confidential commercial information during the period from 1997 to 2003.
Oops, guys!
Thurs - Egg.com finally has a future secured
Egg, the leading UK online financial services company, finally has a secure future. It's parent, leading UK financial services group, the Prudential, who launched the business in the go-go days of the late '90's, has decided not to sell Egg after all.
The Prudential has been trying to sell Egg for a few years now, but with considerable losses from it's expensive foray into the French market, buyers were hard to find. So, I guess now that the Prudential has seen the value of the Egg business in the UK, they have decided to buy the remaining 19% of shares they do not own and re-intergrate the company.
I guess this is yet another sign that interent companies are popular again.
The Prudential has been trying to sell Egg for a few years now, but with considerable losses from it's expensive foray into the French market, buyers were hard to find. So, I guess now that the Prudential has seen the value of the Egg business in the UK, they have decided to buy the remaining 19% of shares they do not own and re-intergrate the company.
I guess this is yet another sign that interent companies are popular again.
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