What’s up with… Ericsson, Huawei, Telefónica
- Shareholders determined not to give Ericsson board an easy ride at AGM
- Huawei reports massive leap in annual profits
- Telefónica turns down Vivendi’s overtures
Testing times for Ericsson, a bullish assessment of its own business by Huawei and further M&A speculation in Spain front up today's news line-up.
The Ericsson board is in for a tense day on Tuesday as the company holds its Annual General Meeting amidst mounting pressure from investors regarding the way it has handled its investigations into, and subsequent reporting of, its operations in Iraq that led to the indirect funding of terrorism. Activist investor Cevian, in particular, has made it known that it will vote against any AGM motion that seeks to ‘grant discharge’ from liability to the vendor’s board: If board members were granted discharge, then investors may not be able claim damages against them for their management during the financial year, notes Reuters in this report. Ericsson shared its current status with regards to investigations into its business in Iraq, and its ongoing cooperation with the US Department of Justice (which has so far been somewhat unimpressed with Ericsson’s disclosures) in its annual report for 2021, which was published at the end of last week. In that report, the company noted that it “may also face other potentially negative consequences relating to the investigations by, and settlements with, the DOJ and SEC, or to other potential investigations. Enforcement authorities in the US or elsewhere, including the SEC, the DOJ or OFAC, could investigate us for additional possible violations of applicable anti-corruption (including anti-bribery, anti-money laundering, sanctions, terror finance and anti-terrorism) laws, rules or regulations of which we are aware or unaware at any time.” Ericsson last week gave its vote of confidence in CEO Börje Ekholm: Cevian, it should be noted, has made it clear it has no intention of voting against Ekholm’s re-election to the board.
Huawei has issued its annual report for 2021 and has reported annual revenues of RMB636.8 billion (US$99.9 billion), a 28.6% year-on-year decrease, and a net profit for the full year of RMB113.7 billion ($17.85 billion), up by 75.9%. Meng Wanzhou, Huawei's CFO who was under house arrest in Canada for more than two years until last September, noted at a Huawei event to unveil the report: "Despite a revenue decline in 2021, our ability to make a profit and generate cash flows is increasing, and we are more capable of dealing with uncertainty." The Chinese vendor is still bullish about its future, but its enterprise business, which will need to be a major engine of growth for the company in the long-term, didn’t move the needle much in 2021, as its revenues edged up by only 2.1%.
Telefónica has reportedly turned down an approach by Vivendi about the potential sale of its pay TV business, Movistar+. According to Bloomberg, Telefónica is considering options for the pay TV business, but any move would involve inviting external investors on board rather than an outright sale, which would be more in keeping with many of the asset monetization deals Telefónica has struck during the past couple of years.
Giant Indian operator Bharti Airtel will pay INR23.88 billion ($313 million) for Vodafone’s 4.7% stake in wholesale mobile towers firm Indus Towers: The deal had been initially announced at the end of February and is a complex one, as this Business Standard article explains. Once the deal is closed, Bharti Airtel will own a 46.4% stake in Indus Towers, which has almost 185,000 towers in its portfolio.
As the crisis in Ukraine continues, so telcos are updating their policies to address the developing situation. Michael Ackland, Group Executive of Consumer and Small Business at Australian operator Telstra, unveiled the company is extending its period of waiving fees for calls and roaming to Ukraine and surrounding nations that are housing refugees, including Poland, Hungary, Moldova, Slovakia and Romania. Services have been made free for another 30 days, so that people in the region can be contacted. See more here.
The number of buildings deploying smart building technology around the world is set to hit 115 million in 2026, a rise of more than 159% from the 45 million expected by the end of this year, according to the forecast team at Juniper Research, which defines a smart building as one that “uses connectivity to enable economical use of resources, while creating a safe and comfortable environment for the occupants.” About 90% of smart building investments in 2026 will be on non-residential premises, about a similar level to this year. The Juniper Research team “recommends that vendors focus on building analytics platforms” if they are to capitalize on the expected growth. Read more.
Verizon says Cradlepoint’s W1850 Wideband Adapter is certified and ready to be used for 5G fixed wireless access (FWA) services that make use of the operator’s C-band spectrum. “Cradlepoint 5G Wireless WAN solutions have been specifically designed to support the Verizon 5G mid-band networks and have gone through extensive testing and certification from Verizon,” noted Justin Blair, Vice President Carrier Business Development at Cradlepoint, which is owned by Ericsson. Verizon plans to have 5G UWB services available to 175 million people by the end of this year, and having customer premises devices approved and ready to be deployed is critical if the operator is to build up its user base. “Businesses are looking for partners that can provide fit-for-purpose solutions that unlock the full potential of 5G,” says Massimo Peselli, senior vice president of Global Enterprise, Verizon Business. “The collaboration we’ve announced today with Cradlepoint unlocks the potential of cellular for businesses and delivers Verizon’s 5G Ultra Wideband to businesses of all sizes, enabling them to take advantage of C-Band spectrum. Our strategic relationship has allowed us to deliver enterprise class solutions that, among other things, enable IT organizations to manage the entire Wireless WAN lifecycle.” Read more.
In the UK, the Department for Digital, Culture, Media and Sport (DCMS) has identified 79-year-old Lord Michael Grade as its “preferred candidate” to be the next Chairman of UK regulator Ofcom, which oversees the broadcasting and digital as well as telecoms sectors. Grade still has to appear before a pre-appointment hearing before he can be approved for the role, but his recent track record of comments about the broadcast sector, of which he has plenty of experience, has raised concerns, according to this article by The Guardian. The news came as Ofcom unveiled its ‘plan of work’ for 2022-2023, which includes the usual commitments to getting everyone connected, ensuring fairness for customers and so on.
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