- The axe has fallen at Twitter
- BT is looking to increase its cost savings
- The FCC is planning a Space Bureau
In today’s industry news roundup: Elon Musk lays off thousands of staff at Twitter; BT is looking for even greater cost efficiencies; the FCC is set to update its structure to better support the satellite sector; and much more!
Twitter has reportedly sent an internal memo to all staff informing them of mass layoffs and telling them that its offices will be temporarily shut. Business Insider reported that this was the first time the social media giant has communicated with staff since Elon Musk took the reins as owner and CEO of Twitter, when a lengthy and controversial $44bn deal was finally completed on 28 October. According to the report, the cuts affect some 3,700 jobs – around half of the company’s staff. In the memo, staff were informed that the move is designed to “help improve the health of the company”, and that such “decisions are never easy”. It added that those affected will remain employed by Twitter on a “non-working notice” period during which they will receive compensation and benefits until 2 February 2023. They will, however, be left without access to Twitter systems and will not be expected to work. The overhaul comes a week after Musk stepped through the HQ doors (notably carrying a sink to allow for the news of his takeover of the company to “sink in”), and reportedly fired some of the former senior executive team at the company, including CEO Parag Agrawal, CFO Ned Segal and head of legal policy, trust and safety Vijaya Gadde.
UK operator group BT is trimming the fat more than previously planned, with CEO Philip Jansen noting that the company is looking to increase its cost savings target from £2.5bn to £3bn by the end of fiscal year 2025. The measure is driven by a need to reduce costs and support network investments considering the current “high-inflationary environment, including significantly increased energy prices”, he explained. Despite this, Jansen is confident that BT is “on the front foot in these turbulent times” and will be able to deliver its long-term ambition “while underpinning economic growth in the UK”. BT’s revenue for fiscal Q2 2022 (ending on 30 September) remained flat at £5.2bn. Its Openreach subsidiary saw a 4% year-on-year rise in revenue while its Consumer unit saw a 1% increase, but these gains were offset by a 4% decline in its Enterprise division and a further 3% drop in its Global unit. The company said that its performance for the period was up due to “improved fixed and mobile service revenues, helped by the annual contractual price rise and higher roaming revenues”. The UK operator is also “ahead of plan” on fibre-to-the-premises (FTTP) deployments as it has now reached 8.8 million premises, including nearly 3 million in rural areas. Its 5G base stood at 8.2 million in the period, with consumer numbers doubling year on year, while enterprise connections were 90% higher compared to the same period in 2021. See more.
Jessica Rosenworcel, chairwoman of US regulator the Federal Communications Commission (FCC), has announced a plan to “reorganise the agency to better support the needs of the growing satellite industry, promote long-term technical capacity at the FCC, and navigate 21st century global communications policy,” which is quite a big task list! Rosenworcel aims to reshuffle the FCC’s International Bureau into a new Space Bureau and a standalone Office of International Affairs to ensure that “the agency can continue to fulfil its statutory obligations and keep pace with the rapidly changing realities of the satellite industry and global communications policy,” noted the FCC. "The satellite industry is growing at a record pace, but here on the ground our regulatory frameworks for licensing them have not kept up. Over the past two years, the agency has received applications for 64,000 new satellites. In addition, we are seeing new commercial models, new players, and new technologies coming together to pioneer a wide-range of new satellite services and space-based activities that need access to wireless airwaves,” noted Rosenworcel. “Today, I announced a plan to build on this success and prepare for what comes next. A new Space Bureau at the FCC will ensure that the agency's resources are appropriately aligned to fulfil its statutory obligations, improve its coordination across the federal government, and support the 21st century satellite industry."
While for some the past quarter might have been relatively challenging due to macroeconomic uncertainty and inflation, others seem to have been affected much less so. Spain-based telco Telefónica reported “solid results” for the third quarter of 2022 reflected in a 11.2% year-on-year revenue growth to €10.3bn. The performance was attributed to a strengthened position in its main markets and exploitation of new opportunities. Most gains were achieved in Brazil, where the company recorded a 29% year-on-year revenue growth, and in its Hispanoamérica unit (including its operations in Latin and Central America) which booked a 18.2% revenue growth in the period. Given this, the company is bullish it will achieve its financial targets for the full year despite “the complex environment of global uncertainty and the deep energy and inflation crisis”, said chairman and CEO José María Álvarez-Pallete. He added that the telco is going ahead with its strategic plan as “the strength of the balance sheet allows the company to face the demands of this new digital era while maintaining its firm commitment to create a better, more connected and more equal world.” Another highlight in its results was the performance of its cloud, AI and cybersecurity services division, Telefónica Tech. The unit’s revenue grew by 68.6% year on year to €386m. Telefónica’s access base stood at 383.5 million, up 5% on the same period of 2021, with fibre growing by 17% and mobile contracts up by 8% year on year. The operator’s 5G coverage has now exceeded 800 towns and cities in the UK, 83% of the population in Spain, three-quarters of the population of Germany and 35 cities in Brazil. Read more.
T-Mobile has gone off-piste with a foray into the world of suitcases. Yes, you read that right! The US self-proclaimed Un-carrier has just unveiled a new “smart, very-magenta suitcase” in collaboration with travel-bag maker Samsara Luggage as part of its connectivity travel package Coverage Beyond, which it introduced earlier this year. The $325 carry-on bag sports wireless charging, a removable battery pack and tag smart technology, allowing consumers to track their baggage. According to the company, the accessory also serves as a “workstation on wheels” as its flat-top surface lets people place a laptop on it and work while in transit. “I know there’s a lot to unpack here. Why is T-Mobile, a wireless provider, launching a suitcase? Well, we’re the Un-carrier – and travel is kind of our bag. So we made one. A bag. An actual bag,” commented the company’s CEO, Mike Sievert, adding that the launch was in “in true Un-carrier fashion”. “We made a smart suitcase to keep your belongings covered, too. Literally.” You can see more about the unconventional offering here.
MTN has announced it is getting very close to exiting Afghanistan as it takes steps to shift its presence away from the Middle East. Alongside its earnings for the third quarter of the year, the telco group revealed it has entered into agreements to sell its Afghan unit to Lebanon-based investment holdings group M1 New Ventures for $35m. Currently, the sale is subject to transition agreement and regulatory approvals. The move is part of MTN’s Ambition 2025 strategy, which aims to build “the largest and most valuable platform business with a clear focus on Africa” instead of prioritising business in the Middle East. MTN is also making progress with cashing in on its fintech business, which has been repeatedly highlighted as a staple for the company’s growth. The telco noted it is now in the binding offer phase and is expecting to secure a minority investment in the unit in early Q1 2023. It also reported that group revenue was up 14.3% year on year, although it did not provide an exact figure. Its total subscribers grew 6.8% to 285 million, while fintech customer numbers saw a 23.3% year-on-year increase to 63 million.
Deutsche Telekom is involved in an interesting industrial 5G field trial at the port of Duisburg, Germany, where the “semi-automated control of port cranes is to be tested via mobile communications technology”. According to DT, “semi-automated control of mobile cargo handling equipment in inland ports has not been possible” up to now, so the operator and various partners, including the University of Duisburg-Essen (UDE), Duisburger Hafen AG (duisport), Startport GmbH and Polo Know-How Industrie-Engineering GmbH are to “develop and test innovative logistics solutions based on 5G in Duisburg on parts of Europe's largest inland port." Read more.
The telecom server market is expected to be worth $14bn by 2026, according to the research firm Dell’Oro Group, with edge datacentre investments driving most of the market growth over the next few years and accounting for 50% of the telecom server investments in four years’ time. “Datacentre IT and telecom network infrastructure have been converging in recent years. Service providers have been replacing dedicated devices with unique hardware architectures in the mobile core network with commercial off-the-shelf (COTS) hardware to virtualise various network functions,” noted Baron Fung, research director at Dell’Oro Group. “Network function virtualisation has the potential to reduce capex through the use of less expensive and commoditised COTS hardware, instead of dedicated or proprietary hardware for network services. Furthermore, a new class of latency-sensitive applications in the form of multi-access edge computing (MEC), and virtualisation of the baseband functions in the radio access networks in the form of Open RAN, will pave the way for the explosive growth of a new class of servers located at the network edge,” he added. Read more.
- The staff, TelecomTV
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