Democratisation…of technology…under threat

The decision by the US to add Huawei and some of its affiliates to a trade blacklist back in May, which had additional Huawei-linked companies added to the list this week, is a concerning development in the rise of powerful forces grappling to deal with the effects of the democratisation of technology through digitisation.

The rise of geopolitics as a method of framing the course of technological advancement and influence is a worrying trend, and has the power to diminish the digital dazzle created by the Web over the last three decades

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5G windfalls are going to take hard graft for service providers to achieve

Disclosure by Samsung recently of weak sales momentum for its premium Galaxy S10 device and stagnant demand for other high-end mobiles in its product line in the quarter to end-June, compounds similar pronouncements from Apple that sales of its iconic, and not inexpensive, iPhone continue to decline. The waning appetite for devices priced above US$500 points to a shift in market sentiment that seems to suggest that features included in high-end devices no longer justify the premium charged over medium-range ones. Or at least points to – and service providers and device manufacturers will be keenly hoping as much – consumers holding off spending top dollar on current generation devices in anticipation of the mass introduction of 5G handsets in the quarters to follow.

Samsung recently disclosed weak sales momentum for its premium Galaxy S10 device and stagnant demand for other high-end mobiles, as have rival device manufacturers

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Regulation hinders uptake of mobile money transfer services in India

Vodafone Idea, the India mobile operator created last year by the merger of Vodafone India and Idea Cellular, has announced plans to close its m-Pesa mobile money transfer business alongside the Payments Bank previously operated under the Idea brand, according to media reports in India.

The economic model for the Aditya Birla Idea Payments Bank is described as being no longer viable, and Vodafone Idea is also set to stop operating m-Pesa

During the company’s recent fiscal Q1 media call, Vodafone Idea CEO, Balesh Sharma said the economic model for the Aditya Birla Idea Payments Bank was no longer viable and together with winding-up the unit, Vodafone Idea would also move to stop operating m-Pesa.

Sharma attributed the decisions to regulatory changes for the banking business and deterioration of the telecommunications sector.

Abitya Birla Idea Payments Bank was part of a scheme by authorities in India to increase access to financial saving services, though similar services from Bharti Airtel and Paytm have also faced difficulties, with both forced to suspend services by regulators for a period during 2018.

Vodafone to spin-off towers into standalone business by May 2020

Following in the footsteps of Middle East operators such as Zain and Etisalat, Vodafone, Europe’s largest mobile operator, is putting into motion plans to spin-off its pan-European mobile tower business, in a process that could see the standalone company established as early as May 2020.

Mobile operators the world over have been struggling to grow revenues for years, and in a bid to do so, have become more open to opportunities to unlock embedded value in their operations. Vodafone recently reported that for the three months to end-June, year-on-year revenue was down 2%

Vodafone intends to monetise a substantial proportion of the new entity, TowerCo, within the next 18 months and this effort may include a potential flotation on the stock market, the sale of a minority stake in the whole business or in its tower operations in individual countries.

TowerCo will comprise 61,700 towers across 10 countries, with 75% of the sites located in key European markets of Germany, the UK, Italy and Spain. It is forecast the business will generate annual revenues in the region of €1.7 billion (US$1.9 billion) and €900 million in profits, leading analysts to value the business at between €15-20 billion.

Mobile operators the world over have been struggling to grow revenues for years, and in a bid to do so, have become more open to opportunities to unlock embedded value in their operations. Vodafone recently reported that for the three months to end-June, year-on-year revenue was down 2%.

Vodafone began evaluating a spin-off of the towers business last year, having received several offers for various parts of its portfolio.

5G stakes rise as falling operator revenues seek a remedy

The current financial results reporting season is an opportunity to assess the strategies being implemented by operators in a bid to hit the 5G jackpot, and whether these are likely to succeed or prove to be a challenging investment to garner positive results from.

Flat or declining revenues is a trend facing many service providers around the world, and in the UAE both Etisalat and du have been among 5G’s most fervent early proponents

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