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UK: International roaming with 3 January 17, 2007

Posted by Jasper in Mobile.
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Yesterday 3 in the UK announced what may mark a new round of cuts to international roaming rates or changes to charging structures (excerpt from press release):

3 today throws down the gauntlet to the other mobile operators to put an end the ‘international roaming rip-off’ with the launch of ‘3 Like Home’. ‘3 Like Home’ marks an end to extra charges for all 3 customers by allowing them to use their existing bundles when using any 3 network abroad.

All 3 customers visiting Ireland, Italy, Austria, Australia, Hong Kong, Sweden and Denmark will now be able to take advantage of being on one of 3’s sister networks to use their existing minutes, text and data bundles to make voice and video calls, send texts, picture and video messages, and even surf the internet or watch TV from their handsets while abroad without accruing any additional charges.

3 Like Home also marks an end to customers being charged to receive calls when abroad – a practice that has led to many people opting to keep their mobiles switched off while abroad to avoid expensive charges. With ‘3 Like Home’, customers on any of their sister networks will be able to receive their calls and texts free of charge – just like they do at home.

Unlike other mobile operators who charge consumers a one-off fee or monthly subscription to access better calling rates to and avoid ‘roaming charges’ – the extra cost for making and receiving calls and data abroad – 3 Like Home will automatically apply when customers are on any of 3’s sister networks.

Great news if you’re a 3 subscriber in the UK travelling to Ireland, Australia, Italy, Austria, Hong Kong, Sweden or Denmark. Not so great if you’re anything else. Judging from other 3 websites a similar initiative has not been taken in other jurisdictions (at least not yet). 


Ireland: Mobile termination H3GI January 12, 2007

Posted by Jasper in Mobile, Regulation.

The Irish regulator ComReg is consulting on wholesale voice call termination on Hutchison 3G Ireland’s mobile network, releasing a consultation paper yesterday.

The interesting thing about this consultation is that reference is made to a bargaining model by Binmore and Harbord (BH).  This model emphasises the bargaining dynamic when operators set termination rates. While considerations of countervailing buying power and the like have been considered in mobile termination consultations before this would appear to be the first time that bargaining has been considered more formally by a regualtor.

ComReg has a number of reservations about the model, their principal being that its predicted outcomes do not fit the empirical evidence. The BH model predicts that H3GI would achieve termination rates equal to the average of the lowest termination rates in the market, this has not happened, as H3GI’s rates are above the levels in the overall mobile market. The BH model also predicts that in a situation of regulatory intervention stemming from the interconnectivity obligation and dispute resolution that H3GI’s bargaining power would be increased but that termination rates would remain around the average of the 2G operator rates. Again, this has not happened, H3GI’s rates are above the level in the overall mobile market.

I haven’t read the whole consultation document yet, but it certainly has a very different flavour than many other model termination consultations that nowadays more or less revolve around the same issues.

The consultation paper is available here.

UK: Spectrum costs November 29, 2006

Posted by Jasper in Costing, Mobile, Regulation.

In a letter sent to Ofcom the European Commission expresses concerns as to how wholesale tariffs, charged by the five UK mobile operators for terminating calls to their customers, have been assessed. In the Commission’s view, Ofcom’s proposed tariffs keep termination values higher than necessary due to 3G spectrum cost valuations which risk overestimating the costs. The Commission therefore asks the UK watchdog to reconsider the valuations. OFCOM’s approach would be detrimental to fair competition in the UK’s mobile market and lead to higher consumer prices for consumers. Commissioner Viviane Reding said:

I am concerned that Ofcom’s approach to calculate 3G spectrum costs could hinder the movement towards lower mobile interconnection prices.

The Commission believes that such costs should not be calculated on the basis of prices paid during the spectrum auctions, which are in today’s context inflated. Otherwise, distortions of competition and higher prices for mobile customers could be the result. I therefore ask OFCOM to reassess their method of calculating mobile termination rates in the UK.

I am generally of the belief that mobile termination prices in most jurisdictions are excessive, but I am surprised that the Commission has decided to attack Ofcom on this issue – Ofcom who were the first to create a mobile LRIC model and have been very aggressive on excessive termination rates. There are many assumptions in the UK mobile LRIC model that could be questioned. To pick one, as the Commission has done, tastes of regulatory cherry picking.

The target mobile termination prices are € 0.078 (5.3 pence) per minute for 2G/3G and € 0.089 (6 pence) per minute for 3G operators. According to the Commission, Ofcom has indicated the inclusion of 3G spectrum costs adds, on average, € 0.016 (1.2 pence) per minute to the mobile termination rates for the 2G/3G operators and € 0.028 (1.9 pence) per minute for the 3G-only operator. Even a small reduction in spectrum costs could therefore have an effect on prices.

However, valuation of spectrum on a current cost basis is no easy task. While a re-valuation of spectrum costs is likely to lead to a reduction, it is far from clear that any reduction in cost will be significant. Europe Economics considered how spectrum could valued in a report to the Commission in 2001. In it they noted:

One interesting case of particular importance in mobile telephony is the appropriate valuation of spectrum. Since the spectrum for 2G licenses cannot be traded, the NRV [Net Realisable Value] is zero. It could also be argued that the replacement cost is infinite (since it is impossible to purchase a similar asset), except on the rare occasion when further spectrum licences are offered for sale (e.g. 3G auctions). Even in these instances, spectrum is typically sold in large blocks that may be inappropriate for the replacement of 2G spectrum alone (MEA adjustments would be necessary). Furthermore, such sales are infrequent and therefore not helpful for calculating current costs on an ongoing basis.

The basis for Europe Economics analysis is the value to the owner convention. This defines current cost as the lower of replacement cost (RC) or deprival value (the greater of either selling the asset or using the asset). This can be written as Min [ RC, max [ NRV, NPV] ]. The replacement cost measures the cost of replacing the existing asset with another asset of similar performance characteristics; NRV is the net realisable value, the amount that would be obtained by selling an asset; and NPV is the net present value, the sum of discounted cash flows that an asset is expected to generate during its lifetime.

According to Europe Economics the substantial barriers to replacing 2G spectrum mean that it is not appropriate to use replacement cost for defining the current cost of spectrum. Hence, using the formula above, the current cost of spectrum is the greater of either zero (which is the NRV) or the NPV of the spectrum.

Basing the cost of spectrum on NPV requires the evaluation of the the expected future profits available to the mobile operator in question (after allowing for return on capital), over the life of the spectrum rights. If the future expected profit stream is greater than zero, the current cost of spectrum is the expected future profit stream (allowing for return on capital).

An easier methodology (but also subject to critique) may simply be benchmarking of spectrum value across Europe. This is likely to give the lower value desired by the Commission.

The Commission’s letter is available here.

Butan: Spectrum auction November 15, 2006

Posted by Jasper in Mobile.
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According to TeleGeography, Bhutan’s telecoms regulator is preparing an auction process for the country’s second national mobile operator. There are some unusual aspects to this process.

First, under the auction rules current monopolist B-Mobile must match the winning bid in order to renew its own license, which expires next July. B-mobile is wholly owned by state-owned fixed line operator Bhutan Telecom and has so far been leasing wireless spectrum and has not had to pay for its concession. Hence worries have been raised that it may struggle to meet the financial demands. I think not. If it does, there is something very wrong in the market or with the auction mechanism.

Second, the auction will start by firms (there are currently four who have shown interest) submitting sealed bids, the highest of which will become the minimum price for the second round, and this will be conducted as an open auction. Why have sealed bid round if you are going to have open auction afterwards? The bidders have no incentive to bid anything in the first round. Something close to zero will do. The competition will only begin once the open cry auction is underway.

Third, in order to try to limit the price of the new 15-year license, the regulator – Bhutan Infocomm Media Authority (BIMA) – is requiring bidders to pay at least 51% of the license fee from their own funds; the remainder can be paid with the help of financial backers. Why try and limit the price in this way unless you are trying to protect the incumbent.

North America: B&O and Samsung October 31, 2006

Posted by Jasper in Mobile, Technology.
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Bang & Olufsen America, with help from Samsung Electronics Mobile Business, has developed a new mobile phone. Their partnership is bringing one a mobile phone to the North American market next month.

As a Dane I pride myself of the B&O brand and during the years I have owned a number of B&O devices.  However, their latest phone creation strikes me as being odd. Dubbed the “Serene,” is the result of a 2-year collaboration between the companies to develop what they consider an elegant and straightforward product for customers for whom “less can be more.” I don’t know about that. After a quick flick through the Serene website it didn’t appeal to me at all. If a simple phone is all you want I would rather go with a black Motorola RAZR V3 which doesn’t come with a US$1000+ price tag. But  then again I don’t fall within the target group represented by 25-40 year-old women, who do not lack money and need to prove their status in society.

Malaysia: highest 3G call October 10, 2006

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As a four time climber of Mount Kinabalu, located in Kinabalu National Park on the Malaysian part of Borneo, I was delighted to read that video calls can be made on the peak thanks to the services provided by Celcom’s 3G coverage. According to Celcom Malaysia this is the highest 3G coverage in the world to date. Mount Kinabalu’s height has been given as 4,095 m or 13,450 ft above sea level.

According to the climbers making the first call, the video transmission quality was fairly good although it could have been better if the weather was good. See The Star for more details.

Australia: NEXT G October 6, 2006

Posted by Jasper in broadband, Mobile.

Today, Telstra formally announced the launch of its nationwide AU$ 1 billion 3G network called NEXT G. Something I was made acutely aware of this morning by loud live music ricocheting off buildings disturbing my otherwise quite office surroundings. The Telstra launch party had installed itself by the Brisbane River no more than 30 meters from my office building. I am surprised that this is allowed in the CBD on an otherwise normal Friday. Nevertheless, there are number of interesting aspects to the launch.

Telstra is rolling out their 3G network using 2100Mhz & 850Mhz in combination. As far as I am aware Telstra are the only carrier in the world to do this. As of yet it is unclear what this will mean in terms of speed. Telstra claims that in March next year it will be able to offer peak speeds of up to 14.4Mbit/s and in 2009 up to 40Mbit/s. Bold promises, but will they deliver and what happens in the 850MHz range? The unique approach will also be a challenge for Telstra in terms of handset availability. Not surprisingly, Telstra’s handset range will initially be limited to three models.

To use the service for broadband data access, Telstra is currently offering a “NEXT G turbo card”, with initial plans offering 400MB for AU$79.95/month and AU$109.95/month for 1GB – not cheap by any means.

Still, good news that Telstra’s mobile network has been upgraded and that its upgrade has a 98% demographic coverage (see coverage map below). But I am still waiting for someone to step up to the plate and build a true high speed fibre based network. Now that would be an announcement and something that Australians desperately need.


Voice SMS October 6, 2006

Posted by Jasper in Mobile.
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Here is a service that has bypassed my radar: Voice SMS (VSMS). It provides the user the option to to send audio SMS messages or to reply to text (and voice) SMS messages with a verbal response. Apparently it is popular service in Asia. Early experience in several Asian countries suggest very rapid adoption — 30% to 50% penetration in less than 12 months for a service which is priced below voice phone calls, but 50% above SMS messages (sourced here).

According to Ericsson’s website:

Digi – Malaysia’s third-largest operator with more than 4 million subscribers – launched BubbleTALK [the VSMS service] in February [2005]. In August [2005], usage had surged to 200,000 messages a day. During this time, customers were offered 10 free messages a day in a two-month promotion.

It addresses literacy issues as well as those created by non-roman based languages. Also it provides a convenient alternative for those that have not mastered the key pad on most mobiles. Finally, there’s a lot more information and emotional content in a voice message than a text message.

Nordic countries: Report on mobile market October 3, 2006

Posted by Jasper in Mobile.

Last week a report on the Nordic mobile market was made available on the IT- og Telestyrelsen website. It is a collaboration between the Nordic telecom regulators: NPT (Norway), FICORA (Finland), PTS (Sweden), ITST (Denmark) and PTA (Iceland).

It provides a reasonable starting point for anyone wishing an overview of the Nordic mobile market. Some of the conclusions include:

  • The growth in the number of mobile subscriptions relative to the population (mobile penetration) has been similar in all Nordic countries. Today, mobile penetration is above 100 % in all five countries;
  • Demark has the lowest mobile prices in the Nordic countries;
  • Denmark has the highest number of text messages per customer per year;
  • Finland has witnessed a markedly higher number of portings than the other Nordic countries;
  • Finland has the highest number of traffic minutes per customer per year;
  • Sweden currently has the most operators (MNO, MVNO and SP);
  • Based on a concentration index at a wholesale level, Denmark has the most competitive market; and
  • Denmark currently has the highest mobile termination prices.

The report is availbale here.

Europe: International roaming – ATKearney CRAI report September 30, 2006

Posted by Jasper in Mobile, Regulation.
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On 21 September 2006 the GSM Association (GSMA), the global trade association for mobile operators, filed a complaint with the European Ombudsman setting out its concerns about the European Commission’s proposal for regulation of the international roaming market. The GSMA’s complaint relates to three aspects of the regulation and the associated adoption process (see press release):

1) The GSMA believes the European Commission failed to conduct a proper consultation process. While the Commission conducted two public consultations on regulation of the international roaming market, they both failed to follow the Commission’s own procedures for providing clear content and adequate time for responses. Moreover, following these ‘public consultations’, the Commission drastically changed its proposal for regulation without submitting the new proposal to additional public consultation.

2) The GSMA believes the European Commission failed to conduct a proper impact assessment. The published impact assessment, which didn’t follow the Commission’s internal guidelines, is incomplete, contains important methodological flaws and is based on unrealistic assumptions. For example, the Commission concluded that consumers would see a net gain of 3.78 billion euros from the proposed regulation. But a review of the Commission’s impact assessment, prepared for the GSMA by AT Kearney and CRA International (CRAI), found that the impact on consumer welfare would be marginal at best, and could even be negative.

3) The GSMA believes the European Commission’s proposed regulation violates the principles of proportionality, subsidiarity, legitimate expectations and non-discrimination. The holistic nature of the existing regulatory framework restricts the Commission’s ability to adopt an ad hoc regulation on roaming services.

What interests me is the report undertaken for the GSM Association by AT Kearney and CRAI. The report discusses the impact of the European Commission’s plans for international roaming and maintains that the Commission has used the wrong figure for the size of the retail roaming market. According to the report’s authors:

…their corrected welfare modelling indicates that the case for the Commission’s proposed regulation is only marginal at best and could even be negative, rather than significant, as the Commission has estimated.

Let me offer a few comments.

The ATKearney CRAI recommendation centres on a Cost Benefit Analysis (CBA) and on the their own evaluation of that CBA. The CBA is an assessment of a counterfactual scenario (“the future without regulation”) with a factual scenario (“the future with regulation”) – in fact there are two factual scenarios.

In principle, the approach adopted is more complete compared to that of the Commission. It attempts to model detriments to regulation which the Commission appear to have neglected (I have not read the Commission assessment). In this sense it provides a more complete analysis of the market for international roaming and the (net) consequences of regulation. Whether or not there are measurable detriments of the magnitude suggested by the authors is an issue I explore briefly below.

One crucial correction is the Commission’s estimate of the benefits which is based on the GSMA’s estimate of the aggregate EU roaming revenues of about €8.5 billion. However, according the authors the GSMA’s €8.5 billion figure includes revenues from both the retail and wholesale markets and is not an appropriate basis on which to calculate the ultimate saving for consumers. I do not have the data to evaluate the figure, but expect that ATKearney and CRAI are correct as the number has been sourced from their client.

I agree with ATKearney and CRAI that the Commission should take account of announcements by individual operators and any announced industry agreements in the factual scenario. Also I agree that the Commission has adopted some rather suspect elasticity assumptions in some of their scenarios.

The authors introduce two concepts: cost pass-through and the waterbed effect or a rebalancing effect.

Cost pass-through is degree to which reductions in wholesale prices are passed-through to retail prices, while the waterbed effect is the degree to which operators seek to recoup lost profits in the market for international roaming from other services or markets. The waterbed effect might also be called a pass-through rate, i.e. it is the extent to which any given loss in international roaming profits resulting from regulation is translated through into increases in other retail mobile prices. A decrease (increase) in this rate produces a smaller (greater) waterbed effect, and hence a smaller (larger) detriment. Setting the pass-through rate to zero is equivalent to assuming that there is no waterbed effect.

Both assumptions are critical to the author’s analysis, unfortunately very little documentation is provided to substantiate the values used. In particular I would have liked to have seen an analysis of historical cost pass-through. In their Medium case, the authors assume that rebalancing would operate so that 80 per cent of the loss in profits on retail roaming calls would be recovered in mobile subscription charges and mobile outgoing call prices. No evidence is provided to support this value – a value I believe is exaggerated.

The authors criticize the Commission for using an aggregate measure for total welfare for consumers and industry and not considering how the proposal will impact different Member States. However, the authors themselves do not attempt a disaggregated approach. I think it would desirable to disaggregate into at least three or four category of Member State.

Any offsetting effects of their new assumptions are disregarded. For example, as a result their assumed reductions in mobile subscribers there would a corresponding outward shift of the demand for fixed calls.

In addition, makes no attempt to discuss a number of issues that could have major impact the results (although to their defense I assume they adopt the same values as the Commission). For example:

  • Study Period: what is period over which the welfare gains/losses are calculated?
  • Discount rate: The choice of discount rate in a CBA is potentially a very contentious issue. What is the level of the discount rate used to calculated the net present value of net benefits?
  • VAT: VAT should be excluded for estimates of productive surpluses since the VAT is a transfer payment; however, it is not correct in the calculation of allocative surpluses. How is it treated here?
  • Shape of demand curve. Two alternatives are typically used: a linear curve and the constant elasticity of demand curve. Which one is used?

ATKearney CRAI assume that the impact of lower wholesale roaming charges on the profitability of operators maintaining cell sites in areas in which roaming revenues are significant leading to loss of coverage. I disagree. It seems highly implausible that an operator will remove (sunk) cell sites already deployed.

A CBA should be applied rigorously and transparently. The ATKearney CRAI report appears to be an improvement on the Commission’s analysis, but it is overly critical and hence biased towards a non-regulation scenario and does not provide the detail needed for a third party to do a proper evaluation.

Access the AT Kearney CRAI report “Review of the Commission’s Impact Assessment” here and the Executive Summary of the Review here.

UK: Launch of quadruple-play September 29, 2006

Posted by Jasper in broadband, Mobile.
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NTL has announced the launch of the UK’s first quadruple-play package. The service will offer digital TV, mobile services, internet access and fixed-line telephony, for a monthly charge of £40 (US$75.7). According to the NTL media release the quad package includes:

• Up to 2Mb with no limits on downloads
• Firewall and anti-virus software included
• Installed by an expert and modem included
Digital TV
• Over 30 channels, including Sky One, UKTV Gold, E4, Film4, ITV2 and LIVINGtv
• On demand access to a huge library of programmes and films – watch what you want, when you want
• Set-top box included and no need for a dish
Home phone
• Unlimited weekend calls to any UK landline
• Highly competitive mobile rates and simple tariffs at other times
• Standard features including 1471 and 1571 voicemail
• A Virgin Mobile SIM
• 300 texts and 300 minutes a month, plus free voicemail
• Access to Virgin Mobile Bites entertainment service

The move is the first realisation of the potential of the combined NTL-Virgin partnership. NTL is expected to rebrand the entire company under Richard Branson’s ubiquitous Virgin name next year. It bought Virgin Mobile earlier this year in a deal that made Branson NTL’s largest shareholder.

One of the key hurdles for NTL will be ensure a high-quality customer service with all four options given that the company is still trying to integrate the companies.

Gapminder and developing countries September 25, 2006

Posted by Jasper in General, Mobile.
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In his blog Greg Mankiw points to the to the excellent and amusing presentation by Hans Rosling on how the well-being around the world has changed over the past forty years. He uses the program Gapminder which I briefly discussed in a previous post.

He wraps-up his presentation with a depiction of internet penetration plotted against GDP per capita. He shows how the world “is flattening out” as he puts it, because the internet has become more accessible over time in developing countries relative to their growth in GDP per capita.

After watching the presentation I thought I would have a look for any research in that area. I didn’t find anything directly related to the presentation but did find an interesting paper how on investments in mobile communications effects developing countries: The impact of telecoms on economic growth in developing countries by Leonard Waverman, Meloria Meschi, Melvyn Fuss, part of the The Vodafone Policy Paper Series. Waverman et al. examine 38 developing countries for which data was available for the period 1996-2003. They conclude:

Differences in the penetration and diffusion of mobile telephony certainly appear to explain some of the differences in growth rates between developing countries…

… There are increasing returns to the endowment of telecoms capital (as measured by the telecoms penetration rate).

Given the speed with which mobile telecoms have spread in developing nations, it is unlikely that large gaps in penetration will persist for ever. However, differences in the speed of adoption will affect the speed with which poor countries converge to rich countries’ level. Relative poverty still poses serious political problems, such as instability and increased demand for emigration. Our analysis suggests the need for regulatory policies that favour competition and encourage the speediest possible rollout of mobile telephony.

This is in-line with other research that suggests that telecommunications investments play an important role in improving well-being and wealth. To attract outside capital and investment in the mobile sector, devloping countries should open up for competition, implement an enforceable regulatory regime, reduce restrictions on foreign direct investment and (probably the most difficult of all) get rid of corruption.

Italy: Unica September 20, 2006

Posted by Jasper in broadband, Mobile, VoIP.
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Amidst the rather chaotic telcom market in Italy, Telecom Italia has (according to Total Telecom) quietly launched a UMA service called Unica. The service simply appeared on the telco’s Web site at the beginning of last week without all the whistles and bells the market had been expecting. Although this is probably not surprising given the sudden change in strategy with the split of fixed and mobile businesses.

The service as been subjected to regulatory scrutiny, which has resulted in the launch of a restricted offer where Telecom Italia only is permitted to sign up 30,000 customers for a six month period.

Unica is available to customers with a Telecom Italia fixed-line service, TIM consumer mobile tariffs and DSL/VoIP product Alice Voce. Unica carries a monthly subscription of €15 (plus €5/month for each additional handset) and customers will also be required to buy the Unica Pack for €369, comprising the Samsung SGH-P200 dual-mode GSM/WiFi handset and an Alice ADSL2+ WiFi modem.

The service enables users to make free calls from the home via the fixed phone or the Samsung handset, using voice over WiFi, and GSM calls away from home. Up to five mobile numbers can be assigned to the same contract.

The offer seems comparable to Home Free in Denmark in price and appears to have the same functionality. Will be interesting to see what the future holds for Unica against the current turmoil.

For more information see Total Telecom and/or Telecom Italia Unica page (in Italien)

US: Broadband auction ends September 19, 2006

Posted by Jasper in broadband, General, Mobile.
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Federal Communications Commission’s (FCC) auction of advanced wireless services spectrum ended yesterday raising US$13.9 billion (gross). T-Mobile USA was the top bidder, bidding almost US$4.2 billion for 120 licenses. Verizon Wireless agreed to pay US$2.8 billion for 13 licenses, while a consortium, Spectrum Co, that includes cable companies Comcast and Time Warner along with Sprint Nextel agreed to pay almost US$2.4 billion for 137 licenses.  Due to anti-collusion rules, the companies are not permitted to talk about what their plans for the spectrum are until they make a down payment.

From the results it is clear that the country’s largest providers have dominated the auction. So, any hope that new entrants would shake up the market has dwindled. 

Based on various sources (primarily RCR Wireless News and cellular news) I have complied the bidding behaviour from start on till finish. The 28-day-long auction ended after 161 rounds, with 104 of the 168 registered bidders winning at least one license. All but 35 of the total 1,122 licenses up for grabs received bids.  Detailed information on the auction can be found at the FCC. Click here.

And here is the summary…

August 9: T-Mobile USA dominates first round of AWS auction
T-Mobile USA Inc. led the first round of bidding, placing bids for spectrum that would substantially expand its national footprint. The carrier bid for 20 megahertz of spectrum in each of six regions across the country, as well as additional spectrum in markets such as San Francisco, Chicago, Dallas-Ft. Worth and many other markets. T-Mobile USA placed seven of the top 10 highest bids and bid highest for the Great Lakes, Northeast and Western regional licenses. The nation’s fourth-largest carrier also made more than half of the 40 highest bids so far.

August 10: T-Mobile USA continues aggressive play
T-Mobile USA Inc. is dominating the Federal Communications Commission’s spectrum auction after three rounds in terms of sheer dollars, with $226.6 million in bids so far. The carrier is the high bidder on 25 spectrum licenses covering 235 million potential customers.

August 11: NextWave strikes back
NextWave Telecom Inc.-backed AWS Wireless Inc. made three of the highest bids in the sixth round of the advanced wireless services spectrum auction, capturing—at least temporarily—the highly coveted Great Lakes regional 20-megahertz license as well as a 20-MHz license that covers 31 million pops in the Mississippi Valley and another that covers about 50 million pops in the West.

August 14:  $4.1B and counting
Bidding is picking up speed in the FCC’s advanced wireless services spectrum auction, with the total value of provisionally winning bids jumping from more than $2.4 billion late Friday to more than $4.1 billion in the two rounds held so far today.

August 15: Verizon Wireless throws weight around
Verizon Wireless staked a claim to all six of the largest licenses for sale in the advanced wireless services auction, bidding $3.5 billion in round 14 of the auction for 20 megahertz of spectrum covering the entire continental United States.

August 16: Satellite players call it quits
Satellite television providers EchoStar Communications Corp. and DirecTV Group Inc. have pulled out of the advanced wireless service spectrum auction.

August 17: Dolan Family Drops Out Of Auction; Bids Over $11 Billion

After initially placing big bids, the Dolan family (Dolan Family Holdings, based in Woodbury, N.Y) withdrew from the auction without winning any licenses.  The withdrawal came as the total amount of bids placed in the auction reached almost $11.1 billion. There hasn’t been any bidding on the five most expensive licenses for the past six rounds, raising the possibility that the winning bids for those licenses have already been placed. The top five bids by dollar value have been placed by companies controlled by Verizon Wireless, T-Mobile USA, and a group that includes buyout firm Madison Dearborn Partners.

August 18: Dust settles around Verizon and T-Mobile

The battle for the large regional licenses appears to be largely settled at this point, with Verizon Wireless and T-Mobile USA Inc. the big winners.

August 21: Bidding remains robust in smaller licenses

Bidding remained active on the ninth day of the auction, as bidders continued to focus their attention on smaller licenses now that bidding on big regional licenses appears to have ended.

August 21: Bidding remains fierce for metro and small regional

Just as at any yard sale after a long weekend, the big, expensive items are long gone and the persistent shoppers have continued to rummage about for the unappreciated gems that add significant value to their own current holdings.

August 23: Bidding nears $13 billion

The total amount raised is creeping toward $13 billion, although each round is raising less money that the previous. However, bidding is still active on a number of licenses; the number of licenses with new high bids continues to hover near 300. 

August 24: Cable gaining steam

Some of the players who were squeezed out of regional spectrum licenses early in the auction seem to be making up the loss with dozens of smaller geographic licenses.

August 25: Bidding slows as third weeken breaks near 

The Sprint Nextel Corp./cable joint venture appears to be achieving a national footprint without the benefit of costly regional licenses.

August 28: Bidding continues to slow

Bidding has slowed dramatically with an average of about 140 new bids placed in the last few rounds. This compares to 240 bids in recent rounds. The leaders in overall bidding are still in place after round 50, and they stack up like this:

  1. T-Mobile at $3.9 billion
  2. Verizon Wireless at $2.8 billion
  3. SpectrumCo at $2.2 billion
  4. MetroPCS at $1.4 billion
  5. Cingular at $1.2 billion

August 29: FCC attempts to spur auction action

In a sign that the auction is drawing nearer to conclusion, the FCC increased the number of bidding rounds per day from 4 to 6. The auction has garnered nearly $13.6 billion in bids following round 58, though the number of bids per round has fallen by half to around 150 bids per round.

August 30: Battle brewing between smaller bidders

NextWave Telecom Inc. continues to elbow other companies for spectrum, holding 144 high bids on spectrum through its AWS Wireless Inc. bidding subsidiary worth about $121 million at the end of round 61.Dobson Communications Corp., has been dueling with AWS for licenses in Maryland, Kentucky and New York. One of the Kentucky licenses, the Kentucky 4-Spencer license, is currently going for about 18 cents per-MHz-per-pop for a total price of $960,000 and is held by NextWave. Meanwhile, Dobson outbid NextWave for spectrum in Glens Falls, N.Y. with an offer of 6 cents per-MHz-per-pop, or $140,000 total.

August 31: Is the end near?

Bidding continues to slow with only 91 new bids being entered in round 67, though the number of bids was up slightly from the 83 bids placed in rounds 65 and 66. The number of bids per round has been below 100 since round 62.

September 1: NextWave, Dobson remain active as auction breaks for holiday

NextWave Telecom Inc. and Dobson Communications Co. are the two most active bidders remaining.  The bidding continued to wind down on Friday, with an average of 63 new bids per round for the last three rounds of the week. Only 110 of the 168 eligible bidders remain. Bidding will resume on Tuesday after the Labor Day holiday. The auction so far has raised about $13.7 billion, and 1,055 of the 1,122 licenses offered have received bids.

September 5: Jousting continues as bidding winds down

The auction continues to creep toward a close, with just 64 bids in recent rounds. Of the 64 new bids placed in round 77, eight came from Dobson, 14 came from NextWave, and another 14 came from Red Rock. Leap chipped in half a dozen, and the Sprint Nextel-cable JV placed four.

September 6: Verizon Wireless kicks T-Mobile USA out of Hawaii

Dobson dominated round 85 placing nearly half of the new bids in the round. Verizon Wireless also re-entered the fray after watching from the sidelines for much of the bidding. The carrier placed a $4.1 million high bid on a 20-megahertz F-block license covering Hawaii; T-Mobile USA Inc. had previously held the license.

September 7: Verizon Wireless shows renewed interest as bids dwindle

Bidding has slowed to a trickle with thirty or fewer new bids received in the last few rounds. But a few tussles are still ongoing, including Verizon Wireless trying to edge the Sprint Nextel Corp.-cable company joint venture out of spectrum in Louisiana. Verizon Wireless is also still fighting for licenses in Hawaii. The nation’s No. 2 carrier had been sitting on the sidelines during most of the auction after picking up several of the most expensive licenses in early rounds.

September 8: Skirmishes continue in Louisiana, Iowa and Hawaii

Spectrum in Louisiana, Iowa and Hawaii is still attracting competition from bidders large and small. After more than 100 rounds of bidding over 22 days, the FCC has received fewer than 20 bids in each of the last three rounds. But battles are still going on. Analysts expect to see the auction go on for at least another week or two, and possibly continue until the end of the month.

September 11 -15: Bidding continues to slow

After 141 rounds, T-Mobile has provisionally won 119 licenses in major markets like New York City and Chicago with offers of almost US$4.2 billion. The auction grossed almost US$13.9 billion on Thursday, but would net about US$13.7 billion, because of discounts offered to entrepreneurial bidders. Four bids were made in the round 141.

September 18: Bidding slows to a crawl and ends

No new bids in round 161 – Auction ends.

India: World’s fastest growing mobile market September 16, 2006

Posted by Jasper in Mobile.
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According to the Cellular Operators Association of India, the country added 5.9 million subscribers last month, topping China’s total of 5.2 million. That makes India the world’s fastest-growing mobile market. Not surprisingly, this is putting a strain on quality of service.

About half a dozen major mobile operators and several smaller ones cover less than half of India’s population. Most coverage is centered in big cities. Operators have yet to venture out to many villages to reach the rural population of 660 million. But I suspect they are not in a hurry too, because of a poor and spotty infrastructure and a very limited ability to pay (although sources suggest India has cheap calling rates).

With 123 million subscribers now, similar growth rates in the coming months will easily project the number of subscribers above the 130 million mark by the end of this year. No doubt someone could sell a lot of secondhand handsets from European markets to the Indians.