Telecommunications

Second front opens in Vivendi’s Italian campaign

19 June 2019

Silvio Berlusconi’s plan to create a 4 bln euro pan-EU broadcaster from Mediaset could mute the influence of its French media rival in the new group. Vincent Bolloré’s firm, which may also be diluted by Rome in Telecom Italia, is getting a taste of its own cooking in Italy.

Rome can get edge on Paris with network M&A

17 June 2019

Telecom Italia may buy rival network provider Open Fiber. A deal could revive its fortunes by taking out a competitor. And a valuation of over 2 bln euros would allow the government, a shareholder in both, to secure control of the telco, at the expense of French rival Vivendi.

Pricey German auction interferes with 5G signal

13 June 2019

The country’s telco operators spent 6.6 bln euros on radio frequencies for next-generation mobile networks. That makes it harder for the likes of Deutsche Telekom and Vodafone to make money from 5G connections. Fierce competition means shareholders, not consumers, bear the brunt.

Trump gives China’s homegrown tech goal a boost

13 June 2019

Beijing’s move to grant 5G telecom licences early is a show of trade war bravura, given the foreign inputs required. Much of its industrial policy, though, has been about encouraging long-term self-sufficiency. Washington’s assault on equipment-maker Huawei now leaves no choice.

T-Mobile US backlash reveals M&A regulatory risk

11 June 2019

U.S. states are suing to block the firm from acquiring Sprint on antitrust grounds. The move defies telecom’s top watchdog but could stiffen opposition at the Department of Justice. Dealmakers who used to count on government agencies to coordinate may now face crossed lines.

Huawei’s EU friends will stay on the line for now

30 May 2019

BT and Vodafone paused sales of some of the Chinese group’s phones after America put it on a blacklist. Yet Huawei equipment still pervades European telecom networks. Ripping it out now would be costly and disruptive. Better to wait and see whether the U.S. pressure persists.

Airtel debt diet prepares it for Africa price war

28 May 2019

The Indian telecom giant is floating 25% of its African arm in London to help cut debt. The continent’s telecom market is growing quickly but competition is fierce. With less debt Airtel will be better positioned to fight back.

Aussie telco buyout exhibits fibre-optic fever

28 May 2019

Sweden’s EQT has offered to buy Vocus for $2.3 bln, a 35% premium to its undisturbed price and far higher than 2017 bids from KKR and Affinity. The price reflects hype around fancy fibre networks, which may not last. Shareholders will be grateful for the opportunity to exit.

Isolated Huawei may be shoved into Beijing’s arms

24 May 2019

Important suppliers such as Arm and Intel are abandoning the Chinese telecom titan after the United States blacklisted it. That puts $50 bln in overseas revenue at risk. Huawei has cash to cope for now, but a breakup or state intrusion can’t be dismissed as potential endgames.

Viewsroom: America’s topsy-turvy regulators

23 May 2019

Qualcomm lost a lawsuit brought by one DC overseer, even as the DOJ intervened, while $26 bln T-Mobile US-Sprint merger is getting yanked around by agencies with opposing views. Doing business is hard when agencies no longer act in unison. Plus: Is Luckin Coffee going cold?

Qualcomm, Sprint show U.S. policy blowing in wind

22 May 2019

A judge ruled against the $94 bln chipmaker in an Obama-era case the current administration failed to stop. The DOJ may block the FCC-recommended $26 bln telecom merger with T-Mobile US. Such cases highlight the random nature of Trump-era oversight. That’s bad for business.

Samsung reaps benefits of U.S.-China tech war

21 May 2019

Restrictions on Huawei’s use of American chips and software will make it harder to sell telecom gear outside the PRC. And Apple products could be vulnerable to a backlash in China. That leaves openings for the Korean group to sell network equipment as well as more smartphones.

Donald Trump may yet play Huawei-saving wild card

20 May 2019

The Chinese telecom firm has effectively been cut off from U.S. suppliers, from Qualcomm to Google. That happened to ZTE too, and the president relented largely to help trade talks. Huawei is a much bigger, bipartisan concern. Even so, a similar reprieve can’t be ruled out.

T-Mobile US wins game of national champions

20 May 2019

Its $26 bln merger with rival telecom Sprint is likely to be approved. There was little reason to block it. Still, taken with a U.S. ban on China’s Huawei and last year’s nixing of a bid for chipmaker Qualcomm, it’s clear keeping 5G in American hands is now a national priority.

MTN’s cut-price Nigerian float has silver linings

16 May 2019

The South African telecom group is listing its Nigerian unit for $5 bln. That looks cheap, but the move chimes with the government’s aim to develop local markets, and may ease a tax dispute. Exposing local shareholders to Abuja’s whims might even make it more predictable.

Washington and Beijing push tech chasm wider

16 May 2019

President Trump has launched an aggressive assault on telecom giant Huawei, as China moves to strengthen cybersecurity rules. The moves will further divide the sector and complicate trade negotiations. A costly technology cold war looks here to stay.

Vodafone belatedly makes the right dividend call

14 May 2019

Boss Nick Read slashed the 43 bln euro telecom group’s payout by 40% but also kept cash-flow targets the same. That implies he thinks investors would prefer a lower-levered company over one handing out unsustainable rewards. He might have made that connection a little sooner.

Masayoshi Son rides Uber from vision to value

9 May 2019

The SoftBank conglomerate he runs tripled quarterly operating profit to $4.5 bln on gains from the ride-hailing outfit and other startups. Son also doubled dividend payouts while obsessing over the stock price. It’s a stretch for a growth investor to try and have it both ways.

New BT manager tries to avoid Barcelona-Ajax fate

9 May 2019

The 22 bln pound UK broadband group has a big lead over rivals. So did the European soccer clubs before unlikely defeats this week. CEO Philip Jansen hopes to press his advantage by building more fibre lines. Staying ahead will probably require lower dividend payouts over time.

SoftBank plays its shell games with Yahoo Japan

8 May 2019

Masayoshi Son's conglomerate is shifting a $4 bln stake in the internet portal to its recently listed Japanese telecom unit. There is strategic logic in the move, but the financial benefit for shareholders on both sides is blurry. It's a prime example of Son's opaque dealings.