a week in wireless

In Vino Veritas?

One morning a couple of weeks ago the Informer met up with a friend, a young boulevardier nursing a rather sore head. He was staring at his mobile phone. It turned out that the previous night, after getting what the Germans call ‘over-served’, he had sent a text message to his former squeeze, a lady who had terminated their relationship based on his refusal to commit to the three steps to heaven of cohabitation, betrothal and eventual procreation. With a weary shake of his aching head he showed the Informer what he had sent, which ran along the following lines:

“Baby I can’t believe it’s over, can’t believe I’ve lost my best friend and the person I love most in the world. Every day I wake up and wish we could still be together. This is the worst mistake of my life and I’m so scared that I’ll never get you back…”

“Crikey,” said the Informer.
“I know,” said his friend, ruefully. “None of it’s true.”

Everyone knows the danger of mixing alcohol with instant communications and there can be few of us among a fairly wide age range who haven’t at some stage sent a text message that, in the sober light of day, looks a touch ill-judged. Which is why, the Informer supposes, Google this week deployed Mail Goggles, an application that forces email users to solve a few arithmetical problems before they’re allowed to send messages late at night or on weekends, in an effort to guarantee their clear-mindedness. This service needs a mobile iteration – and soon.

Even better would be Beer Googles, a service that lets you use your phone to take a photo of the person you’re thinking of going home with and then uses facial recognition technology to check whether they meet your sober standards (pre-loaded in the set-up phase). If not, you get repeated electric shocks until you leave it alone.

These are minor headaches compared with the shattering hangover that dogs the financial community at the moment. Since we wake every day to news of this train-wreck, it occurs to the Informer that somebody should market a budget breakfast cereal called Credit Crunch, and cash in on the gallows-humour-dollar.

The tale of fiscal woe was illustrated beautifully this week when the Informer learned that the US national debt clock in New York, which since 1989 has displayed the soaring Yankee deficit in real time, had broken down because it had run out of zeroes. The clock was only designed to cope with an amount up to $10tn, which has proven a little optimistic. Early next year it will be modified to display debts of up to one quadrillion dollars. That’s $1,000,000,000,000,000. Let’s hope that doesn’t prove optimistic too.

The crunch has affected Chinese vendor Huawei, which this week postponed the planned sale of a stake in its handset unit, from which it had been hoping to raise $2bn – a sum that suddenly seems trifling. The firm issued a statement saying that it “believes that given current global market conditions and prevailing economic uncertainty, the interests of the company are best served by postponing the sale process.” At least Huawei isn’t in hock to shareholders; public companies looking to sell business units – think Motorola and its handset albatross – will be under even greater pressure now.

US carrier Sprint remains confident that it can still find a buyer for its Nextel iDEN business, though, which it bought in 2005 for $35bn. Speaking at a press conference for its Xohm WiMAX unit this week, CEO Dan Hesse was upbeat that a sale could still be made, although he conceded that it would be unlikely if prospective bidders needed to raise finance to make the deal happen. The Nextel business has plummeted in value since Sprint bought it, with $5bn widely seen as a reasonable price tag.

It’s an ill wind that blows nobody any good, they say, and the brass at Sprint certainly seem to be doing ok at the moment. A firm called Glass Lewis & Co – an investment advisory outfit – released a study this week that positioned Sprint at the top of the kind of list you don’t want to be top of. The firm had the worst pay-for-performance rating of all Standard & Poor’s index of 500 large companies, apparently. Which in layman’s terms is: money for old rope.

Sprint gurgled that is was a difficult year because of the golden punch in the stomach received by Gary Forsee on his departure and the golden pat on the bum given to Hesse on arrival. Glass Lewis’ calculations put Forsee’s ’07 takings at $22.4m (hardly the cost of failure that, is it?), and Hesse’s at $28.3m.

Probably the only consolation for Sprint is that it is unlikely to top this particular parade for 2008, what with the performance of the banking community this year.

Sprint’s all about the WiMAX now, of course, which some choose to portray – like Nextel’s iDEN – as a niche technology. When the Informer spoke to Barry West recently, the WiMAX overlord at Sprint, West addressed the comparison himself.

“I look back at Nextel, where we built a great business – a $35bn business – out of what people thought was a quirky, niche push to talk service. I think the same thing will happen with WiMAX, but it will happen much faster, because of the backing we have from companies like Intel on the chipset side.” Whether the value of the business will dive like the PTT operation – or “much faster” – remains to be seen.

Meanwhile, ZTE has announced that its TU25 USB modem has been certified by the Xohm operation.

Whether you wear the WiMAX or LTE colours is a moot point according to US firm xG technologies which, by its own proclamation is, “implementing a revolutionary low cost mobile communications system to defy all others currently on the market.” Phew, that’s heady stuff, isn’t it? We’ve seen some wild claims in this industry but the Informer can’t remember a pledge of universal defiance ever having been made.

Anyway, this week xG – which operates under not so much a veil of secrecy as a blast-proof blanket – announced an agreement with Tresco International, an investment firm controlled by the equally enigmatic Swedish billionaire Johan Bohman. Tresco ordered 1,000 xMax base stations from xG last month and will now act as a deployment partner to the vendor, selling service to aspiring carriers. The deal is worth some $300m.

xG is as bombastic as it is defiant. “xG’s territory partners will be able to offer high quality mobile communications packages at low fixed prices, thereby beating competitors in terms of both cost and service provision. XG expects that its xMax system will begin deploying next month in the southern Florida market, with other US territories following quickly on. xMax’s superior technology capabilities mean that data and modem services will be added on early in 2009,” the firm said.

Cynics might note that Tresco – as xG’s only customer to date – actually owns a little over four per cent of its supply partner. It reminds the Informer of when he was a kid and he had to sell raffle tickets for his school. They all went to his parents and grandparents, which wasn’t exactly a difficult pitch. Then again, it’s certainly not the first time a vendor has effectively sold equipment to itself in this industry. And a billionaire’s backing can be very useful indeed.

Speaking of billionaires, there was a bit of a wobble for Allen Stanford’s $20m cricket match between England and a West Indian all stars team. Caribbean carrier Digicel sponsors the West Indies national side and argued successfully that the team that will face England in the winner-takes-all match was effectively the national team by another name. On these grounds, Digicel claimed, it had been denied its standard sponsor’s rights.

At the time of writing it looks like Digicel’s carved its pound of flesh from Stanford’s cash cow which will cause sighs of relief in the dressing rooms of both teams, whose members stand to become instant dollar millionaires if victorious.

While most around them are losing their money, Deutsche Telekom, it has emerged, has been losing confidential customer details. This actually happened a couple of years ago but came to light this week when it became clear that German mag Der Spiegel was planning to run a story on it.

In 2006, DT was e-burgled, losing the personal information of some 17 million domestic T-Mobile subs. The missing data included subscribers’ mobile phone numbers, addresses, dates of birth and in some cases email addresses. Thankfully for DT and its mobile users, bank account details and credit card numbers remain secure. Unlike the financial institutions that issued them.

DT claims it has no evidence that the records, which include the confidential details of leading politicians and celebrities, have been used for illicit purpose. Some reports claimed the records had been offered for sale online, but no one had bought them. The German incumbent has set up a telephone hotline to deal with enquiries.

Somewhere in America on the dusty porch of a ranch house last weekend, an old man’s knees swelled up leading him to predict that there was a storm coming. He was right of course, although he might have been surprised to learn that it was the launch of a mobile email device from Research in Motion, and not an imminent hurricane.

The RIM Storm, slated for commercial availability later this year – in time for the Christmas feeding frenzy, presumably – is the latest handset that will be viewed principally as a riposte to the iPhone.

Among the claims being made for the unit is that it sports the world’s first “clickable” touch screen, which apparently responds “much like” a physical keyboard. Apple’s handset has come in for a few criticisms over its typing interface and RIM president Mike Lazaridis directed a few jabs in Apple’s general direction while waxing a little too lyrical about his latest product:

“The Blackberry Storm is a revolutionary touch screen smartphone that meets both the communications and multimedia needs of customers and solves the longstanding problem associated with typing on traditional touch screens. Consumers and business customers alike will appreciate this unique combination of a large and vibrant screen with a truly tactile touch interface,” he gushed.

In news just in this morning, UK-based operator Vodafone has made a Rand22.5bn ($2.5bn) bid for a further 15 per cent stake in South African operation Vodacom. If successful, Vodafone would own 65 per cent of an attractive asset with strong market positions in South Africa, Democratic Republic of Congo, Lesotho, Mozambique and Tanzania.

Vodacom is a 50/50 joint venture between Vodafone and local carrier Telkom, but the Big V has long been seeking to assume control of the South African JV and has come close on occasion, although talks with Telkom always seem to break down. Last month also saw the break down of merger talks between Telkom and Nigerian mobile operator Globacom, owned by business tycoon Mike Adenuga.

However, Vodafone’s latest proposed deal with Telkom also relies on the South African firm agreeing to unbundle its remaining stake of 35 per cent in Vodacom to Telkom shareholders.

Finally, the inherent silliness of the stock markets was exposed this week when a blogger posted news of a fictitious heart attack suffered by Apple front man Steve Jobs. This caused Apple shares to dive significantly. It’s a good way, the Informer supposes, for CEOs to test their reps in the marketplace. Imagine how miserable he’d have felt if the shares had gone up…

Take care

The Informer

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