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24 October 2014
| Kavit Majithia
A summary of the week’s biggest telecoms news stories.
Operators look towards
Both Telefónica and SoftBank announced plans to invest
in startups outside of their home markets this week.
Spain’s Telefónica struck a partnership
with innovative developer VLX Ventures in a bid to tap into the Israeli market,
and the companies will look at developing startups across the
The collaboration is an interesting one. Telefónica will
offer investment capital to a range of companies focussed on
the telecoms verticals, including cloud computing, big data,
the IoT, smart homes and wearable technologies.
Telefónica – which launched its
Telefónica Digital entity as part of a move towards
developing new services – said it was committed to
Israel, given that it is a "country packed full of
world-leading talent and innovative companies".
Active Japanese player SoftBank also announced a partnership with
tech investor Sequoia Capital, to spend $100 million in
Indonesian startup player Tokopedia.
Global companies continue to target the pending growth in
internet penetration across the country, with the amount of
users expected to jump from 75 million to 125 million by
SoftBank’s investment with Sequoia Capital, which
has previously financed a range of Silicon Valley startups,
will leverage pending growth in Indonesia’s
The country’s incumbent Telkom Indonesia announced it will also triple
investments in the country in 2015, as part of growth plans
for the sector.
Verizon not interested in Mexico
Verizon took the unusual step of distancing itself from a deal to acquire parts
of América Móvil's assets after rumours
emerged that it could rival AT&T in acquiring parts of the
América Móvil is looking for prospective buyers
as the Carlos Slim-owned company looks to appease the
country’s regulators by lowering its market share
to below 50%.
Verizon’s CFO Francis Shammo told the
world’s press this week that the company was not
interested in América Móvil assets, and seemingly
is not interested if AT&T were to make a play for those
parts of the entity.
Several global operators are said to be interested in acquiring
a chunk of the assets, and investment from an international
player would be welcomed by the government, which is promoting
the entrance of new companies.
Verizon’s announcement comes as a surprise, but it
is doubtful that they are completely out of the running at this
EE tops the charts in Europe
Despite all the rumours and speculation surrounding a potential
sale of UK operator EE, the company announced this week it had added 1.4 million
4G subscribers to its network in Q2. The company is now the
largest 4G player in Europe and it continues to grow its 4G
With the UK market due to become even more saturated with the
entrance of BT as a mobile player, the news of its growth in 4G
comes as a welcome development.
Despite this, rumours that Orange and T-Mobile will look at
either an IPO or a sale of the joint entity continue to
surface, and the company’s CEO drew on low
consumer spending as a potential factor for some of the
troubles it is facing due to flat revenues.
EE forecasts it will have approximately six million 4G
customers by the end of the year, and if both parent companies
persist with the sale, EE could prove to be an attractive
proposition for any potential buyer.