Friday News Round-up: 29/08/2014
29 August 2014 | Kavit Majithia
A summary of the week's biggest wholesale telecoms news stories.
The noise from Brazil
The long-running saga regarding Vivendi’s proposed sale of its Brazilian unit GVT is now heading in one of two directions, after both Télefonica and Telecom Italia made bids to acquire the company this week.
By the close of business today, the market could see the French media group accept Telefónica’s slightly higher offer, valuing GVT at an enterprise value of €7.45 billion.
The increased bid, which was confirmed yesterday, is due to expire today, and could see the unit fall into the hands of the Spanish group after nearly two years of speculation concerning the Brazilian firm.
Conversely, Vivendi could opt to reject the bid and instigate a price war between the two European players, with the intention of gaining as much enterprise value as possible from the lucrative Brazilian broadband player.
Will Vivendi play the game, or look for a quick exit?
In the US, AT&T took the bold step of integrating its mobile and fixed-line businesses and will now offer the services through one division.
The combined unit will be headed up by its former mobile head Ralph de la Vega, and is targeted at working more closely with business services customers.
According to analysts, AT&T’s move is designed to counter the growing threat from cablecos, which are increasingly trying to muscle in on business and enterprise customers, and offers a rounded solution on both sides of the market.
As the cable industry gets stronger, particularly with the pending merger of Time Warner Cable and Comcast, Capacity expects other carriers in the market to adopt a similar strategy to AT&T in the near future.
Capacity’s second Myanmar Connect conference is also fast approaching, and the country’s incumbent player MPT announced plans on Wednesday to modernise its core infrastructure in a bid to help the international operators due to enter the market.
The news came a week after Telenor, one of the winners of Myanmar’s lucrative mobile licence auction, revealed that it had found child labourers working for its suppliers, as it prepares to launch mobile services.
Despite widespread telecoms deployment and development, Telenor said it continues to be subject to a range of external hurdles in its efforts to implement its initiatives.
International players entering Myanmar, including Ooredoo, KDDI and Telenor will now hopefully implement their own successful CSR initiatives to alter the landscape of how businesses operate in the country.
To round off, news broke late yesterday that a seven-operator consortium will build another cable connecting Asia to the US, after the FASTER trans-Pacific cable network was announced in early August.
It will also have the same network supplier, with NEC’s submarine business awarded the contract to build the 15,000km cable.
The latest system, SEA-US, will provide connections between the Philippines, Indonesia and the US, requiring an investment of $250 million with five landing points.
The consortium said the cable is designed to foster international trade and economic development between the three nations and will cater to the needs of multinationals and entrepreneurial startups.
SEA-US is scheduled to be completed in Q4 2016 and joins FASTER, SEA-ME-WE 5 and AAE-1 on the construction schedule.
2014 has been a big year for the subsea cable market.
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