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América Móvil Increases Its Stake in Telekom Austria to Over 50 Percent

América Móvil has announced that it has raised its stake in Telekom Austria to 50.8 percent. Its tender offer of 23.5 percent of the Austrian operator’s shares closed on 10 July, and its payment of €7.15 (US $9.70) per share is due by 24 July. Shareholders who did not tender their shares will have three more months in which to do so. The Austrian government will retain a 25 percent stake in Telekom Austria, under a joint shareholding pact it agreed upon with América Móvil in May. América Móvil, controlled by billionaire Carlos Slim, was declared dominant by Mexican regulators last year. While it is appealing the dominance finding, it seems that América Móvil has accepted that an appeal is very unlikely to succeed. Last week, the Mexican government approved broad regulations aimed at opening up the telecommunications and broadcasting industries. Shortly thereafter, América Móvil announced plans to divest itself of some of its operations in Mexico, which were not specified, in order to bring the company’s share of the Mexican telecommunications market below 50 percent. That could remove its dominant status and allow it to enter the TV sector.   Whether or not it ends up entering that sector, Mexico has clearly become a much less comfortable environment for América Móvil than previously. With opportunities contracting at home, and the size of its business set to contract there as well—at least for now—América Móvil is looking to expand abroad. By increasing its stake past the 50 percent mark, América Móvil will now control Telekom Austria’s management decisions and thus is set to become a player not only in Austria but in other Central and Eastern European countries where Telekom Austria has a presence.

The above item appeared in a recent issue of Tarifica's "The Story of The Week", a weekly report that analyzes noteworthy developments in the telecoms industry from around the world. For past issues or to learn more about The Story of The Week :  http://www.tarifica.com/storyoftheweek.aspx

3 UK to Launch App for Calls, Texts Via Wi-Fi

Mobile operator 3 UK has announced a new app called Three inTouch that allows customers to talk and text over a Wi-Fi connection. The app will be available beginning in early August and will be offered free to all contract, SIM and pay-as-you-go customers. Any minutes or texts used are charged against a customer’s existing monthly allowance or prepaid credit. The Wi-Fi usage is not charged against the customer’s data allowance.

This is an interesting service option. The calls and texts and not carried over IP; rather, a Wi-Fi signal conveys the calls and texts to 3 UK’s cellular network, which then completes the connection. Unlike with a VoIP or other OTT service, the charges are made to the user’s existing voice and text allowances. So it appears that the purpose of Three inTouch is not to compete with OTT providers but to ensure connectivity for 3 UK customers, especially if they are in a place where cellular coverage is poor or nonexistent, as long as a Wi-Fi connection is available.

 According to the operator, once the app is installed, the transition from standard service to Wi-Fi-assisted service is intended to be seamless.

Also in the U.K., operator EE has announced trials of a Wi-Fi voice service that is intended to create a “zero-defect” calling experience in the country’s busiest regions and get rid of “whitespots,” or no-service areas. In the U.S., T-Mobile currently has a similar service in which calls can be placed over a Wi-Fi connection and are charged based on monthly plan minutes.

“Using Wi-Fi to fill in low- or no-coverage “whitespots” makes sense in a country like the U.K., where free public Wi-Fi is available in many areas. In other markets, it is an open question whether operators would do better to invest in expanding and strengthening their cellular networks or in promoting the proliferation of Wi-Fi. In truth, while apps such as Three inTouch can offer some advantage to users, they are, in the long run, no substitute for reliable, gap-free mobile networks. “

John Dorfman,

Editor-in-Chief,

The Tarifica Alert

The above item appeared in a recent issue of The Tarifica Alert, a weekly resource that analyzes noteworthy developments in the telecoms industry from around the world. To access all of the latest articles and issues:  http://www.tarifica.com/TarificaAlert.aspx

EU Confirms Roaming Rate Cuts Starting in July

The European Commission has confirmed its new cuts in mobile roaming rates, which will take effect starting 1 July 2014. The cost of making a call when traveling in the EU drops 21 percent to €0.19 (US $0.26) per minute; the cost of receiving a call falls by 28.5 percent to €0.05 (US $0.06) per minute; SMS costs decrease 25 percent to €0.06 (US $0.08) per text and data services fall by 55.5 percent to €0.20 (US $0.27) per MB. (All prices exclude VAT.) The rates are now down 80 to 90 percent from when the EU first started regulating prices in 2007. Proposed legislation would see roaming surcharges eliminated entirely beginning next year; operators would be required to charge the same prices as they do in their home markets.

The size of these cuts shows that the EU is serious about dialing down roaming within its borders. The rate reduction for data use, at 55.5 percent, is particularly significant, not only for the generosity of the amount but because of the increasing importance of data services for those traveling abroad. The falling rates may have the effect of increasing subscribers’ use of roaming services and thereby offset mobile operators’ losses to some extent. However, the writing on the wall could not be clearer: Now is the time for MNOs to find replacements for a revenue stream that will almost certainly run dry in the near future.

The above item appeared in a recent issue of Tarifica's "The Story of The Week", a weekly report that analyzes two noteworthy developments in the telecoms industry from around the world. For past issues or to learn more about The Story of The Week :  http://www.tarifica.com/storyoftheweek.aspx  

Tarifica Score Launched With Ratings of Australian Postpaid Plans

Tarifica the U.S.-based telecom research and analysis firm, announced ratings for all the major Australian mobile operators’ postpaid plans, created with its recently launched comparison tool, the Tarifica Score. The highest scores were achieved by Optus and Vodafone, which ranked significantly ahead of competitors Telstra and Virgin Mobile. The top score among plans that included a phone went to Vodafone’s $100 Red Plan with Double Data Promotion, while in the without-phone category the highest score was achieved by Optus’ $60 My Plan Plus. These scores provide objective, quantitative comparisons of mobile plans, based on a consumer-value-oriented approach, and are generated by a proprietary mathematical model. Among the factors taken into account are plan allowances (voice minutes, SMS, MMS and data), network speeds and value-added elements such as data sharing, international calling allowances and roaming benefits.   

Optus’ plans received high scores because they combined large data allowances with relatively moderate prices. Vodafone’s high scores were driven by the combination of its “Double Data” promotion and its network’s fast 4G download speeds, which dwarfed that of the competition. Although it is the largest mobile operator in the market, Telstra’s plans were simply too expensive to compete with the value offered by Optus and Vodafone. The algorithm used to calculate Tarifica Scores awarded a high number of points to Telstra’s plans because of the operator’s wide geographic coverage, but even with this bonus, its plans did not include anywhere near the allowance volumes available in similarly priced plans from Optus and Vodafone. 

The Tarifica Score, which assigns a single number to each plan analyzed, is notable for making possible “apples-to-apples” comparisons between offerings that may on the surface appear to be quite different from each other. By doing so, it allows consumers to determine which plans offer the best value for the money. For mobile operators, the Tarifica Score offers several advantages: First, it allows in-house evaluation of plans’ market potential against an objective, algorithm-based third-party analysis provided by a firm with years of institutional knowledge and experience as well as relationships with major industry participants around the world. Second, Tarifica will work with operators to analyze plans prior to their launch so as to ensure the highest possible score. Third, the score is an excellent marketing tool by which operators can communicate to consumers, in simple, quantitative terms, the actual value of their offerings. Fourth, it can be supplied to regulators as a way of addressing concerns about the value and fairness of plans. Finally, for a deeper understanding of a plan’s place in the larger telecom world, Tarifica offers a modification that will allow a plan to be compared across markets. In addition, both operators and consumers can benefit from having the Tarifica Score segmented according to various metrics such as cost, device inclusion or regional availability.

Tarifica Scores can be calculated for any of the 85 countries Tarifica tracks.

The above item appeared in a recent issue of Tarifica's "The Story of The Week", a weekly report that analyzes two noteworthy developments in the telecoms industry from around the world. For past issues or to learn more about The Story of The Week :  http://www.tarifica.com/storyoftheweek.aspx   Photo by Abd allah Foteih on Flickr