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KKR, Macquarie reportedly in the chase for Altice fibre unit

Annie Turner
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KKR, Macquarie reportedly in the chase for Altice fibre unit

According to BNN Bloomberg, there is now a shortlist of potential investor’s in Altice France’s XpFibre unit

KKR and Macquarie Group are on the shortlist of potential buyers for Altice France’s XpFibre subsidiary, according to BNN Bloomberg. Others on the shortlist include the pension fund Caisse de Depot et Placement du Quebec and Global Infrastructure Partners.

Altice France is part of the Altice group controlled by billionaire Patrick Drahi. Since September, the group has been seeking to offload assets as the cost of serving debt mounts – and the group’s debt amounts to €60 billion.

Drahi’s preferred option was to sell a minority stake in the SFR business, but unnamed sources cited by BNN Bloomberg say investors are more interested in the fibre network unit.

Altice France owns 50.01% of XpFibre which is responsible for the construction, maintenance and commercialisation of the fibre network in France. The minority stake is owned by a consortium, in which the biggest shareholder is OMERS Infrastructure. Other consortium members include Allianz Capital Partners and AXA IM Real Assets.

The three investors acquired the minority stake for €1.7 billion in 2019, which values the whole of XpFibre at €3.4 billion.

Altice France is the biggest unit in the Altice group.

None of the offers are binding and the sale of XpFibre is not assured. Altice is also looking to sell major assets in Portugal.

Nvidia forms bespoke chip unit to target cloud and wireless markets 

Simon Dux
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Nvidia forms bespoke chip unit to target cloud and wireless markets 

Ericsson has emerged as a wireless chip partner for Nvidia but is tight-lipped about latest collaboration

The dominant global designer and supplier of AI chips Nvidia is building a custom chip unit to design bespoke AI processors for cloud computing firms, data centre operators and service providers. It has also emerged that Nvidia is in talks Ericsson, for a wireless chip that includes the chip designer’s graphics processing unit (GPU) technology, two sources familiar with the discussions told Reuters. 

The two companies have collaborated for several years since announcing in 2019 they were collaborating on technologies that can allow telcos to build high-performing, efficient and completely virtualized 5G RAN. 

Nvidia already controls about 80% of high-end AI chip market and customers include all of the largest tech companies but its H100 and A100 chips serve as a generalized, all-purpose AI processor for many of those major customers. However, hyperscalers and service providers have been developing their own chips for specific applications such as reducing power in data centres.  

As a result, Nvidia wants to recapture some of this emerging business and take-on custom chip builders Broadcom and Marvell Technology. And the numbers forecast for the market are large enough to encourage it to do so. Research firm 650 Group’s Alan Weckle told Reuters he expects the telecom custom chip market to remain flat at roughly $4 billion to $5 billion a year. 

The numbers go up from there. Weckel said the data centre custom chip market will grow to as much as $10 billion this year, and double that in 2025. Meanwhile, the broader custom chip market was worth roughly $30 billion in 2023, which amounts to roughly 5% of annual global chip sales, according to Needham analyst Charles Shi. 

It is easy to see Nvidia has to make this move. Nvidia does not disclose H100 prices, which are higher than for the prior-generation A100, but, according to Reuters, each chip can sell for $16,000 to $100,000 depending on volume and other factors. Meta plans to bring its total stock to 350,000 H100s this year. 

Dina McKinney, a former Advanced Micro Devices and Marvell executive, heads Nvidia’s custom unit and her team’s goal is to make its technology available for customers in cloud, 5G wireless, video games and automotives, a LinkedIn profile said. Those mentions were deleted and her title changed after Reuters sought comment from Nvidia. 

Now or never for Nvidia? 

The company knows if it doesn’t move with market demand, its customers like Amazon, Google, Microsoft, Meta and OpenAI will look elsewhere, despite its market dominance.  

This month, Nvidia CEO Jensen Huang visited China and Taiwan where he met Taiwan Semiconductor Manufacturing Co., cryptically saying the entire supply chain will have to work extra hard to match demand in what he expects will be “a huge year.” As the US continues to block the export of advanced semiconductors to China, the country is still a huge market for Nvidia’s graphics processing units, which can be adapted for the power-intensive task of training AI models. 

According to Nikkei, Nvidia’s RTX 4090 graphic cards, beloved by video gamers and PC hobbyists, have been flying from store shelves across Southeast Asia and Taiwan since the US tightened export controls of advanced chips to China – buyers are snapping them up to resell in China and Hong Kong. The RTX 4090 is designed for rendering images, particular for video games, but because its computing capability can also be used to train artificial intelligence tasks. 

At the same time OpenAI’s Sam Altman met with officials of Samsung Electronics and SK Hynix, the makers of the high-bandwidth memory that complements Nvidia’s chips – suggesting the company may be looking to be less reliant on Nvidia’s chips.  

The chip industry operates in cycles of oversupply and under-supply. The Covid-19 pandemic trigged a combination of supply constraints and high demand that lasted for years, but the slump finally arrived in mid-2022, according to Bloomberg. SK Hynix, Samsung and TSMC have all signalled they expect a recovery this year. Altman and Huang’s activities add weight to those expectations. 

According to Reuters, Nvidia also plans to target the automotive and video game markets, according to sources and public social media postings. Weckel expects the custom auto market to grow consistently from its current $6 billion to $8 billion range at 20% a year, and the $7 billion to $8 billion video game custom chip market could increase with the next-generation consoles from Xbox and Sony.  

Fredrik Jejdling, executive vice president and head of Networks at Ericsson (above, left), and Jensen Huang, founder and CEO of NVIDIA (above, right), discuss the companies’ collaboration during a keynote address at MWC LA in 2019. 

MTN South Africa and Huawei complete 800G optical network deployment 

Simon Dux
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MTN South Africa and Huawei complete 800G optical network deployment 

Data centre connect network links Johannesburg, Durban and Cape Town

MTN South Africa has completed the upgrade of its domestic backbone to 800G with vendor Huawei. The links were set up with single fibre capacity of 48Tbps, to connect data centres in Johannesburg, Durban and Cape Town.

The operator has utilized Huawei’s optical transport solutions, including its 400G/800G per channel, Optical Cross-Connect (OXC), and Automatically Switched Optical Network (ASON). The OXC solution has been deployed in the backbone nodes, not only to meet long-term capacity and degree-expansion requirements, but also improve the network energy efficiency by reducing power consumption by up to 60% compared to conventional ROADM technology, according to Huawei.

“The 800G, OXC and ASON scale deployment with Huawei is a result of MTN’s clear vision to lead the delivery of a bold new digital world to customers,” said MTN SA senior specialist in core fibre and transmission Takalani Ligudu. “MTN is proud on having one of the world’s advanced networks and using industry leading technologies to deliver superior network services for our customers across South Africa.”

“It is a great honour to work with MTN SA to bring the leading and green optical technologies into South Africa, building advanced optical network for digital development,” said Huawei president of optical transmission Victor Zhou.

MTN SA began working on upgrading its backbone network with Huawei around 2022. In that year the two completed the first commercial trial of single-wavelength 800G with Huawei in South Africa. That test applied Huawei’s OXC all-optical switching product after the two had already collaborated to jointly deploy single-wavelength 400G technology. Data centre interconnects, according to the partners, increase the optical direction of the core nodes, which increases O&M difficulties. This drove the solution towards the choice of deploying OXC.

On its Network Management System, MTN has applied Huawei’s NCE-T to boost management, control, and analysis capabilities on transport networks and provide differentiated services for various types of customers through visualised parameters like the latency and reliability maps.

Partnership powers on

The operator has had a long-term strategic relationship with the Chinese vendor which stretches beyond optical transport. Given South Africa’s unique power supply issues and subsequent load-shedding impacting every business and consumer customer in the nation, the two companies recently launched an advanced load-shedding solution, the Huawei Power-M which is designed to provide a space-efficient and digital backup power solution for SMEs.

Power-M is available online and through selected MTN Retail stores offers an all-in-one solution that negates the need for additional devices and can withstand even the most challenging grid conditions. SMEs have the option to enhance their power backup setup with solar panel add-ons, enabling them to harness renewable energy sources or add new batteries without sacrificing performance, providing scalability and long-term viability. Customers can choose to purchase the solution outright or opt for a rental option.

Featuring an all-in-one system with a silent inverter battery and a 10-year swap-out warranty, this solution guarantees a continuous power supply. The modular design allows easy expansion of battery capacity for future needs, addressing load-shedding concerns. Safety is ensured through a built-in suppression kit.

What is Hyperscale?: eBook from AFL

Annie Turner
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What is Hyperscale?: eBook from AFL

BT, Ericsson and Qualcomm demo slicing for gamers and enterprise

Annie Turner
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0
BT, Ericsson and Qualcomm demo slicing for gamers and enterprise

The operator called the trial “a significant milestone” as it moves towards the launch of its own 5G Standalone network

BT Group says it has successfully demo’d network slicing in collaboration with Ericsson and Qualcomm Technologies. The trial was carried out at BT’s R&D centre, Adastral Park in eastern England. It used Ericsson’s 5G Core and Radio Access Network technology with devices based on Qualcomm’s Snapdragon 8 Gen 2 for Galaxy Mobile Platform.

The three set up network slices for gaming, enterprise applications and enhanced Mobile Broadband (eMBB). They allocated a portion of the 5G Standalone (5GSA) network to provide dynamic partitions for specific use-cases. This showed how optimal performance can be maintained for bandwidth-hungry applications like gaming and video conferencing, even in peak times.

Game on

According to BT, “Mobile gaming is experiencing relentless growth, with traffic on EE’s network almost doubling since the beginning of 2023 to more than two petabytes of data every month”.

BT Group, Ericsson and Qualcomm showcased a gaming session on Fortnite Nvidia’s GeForce Now, maintaining a throughput above 25 Mbps at 1080p even when a background load was added. The experience was simultaneously compared to a non-optimised eMBB RAN partition, also congested by the background load. This delivered a poorer experience.

In business

The trial showed network slicing’s potential for BT Group’s business customers. The enterprise and eMBB slices were configured via User Equipment Route Selection Policy (URSP) rules. They enable a device to connect to multiple network slices simultaneously depending on the application.

The pilot showed consistent 4K video streaming and enterprise use-cases using the Samsung S23 Ultra device, powered by Snapdragon 8 Gen 2 for Galaxy. Enterprise communications platforms and video applications such as YouTube require a stable connection and low jitter to work well. The Ericsson 5G RAN Slicing feature, Radio Resource Partitioning ensured enterprise traffic achieved optimal experience

Stepping stone to 5G SA

Greg McCall, Chief Networks Officer, BT Group, said, “As we work diligently towards the launch of our own 5G SA network, today’s successful demonstration of how slicing enables us to differentiate Quality of Service to guarantee performance for different segments is a significant milestone, and illustrative of the new services that will be enabled by 5G SA.”

Katherine Ainley, CEO, Ericsson UK & Ireland, said, “This ultimate next step in connectivity will enable new service offerings for consumers and businesses who require premium performance, while helping to drive future market growth and innovation for the UK in a wide range of new industries.”

Nokia declares patent peace on licence renewals 

Simon Dux
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Nokia declares patent peace on licence renewals 

Its patent group now has a sales run-rate of approximately €1.3 billion and is expecting significant catch-up payments

Nokia announced that it has signed its seventh and final major smartphone patent licence agreement it has been pursuing over the past thirteen months as part of a renewal cycle that began in 2021. Earlier this week, Nokia and Vivo signed a multi-year, cross-licence patent agreement covering 5G technologies, which ends all litigation between the parties. This was the third such deal announced by Nokia in 2024 alone, after similar agreements with Honor and Oppo. The company already had deals with Samsung, Apple and Huawei in the bag.  

As a result of the latest deal, Nokia’s licensing business, Nokia Technologies, will now enter a period of stability with no major smartphone agreements expiring for several years. Nokia Technologies currently has an annual net sales run-rate (contracted recurring net sales) of approximately €1.3 billion, excluding catch-up net sales.  

In addition to the remaining addressable smartphone market, it will continue to focus on opportunities to grow the annual net sales run-rate through patent licensing in areas such as automotive, consumer electronics, IoT and multimedia, to reach a run-rate of €1.4-1.5 billion in the mid-term, according to the company. 

Nokia said its Q1 net sales are expected to benefit from significant catch-up net sales of more than €400 million related to prior periods of non-payment. The number has already been worked into Nokia’s FY2023 assumptions of generating at least €1.4 billion of operating profit in 2024. Nokia said its patent portfolio is built on around €150 billion invested in R&D since 2000 and is composed of around 20,000 patent families, including over 6,000 patent families declared essential to 5G. 

“We are delighted to have successfully completed our smartphone license renewal cycle. These seven major agreements demonstrate the strength of Nokia’s patent portfolio and the smartphone industry’s continued reliance on Nokia’s technology in their devices,” said Nokia Technologies president Jenni Lukander. “Conclusion of our smartphone license renewal cycle will enable us to focus on growing our licensing run-rate in new areas. We have already made significant progress in these growth areas and have a strong pipeline of future opportunities.” 

Wrapping up patent litigation 

Earlier this week, Nokia and Chinese smartphone vendor Vivo announced the signing of a multi-year, cross-licence patent agreement covering 5G technologies, which ends all litigation between the parties. The terms of the deal – which remain confidential – mean Vivo will make royalty payments, as well as payments to cover the dispute period from 2021, to Nokia. 

According to JUVE Patent sources, litigation between Nokia and Vivo originally arose when they could not decide on a new licence agreement regarding 5G technologies. A previous agreement, where Vivo paid Nokia for use of its patented 2G and 3G technologies, had expired in December 2021. In April 2023, the Regional Court Mannheim found that Vivo infringed three Nokia standard essential patents (SEPs), resulting in the court granting the latter an injunction against Vivo. While the Chinese company appealed, Nokia then enforced the injunction in June 2023. Vivo later removed its products from the market. 

Parallel proceedings were also ongoing in India, China, Malaysia and the Philippines. The latest licence deal has ended any pending litigation. Last month, Nokia also announced licensing deals with Honor, as well as the end of litigation with Oppo. Since 2021, Nokia and Oppo had sued each other in patent courts globally, with the global cross-licence agreement ending all patent lawsuits. This included actions in Germany, France, the Netherlands, India, China and the UK, as well as five other countries, according to JUVE Patent. 

EY and Dell launch EY Edge Technologies Lab  

Simon Dux
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EY and Dell launch EY Edge Technologies Lab  

With the arrival of AI in the mainstream, both companies see edge compute critical for Industry 4.0 

EY has joined forces with Dell Technologies to launch the EY Edge Technologies Lab which will demonstrate and test local edge-based computing system applications due to their advantage over central cloud processing for specific Industry 4.0 applications. The companies say the lab comes with the ability to create prototypes within a week and will demonstrate how Generative AI and edge technology can reduce manual effort and improve the efficiency and accuracy of data integration tasks. 

The lab’s goal is to change the way organisations experience and envision their business outcomes and data strategy by helping create real-time industry-specific use cases and prototypes for edge-centric solutions, seamlessly integrating the technology into business operations. It will also helps demonstrate the competitive advantages of embedding AI at the edge, in conjunction with EY.ai, the company’s new unifying platform combining its business experience with AI.  

The Lab will also help leaders understand how having the right edge and data strategy impacts the convergence of IT and operational technology – a trend that’s helping to drive rapid adoption of edge computing. Initially, the lab will focus on manufacturing, life sciences, healthcare, consumer products and utilities – creating edge-centric use cases, like deploying an IoT solution for a client’s manufacturing process. 

EY will use Dell’s NativeEdge, an edge operations software platform, combined with edge computing technologies such as the Dell edge gateway, Dell PowerEdge servers and Dell OptiPlex desktops to provide for various industry use cases. In collaboration with Microsoft, PTC, GE Digital, Snowflake and others, the development work at lab is also supported by EY Technology Strategy & Transformation team members, providing virtual interactions with clients. 

EY continues to step up its AI game. Last week it announced EY announced alliance with Reveal to offer legal sector clients AI-powered solutions to advance data discovery and compliance needs. 

“With the Lab, we’re putting the power of edge directly into the hands of leaders, offering them the opportunity to explore, experiment, and harness live data insights in unexpected ways that will have a substantial impact on their business growth,” said EY Global TMT industry market leader Greg Cudahy.  

“Through our collaboration with the EY organization, businesses will be able to harness the power of edge technology with a transformative platform approach,” added Dell Technologies SVP of edge solutions Gil Shneorson. 

Dell continues to make telco waves 

Dell’s involvement in the edge lab makes the new EY lab of more interest to telcos looking at how edge networking and compute will play out. The US IT giant realised early on that the telco sector was ripe for disruption given network virtualisation, APIs and the arrival of edge and AI. Last year, Dell signalled its intent by investing €2m to create an Open Telecom Ecosystem Lab in Cork – its first outside the EU. Ireland used to host around 25% of Europe’s data centres and while that figure has changed as more facilities are announced, the nation has proved important for Dell given its presence in that DC sector.  

The Cork facility provides an innovation testbed for telecoms and technology leaders across EMEA, connecting leading engineers at Dell with telecom providers. Partners can test and deploy open telecom solutions at the heart of 5G and 6G networks. The telco lab also helps develop applications for smart manufacturing and Industry 4.0, smart mobility solutions and digital cities.    

Open RAN to account for up to 30% of global market by 2028

Annie Turner
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Open RAN to account for up to 30% of global market by 2028

The RAN equipment market suffered a second year of decline in 2023, but is expected to perk up all round after 2024

Dell’Oro Group predicts that the global market for RAN equipment will continue to fall in 2024 from its height of more than $40 billion 2022. Last year the value of the market dropped “sharply” and will shrink again in 2024, but less steeply, to over $35 billion, according to a blog by Stefan Pongratz, VP, Dell’Oro Group.

It seems that Open RAN shrank in 2023, but is expected to account for between 7% and 10% – that is, up to $3.5 billion – in 2024. Dell’Oro expects this to rise to between 20 and 30% of worldwide RAN revenues by 2028, according to a new report.

Commenting on the Open RAN report, Pongratz noted, “Current growth deceleration combined with the increased acceptance that Open RAN is not some kind of magic solution that will significantly alter barriers to entry or overall market concentration, is prompting more questions about the rationale behind Open RAN.

“The fundamental assumptions shaping the role Open RAN will play in this RAN journey have not changed. Over time, operators will incorporate more virtualization, intelligence, automation, and O-RAN into their RAN roadmaps. However, the business case for multi-vendor RAN is less compelling.”

There is other good news. Some relatively immature areas of RAN technologies will continue to grow, including for mmWave, massive MIMO, private mobile networks, small cells and virtualised RAN.

The analyst house does not expect the decline in the value of the RAN market to continue beyond this year.

The main cause for the fall is that most network operators completed substantial parts of their 5G RAN deployments between 2017 and 2022.

TIM rejects Italian government’s €750m offer for Sparkle

Annie Turner
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TIM rejects Italian government’s €750m offer for Sparkle

CEO Pietro Labriola has been instructed to negotiate a different offer from the Ministry of Economy and Finance

Telecom Italia (TIM) has rejected the Ministry of Economy and Finance’s (MEF) offer made on 31 January. It proposed to pay €625 million to acquire TIM’s international infrastructure arm, Sparkle plus €125 million in earnouts – a share of future earnings assuming certain criteria are met.

The board of directors decided the offer was “unsatisfactory”. Apparently advisors had recommended an offer closer to €850 million.

The board gave CEO, Pietro Labriola, the mandate to negotiate a different option, including possible adjustments to the contractual conditions.

The renegotiation is on the basis that TIM maintains a stake of about 15% in the company for a specified time to oversee implementation of the strategic plan. Ultimately, TIM would sell its stake.

The MEF offer is effective for 15 days. TIM’s board is to meet again on 14 February to approve the 2023 accounts. It might receive a fresh offer by then.

Later in the year, TIM is proposing to slim down its board from 15 to nine directors.

Magyar Telekom expands used smartphone options with Recommerce 

Simon Dux
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Magyar Telekom expands used smartphone options with Recommerce 

Second hand and refurbished smartphones are gaining ground despite the challenge of getting stock

Deutsche Telekom-owned Magyar Telekom has expanded its relationship with French used smartphone trading company Recommerce Group, which began last October, and will see the operator offering a wider range of used products to customers. The companies have claimed success in their joint efforts and marketing so far and the telco is enthusiastic about expanding its offers.  

“By expanding our already extensive range of devices to include refurbished phones, we can offer people the best-in-class devices at a reasonable price, while taking another step towards our sustainability goals,” Magyar Telekom chief commercial officer Zoltán Pereszlényi told Telecomnieuws.  

“It may seem like a small step, but small steps add up and lead to big changes. Since launch, sales of the refurbished devices have doubled compared to our original targets, meaning thousands of our customers can move forward digitally with a quality refurbished device,” he added. 

Analysts International Data Corporation (IDC) estimate worldwide shipments of used smartphones, including officially refurbished and used smartphones, reached 309.4 million units in 2023. The unit growth represents a 9.5% increase over the 282.6 million units shipped in 2022. In addition, IDC projects that used smartphone shipments will reach 431.1 million units in 2027, with a compound annual growth rate (CAGR) of 8.8% from 2022 to 2027. 

IDC says that one of the biggest issues hampering growth in the used smartphone market is that users are holding on to their phones much longer meaning inventory is scarce. Refresh rates for new phones in most developed markets have extended past 40 months, which has caused a shortage of available inventory for the secondary market. Trade-in programs continue to fuel the industry but only make up a portion of the total used inventory. 

As a result, the analysts said the total secondary market has been pulled down around 2.7% as longer refresh rates and weak consumer spending continue to dampen both the new and used markets. Of course, market growth of almost 10% despite this pressure – versus an IDC-estimated market decline of 3.5% for new smartphones – suggests it is still a market that MNOs are paying attention to – and why the likes of Recommerce can grow so rapidly. 

Spreading in Europe 

Recommerce’s Budapest office was its tenth in Europe and third country in Central-Eastern Europe after kicking off in Romania with partner Fenix in 2021. The company recently hit €150m in revenue and since Romania, has expanded to Bulgaria, Croatia, Greece, Hungary, Moldova, Slovakia and Slovenia, with more countries to come.  

CEE general manager Hector Destailleur told Telecomnieuws the company was “eager to collaborate with renowned and powerful retailers such as Magyar Telecom who share our passion for growth and consumer interests, as well as environmentally friendly values.” 

He added: “We believe that enabling investments from other companies in the circular economy is the fastest way to spread and develop the remanufacturing market in the area.”  

The company sold more than 30,000 refurbished smartphones in the CEE region and is planning for at least 30% growth in 2024. Across the wider company, it has diversified its product range to include refurbished iPads and video game consoles alongside smartphones. In the B2B space, it is signing partnerships such as its deal with home improvement and gardening retailer Leroy Merlin, where it is procuring refurbished smartphones for that company’s local employees. 

Recommerce now counts Orange, T-Mobile, Vodafone, Carrefour, Auchan and Flanco as its main partners in the CEE region.  

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