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    SES announces O3b mPOWER constellation is ready for service

    Simon Dux
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    SES announces O3b mPOWER constellation is ready for service

    However, the European satellite operator is still grappling to overcome the power issues impacting its fleet

    In what should have been a big day of celebration, SES announced that its medium Earth orbit (MEO) O3b mPOWER software-enabled satellite constellation was now operational and ready to provide connectivity services around the globe, ranging from tens of Mbps to multiple gigabits per second.  

    However, the day was tinged with some disappointment given the constellation has been dealing with power module issues on its Boeing satellites, leading to a delayed go-live of around four months.  

    In its third quarter 2023 results call last October, SES noted that the electrical “trip-offs”, first noticed in August, in the existing fleet had increased with a few becoming non-recoverable events, according to Via Satellite. As a result, the initial satellites would see a “significant reduction” in their expected lifetime and available capacity, according to the company.  

    SES went to work with Boeing to upgrade the five yet-to-launch satellites and the two companies agreed to add two further satellites to the constellation – after agreeing to share the risk and the capex. No doubt nervous satellite insurance brokers and watching closely to see what impact the power issues will have on the longevity of the constellation.  

    To date, SES has launched six out of 13 O3b mPOWER satellites, which together with strategically located satellite ground stations, enable SES to serve customers across multiple market segments around the world. With the O3b mPOWER system now operational, SES strengthens its unique MEO network capabilities by complementing its O3b constellation. SES expects to launch the next two O3b mPOWER satellites in late 2024. 

    The operator likes to point out that it now offers GEO, MEO and low Earth orbit (LEO) solutions – the latter through strategic partnerships.  

    “We are very excited that O3b mPOWER is now ready to serve our customers around the world. Over the last few years, our SES team, along with our technology partners across space and ground segments, have worked tirelessly to bring our O3b mPOWER system online. I’m proud to say that all the core infrastructure is deployed, tested and ready on a global basis,” said new SES’s CEO Adel Al-Saleh (above).  

    “The demand for O3b mPOWER solutions is very high, and this moment has been long-awaited by our customers. Over the coming weeks we will work with our mobility, government, enterprise and cloud customers on O3b mPOWER onboarding plans,” he said. We’re eager to empower their operations with reliable, high-performance, and secure services.” 

    Swisscom slams regulator’s decision on its fibre rollout 

    Simon Dux
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    Swisscom slams regulator’s decision on its fibre rollout 

    The telco finds COMCO’s decision “incomprehensible” and says it will lead to higher fibre rollout costs

    Swisscom has defended its decision to adopt a point-to-multipoint (P2MP) topology between the exchange and local cable duct (manhole), which it began using in 2020, as “the right one”. The announcement came after Swiss regulator Competition Commission (COMCO) fined Swisscom CHF 18 million for what it deemed unlawful conduct in the optical fibre expansion.  

    In addition to the fine, COMCO imposed “clear guidelines” on Swisscom for the expansion of its fibre optic network: “so that third parties can jointly use the fibre optic network infrastructure.” 

    At the start of 2020, Swisscom changed the way it built its fibre optic network. With this new network design, COMCO said competing companies would no longer have direct access to the network and would only be able to sell Swisscom services under their own name. By changing its network construction strategy, Swisscom prevented competing companies from accessing the fibre optic network and thus violated cartel law.  

    Since December 2020, COMCO has been investigating the extent to which P2MP topology impedes competition. Alongside the investigation, it ordered precautionary measures, preventing Swisscom, other than in a few exceptional cases, from putting any P2MP connections into operation and marketing them. Swisscom challenged these measures before the Federal Court, which, in its judgement of 29 November 2022, nevertheless upheld the measures imposed by COMCO. 

    It is COMCO’s view that Swisscom’s expansion of the fibre-optic network should only be permitted to continue in point-to-point (P2P) topology. Swisscom said the consequence of COMCO’s decision is that the expansion will take “much longer and involve significantly higher costs, especially in rural areas.” It added it found the decision “incomprehensible.” 

    P2P or not P2P? 

    COMCO subsequently prohibited Swisscom from making this modification from the end of 2020. The regulator said Swisscom would otherwise have modified the existing market structure and would have “created a de facto monopoly”. It stated: “Competing companies would have been deprived of a large part of their innovation possibilities and commercial opportunities, and consumers as well as commercial customers would have been severely limited in their choice of supplier and in the diversity of products.” 

    Not so, said Swisscom, arguing that all competitors would have been able to “obtain a data stream from Swisscom for a specific connection on non-discriminatory terms, enabling them to continue to offer a full and competitive range of services, including telephony, Internet and TV.” 

    In Swisscom’s view: “P2MP is the most efficient and cost-effective way for FTTH to be rolled out in Switzerland. Moreover, P2MP topology is the prevailing architecture for the FTTH rollout in most EU states. It is accepted by the regulatory authorities and considered compliant with anti-trust law. It is for this reason that Swisscom considers its conduct fair under competition legislation.” 

    More work needed 

    As previously announced in October 2022, to counteract the stalled optical fibre expansion and ensure that third-party providers have the layer-1 access required by COMCO, Swisscom will install new fibre connections as before, using the point-to-point (P2P) architecture endorsed by COMCO and convert existing P2MP connections to P2P. 

    As a result of the decision, Swisscom said the expansion is still mostly assured in line with the Swisscom network strategy, even though the expansion with P2P is more laborious, will involve more civil engineering work and will bring delays – especially for rural communities. “Proceeding with P2P means that, by 2030, up to 10% fewer households will have optical fibre access than would have been possible with P2MP, and the FTTH expansion will be completed several years later than originally planned,” stated the carrier. 

    However, COMCO believes that the financial and time savings are not sufficient to compensate for the “elimination of competition over several generations”. The regulator scathingly pointed out: “Until now, the most significant innovations and price reductions in the fibre-optic network have come from competing companies, not Swisscom. This would not have been possible in the future.” 

    The telco said its financial outlook for the 2024 financial year remains unchanged as it had factored COMCO’s ruling into its planning and made appropriate provisions. Swisscom reserves the right to appeal the decision before the Federal Administrative Court. 

    T-Mobile US enters fibre JV to acquire Lumos, extend footprint

    Annie Turner
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    T-Mobile US enters fibre JV to acquire Lumos, extend footprint

    Assuming the transaction clears all the necessary hurdles, the operator expects to invest $1.45bn in deploying fibre infrastructure by 2028 via the JV

    T-Mobile US and investment house EQT have entered into a joint venture with EQT’s Infrastructure VI fund (EQT). The JV will acquire FTTH platform Lumos from EQT’s predecessor fund, EQT Infrastructure III.    

    Lumos’ infrastructure reaches 320,000 households having deployed some 7,500 miles of fibre and home Wi-Fi service in the Mid-Atlantic. After the transaction is completed, it will adopt a wholesale model with T-Mobile as the anchor tenant.

    T-Mobile is Deutsche Telekom’s US subsidiary, which helped propel the former German incumbent to a market capitalisation above €100 billion in January 2023. It is the first European operator group to breach that threshold.

    Once complete

    At closing, T-Mobile is expected to invest about $950 million (€886.4 million) in the JV to acquire a 50% equity stake and all existing fibre customers. The funds invested by T-Mobile will be used by Lumos for future fibre builds.

    The next capital contribution by T-Mobile out of an additional commitment of about $500 million is expected between 2027 and 2028. The JV will focus on identifying and choosing markets, network engineering and design, network deployment and installations for customers.

    The combined investments should allow Lumos to pass 3.5 million homes by the end of 2028.

    The transaction is expected to close in late this year or early next, subject to customary closing conditions and regulatory approvals.

    Current customer base

    T-Mobile provides connectivity to homes and businesses across through fixed wireless access on its 5G network. The service is available to more than 50 million households and businesses nationwide and serves over 5 million customers.

    It also operates T-Mobile Fiber which has begun deployment in parts of 16 US markets. This has revealed the demand for the reliability and speed of fibre-based broadband.

    With this transaction, EQT Infrastructure VI is expected to be 35-40% invested (including closed and/or signed investments, announced public offers, if applicable, and less any expected syndication) based on target fund size and subject to customary regulatory approvals.

    High demand for fibre

    Mike Sievert, CEO of T-Mobile said in a written statement, “As the demand for reliable, low-latency connectivity rapidly increases, this deal is a scalable strategy for T-Mobile to take a significant step forward in expanding on our broadband success and continue shaking up competition in this space to bring even more value and choice to consumers.

     “With EQT and Lumos, T-Mobile is building on our position as the fastest growing broadband provider in the country in a value-accretive way that complements our sustained growth leadership in wireless.”

    New phase

    Jan Vesely, Partner within EQT’s Infrastructure Advisory Team commented, “We are proud to have partnered with Lumos over the past six years to rapidly scale the company and roll out fiber to underserved markets, and we look forward to continuing to leverage EQT’s considerable digital infrastructure and fiber expertise to support the significant fiber buildout ambitions of T-Mobile and the JV.

    “This new effort will build critical fiber broadband infrastructure that will enable remote work, education, and healthcare use cases across the country. We have worked with T-Mobile as a customer across many of our existing digital infrastructure investments and are delighted to build on that relationship and partner with T-Mobile on this opportunity to roll out fiber to underserved Americans.”

    Brian Stading, CEO of Lumos, added, “With the support of our private equity partner, EQT, and leveraging the strength of the T-Mobile brand and unrivaled customer experience, Lumos is set to expedite our network expansion. This joint venture will amplify our ability to change lives through the transformative power of fiber optic internet.”

    Cellnex sees Spanish consolidation ahead as Q1 net loss halves 

    Simon Dux
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    Cellnex sees Spanish consolidation ahead as Q1 net loss halves 

    The towerco also has opportunities after the arrival of MásOrange and Digi Spain’s subsequent market approach

    Cellnex Telecom has posted revenues of €946 million (+7%) and its adjusted EBITDA grew to €778 million (+7%) with a clear drive from its PoPs (Points of Presence) organic growth (+10.7%) in Q1 2024. The towerco saw a net loss of €39 million, however this represented a €52 million improvement over the first quarter of 2023 (-€91 million), reflecting the growth in the Group’s EBITDA.

    Cellnex announced on 5 March the sale of its business in Ireland to Phoenix Tower International for €971 million, equivalent to a multiple of 24x EBITDAaL. The company expects non-binding offers for its Austrian business in May. Saudi Arabia’s stc Group and sovereign fund PIF may bid for Cellnex’s Austrian unit, El Economista newspaper reported, citing unidentified industry sources.

    Cellnex CEO Marco Patuano said the towerco was making “good progress” on its “next chapter”. “Having obtained our investment grade rating by S&P much earlier than originally planned, we confirm an unconditional commitment to maintain this credit rating level both by S&P and Fitch,” he said.

    “From the leveraging perspective we’re making remarkable progress thanks to the disposal of the sites in France, our agreement in the Nordics and our recently announced exit from Ireland. This closest process is on track, we presented all the documents, the relevant documents to the antitrust and leverage will be reduced by €971 million when completed and paid,” he added.

    He also confirmed progress on forming “LandCo”, a new Spanish company dedicated to holding all of Cellnex’s land assets as part of an effort to maximise value. “We are trying to start to evaluate if it could be appropriate to transfer existing portfolios into the newly created LandCo or not. This depends very much on the tax efficiency of this process,” he said.

    Spanish consolidation will happen

    Speaking on the company’s analyst call, Patuano said it was not a question of “if” the Spanish tower market will consolidate but “when and how.”

    “Obviously, American Tower invested a very significant amount in Spain in their acquisition of the tower from Telefonica. So my base case is that American Tower will be a long-term player. And we are here since ever and so this is our home market, and we know it fairly well,” he said.

    “I think that the Spanish Tower market is four tower operators, and in a while, there will be more tower operators than operators, which means that this is something that possibly is going to happen. Then I ask myself if this will be a game of combination or a game of someone exiting from the market. I don’t exclude that it could be a combination game,” he added.

    MásOrange network redesign

    Patuano said that the MásOrange merger has raised two questions from a network standpoint – with the entire Spanish market becoming way more interesting.

    “…Please don’t take as being offensive with anyone, [but] the network quality of Másmovil was not at the standard of the network quality of Orange. But on the other side, the network quality of Orange is not capable to receive the entire customer base of Másmovil,” he said.

    “What is clear is that MásOrange should make a fairly, I don’t want to say complicated, but fairly big project of the network redesign,” he said. “We are talking with the MásOrange CTO in order to understand how we can support them in making efficiency in the periphery of the network, where the network can be optimised.”

    He added: “Possibly, there are sites and antenna both from Másmovil and Orange, and it’s not necessary to have both, but to densify the network where the density of the clients is higher.”

    “In this, there is the big question mark,” he said. “You know that Orange had a RAN sharing with Vodafone in the so-called jumping network. The territory of Spain was divided in two areas. Let’s make a proxy. The coastline was covered by Orange with the exception of Catalonia, and Catalonia and the inner land was covered by Vodafone with their network.”

    He added: “So, also, Vodafone passed through a change of control or better, it’s passing through a change of control, and so the future evolution of this joint venture is in a delicate moment because of all the changes at the proprietary level.”

    Patuano said it was unclear with Digi is going to do, adding that Cellnex is discussing options with the telco. “What is almost sure is that there are two points that are almost sure,” he said. “One is that they are not going to make a nationwide network, so the vast majority of their coverage will be through a RAN sharing, and the second is that in order to keep the frequencies, they have to use the frequencies, otherwise they lose the frequencies. So, this means that they have to do – they will do some RAN sharing and some new emplacement.”

    Polish evolution

    Patuano told analysts the towerco continues to look closely at its Polish operations. “It’s not a mystery that we are looking towards the evolution of Poland. The evolution of Poland is we have a potential opportunity to consolidate the active market in Poland,” he said. “If this would be the case, it would be appropriate for us to welcome a co-investor who can work with us. This can turn into some capital repatriation, so there is – there are many projects.”

    He pointed out Poland could readily be densified in terms of passive infrastructure. “There is a quite significant lack of coverage when you go out of the major cities and there is the RAN component, both in terms of existing relation with [Polsat Plus] and the possibility of having a partnership also with Play,” he said. “So, this is a big project. It is something that we’re looking at. Is there interest? Yes, there is interest. So, we are working with some counterpart who could be focused on this.”

    Business lines in detail

    EBITDAaL stood at €535 million (+9%) showing a disciplined approach to Opex and lease management. Free cash flow was €103 million vs -€139 million from the same period of the previous year, due also to proceeds from the second tranche (€152 million) of the sale of sites in France, in accordance with the remedies established by the French Competition Authority (FCA) following the purchase of Hivory in 2021.

    For better transparency, Cellnex began reporting revenues from its four business lines. Towers accounted for 82% of revenues, with €776 million (c.+5%). DAS, Small Cells and RAN as a service contributed 6% of revenues, with €59million (c.+21%). Fibre, connectivity and housing contributed 5% of revenues with €47 million (c.+24%) while broadcasting contributed 7% of revenues with €64 million (c.+2%).

    As of 31 March, Cellnex had a total of 112,247 operational telecom sites: 23,861 in France, 22,559 in Italy, 16,227 in Poland, 13,341 in the United Kingdom, 8,770 in Spain –the Group’s five main markets–, and a total of 27,489 sites in the rest of the countries in which it operates (6,571 in Portugal, 5,498 in Switzerland, 4,639 in Austria, 3,979 in the Netherlands, 3,158 in Sweden, 1,652 in Denmark and 1,992 in Ireland); in addition to 1,892 Broadcasting & Others sites and 10,252 DAS and Small Cells nodes.

    Organic growth of points of presence at sites was +10.7% compared to the same period of 2023, 7.5% from new colocations in existing sites, with a total of 3,390 – with Italy and Portugal standing out in this field – and 3.2% from the rollout of 1,454 new PoPs during the period due to the progress made in the BTS (Built to Suit) programmes in France, Italy and Poland.

     

    Kenyan city builder launches Fahari Link to deliver high-speed internet 

    Simon Dux
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    Kenyan city builder launches Fahari Link to deliver high-speed internet 

    New town Tatu City builder Rendeavour pledges to connect its neighbours, as Kenya announces fibre rollout acceleration

    Rendeavour, the builder, owner and developer of Tatu City – a 5,000-acre new city on Nairobi’s doorstep – has created a new service provider, Fahari Link, to deliver high-speed internet connectivity to thousands of currently underserved residents in nearby towns and informal settlements.

    Fahari Link has invested heavily in acquiring wholesale bandwidth from global internet service providers to extend its reach to areas beyond Tatu City, including the informal communities of BTL, OJ and Rutoro. Rapidly growing Ruiru, the sixth fastest growing town in Africa, will be served, as well as the communities of Oaklands, Murera, Kamakis and other parts of Kiambu County. In total, Fahari’s services will be available to close to one million people.

    Fahari Link will provide low connection fees, daily internet plans, reliable internet connectivity and technical support to citizens of Kiambu County, including those earning subsistence wages. In addition to connecting homes, Fahari Link will deploy wi-fi internet connections in public spaces such as shopping centres and sports fields, ensuring that digital access is available to all, including mobile users.

    “With Fahari Link, we are not just connecting people; we are connecting aspirations, opportunities, and futures,” said Rendeavour deputy country head Alex Kahu. “By expanding affordable internet and broadband services to our neighbouring community, Tatu City is ensuring that no one is left behind in Africa’s digital future.”

    According to Rendeavour, more than 3,000 homes and apartments are occupied or under construction in the city and 4,500 students study at Tatu City’s schools. The city is also home to around 75 local businesses. German-based cleaning equipment manufacturer Karcher has announced an approximate €3 million investment in building a regional distribution centre at Freight Forwarders Solutions (FFS) in Tatu City, located in a Special Economic Zone (SEZ) on Nairobi’s doorstep.

    The city already has its own telecom provider, Tatu Telecom, which has laid more than 40km of fibre optic cables and currently serves over 1,000 residential and commercial customers, including schools and local, regional, and multinational companies within Tatu City. Tatu Telecom has also built an open-access network, allowing multiple internet service providers to serve Tatu City residents and businesses.

    Rendeavour currently has 30,000 acres of urban-build projects in across Ghana, Nigeria, Kenya, Zambia and the Democratic Republic of Congo.

    Kenya accelerates its fibre rollout

    The arrival of Fahari coincides with cabinet secretary for information, communications, and the digital economy Eliud Owalo announcing the nation has changed its rollout model and now believes it can deploy 100,000 kilometres of optical fibre to underserved areas in two years rather than the original five planned.

    To achieve this the country was switching away from burying cables to using existing infrastructure from the Kenya Power and Lighting Company (KPLC). Needless to say, this isn’t a new approach in Kenya. For example, in 2017 Liquid Telecom Kenya announced a 10-year partnership with Kenya Electricity Transmission Company Limited (KETRACO) to operate KETRACO’s Optical Ground Wire (OPGW) fibre cables and expand the internet network across East Africa.

    But Owalo, speaking at the Digital Transformation in East Africa conference, signalled the government was backing the plan to accelerate its rollout. “If we go that route, which is now work in progress, it is our estimation that as opposed to the five years within which we are envisaged to roll out 100 000km, we will now be able to roll out the 100,000km of fibre within the next two years,” he said.

    He added that since the resumption of the fibre rollout last year, Nia Fibre, which was contracted by the government, had laid 10,000 kilometres. As the fibre build continues, the government said it would also roll out 25,000 wi-fi hotspots across the country.

    Safaricom’s fibre training commitment

    Elsewhere, Safaricom, in partnership with Kenya’s ICT Authority has launched the Connect Academy, a training programme designed to address the shortage of skilled fibre optic technicians in Kenya. As part of the Presidential DigiTalent Programme, a Public-Private Partnership (PPP), the academy will focus on skill development, mentorship, training, certification, and fostering innovation in the ICT sector.

    The initial cohort of 200 participants will begin training in May. They will receive full-day sessions every Friday for three months led by Safaricom engineers. “Our target is to grow a world-class broadband connectivity talent pool for public and private sectors in partnership with Technical and Vocational Education and Training (TVET) institutions. This will create employment and a career path for Kenyan youth who lack higher education,” said Safaricom chief consumer business officer Fawzia Ali-Kimanthi.\

    Pictured (left to right) Frank Mosier, chairman, Rendeavour; Alex Kahu, country head, Kenya, Rendeavour; John Njogu, Gitothua Ward MCA; and Linda Nyaseda, head of city management, Tatu City.

    AI-based automation: Wait or act now? | White paper by CORTEX

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    AI-based automation: Wait or act now? | White paper by CORTEX

    Orange boosted by on-going, double-digit growth in Middle East and Africa

    Annie Turner
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    Orange boosted by on-going, double-digit growth in Middle East and Africa

    Elsewhere progress is less dramatic but appears to be going to plan, if not fast enough for the stock market

    Orange Group CEO Christel Heydemann was pleased with the first quarter’s earnings, reported yesterday. She highlighted the completion the 50:50 merger of Orange España and MásMóvil to form Spain’s biggest operator by subscriber numbers and the strong growth in its Middle East and African opcos (MEA).

    Orange’s revenues in the MEA region had double-digit growth in revenues for the fourth consecutive reporting period, up by 11.1% year on year to to €1.85 billion. More specifically,

    mobile data revenues rose in the region by close to 16%, fixed broadband by 20.6%, mobile money by 23.5% and B2B by more than 14%.

    Orange achieved less dramatic results at home in France where revenues rose by 0.8% to €4.3 billion, but was still the star turn in Europe, apart from Spain, as the total revenues from the other European market fell by 2% to €1.7 billion.

    The company said this was due to a deliberate reduction in low-margin sales and the fall was somewhat offset by ongoing growth in retail.

    Means business

    Orange Business reported a 0.3% decrease in revenues to €1.9 billion, in large part due to a fall in income from legacy fixed voice services, However, the good news is the accelerated growth in IT and integration services revenues, which rose 7.5% to €937 million.

    Orange Cyberdefense is making a hefty contribution to Orange Business, as laid out in the Lead the Future strategic plan, with accelerating growth. “Orange Business continues to execute its transformation plan with several important milestones achieved this quarter, notably the implementation of the cost-reduction plan,” stated Heydemann.

    Overall, Orange’s group revenues were up 2.1% year on year to €9.9 billion, with earnings before interest, taxes, depreciation, amortisation and adjusted loss (EBITDAaL) up 2.3% to €2.4 billion.

    Investors were not as encouraged by the results as Heydemann: the group’s share price fell nearly 4% (to €10.60) on the Paris stock exchange (pictured) giving Orange a market cap of €28.2 billion.

    Zain pilots ‘world-first’ signal overlay to secure Saudi networks

    Annie Turner
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    Zain pilots ‘world-first’ signal overlay to secure Saudi networks

    With Enea, the operator could help extend the capabilities and architecture of signalling firewalls to improve protection for virtual, cloudified and physical infra

    Zain KSA, which provides mobile and digital services in the Kingdom of Saudi Arabia, is to trial what Enea says is world’s first signalling overlay on a mobile network. The technology is designed to extend the signalling firewall’s capabilities and the trial is expected to start this year on Zain KSA’s network.

    Enea says the pilot programme could be expanded to other markets and customers.

    The patent-pending tech was conceived in Enea’s Technology Research unit last year. It takes advantage of the signalling firewall’s techniques for detection and protocol correlation, using “transport layer-aware distributed ingestion” across virtual, cloudified and traditional network infrastructure.

    Deep insights, greater protection

    This gives the operator deeper insights into network events and helps defend against “emerging threats”. Anders Lidbeck, CEO of Enea, elaborates, “The emergence of cloud and virtualized infrastructures, along with the proliferation of private networks and APIs, has introduced new complexities and vulnerabilities in mobile networks, significantly increasing the risk of sophisticated cyberattacks.

    The Kingdom aims to be at the forefront of 5G development as part of Saudi Vision 2030’s goal to become an ICT leader and transform into a sustainable digital economy.

    Threats on and to telecom networks are escalating globally, hence network security is a high priority for Zain KSA, which has consistently invested in security for signalling and messaging to safeguard its digital ecosystem.

    Acceleration

    The intention is that this pilot will accelerate innovation and the deployment of next-generation signalling security for complex and more sophisticated attacks on networks.

    Eng. Abdulrahman Al Mufadda, COO of Zain KSA, commented, “By being the first to test this promising technology, we are cementing our position at the forefront of telecom innovation, furthering our commitment to providing secure and cutting-edge solutions to our individual and business customers in the Kingdom of Saudi Arabia.”

    Lidbeck added, “This partnership builds on our long-standing relationship with Zain KSA, and emphasizes our shared commitment to enhancing network security and embracing innovation.”

    Microsoft’s new Phi-3 AI model can run on an iPhone  

    Simon Dux
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    Microsoft’s new Phi-3 AI model can run on an iPhone  

    As Deutsche Telekom’s CEO Tim Höttges recently quipped, “Who the hell needs apps?”

    Microsoft has introduced Phi-3, a family of open AI models it claims are the most capable and cost-effective small language models (SLMs) available, outperforming models of the same size and next size up across a variety of language, reasoning, coding, and maths benchmarks.  

    The mini version, for example, is a 3.8 billion parameter language model trained on 3.3 trillion tokens, whose overall performance, as measured by both academic benchmarks and internal testing, rivals that of models such as Mixtral 8x7B and GPT-3.5, according to a research paper published by Microsoft.  

    More importantly, the “highly capable language model” was running locally on a mobile phone. “Thanks to its small size, phi3-mini can be quantised to 4-bits so that it only occupies around 1.8 GB of memory,” stated the paper. The researchers tested the quantised model by deploying phi-3-mini on iPhone 14 with A16 Bionic chip running natively on-device and fully offline achieving more than 12 tokens per second. 

    At MWC, Höttges predicted that in five or ten years from now: “nobody will use apps anymore. We will use the interface of speech, or an easy way of asking the system, and be automatically connected to the functionalities of the apps.”  

    DT demonstrated the concept on its own-branded T Phone at the show. An AI-based assistant replaces all the apps on smartphones so that people can access what they need through a “generative interface” via voice or text. DT is working with Brain.ai and Qualcomm to develop the technology in Europe and the US. 

    Earlier this month, a Worldpanel ComTech study showed that 25% of Samsung Galaxy S24 buyers say AI is key reason to buy and that Samsung and Google, which are successfully marketing “halo” artificial intelligence (AI) features in their devices, can influence consumer behaviour. AI may not be generally understood by the mass market, but it knows a great acronym when it sees one.  

    Available on Azure AI 

    In a blog post, Microsoft GenAI corporate VP Misha Bilenko said Phi-3 models significantly outperform language models of the same and larger sizes on key benchmarks. Phi-3-mini does better than models twice its size, and Phi-3-small and Phi-3-medium outperform much larger models, including GPT-3.5T.   

    He added that small language models, like Phi-3, are especially great for: resource constrained environments including on-device and offline inference scenarios; latency bound scenarios where fast response times are critical; and cost constrained use cases, particularly those with simpler tasks. 

    “Thanks to their smaller size, Phi-3 models can be used in compute-limited inference environments. Phi-3-mini, in particular, can be used on-device, especially when further optimized with ONNX Runtime for cross-platform availability,” he said. “The smaller size of Phi-3 models also makes fine-tuning or customisation easier and more affordable. In addition, their lower computational needs make them a lower cost option with much better latency.” 

    He added: “The longer context window enables taking in and reasoning over large text content—documents, web pages, code, and more. Phi-3-mini demonstrates strong reasoning and logic capabilities, making it a good candidate for analytical tasks.” 

    Still showing familiar AI weaknesses 

    In terms of LLM capabilities, while phi-3-mini model achieves similar level of language understanding and reasoning ability as much larger models, it is still fundamentally limited by its size for certain tasks. 

    The researchers found the model simply does not have the capacity to store too much “factual knowledge”, which can be seen for example, with low performance on a TriviaQA task. “However, we believe such weakness can be resolved by augmentation with a search engine,” they wrote.  

     Another weakness related to model’s capacity is that the researchers mostly restricted the language to English. “Exploring multilingual capabilities for Small Language Models is an important next step, with some initial promising results on phi-3-small by including more multilingual data,” they stated.  

    “Despite our diligent RAI efforts, as with most LLMs, there remains challenges around factual inaccuracies (or hallucinations), reproduction or amplification of biases, inappropriate content generation, and safety issues,” said the research paper. “The use of carefully curated training data, and targeted post-training, and improvements from red-teaming insights significantly mitigates these issues across all dimensions. However, there is significant work ahead to fully address these challenges.” 

    Car makers meet tech firms to thrash out mobile Digital Keys 

    Simon Dux
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    Car makers meet tech firms to thrash out mobile Digital Keys 

    The Car Connectivity Consortium (CCC) is working on standards to let mobile phones securely open cars, but customer perception will be the key

    The Car Connectivity Consortium (CCC), a veritable who’s who of auto manufacturers and big tech, gathered in Ulm, Germany this past week to test the latest version of the CCC Digital Key specification – an interoperability certification standard launched last December. The certification mark signals to consumers, partners, and stakeholders that the product meets industry and program standards for the best device-to-vehicle connectivity experience. 

    The German get-together was the eighth Plugfest for this organisation and its members, and this time included participants from BYD, CARIAD, COMPRION, Continental, Google, Huf Hülsbeck & Fürst, Marquardt and Qualcomm and served to further refine the CCC Digital Key applications, enhancing implementations, specifications, test suites and tools. 

    Specifically with release 3 version 1.1.3, this Plugfest focused on incorporating ultra-wideband (UWB) and Bluetooth Low-Energy (BLE) into the next CCC Digital Key Certification, building on the capabilities already included in the current programme. 

    The CCC members point out the CCC Digital Key Certification for NFC implementation is already live and the first products to reach certification are expected very soon.  

    “We believe vehicle-to-device access will soon be a standard, expected feature for consumers, and to do this, we must be able to deliver a seamless user experience and ensure security,” said Mercedes-Benz development expert Dirk Hassert. “The work done to incorporate UWB and BLE, here in Ulm and ongoing as a larger membership, makes certain we can optimise value for consumers and provide fully interoperable, secure implementations. We’re excited for the progress we made this past week and look forward to our continued advancements.” 

    “The automotive industry has worked for decades to make the driving experience more convenient through digital technologies. But unlocking the full potential of digital key, and accessibility technologies across the board, depends on a universally interoperable and secure standard,” said CCC president Alysia Johnson. “As an organisation committed to driving global progress, we remain steadfast in our dedication to creating that standard and are thrilled to have spent time collaborating in Germany, a hub for innovation and excellence.” 

     When the certification launched BMW’s Daniel Kuelzer pointed out exactly why car manufacturers are so keen to make it happen. “Displaying the CCC Digital Key mark will be a game changer for automakers because it tells customers they can access their cars securely and seamlessly with their smart device by simply identifying the mark,” he said. 

    As a result, the CCC board of directors is stacked with their reps and those of big tech including: Apple, BMW, CARIAD, DENSO, Ford, General Motors, Google, Honda, Hyundai, Mercedes-Benz, NXP, Panasonic, Samsung, Thales and Xiaomi.  

    The next CCC Plugfest will be held on 17-21 June in Hefei, China, hosted by Volkswagen Group (China) Technology Company.  

    The other standards body 

    Of course, when it comes to standards bodies tech loves competing groups and sure enough another consortium which also certifies, the FiRa Consortium literally has overlapping members among the likes of Apple, Google, Cisco, Samsung and Qualcomm. FiRa backs ultra wideband and fortunately, the membership overlap led the two organisations to announce the formation of the Joint Ultra-Wideband (UWB) MAC PHY Working Group (JUMPWG) to jointly develop and maintain the UWB technology specifications last November.  

    The organisations knew that as the underlying IEEE 802.15.4 standards evolve, this new working group would “ensure long-term interoperability and scalability of the advanced UWB technology developed for the CCC Digital Key,” encouraging broader adoption of UWB technology for secure and accurate ranging for vehicle access – leading up to the German plugfest.  

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