What’s up with… Orange and MásMóvil, Microsoft, Nokia

• Orange Spain-MásMóvil merger gets EC approval
• Microsoft boosts AI and cloud play in Spain with a $2.1bn investment
• Nokia puts Orange in a deep sleep

In today’s industry news roundup: Orange and MásMóvil edge closer to finalising their planned merger in Spain after receiving the green light from the European Commission; Microsoft targets Spain for AI and cloud infrastructure expansion; Nokia unveils a deep-sleep mode for energy savings in the radio access network, with the solution to be rolled out across Orange’s networks; and much more! 

The European Commission has given its blessing to the planned €18.6bn merger between Orange Spain and MásMóvil. Once the deal is finalised, which is expected by the end of the first quarter of 2024, the new joint venture will become the market leader in Spain, with more than 30 million mobile connections, 7.3 million fixed subscribers and 2.2 million TV customers. In its announcement of the approval, the European Union governing body confirmed the proposed deal “would no longer raise competition concerns” as Orange and MásMóvil have agreed to comply with several conditions. The main commitment requires MásMóvil to divest spectrum to Digi Spain, an up-and-coming alternative mobile and broadband network operator part of Digi Communications, across three frequency spectrum bands. The spectrum is to be used by Digi to build its own mobile network and to “exert a strong competitive constraint on the joint venture”, the commission said. Additionally, Digi will have the right to enter an optional national roaming agreement, either choosing to remain with its current wholesale provider Telefónica or opting for another Spanish operator (such as the Orange-MásMóvil JV or Vodafone) instead. The commission described this option as “critical” considering that Digi’s future mobile network would not be likely to cover the whole of Spain. Digi is considered by the European Commission as “a suitable purchaser” for the divested spectrum and is currently “the largest and fastest-growing MVNO [mobile virtual network operator] in Spain”. The approval is good news for Digi, which is on the path to solidifying its presence in a changing telco market in Spain. Further upheaval in the market is imminent as Zegona Communications takes over Vodafone Spain and is reportedly looking at other asset acquisitions to boost Vodafone’s position in the country. The European Commission has previously objected to the Orange and MásMóvil deal over concerns it would hamper competition, however, following its investigation, it concluded that the remedies offered by Orange and MásMóvil “fully address the identified competition concerns and will preserve a competitive telecom market in Spain, both in terms of price and quality, as well as in terms of 5G network deployment, to the benefit of consumers.” Orange welcomed the decision, adding that the combined entity will be “a stronger and solid market player” with estimated revenues exceeding €7.4bn and expected synergies of more than €450m per year (from the fourth year after the closure of the deal). Orange CEO Christel Heydemann described the approval as “a crucial moment for the future development” of Orange in Europe. “By joining forces, we can scale, we can innovate, and we can drive investment in Spain for the benefit of consumers and businesses,” she added. Meinrad Spenger, CEO of MásMóvil, said the move allows the company to “assume a relevant role in the Spanish telecommunication sector”, adding, “Our exceptional team is committed to forming a unified and distinctive company capable of delivering positive impact and providing a trustful service to the most satisfied clients in Spain.”

Spain is attracting more attention… Yesterday, Microsoft unveiled plans to invest $2.1bn over the next two years in expanding its AI and cloud infrastructure in the market. The news came from the tech giant’s vice chair and president, Brad Smith, who posted on X (previously Twitter) that the move is beyond “just building data centers” and is rather “a testament to our 37-year commitment to Spain, its security, and the development and digital transformation of its government, businesses, and people”. Specific details about the investment were not disclosed.

Addressing the ongoing challenge of energy consumption by the radio access network (RAN) – which is widely believed to represent around 80% of all mobile network power usage, Nokia has unveiled an ‘extreme deep-sleep’ mode that shuts down key hardware elements in selected radio units. The “zero traffic, zero watt” solution will be deployed across French telco group Orange’s mobile networks in the second half of 2024. It is capable to detecting when traffic on the network is low, and can pull the plug on certain parts of the RAN, reducing radio unit consumption by a factor of eight. Nokia explained that the offering consists of its MantaRay energy solution that optimises power consumption of the RAN using AI and machine learning (ML). What makes it different from previous deep-sleep solutions, according to the Finnish vendor, is that it can disconnect additional hardware subsystems and, therefore, support “intelligent, efficient and cognitive RAN operations”. Find out more.

The EU’s competition commissioner, Margrethe Vestager, has been cited as saying that the European Commission is not considering easing merger regulation for telecom players, in what appears to be a significant blow for telcos in Europe, which have repeatedly called for loosened rules on such deals made across the bloc. Reuters has reported that Vestager has dismissed earlier speculation on potential changes in legislation regarding mergers in the industry, claiming that she has not heard of such plans. She has also reportedly highlighted a need to address barriers to a single European market for the telecoms sector. Acknowledging the fragmented marketplace, Vestager has suggested that there should be more centralised spectrum management so that businesses can harvest scale and related efficiencies. Currently, each EU member state has its own policy on owning and regulating spectrum.

BT is moving closer to adopting generative AI (GenAI) across its operations, with the deployment of GenAI coding companion Amazon CodeWhisperer, a tool by Amazon Web Services (AWS), to assist the telco group’s software engineers. The deployment has been made at BT’s Digital Unit, which has been tasked with leading BT Group’s digital transformation. The UK’s incumbent operator noted that Amazon CodeWhisperer is the first in “a suite of generative AI tools that BT Group plans to introduce to enhance product development processes across the business”. What the deployment brings to the table is real-time, AI-powered code suggestions in multiple integrated development environments (IDEs), based on natural-language comments and existing code, across 15 coding languages, BT noted in its press release unveiling the move. It added that the service helps developers “code more responsibly and securely”, as it filters out suggestions that might be deemed biassed or unfair. It can also scan for “hard-to-detect vulnerabilities” and propose ways to rectify them. Since the tool was implemented, around 12% of “the tedious, repetitive, and time-consuming work done by an initial group of volunteers” has been automated. Following tests, the tool has now been made available to 1,200 of engineers across BT’s business.

Japanese telco NTT Docomo and its South Korean peer SK Telecom (SKT) have issued a whitepaper on the technological advancements that are deemed “critical” for introducing virtualised RAN (vRAN) base station equipment. The joint report outlines three requirements to make such efforts successful, the first of which is the need for increased processing capacity and reduced power consumption. The second requirement is for early implementation of key virtualisation capabilities, such as resource pooling, scaling and auto-healing. The whitepaper also emphasises on the importance of enhancing the integration technology and tools for vRAN base station kit. The document also looks into conducting technical analysis of capacity, power consumption and complexity across various accelerator structures and network architectures based on proprietary studies. This is the latest move by the two companies, which united forces in November 2022 to boost R&D in next-generation telecoms infrastructure for 5G and 6G. Last year, NTT Docomo and SKT published a whitepaper on the energy efficiency of 5G and related technologies, and another one about requirements for future 6G networks – see What’s up with… SK Telecom, NTT Docomo, Telecom Italia, KKR, Ooredoo.

SoftBank Group founder and CEO Masayoshi Son is reportedly aiming to raise $100bn to build a chip venture that can compete with Nvidia, the current leader in graphics processing units (GPUs) that power AI applications. According to a Bloomberg report, through an initiative, code-named Izanagi, Son is aiming to create a company that can complement chip design unit Arm and provide semiconductors that are considered essential for AI. It is not yet known how the project will be funded, but a potential scenario is for SoftBank to stump up $30bn, while the remainder is likely to come from institutions based in the Middle East, the report suggested.

- The staff, TelecomTV