What’s up with… SES & Intelsat, US telcos, Samsung

• SES strikes $3.1bn deal to buy Intelsat 
• US telcos fined almost $200m for illegal data sharing
• Samsung gets back to profitable ways

In today’s industry news roundup: The marriage of satellite firms SES and Intelsat is back on following a $3.1bn agreement; the FCC has fined the three largest US telcos for illegally sharing the location data of their customers; the AI boom has helped Samsung report healthier profits for the start of 2024; and much more!

SES has struck a $3.1bn (€2.8bn) deal to acquire fellow satellite operator Intelsat in a move that, if successful, will create “a stronger multi-orbit operator with greater coverage, improved resiliency, [an] expanded suite of solutions [and] enhanced resources to profitably invest in innovation.” This isn’t the first time these two have approached the altar: They held merger talks last year but abandoned discussions in June. Now, though, it seems the time is right. The combined operator would have annual revenues of €3.8bn, adjusted EBITDA of €1.8bn, a combined order backlog worth €9bn and a combined fleet of more than 100 geostationary earth orbit (GEO) and 26 medium-earth orbit (MEO) satellites, while a further eight GEO and seven MEO satellites are on course to be launched by the end of 2026. SES believes it can achieve financial efficiencies worth €2.4bn, about 85% of the transaction’s value, through the “combination of selling, general, and administrative savings as well as optimisation of third-party capacity costs and future efficiencies in procurement. The remaining synergies will be captured from optimising the combined satellite fleets and ground infrastructure with the process expected to start soon after closing,” noted SES. So there would be a lot of job cuts, basically. SES added: “With the creation of a stronger multi-orbit operator, customers across government, mobility, fixed data, and media segments will benefit from an expanded set of capabilities and solutions, which will enable them to expand their network reach, add further resiliency, improve productivity across their operations, and bring world-class experiences to their end users… In fixed data, customers will be able to take advantage of the combined company’s expanded multi-orbit network coverage, complementary innovations in software-defined delivery, and competitive offerings capable of seamless integration with cloud and 5G applications. Both companies have a proven record serving the requirements of major telecommunications companies, mobile network operators and cloud service providers in this growth segment.” The deal will take quite some time to conclude, though: SES doesn’t expect it to happen until the second half of 2025 as there are a number of regulatory hurdles. Christof Kern, business development lead for the satellite and space sector at satellite industry consultancy TTP, believes the combination will have a massive impact on the sector. “The acquisition of Intelsat by SES marks a significant milestone in the satellite communications industry,” he noted in comments emailed to the media. “Both companies are focused on driving efficiencies and maximising their investments in both geostationary earth orbit (GEO) and medium-earth orbit (MEO) satellites. However, based on the operating efficiencies gained, there’s potential for deploying low-earth orbit (LEO) satellites in the future to meet high-bandwidth and low-latency connectivity demands when required. With confidence in the competitiveness of these satellites, when compared to Starlink’s LEO constellation, the combined entity will be able to offer wider coverage of the Earth’s surface at a more affordable cost, albeit at higher latency. The combined entity is poised to be the world’s largest satellite company in terms of revenue, and could dominate the market, leveraging its extensive resources and expertise to shape the future of satellite communications and deliver on new use cases,” added the consultant. News of the acquisition came as SES reported first-quarter revenues of €498m, up by 2.5% year on year, and adjusted EBITDA of €275m, up by 4.7%. SES might be excited about the proposed acquisition and its financial start to the year but its shareholders are not: SES’s share price slumped by 12.4% to €4.34 on the Euronext exchange following the news announcements. 

The three largest telcos in the US have been slammed with fines totaling almost $200m by national regulator the Federal Communications Commission (FCC) for illegally sharing access to customers’ location data. T-Mobile US has been fined $80m and its now merged unit Sprint was fined $12m, while AT&T has been hit with a $57 penalty and Verizon a $47m fine. The reason? According to the watchdog, the operators have been sharing location data without consent and without taking “reasonable measures” to protect that information against unauthorised disclosure. Furthermore, the FCC found that each of these telcos sold access to customers’ location information to so-called ‘aggregators’, “who then resold access to such information to third-party, location-based service providers.” “In doing so, each carrier attempted to offload its obligations to obtain customer consent onto downstream recipients of location information which, in many instances, meant that no valid customer consent was obtained. This initial failure was compounded when, after becoming aware that their safeguards were ineffective, the carriers continued to sell access to location information without taking reasonable measures to protect it from unauthorised access,” the commission explained. Under US legislation, operators are required to maintain confidentiality of customer location data and to obtain customer consent before using, disclosing or allowing access to such information. “Our communications providers have access to some of the most sensitive information about us. These carriers failed to protect the information entrusted to them. Here, we are talking about some of the most sensitive data in their possession: Customers’ real-time location information, revealing where they go and who they are,” said FCC chairwoman Jessica Rosenworcel. Find out more.

Samsung Electronics has returned to profit after a weak performance in 2023, strongly signalling that its AI-driven approach is paying off. During the first quarter of 2024, “strong sales of flagship Galaxy S24 smartphones and higher prices for memory semiconductors” helped it achieve a staggering 933% year-on-year increase in operating profit to 6.61tn Korean won (KRW) (US$4.8bn). Revenue was up 13%, reaching KRW 71.92tn ($52bn) in the period. According to the South Korean giant, there was solid demand for its memory chip DDR5 (a model of dynamic random-access memory chip, or DRAM) and storage for generative AI (GenAI). The company highlighted that the Galaxy AI features on its latest S24 smartphone series, such as Circle to Search, saw high usage rates and, therefore, it plans to apply the ‘AI experience’ to other flagship models. “In the second half of 2024, business conditions are expected to remain positive with demand – mainly around generative AI – holding strong, despite continued volatility relating to macroeconomic trends and geopolitical issues,” stated Samsung.

Telenor CEO Sigve Brekke used the company’s first-quarter results to highlight how it is embracing AI, including through its strategic collaboration with Nvidia. “We will work together in a number of areas with the goal to accelerate AI in the Nordic region. This means, among other things, that AI will be integrated into all aspects of our business, from the workplace and the value chain to the customer experiences. Everything that can be improved with AI will be improved with AI,” he explained. Brekke noted that Telenor already uses AI in several areas, including to optimise its networks, manage its power usage and enhance its customer service operations. Telenor’s results also warned of a rise in cybersecurity threats: In the first three months alone, the company saw the number of digital attack attempts against its customers increase by nearly 70% compared to the previous quarter, which led to an increased appetite for security products. Aside from these highlights, the company reported “good momentum” with top-line growth in the Nordics and Asia. Service revenues were up 5.6% year on year to 15.8bn Norwegian kroner (NOK) (US$1.4bn), while earnings before interest, taxes, depreciation and amortisation (EBITDA) grew 6.9% to NOK8.5bn ($769m). Total revenues were up slightly to NOK19.5bn ($1.76bn). Read more

Vodafone has completed an Open RAN trial in Italy with Nokia, Dell and Red Hat using the operator’s live 5G standalone (SA) network. The trial used Nokia’s AirScale Massive MIMO radios and its MantaRay Networks Management system as well as the vendor’s baseband software running on Dell PowerEdge XR8000 servers and Red Hat OpenShift cloud platform. According to Santiago ‘Yago’ Tenorio, director of network architecture at Vodafone, the operator continues to be “dedicated to supporting the development and adoption of Open RAN worldwide by fostering a diverse ecosystem of partners and solutions. This approach offers numerous benefits, including increased choice, enhanced energy efficiency, higher network capacity, and improved performance for customers.” This is one of the few Open RAN trials or deployments where Vodafone has not teamed up with Samsung Networks. Vodafone is currently engaged in a major RAN request for quotation (RFQ) process that covers all of its 170,000 mobile sites and has Open RAN at the heart of its technical requirements: It aims to have at least 30% of its mobile network in Europe based on Open RAN technology by 2030. The operator has multiple Open RAN trials ongoing across Europe and is already underway with commercial Open RAN deployments in the UK and Romania – see Vodafone starts swapping Huawei gear for Open RAN systems and Vodafone preps extensive Open RAN rollout in Romania. 

Lumine Group, which has been building up a broad portfolio of communications networking software systems as a result of multiple acquisitions for several years, has beaten off late competition from another telecom software-focused vendor, TelcoDR’s Skyvera (backed by ESW Capital), to acquire the 5G mobile core and cloud radio access network (RAN) assets of bankrupt vendor Casa Systems. Casa announced at the beginning of April that it was selling its product lines as part of a court-supervised bankruptcy process and had agreed to sell the 5G core and RAN assets to Lumine for an undisclosed sum. That sum turned out to be $15m, but this was trumped by Skyvera, forcing Lumine to up its offer to $20m. Casa initiated an auction that Lumine eventually won last week, with a Delaware bankruptcy court judge approving the sale of the 5G/cloud RAN assets for $32.25m after Skyvera topped out at $32m. So Lumine ended up paying more than double its initial bid. Casa will be happy with the outcome while Lumine will be pleased it won the auction and, according to this audio recording of the bankruptcy court meeting held last week related to the sale of Casa’s assets, Verizon will also be pleased. During that meeting, a spokesperson representing the giant US operator, which is the main customer of Casa’s mobile network products and which also invested in a stake in the vendor in 2022, noted that “much of this sale is really an opportunity to work with Verizon.” The spokesman noted that the telco was “very comfortable” with Lumine buying the assets but “less comfortable” with those assets going to Skyvera, which would be a new technology partner for Verizon. How intriguing – and how comforting for Lumine!   

Rakuten Mobile has started radio frequency tests for its 700MHz spectrum, which is also referred to by the Japanese telco as ‘platinum band’. According to the operator, spectrum in this band delivers “better indoor building penetration and enables better connectivity indoors and in underground locations”. The company is preparing to launch base station operations using the 700MHz band and, once it has completed testing, aims to launch an early commercial service utilising the band – although it did not reveal a timeframe. It comes as no surprise that Rakuten Mobile is eager to enhance its network in Japan and turn the tables after reporting a loss in 2023 – see For Rakuten Mobile, scale is still elusive as it enters Phase 3.

The apparently endless quest to find robust, flexible wearable technology that can withstand actually being worn by real people in day-to-day circumstances continues. Over the years, TelecomTV journalists have been at press events hyping wearable technology, where models pretending to be human statues stood immovable on a catwalk in clothing that couldn’t move either. They might as well have been wearing Wallace’s Techno-Trousers, as invented by Aardman Animations – it would have been a lot more fun for all concerned. Generally, though, the over-managed, smoke-and-mirror effects were as depressing as they were risible. But now comes the news, first published in Science Daily, that scientists at Pohang University of Science and Technology in South Korea have announced the development of a “rubber-like, small-scale energy storage device capable of stretching, twisting, folding, and wrinkling” based on a matrix of highly deformable micro super capacitors (MSCs). That sounds more like it! In addition to its potential as a material that could be crafted into wearables, it could also be applied to the manufacture of flexible, malleable, stretchable “soft” electronic devices. As the Pohang University team writes, “The fabrication of interdigitated electrode patterns capable of maintaining the energy storage performance under repeated stretching and twisting has remained a great challenge, because brittle materials like gold have been commonly used as an electrode.” Meanwhile, although the properties of eutectic gallium-indium liquid metal (EGaln) include high conductivity and deformability, it is very difficult to produce fine laser patterns using EGaln because of its high surface tension. By the way, “eutectic” means relating to or denoting a mixture of substances (in fixed proportions) that melts and freezes at a single temperature that is lower than the melting points of the separate constituents or of any other mixture of them. Eutectic gallium-indium is a liquid metal alloy with a melting point of just 15.7°C. It has a self-limiting oxide layer that retains its shape and is ductile, malleable, easy to mould, stretch and form into many shapes. Such characteristics are ideal as the basis of material that can withstand routine wear and tear. Meanwhile, micro supercapacitors, which have high-power density, permit rapid charging and have a long lifecycle, have become prime candidates for deformable energy storage. They can work for what is called an “ultralong time”, which translates to tens of thousands of times with only minimal capacitance attenuation. Professor Jin Kon Kim, the Pohang University team leader, commented: “The use of laser-patterned liquid metal electrodes represents a significant step forward in the development of truly deformable energy storage solutions. As wearable technologies continue to advance, innovations like these will play a vital role in ensuring that our devices can adapt to the demands of our dynamic lifestyles.” 

The Council of the European Union has adopted the Gigabit Infrastructure Act, which will replace the 2014 broadband cost reduction directive (BCRD). According to the council, the “new law aims to simplify and accelerate the rollout of high-speed networks, such as fibre and 5G, with a view to achieving Europe’s connectivity objectives and targets set out in the digital compass for this decade.” The overall aim of the legislation is to make it quicker and easier for network operators to deploy broadband network infrastructure, though it’s been made clear that the region’s operators, via a number of industry lobby groups, are not happy with the details and are not convinced it will ultimately help them much. The act also includes an extension until 30 June 2032 of the intra-EU communications retail price caps of €0.19 per minute for calls, and €0.06 per SMS text message: The caps were due to expire on 14 May this year. For further details about the act and to access a copy of the legislation, check out this EU council site.  

- The staff, TelecomTV