What’s up with… Smartphones, Lidl, Nokia & Bite

• GenAI could boost smartphone sales
• Lidl branches out with sovereign cloud solution 
• Nokia helps Bite close in on 5G services

In today’s industry news roundup: GenAI smartphones could fuel additional smartphone sales but are likely to carry a premium price tag, finds IDC; Lidl is diverging into enterprise data services and unveils a European cloud solution via its internal IT unit, Schwarz Digits; Bite chooses Nokia’s Packet Core solution to help it expand FWA offerings and boost bandwidth and capacity for customers; and more!

Will the interest in generative AI (GenAI) help ship more smartphones? Maybe. The latest research from analyst firm IDC suggests that GenAI smartphones – whilst relatively new in the market – will capture 18% share of the total market by the end of 2024, as most flagship models will adopt some on-device GenAI features. However, in this press release, Anthony Scarsella, research director with IDC’s Worldwide Quarterly Mobile Phone Tracker, sounds a note of caution: “GenAI-capable devices won’t come cheap initially, as the average selling price for these GenAI smartphones will be more than double the cost of non-GenAI capable devices, further driving the premiumisation trend. Apple is due to announce its latest GenAI-equipped iPhones early next month, which could well boost the fledgling GenAI smartphone market, as could the establishment of local AI partnerships in China. As for the overall smartphone market, IDC forecasts shipments will grow 5.8 per cent year on year in 2024 to 1.23 billion units. It also notes that affordable Android smartphones continue to grow rapidly in emerging markets. “The improved forecast for 2024 cements the road to recovery for the smartphone market, driven by stronger growth for Android devices in China and emerging markets,” said Nabila Popal, senior research director at IDC.

Next time you’re in the Middle at Lidl (if you know, you know...), look out for a sovereign cloud solution. Yes, the budget-friendly supermarket is spinning up a European cloud solution and offering a range of data services to enterprise customers. Its internal IT unit, Schwarz Digits (named after Lidl’s 84-year-old billionaire founder, Dieter Schwarz) became a standalone operating division last year, just two years after launching, with all data processed and stored in Germany and Austria. The FT has all the details (behind its paywall), including an impressive list of European customers and the company’s progress on AI. Last year, the notoriously secretive and publicity-shy company acquired a stake in German AI start-up Aleph Alpha and is currently developing an AI Campus that intends to become “the global home” of applied AI. Doubtful? Well, Schwarz Digits already generated €1.9bn in revenues last year. So take our advice: never underestimate Lidl.

Regional Baltic operator Bite Group has selected Nokia’s Packet Core solution for its network evolution programme, as it looks toward advanced 5G services and the simplification of its network architecture in Latvia and Lithuania. The appliance-based solution provides a pre-integrated and modular server-based configuration, allowing Bite to target and serve new customers and create new revenue streams. These include expanding fixed wireless access (FWA) offerings and delivering improved bandwidth and capacity to end users. Mindaugas Rauba, CTO at Bite Group, said that the deal will “facilitate important changes to our network quality and service delivery and, most importantly, elevate the overall customer experience”. As part of the agreement, Bite will also integrate Nokia’s MantaRay Network Management solution. Read more.

UK-headquartered bandwidth infrastructure company, euNetworks, has closed a €2.1bn equity recapitalisation deal. Leading participants included an indirect investment from its majority shareholder, US private equity firm Stonepeak Infrastructure Partners. Details of the deal are in this investor note. The equity commitments follow the company’s recent debt refinancing announced in June. euNetworks builds and invests in city and long-haul fibre networks. It directly connects 542 European datacentres and operates deep fibre networks in 18 cities. “We’re very proud of what we’ve achieved and are excited for the future, continuing to construct and deliver Europe’s future critical infrastructure with our customers and our long-term committed investors,” commented Kevin Dean, interim chief executive of euNetworks.

5G network security is experiencing a shift, as traditional signalling security moves from being hardware based (firewalls) to software based (including as-a-service solutions). Market intelligence from ABI Research suggests that hardware revenues have stagnated, while software and as-a-service solutions are expected to see 50% year-on-year growth. “The shift is clear – there is still demand for signalling security, but customers increasingly want it delivered in a software format,” explained Georgia Cooke, digital security research analyst at ABI Research, “with an emphasis on single-pane-of-glass interfaces, ease, and integration.” According to ABI Research, around half of network operators still lack a signalling firewall despite this being a core security component. Furthermore, trust levels in signalling firewalls have been low (although the situation is apparently improving), with a quarter of mobile operators stating that 75% of attacks were missed by their firewalls in 2021. Cooke added: “A move to flexible, scalable software solutions will help signalling firewalls become ubiquitous, underpinning 5G security and raising security standards across the market.” Read more.

Cisco has announced its intent to acquire AI security solutions company Robust Intelligence, which is currently a part of the Cisco Investments portfolio. The company has developed a platform that offers robust protection for AI models throughout their lifecycle, from development to production, enabling organisations to securely deploy AI applications while adhering to industry and regulatory standards. Making the announcement on the Cisco blog, Tom Gillis, senior vice president and general manager of the Security Business Group at Cisco, said the intended deal “marks an exciting new chapter in our journey to secure the AI-driven enterprise. Together, we’ll push the boundaries of AI security, empowering organisations to embrace AI’s full potential while safeguarding their critical assets.” Once the deal is finalised, Cisco intends to integrate Robust Intelligence’s technology into the Cisco Security Cloud. Gillis added that the combined offering means that Cisco can deliver advanced AI security processing seamlessly into existing data flows, providing the company with “unparalleled visibility into all of a customer’s AI traffic”. Robust Intelligence was co-founded by Professor Yaron Singer and Kojin Oshiba in 2019 after a period of machine learning research at Harvard University. Prior to the news this week, the company had reportedly raised $44m and was valued at more than $200m. “Security leaders need purpose-built solutions they can trust to keep up with the new paradigm of AI risk,” said Singer.

– The staff, TelecomTV