Tuesday is our Telecom day which means that we are back with the latest happenings in the telecom industry that dominated the news in the past week. If you did not have a chance to read our last week’s telecom main happenings, you can find them here. Let’s see what is on our agenda this week. In a rather surprising move, Ericsson withdrew itself from the Mobile World Congress 2021 months before its due, Vodafone wants to raise more than $3 billion with the Vantage Towers IPO, Deutsche Telekom successfully completes its first, pure 5G video call, Comcast’s upstream traffic increases significantly, Telecom Italia to cut 1300 jobs in their domestic market, DuPont with a big acquisition ahead of them, Foxconn expecting some big results, and Ciena showing disappointing performance but keeping optimistic about the second quarter of the year. Let’s dig into the telecom happenings of the week!
Founder Of Zoom Transfers $6 Billion Worth Of Stocks
According to a regulatory filing from last week, Eric Yuan, the founder of the video-conferencing collaboration platform Zoom, has transferred approximately 18 million shares that are worth more than $6 billion. The transfers were done in accordance with Yuan’s estate planning practices.
“The distributions were made in accordance with the terms of Eric Yuan and his wife’s trusts,” a spokesperson for Zoom said.
As Zoom disclosed in a filing on Friday, Yuan transferred almost 40% of his stake in Zoom to unspecified beneficiaries. The transfers were performed in two parts of approximately 9 million each, being shown as “gits”
We remind that Zoom’s shares have almost tripled in the past year, as a large part of students and professionals around the world switched to online collaboration.
Telecom Italia To Cut 1300 Jobs In Italy
On Monday, Telecom Italia and the unions have agreed to cut up to 1300 jobs in Italy through an early retirement scheme.
Telecom Italia currently employs 42,600 employees in Italy, and the cut would amount to approximately 3% of all of the employees, as the biggest Italian Telecom is trying to survive the impact of the pandemic.
Another 178 jobs may be cut through a different voluntary layoff scheme by the end of 2023. Since the beginning of 2020, Telecom Italia has already used voluntary layoff schemes to cut more than 2500 jobs this year.
Due to the pandemic and a more competitive environment in their key market, the revenues of Telecom Italia fell by 7.7%
As of now, TIM has not made an official comment about the decision.
Foxconn Expects Whooping First Quarter Results
The Apple supplier, Foxconn, has reported that it forecasts a huge growth to its revenue due to the iPhone sales and the heightened demand for electronics. A 15% Q1 revenue growth is forecasted.
Telecommuting and ‘“stronger than expected” sales for the smartphones during the lockdown are the main reasons for the strong performance of the Taiwan-based electronics manufacturer.
Foxconn’s shares in 2021 have surged by more than 20%.
DuPont Will Buy Laird Performance for $2.3 billion
On Monday, DuPont informed the press that it is about to buy the Laird Performance Materials from the private equity firm Advent International, in a deal worth $2.3 billion. The reason behind the deal is DuPont’s goal to expand its portfolio of advanced electronic materials which are used in 5G telecommunication and autonomous vehicles.
As these materials are also demanded in computing, IoT, and AI, electronics is a key area for DuPont and its growth strategy. In February, the company said that it plans to spend approximately $2.5 billion on mergers and acquisitions. Back then, the company spoke about two possible companies to acquire.
DuPont’s sales were up by 9% in Q4 of 2020 as compared to Q4 of 2019, reaching $1.02 billion.
DuPont also announced that a new $1.5 billion share buyback program has been approved.
Vodafone Seeks To Raise Over $3 Billion From Vantage Towers.
On Tuesday, the Vodafone Group said that it will attempt to raise up to 2.8 billion euros by floating infrastructure unit Vantage Towers in the largest European IPO of 2021.
The UK-based telecom set the price for the flotation of Vantage Towers on the Frankfurt Stock Exchange at 22.50 to 29 euro per share, which indicates an overall market cap of over 15 billion dollars (14.7 billion euros)
The deal will be the biggest IPO of European telecom in the last years, the last comparable one being the 2014 Belgacom that raised $4.4 billion.
The CEO of Vantage, Vivek Badrinath said that he will consider either issuing new shares or borrowing to fund the acquisitions of the tower. From Vodafone’s side, the company stated that the infrastructure investor Digital Colony and the Singapore-based equity fund RRJ will be the main investors buying up to 950 million euros worth of shares.
Vodafone said that infrastructure investor and operator Digital Colony and Singapore-based global equity fund RRJ had agreed to be cornerstone investors and buy a total of 950 million euros in shares.
The offer period is expected to end on March 17th, with March 18th being the first day of trading.
Ericsson Pulls Out Of Mobile World Congress 2021 Due To Covid-19 Concerns
Today, a surprise announcement came from Ericsson that decided to pull out of the Mobile World Congress 2021 just hours after GSMA has announced the measures they decided on for the event.
In a statement that Ericsson has issued to Light Reading, the Swedish telecom says that their primary motivation to withdraw from the event is the wellbeing of their employees and the safety measures against the Covid-19 spread.
“The decision, whilst regrettable, reflects our precautionary approach to managing the pandemic from a people and travel perspective whilst vaccination programs are rolled out globally. We look forward to the opportunity to rejoin future events and continue to work closely with the GSMA and industry partners.”
The Mobile World Congress has been scheduled for 28 June, later than in the previous years, due to the Covid-19 concerns. Thus, it may be surprising to many that Ericsson has already decided to firmly pull out of the event months ahead. With Ericsson being one of the biggest and most important exhibitors at the congress, it is hard to imagine that the organizers will be satisfied with the Swedish telecom’s decision. Having said that, in a statement they issued, GSMA says:
“We respect Ericsson’s decision and look forward to welcoming the company back to Barcelona for future editions of MWC. We appreciate that it will not be possible for everyone to attend MWC Barcelona 2021. This is why we have developed an industry-leading virtual event platform that will ensure everyone can enjoy the unique MWC experience. The in-person and virtual options are provided so that all friends of MWC Barcelona can attend and participate in a way that works for them.”
“We’re not too worried about the epidemiological implications of attending MWC 2021 here at Telecoms.com, for the previously discussed reasons. But if exhibitors keep pulling out there will come to a point at which it just isn’t worth us physically attending because there won’t be enough going on. That would be a real shame because we really miss having a drink and a chat with industry figures of all kinds, something that is uniquely facilitated by trade shows,” they add.
Biggest Happening For Deutsche Telecom As It Completes The First Pure 5G Video Call
The German telecom giant, Deutsche Telekom has just completed its first full 5G video call that was not dependent on any legacy 4G kit. The call was made via a standalone antenna in Garching to Bamberg and from there to Bonn.
“True technical innovation is made up of implementation strength and pioneering spirit,” said Walter Goldenits, CTO of Telekom Deutschland. “Telekom has clearly demonstrated both with 5G. More than two-thirds of people in Germany can already use Telekom’s 5G network today. And the next step has also been taken. With our first data connection via 5G Standalone, we are making history again.”
“Our goal is to continue to actively shape the future of mobile communications. 5G standalone is important to be able to use technologies such as network slicing or edge computing,” said Claudia Nemat, Board Member Technology and Innovation at Telekom. “We are very proud to have taken the next innovation step in 5G. With this test, we are once again demonstrating our innovation leadership.”
Revenue Drops For Ciena
Ciena has seen some revenue drop for the first quarter of 2021 with a $757.1 million revenue for the Q1 of its 2021 fiscal year, as compared to the $832.9 million for the same period last year and $828.5 million for the last quarter of the fiscal year 2020.
Profit has also declined, with the newest number showing a $55.3 million profit, a drop from $62.3 million in 2020. Having said that, during this week’s earning calls, Ciena’s executives said that they are optimistic about the upcoming months and that they predict more demand from network operators and service providers both.
The CEO of Ciena, Gary Smith, said that the first quarter will most likely be their lowest performance of this year and that they expect a significant improvement in the next quarter.
Telecom Traffic Happening: Comcast’s Upstream Traffic Increases By 56%
The pandemic has helped broadband networks grow and gather unusually high traffic in 2020. However, Comcast has released traffic numbers about its network that show that it is not just downstream traffic that has improved, but that upstream traffic has increased significantly as well.
While peak downstream traffic in 2020 has gone up by approximately 38%, the peak upstream traffic has increased by more than half, scoring 56% higher than upstream traffic in 2019.
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Remember to come back next Tuesday for the fresh portion of the latest telecom happenings. Meanwhile, if you want to find out about the most important news summaries from the fintech and biotech industry, as well as follow the features and interviews that will appear on the website later this week, stay tuned and come back tomorrow.
