May 2011

France’s leading telecoms group has avowed its determination to remain the top operator after the government capped the amount of 4G wireless frequencies a single company can buy when they are auctioned at the end of the month.

“Our target is to be the leader in France for broadband networks, both fixed and mobile,” Stephane Richard, chairman and chief executive of France Telecom, said. While the conditions of the auction are “very complicated” the French group “will definitely apply to buy more spectrum,” he said. The importance of securing access to frequencies which allow high-speed mobile Internet services is underscored by the growing popularity of wireless handheld devices such as smartphones. However, France’s incumbent operator faced a blow when Eric Besson, industry minister, announced the limit on bids earlier this month.

Crown Fibre Holdings (CFH), the government agency charged with managing New Zealand’s Ultra Fast Broadband (UFB) network and seeks to extend high speed fiber-based Internet to at least 75% of the country’s population through a new fibre-optic network, has confirmed that it has allocated the remainder of the country’s geographical regions to Telecom New Zealand and Enable Networks. As part of the agreement Telecom New Zealand has agreed to structurally separate its infrastructure business unit, Chorus, from the rest of the company. Going forward, Chorus will operate as a nationwide fixed line access network operator, offering services on an ‘open access’ basis, whilst ‘Telecom’ will function as a retail-focused telecoms business, comprising fixed, mobile and ICT businesses. Pending certain conditions, including stakeholder approvals and legislative change, Telecom has confirmed that it aims to demerge Chorus by the end of the calendar year.

Sens Amy Klobuchar (D-MN) and Herb Kohl (D-WI) wrote AT&T Chief Executive Randall Stephenson asking a series of questions about its billing practices and a lawsuit alleging the wireless giant systematically overcharged smart phone customers. AT&T has disputed allegations by customer Patrick Hendricks, who filed his class-action suit in the U.S. District Court of Northern California. According to Hendricks, AT&T systematically overstates Web server traffic for smart phone users by 7 to 14 percent. He hired an independent consulting firm to study billing of AT&T customers, according to the suit. Sens Klobuchar and Kohl asked AT&T to respond to the charges. It also asked for the company to specify how it ensures the accuracy of bills and to provide an estimate of how many errors occur in their charges for data and other services. They asked how many people exceed their monthly data caps and the amount such customers are billed for excess data usage during the three months preceding the date of this letter.

“The answers to these questions will be important as we consider competition in the cellphone industry, including the proposed AT&T/T-Mobile merger,” the lawmakers wrote. “And, whatever the validity of the allegations of overcharging, our goal is to ensure going forward that consumers can have confidence that their bills for data service are completely accurate and reliable.”

Rep. Mel Watt (D-NC), the ranking member of the House Judiciary Competition subcommittee, is wary about members of Congress getting too hotheaded about the AT&T merger with T-Mobile. He believes Congress has the role of educating the public but should stop short of trying to influence the review of a merger: "To the extent people start to feel like we should be making the decision about how to apply the antitrust laws, that's overstepping congressional authority." "It's not our job to be out there to be demagoguing on one side or the other," he said.