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Japan linked to US

Google and five Asian comms companies have agreed to invest $300 million in a new undersea trans-Pacific cable.

Paul Booth
By Paul Booth
Johannesburg, 18 Aug 2014

A new submarine cable linking Japan and the US made international news headlines last week, as well as the overhaul of Alibaba's pact with Alipay.

At home, the BCX shareholders' approval of the deal with Telkom SA, and Blue Label's acquisition of Via Media, stole much of the local ICT media space during another very quiet week.

Key local news

* A positive trading update from Mustek.
* Blue Label Telecoms acquired Via Media, a mobile content and value-added services provider, for R144.3 million (75%).
* BCX's shareholders have approved the proposed acquisition by Telkom SA.
* A renewed JSE cautionary by Amecor.

Key African news

* Excellent quarterly revenue figures from Lenovo for the EMEA region, with 49% growth.
* Kenya Airways has entered the telecommunications market as an MVNO hosted by Airtel.
* The appointment of Ravi Bhat as COO of Logikal Consulting's Africa and Indian operations.

Key international news

BCX's shareholders have approved the proposed acquisition by Telkom SA.

* Anixter International acquired Tri-Ed, an independent distributor of security and low-voltage technology products.
* CoreOS bought Quay.io, a development shop that specialises in hawking private Docker repositories.
* FleetCor purchased Comdata, a payments processor, for $3.45 billion.
* IBM acquired Lighthouse Security Group, a cloud identity and access management company.
* Google bought JetPac, a start-up that designs social travel applications.
* Intel purchased LSI's Axxia Networking business.
* Kaseya acquired Scorpion Software, a provider of security and authentication software.
* KPN bought Argeweb, a Web hosting company.
* Samsung purchased SmartThings, a home automation start-up.
* Telstra (Australia) acquired Ooyala, a US-based video platform company, for $270 million.
* Andreessen Horowitz made a $50 million investment in Buzzfeed, a viral content company.
* ChipMOS made a 19% investment in JMC Electric Corporation.
* InterDigital has lost its patent case against Microsoft (Nokia) and ZTE.
* AOL, Google, IAC and others have won their appeal against a patent suit originally won by Vringo.
* IBM has patented a technique that helps clients automatically analyse and manage the location where their public and private cloud data is stored.
* Google and five Asian telecommunications and communications companies have agreed to invest about $300 million in a new undersea trans-Pacific cable linking Japan to the west coast of the US.
* Alibaba has overhauled its pact with its Alipay parent and sold its SME loans business.
* Pantech, a South Korean mobile phone manufacturer, has filed for court receivership; the equivalent to chapter 11 bankruptcy protection in the US.
* Very good quarterly figures from Tencent.
* Good quarterly numbers from Applied Materials, Aspen Technology, King Digital, Lenovo and Sina (back in the black).
* Satisfactory quarterly results from Convergys, Cree, Rackspace Hosting and TeleTech Holdings.
* Satisfactory half-year figures from China Unicom.
* Mediocre quarterly results from Cisco and SingTel.
* Mixed quarterly figures from Autodesk, with revenue up but profit down; China Mobile, with revenue up but profit down; ChipMOS Technologies, with revenue up but profit down; Hon Hai Precision Industry, with revenue down but profit up; NetApp, with revenue down but profit up; and Trend Micro, with revenue up but profit down.
* Quarterly losses from Bottomline Technologies, Document Security Systems, Extreme Networks (although revenue almost double), JD.com, JDS Uniphase, Nuance Communications, NII Holdings, Oclaro, ViaSat and Weibo (although revenue almost double).
* The appointment of Ronald Freidheim as CEO of CDI.

Research results and predictions

EMEA/Africa:
* Middle East and Northern African banking and securities firms will grow more than 2.7% this year, according to Gartner.

Worldwide:
* Sales of Chromebooks will reach 5.2 million units this year, up 79% from last year, according to Gartner.
* Worldwide revenue for communications processors rose to $1.8 billion in 2013, an increase of 8.8% compared to 2012, according to IDC.
* The worldwide personal and entry-level storage market grew 1.5% in Q2, according to IDC.
* Mobile context and location services will reach $43.3 billion in revenue by 2019, up from 12.2 billion in 2014, according to Juniper Research.
* Smartphone shipments are expected to reach 322 million in Q3, up 13% on quarter, according to TrendForce.

Stock market changes

* JSE All share index: Up 1.2%
* Nasdaq: Up 2.2%
* NYSE (Dow): Up 0.7%
* S&P 500: Up 1.2%
* FTSE100: Up 1.8%
* Top SA share movements: Adapt IT (-7.5%), CompuClearing (+8.2%), Digicor (+7.4%), Ellies (-6.9%), Gijima (+11.8%), MICROmega Holdings (+6.7%), Morvest Business Group (-8.3%) and Pinnacle Holdings (-9.8%)

Look out for

International:
* The possible acquisition of TDC, a major Danish telecommunications operator.
* The possible application for bankruptcy by NII Holdings.
* The possible sell-off by Orange of its masts in Spain.
* The privatisation of Daisy Group, the UK telecommunications company.

Africa:
* The $120 million acquisition by Safaricom of the network assets of Essar's Yu, while the customer base is sold to Airtel.

South Africa:
* Further developments regarding the telecommunications consolidation happening in SA.

Final word

Worldwide smartphone shipments totalled 301.3 million in Q2, up 25.3% from the same quarter last year, according to IDC. The following chart shows the latest market shares, clearly illustrating that Android and iOS are increasingly dominating the market, with BlackBerry's share shrinking dramatically to 0.5%.

Operating system

2Q14 Shipment volume

2Q14 Market share

2Q13 Shipment volume

2Q13 Market share

2Q14/2Q13 Growth

Android

255.3

84.7%

191.5

79.6%

33.3%

iOS

35.2

11.7%

31.2

13%

12.7%

Windows Phone

7.4

2.5%

8.2

3.4%

-9.4%

BlackBerry

1.5

0.5%

6.7

2.8%

-78%

Others

1.9

0.6%

2.9

1.2%

-32.2%

Total

301.3

100%

240.5

100%

25.3%

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