Telecoms shake-up

Last week, the international ICT market was dominated by Verizon Communications' acquisition of Alltel.

Locally, the telecommunications sector was also in the spotlight, with Mvelaphanda's bid for Telkom, MWeb and Verizon Business Africa up for grabs, and the continued speculation as to the outcome of the MTN/Reliance discussions.

* Mediocre interim numbers from Zaptronix, with both revenue and profit slightly down.

* A positive trading update from TeliMatrix.

The 50% investment by Simeka in Adcheck, a provider of custom-developed mobile applications.

* The announcement by Mvelaphanda that it has made an offer for all of Telkom SA. I wonder whether this is a catalyst for other bids or expressions of interest in Telkom SA in a similar way that the Bharti talks with MTN triggered a host of interest from around the globe in MTN. I would not be surprised at a firm bid from Oger Telecom for Telkom SA, assuming the Vodacom issue is resolved.

* Naspers intends to sell-off, by auction, its ISP, MWeb. Naspers' strategy is focused on online content platforms, communities and commerce, and diverges from MWeb's plans to invest in wireless broadband. MWeb is one of the largest residential ISPs in SA and owns the largest VSAT corporate Internet base in sub-Saharan Africa. Apart from a number of South African companies wanting to bid for MWeb, including Vox Telecom, I also expect some of the larger players elsewhere in Africa and the Gulf to be involved, since MWeb has a base in Africa outside SA.

* Vodafone has made a R18.75 billion offer for an additional 12.4% stake in Vodacom. This would raise its shareholding in Vodacom to 62.4% and give it overall control. This move is seen as key for Vodacom in order for it to compete with the positive outcome of the expected MTN/Reliance strategic tie-up.

* The opening of a local office by US-based Check Point Software Technologies, headed by Sean Wainer.

* The opening of a local office by Delta Partners, one of the largest telecommunications advisory and investment companies in the Middle East, and headed by Kristoff Puelinckx, a managing partner.

* The retirement of Alan Knott-Craig, CEO of Vodacom.

* The $1.1 billion investment by various private equity companies in Weather Investments (Egypt), a holding company that has a controlling stake in Orascom Telecom (Egypt), the largest telecommunications company in Africa outside SA.

* The $15.2 billion acquisition by China Telecom of China Unicom's wireless network, which only broke even in 2006 after many years of losses. This is part of the country's restructuring of its telecommunications industry and had been predicted.

This move is seen as key for Vodacom in order for it to compete with the positive outcome of the expected MTN/Reliance strategic tie-up.

Paul Booth, MD, Global Research Partners

* The $55 billion acquisition by China Unicom, a mobile operator, of China Netcom, a fixed-line operator. This value seems high as it is double Netcom's current market value. Again, this is part of China's telecommunications restructuring programme and had been anticipated.

* The acquisition by Deloitte Consulting of Solbourne Computer, an Oracle-based systems integration services provider.

* The $26 million acquisition by NetSuite, one of the few global SaaS players, of OpenAir, an on-demand professional services automation software provider.

* The $28. 1 billion acquisition by Verizon Wireless of Alltel, a regional wireless carrier. This deal makes Verizon Wireless, a joint venture between Verizon Communications and Vodafone (45%), the largest mobile player in the US, with 80 million subscribers. Alltel was bought by Private Equity companies for $27.5 billion in November 2007.

* Microsoft has extended the life of Windows XP, so that computer makers can include it on low-cost PCs, such as the Asus Eee. This is yet another example of action by Microsoft after the rejection of Vista by many consumers and businesses.

* The next step in France Telecom's $42 billion bid for TeliaSonera AB, which has been rejected by the latter as one that undervalues the company.

* According to Gartner, worldwide semiconductor revenue is forecast to reach $286.5 billion this year, 4.6% up from 2007.

* According to the Semiconductor Industry Association, global semiconductor sales in April 2008 were up 5.9% over April 2007, fuelled by the demand for flash memory devices.

* According to Gartner, the worldwide external controller-based disk storage market grew 10.2% in Q108 to $4.3 billion. EMC remained in the number one slot followed by IBM, HP and HDS.

* According to Gartner, worldwide smartphone sales grew 29.3% in Q108 to 32.2 million units.

* JSE All share index: Down 0.8%

* Nasdaq: Down 1.9%

* Top SA share movements: AdaptIT (-12.1%), Celcom (-11.8%), DVT (-17.6%), Faritec (-10.4%), Labat Africa (-20%), MICROmega (+12.7%), Spescom (-17.4%), Square One (-15.3%), Stella Vista (-11.1%) and TCS (-17.6%)

PC World recently listed its Top 50 Technology Visionaries. Apart from the obvious inclusion of most of the currently known names, the list included Jack Kilby and Robert Noyce at number one (they invented the integrated circuit in 1959); Tim Berners-Lee at number five (the inventor of the World Wide Web); Marc Andreessen at 20 (the brains behind the Mosaic Web browser and Netscape); and Al Shugart at 33 (the inventor of the hard disk).