AT&T Vexes DOJ, American Idol Fans

By Evan Koblentz

It’s been a week of minor annoyances for AT&T, having run-ins with two groups you don’t want to anger: the Department of Justice and frustrated teens.

On the legal front, AT&T agreed to pay $2 million to avoid trial for allegedly violating court orders last spring to separate customer data in divested markets and for illegally using that data to gain subscribers.

“It is imperative that companies fully abide by their court-ordered obligations in order for our settlements to be effective in preserving competition and protecting consumers,” said Deborah Garza, acting assistant attorney general in the antitrust division.

The divested markets – two markets in Kentucky and one in Oklahoma – were part of the FCC’s consideration when approving AT&T’s $5.1 billion acquisition of Dobson Communications last year.

Meanwhile, frequent texters and American Idol fans called out AT&T this week for sending text-message spam. The New York Times said AT&T did not charge recipients and noted a simple opt-out method, but the controversial matter is whether AT&T had the right to send messages in the first place.

The form of such messages is illegal in Europe but not in the United States, the newspaper noted.  Text spam in general is a hot topic. In the United States, it’s related to the Telephone Consumer Protection Act and the better-known CAN-SPAM act.

AT&T’s stock dipped yesterday morning and again this morning, in both cases swinging back up soon after.

 

Boost Takes Shot at Metro, Cricket

By Monica Alleven

Boost Mobile, the prepaid arm of Sprint Nextel, is taking aim squarely at rivals MetroPCS and Leap Wireless International/Cricket with a new $50 monthly unlimited calling, text, wireless Web and walkie-talkie plan. The new, no-contract plan will be introduced Jan. 22.

Boost executives say they have some clear advantages over the two regional carriers: a nationwide network, courtesy of Nextel; the walkie-talkie service; and no extra fees. The $50 price includes taxes, roaming and other fees, so customers won’t get hit with a host of other charges. “What you see is what you get,” said President Matt Carter.

Boost did a trial of the unlimited offer in CDMA markets, but that was limited to 19 markets and was largely used as a learning tool. The plan is still available in those markets but eventually will be winding down. The focus now is on the iDEN markets, which include more than 15,000 cities compared to the combined reach of Metro and Cricket-run markets that total about 300, Boost executives say.

Boost says that Cricket has more than four times dropped calls than Boost, and MetroPCS has twice as many dropped calls than Boost. That’s based on independent third-party drive test data for the 19 common Boost/Cricket markets and the nine common Boost/MetroPCS markets within the top 50 most populated U.S. markets.

Like Sprint executives have said in the past, Boost leaders point out that iDEN is performing at its best-ever levels, and they’re not worried about having enough capacity to serve customers.

Boost’s other offers include a $1 a day plan or 10 cents a minute. Customers who find they can’t make the $50 payment can switch to one of the other plans at no additional charge.

Boost last year announced its intentions to move beyond the urban youth market that was at its core for many years and target more families and ethnic groups, as well as older clientele. Carter said the company believes the $50 plan will drive up ARPU and compete with plans from the other carriers, including T-Mobile USA, that add extra fees to the base amount. Boost also has the advantage of using the Nextel network that was designed with use by public safety in mind.

All of Boost’s handsets are from Motorola, and more new models are expected this year.

 

Motorola Cuts Another 4,000 Jobs

By Wireless Week Staff

Motorola will cut 4,000 jobs this year, with 3,000 coming from the mobile handset division, the company announced last night.  That’s in addition to a 3,000-person cut announced in October, in which 2,000 were part of the mobile division.

The combined rounds of layoffs are expected to save Motorola $1.2 billion this year.

Motorola also said it ended the fourth quarter with $7.4 billion in cash and that it shipped 19 million phones. Revenue is in the low-$7 billion range, with a net loss of $.07-$.08 per share. Final results will be announced the morning of Feb. 3, officials said.

Changes to investment plans along with a company-wise salary freeze and salary reductions for co-CEOs Greg Brown and Sanjay Jha were announced last month.

 

Apple’s Jobs Says Illness is Serious, Takes Medical Leave

By Wireless Week Staff

Apple co-founder Steve Jobs is leaving the company until the end of June for medical reasons.

Jobs earlier this month said he would remain at work but undergo “relatively simple and straightforward” treatment for an unspecified hormone imbalance that led to his recent dramatic weight loss.

Now, “unfortunately, the curiosity over my personal health continues to be a distraction not only for me and my family, but everyone else at Apple as well. In addition, during the past week I have learned that my health-related issues are more complex than I originally thought,” Jobs said in a letter posted on Apple.com yesterday.

Jobs will “remain involved in major strategic decisions while I am out,” he said, with COO Tim Cook serving as interim CEO.

The charismatic and often enigmatic Jobs fought a rare form of pancreatic cancer in 2004.

Apple’s other co-founder, Steve Wozniak, survived an airplane crash in 1981 and suffered from temporary amnesia.

 

MetroPCS Continues Fundraising Spree

By Evan Koblentz

MetroPCS raised $550 million in Senior Notes, on top of $300 million announced yesterday, with the same terms.

However, the prepaid operator again only gave a vague reason for why it needs to raise money, citing the same list as yesterday – “for general corporate purposes, which could include working capital, capital expenditures, future liquidity needs, additional opportunistic spectrum acquisitions, corporate development opportunities and future technology initiatives.”

Company officials did not return messages for further explanation yesterday or today.

So what does MetroPCS really intend to do with the windfall? “I would say they build out with it… It looks like they’re raising it for capex,” said Neilsen analyst Roger Entner, head of telecommunications research.

Specifically, the funds likely would be used for market expansion into Boston and New York and to pay for spectrum won at FCC auctions last year, he noted.

 

Tangoe Buys Internoded  

By Evan Koblentz

Tangoe, one of the top companies in telecommunications expense management, said it’s expanding its device management portfolio by acquiring Internoded for an undisclosed amount.

The deal gives Tangoe the ability to remotely manage applications by getting behind enterprise firewalls.  Until now, Tangoe could help companies acquire and provision mobile devices, but only had manual processes for the day-to-day device administration.

Tangoe CEO Albert Subbloie said the transition of enterprise devices from merely telephones to mobile computers is an important reason behind the current and future changes.

“It was one of the primary reasons why we felt the MDM and the expense management space are adjacent and belong under one roof, because we don’t see the computer asset folks out there managing this device very well,” Subbloie explained. A problem in many enterprises is that all manner of mobile phones are expensed by individual employees, but IT departments have little control, he noted.

Currently, Tangoe could send monthly billing reports, but the future development of Internoded’s technology will enable services such as alerting end-users to their options in real-time when roaming begins. 

Subbloie also said his company is still looking to expand, possibly by more acquisitions or by partnerships, specifically in its distribution strategies and at its help desk. Many customers also inquire about the wisdom of buying devices directly from manufacturers instead of through wireless carriers – a controversial question for which Tangoe doesn’t yet have an answer, he admitted.

Aberdeen Group analyst Hyoun Park said the deal means there is still plenty of life in the bigger trend of traditional telecomm expense companies expanding their mobile offerings. Carriers have tried to enter the market as well, but with far less success because enterprises see the need for objectivity around mobile price analysis, he said.

“This is definitely a space where acquisitions and partnerships are happening on a very rapid basis. It’s important for enterprise IT departments to realize this maturity is happening in the marketplace,” Park said.

Other recent deals include AnchorPoint buying MTS for an undisclosed amount and HCL Technologies buying Control Point Solutions for $20.8 million.

 

FirstNews Briefs for Jan. 15, 2009

Companies in the News: InterDigital, Samsung, Ericsson, TeliaSonera, mig33, Yahoo, AllOne Health, Diversinet, Onset Technology

• InterDigital and Samsung signed a patent license agreement under which Samsung agreed to pay $400 million in installments to resolve disputes around 2G and 3G products.

• Ericsson and TeliaSonera announced the signing of a contract for a commercial LTE network. The network will cover Sweden’s capital Stockholm; the contract is Ericsson’s first for commercial deployment of LTE.

• mig33 appointed Steve Boom to the role of CEO. Steven Goh, co-founder and former CEO, will retain an active executive role with the company as executive vice president and member of the board of directors. Boom previously was senior vice president of Yahoo’s Connected Life division, where he had global responsibility for Yahoo!’s mobile business.  

• The U.S. military is launching a pilot telehealth outreach program to better track the progress of injured service members. Through AllOne MobileSM, a health information management application provided by AllOne Health and secured by Diversinet, secure, 2-way mobile technology will link wounded soldiers recuperating at home with their case managers and unit support staff. Initially, AllOne Mobile’s platform is anticipated to support the rehabilitation needs of up to 10,000 returning soldiers in a phased implementation over the next year.

• Onset Technology announced the launch of its expanded METAmessage Advanced Paging solution. The solution targets healthcare enterprises with paging features on smartphones transmitting on cellular data lines as well as over secure Wi-Fi connections.