Wednesday, May 31, 2006

Bite and Vodafone, get the f**k off my newspage!

While idling away some time here at the big SAP conference in Paris, I decided to check out what was going on back in Latvia. So I checked out my Apollo page and got just the barest glimpse of a story that the Wacko-loonie Light (the serious wacko-loonies are most of the other political parties) party New Era (Jaunais Laiks) was leading the polls. Then bang, an impenetrable green curtain rolled down telling me what a hotshit partnership Bite and Vodafone is. I am sure they are, but my clicking to make the Green Curtain go away took me to an even bigger advertisment page.
Now I do think Bite is cool and if they get HSDPA going as promised, I may even get a second SIM card just for that, say, next summer if the coverage reaches my summer house. But for fuck's sake I don't like this pesterware dropping down in front of the main news item and forcing me to read this ad. It is bad enough that there are some other things randomly floating around, like shit in a duckpond. Who thought of this, anyway and how well are these advertising agencies serving their clients? I realize that banners and sidebars are ignored, but there has to be a kinder, gentler way to push your ads.
Also, Vodafone just lost enough money to buy Latvia two nuclear-powered aircraft carriers, does it have to spend its advertising money on this irritating shit?

Some impressions of SAP in Paris

The SAP ERP system is on such a scale that, in terms of Latvia, you could run TWFC* on it. And it seems that is what may be done, as one of the major implementations is at the Latvian Ministry of Finance. The ambition is to compose next year's state budget on the system, getting inputs from all the ministries, etc. Should be interesting.
What I am also trying to say is that the small countries with relatively small businesses are a limited market for these massively capable systems, except to the extent that the small and medium-sized businesses (medium globally, being, say, Lattelecom) will have to eventually integrate with global companies running SAP or brand X. The vision here is of a total electronic information and management nervous system -- you place an order online in Bangkok and it, via three layers of subcontactors, turns on a factory in Latvia that makes a subwidget for the order, and then the ultimate customer in Borneo can drill down and see exactly when the subwidget was made.
This kind of knowledge and information saturation makes it possible, as Shai Agassi framed it, to "drive (a business) while seeing forward." When you think about it, most businesses steer by looking back at what happened. Interesting.
It also means that businesses have to define themselves and their processes very precisely and carefully. It is of little use to "drill down" to the benchmarks and metrics for a particular manufacturing step if one has not defined or determined them and manufactures on the general assumption that most of the stuff will somehow turn out OK as it has, generally speaking, in the past. In this regard, the capabilities of SAP and enterprise resource planning systems generally expose the blindness of much of business to its own essential processes.
So SAP and its like are inevitably coming and businesses in Latvia that don't want to be roadkill in the next few years must adapt.

*the whole fuckin' country (what did you think :) )

Monday, May 29, 2006

The Lattelecom snake and the IT rodent

Eating something big is a visible process in snakes, you see its lunch after it is eaten as it is slowly crushed and digested inside the snake. In this case, Lattelecom is the snake and its apparently willing lunch was the company formerly known as MicroLink. And there lies the problem--a well known brand with not only customer recognition but employee loyalty as well – is not going down inside the snake very smoothly.
I would not be writing this if I had not heard it from two different sources in the Latvian IT industry. Pulling down the old battleflag of MicroLink and getting everyone to salute the Siamese twin snowboarders (Lattelecom Technology, the new "us" ??) is not an easy task. It doesn't help that one of the battle hardened generals (Janis Bergs, who founded, as Fortech, and headed MicroLink in Latvia) has left with his own little army (buying out the local MicroLink software development unit FMS).
This is not to say that it is impossible, because Lattelecom has to get its IT act together, there is no alternative. If management understand how mission critical it is helping all them former Linkers or whatever they called themselves to rally to the twins, then the job should get done. But at least this explains some of the stories circulating about Lattelecom's merger hurdles.

Citywide WiFi in Riga
Lattelecom has announced that it will wire the 150 or so public urinals and places for writing obscenities and smashing safety glass (the kind that turns to granules) for drunken fun -- also know as phone booths, into WiFi base stations to blanket most of downtown Riga with outdoor WiFi. This will require one to, I suppose, to buy a subscription card to the service. On the other hand, since I don't foresee sitting in Vermanis Park with this laptop on January 3, 2007, describing the snowfall, I could imagine the city or even Lattelecom simply declaring these hotspots to be free for the summer at least. As we do not have a cybercafe on every corner, there would not be too many people screaming about unfair competition and all that. It would be a great promotion for tourism -- free wireless Riga. It would also upstage the E-stonians, those folks to the north of us who are born with IP addresses instead of names (there are Estonian, sorry E-stonian names that will not be missed if you try pronouncing them -- Kukakmägikaksikolmiterviseksi and the like.)
Jokes aside, I am expecting comments from E-stonia about how they were first with the free wireless city internet, which may well be true...
As for me, I am in Paris at the moment, attending the SAP event here over the next few days. If you chopped off fingers and toes for every Latvian company that can actually use and afford SAP (the heavy-duty ERP system and all its variations), you would probably still have an intact foot. But this is more a look at the future than at today's reality.

Wednesday, May 24, 2006

The summer of WIMAX??

It looks like it may be a summer when some WIMAX experiments are launched in Latvia, aimed, however, at different markets. Unistars, a provider of wireless broadband for business, is probably going to start a major marketing campaign to raise its profile in the B2B sector, presenting WIMAX as a platform for secure and cost-effective access to business processes. Telecentrs, a rival, may also launch its wide-area broadband solution as soon as June or July, possibly with more of a consumer and household oriented approach.
Anyway, with Triatel already offering small-business and household «in a box» wireless internet and telecommunications solutions, and with Bite promising to offer HSDPA with stable 2 Mbps when it launches its 3G service in the fall, it looks like a boom-time and wide range of choice for those who don't want their netsurfing or even their business process platform at the end of a length of copper wire.

Monday, May 22, 2006

Moving right along...on the LMT deal

TeliaSonera and the Latvian government are understood to be close to agreement on how to make an appraisal of Latvian Mobile Telephone (LMT) and Lattelecom so that both sides can move along on getting the appraisal done and coming to an agreement on how to swap TeliaSonera's (49 %) Lattelecom stake plus some cash for the rest of LMT. It now looks like the appraisal will be made by two companies, which are tentatively acceptable to both parties. Since appraising a non-listed company is difficult, the parties are ready to accept a consensus of two as the benchmark for further talks.

Bizarro rumors..
..are being spread by the sometimes crackpot-leaning Neatkariga Rita Avize (NRA), which writes that TeliaSonera wants to unseat Lattelecom CEO Nils Melngailis because they are unhappy with his management and with the profitability of fixed network operator. While Melngailis undoubtedly places somewhat different accents on priorities (his mission, after all, is to increase the value of Lattelecom, which sorta also increases the value of the stakeholding), the Swedes would be utter fools to tamper with him at this time. Until a final deal is made, Lattelecom is one of the means of payment for LMT. Creating turbulence around the management of Lattelecom is like having a pocket full of EUR to pay for something, and then dissing the euro, so that your potential payment looses value. Indeed, if the Swedes were totally Machiavellian (which they were not) and if instead of Melngailis, Lattelecom was run by a baboon on nitrous oxide, the smartest thing for TeliaSonera would be to say the baboon was a fantastic CEO who just happens to get a little carried away with twirling his own tail and laughing hysterically about it.
Why so? Because it is to TeliaSonera's advantage now to make Lattelecom appear like the greatest thing since soft cheese spread. Indeed, the better the company looks, the less the Swedes will have to reach into their cash till to pay on top of their swap. Once the deal is done, Lattelecom is not the Swedes' problem any more. Simple as that.

And now I'm paranoid...
..,because the word is out that some PR-related people are looking into Melngailis' background, his business interests outside of Lattelecom, what banks he deals with, even whether one of his children attends school in Britain. Now that makes me wonder whether the article in the Zoonie-tunes, sorry, NRA has its roots in the so-called black PR business in Latvia. It seems that someone is seeking innocent ingredients for a witches' brew.
For the record, Nils Melngailis is, as we say back in the hood, my homeboy, from the Boston area Latvian community, and he was briefly my pupil in the Boston Latvian Saturday School in like 1970-whatever, when i was a 20-something hippie (I think I taught some Latvian lessons still stoned from Friday night smoking grass on my parent's house front porch in Newton, MA, I remember I had the kids pound the table to imitate the hooves of German Knights of the Cross crusader horses riding into ancient Latvia, why, exactly, I don't remember). However, between then and now both Nils and I left the hood and I really don't know much of what he did, except it included some upper echelon business intelligence stuff at IBM in Great Britain and a stint at Coopers & Lybrand in Latvia.

Sunday, May 21, 2006

Lattelecom goes to 10 Mbps in some places

Lattelecom starting May 22 will offer 10 Mbps DSL speeds for 11.99, the same as its basic 512 kbps Home DSL. This was predicted on the blog some time ago. Unfortunately, the news leaked out as I was away in Stockholm and I could not check out all the details. One possibly personally disappointing aspect is that the 10 Mbps service will be offered in outlying areas of Riga, mostly the Soviet-era new suburbs (some pretty grim architecture) where competition has been the most intense from actors like Balticom (10Mbps from a respectable service) and others, some of whom are fly-by-night. I live in the Centra (Central) district of Riga and there is no clear word that the new service will be available there immediately. Perhaps I will be pleasantly surprised when I get back to Latvia in the evening. Whatever the outcome for me (still enjoying 1 Mbps at home after paying LVL 1.99 extra per month), I am glad the predictions came true. Now let us wait for the next jump to 24 Mbps...

Wednesday, May 17, 2006

300 posts and still at it -- revealing secrets :)

First, I would like to dedicate this 300th post since September, 2004 to my loyal readers who have tolerated obscenity, cynical humor, bizarre texts and weird tastes in music.
Then I would like to disclose that one of my favorite brands -- this is being written on an iMac G5, and when not, on a Powerbook G4 -- Apple, is finally getting an Apple Center in Riga on or around May 26. It is no big deal, around 60 or 70 m2 (not quite the Apple Store in San Francisco), but a first for Latvia. Franchised (?) to, the re-sellers who have been peddling Macs, MacBook Pros and iPods with paraphenelia at their store in the Riga shopping mall Alfa Centrs. Good luck.

And now the secret of the DaVinci code post: The company formerly known as Lattelekom's new corporate logo:
So there you have the snowboarding Siamese twins. Simple, wasn't it? The grey line on the right, BTW, is some kind of mistake in the upload.
lattelecom bought a huge, inane and totally wacko front page ad in my newspaper about some guy (a character borrowed from one of the Bite Toxic commercials, who is wondering about which way the wind is blowing in the beach resort town of Saulkrasti --Sunnyshores). What the fcuk does that have to with anything??? Having said that, as I see it, the corporate identity relaunch campaign can only go uphill from this..
Anyway, the repackaging is better than what happened in Estonia, where Eesti Telekom or Telefooni or whatever it was called has for a couple of years been called Elion. With absolutely no offense to any of my gay readers, for some reason, Elion sounds like the name of someone's gay Greek or Rumanian boyfriend. What it does not sound like is a telecoms company. although repeatedly shouting Elioni DigiTV on kohal! in a crowded Tallinn bus might get you some stares...
By the way, and no offense here too, homocritical (phobic would be fearful, one does not have to fear to, for ideological reasons, criticize homosexuality) blogging (in Latvian) colleague Kristaps, but the real gay Elion, should there be one, is welcome to the Riga Pride Parade in June, where, as in any democracy, harsh opinions against gayness may also be expressed. As a libertarian, I support the freedom of voluntary association of individuals, therefore also gay rights.
But let us move on to Lithuania, where Lietuvos Telekomas also recently changed its name to Teo. Teo? Indeed, Teo.. Teo sounds like some plain mousy but under it all very sexy heterosexual girl's tomcat. The girl in the linked page doesn't even have a cat! Girls, called by the then still acceptable term chicks back in the 60s, when I was in college in the US, had cats named Teo. To Latvian ears, Teo also makes me think of the sleazy hyperreligious Brother Theodore in the classic Latvian movie The Fisherman's Son. Teo...brālis Teodors...
So I think that lattelecom did the right thing. The company's half-mother TeliaSonera won't have to look up where her renamed daughter is...
As for what is strategically behind all this, that's already been on the blog, indeed, more is in the blog than you will see in the press. The newspaper has only a reporter, I as a blogger seem to have a fly on the wall in some interesting offices, so I am told :).
So, at three minutes past midnight, the totally tight embargo on lattelecom has ended and I press the publish button :)!

Tuesday, May 16, 2006

Blowback at last

Latvian blogger Kristaps Kaupe notes that the Latvian-language IT-related website and quasi-blog Datuve has translated and summarized my earlier post on 10 gigs across the Baltic. Finally, some blowback, which is not really the right word. Blowback is spook (read spy or intelligence agency) terminology for disinformation planted in the foreign press that somehow comes back into the mainstream media of the disinforming country :). It is like the CIA plants a story in the Moldovan press that an enemy of the US, Sheik Yerbooty of Wazoonistan gets it on with his sheep. That is meant to make Moldovans, who are looking for an alternative oil supply to, say, Russia, will avoid Wazoonistan because they are sensitive about human/sheep affection and actually believe that kind of weird shit. But there is, say, a Moldovan American stringer for the National Enquirer* who files a story saying that press reports claim Sheik Yerbooty does lambs (sheep pedofilia) and the New York Times at least notes that preposterous claims are circulating about someone already in disfavor with Washington, so blowback does have its benefits.
*a newspaper sold in lower-scale supermarkets with headlines like "Two-Headed Alien Crocodile Eats Baby Siamese Twins" and the like.
Anyway, I have discovered and tested the linking tool in Blogger that Kristaps Kaupe recently said he was surprised I wasn't using (well, not linking is what he meant).

Monday, May 15, 2006

Bite to launch HSDPA in September

Bite Latvija will launch HDSPA with stable download speeds of 2 Mbps in September, effectively postponing its planned launch of 3G services with slower date speeds originally scheduled for June.
This will be a flat fee service, probably comparable to what Bite charges in Lithuania for EDGE, which is around equivalent LVL 20, though no Latvian price has been set.
At the same time, the company will offer 22 channels of international and local mobile TV, presumably also viewable on laptops equipped with HSDPA cards. There will be a fixed premium fee for watching mobile TV. A collection of 300 000 songs will be available for download through the enhanced Bite Plus entertainment portal
The reason for the delayed launch is that Bite sees more of an opportunity in waiting and launching something that offers DSL comparable speeds for business and a high speed entertainment platform for the consumer market. In addition, Bite is counting on HSDPA phone /handset availability by September, so that there will be demand from the consumer side and, of course, the inevitable offering of cheap HSDPA phones at Bite outlets.

The Story of the Story

Exclusivity of news is like freshness in fish. It is governed by rules outside the control of the fisherman who catches it. To eat fresh fish, you gotta cook it fresh. I was given the Bite to launch HSDPA story on Friday. It did not go in Monday's paper. It will not be in Tuesday's paper. I don't know when it will be published. However, no one in the Latvian media seems to read this blog anymore, so maybe, by a process akin to mummification, the story will still be fresh looking when finally published.

Friday, May 12, 2006

An experimental opportunity lost :)

In a strange fit of sanity, the Latvian parliament, the Saeima, rejected a raving loonie crackpot scheme by the Green/ Farmers Alliance (ZZP) to ban all political "agitation" and advertising in most media 90 days ahead of the upcoming election. It opted, instead, for no restrictions and a system of spending limits on political parties (wildly honored in the breach* during the 2002 elections).
How does this relate to telecoms and IT? Well, had the ban actually been enacted, it would have been a wonderful stimulus to start an "offshore" internet-based political campaign with ads and programming running as video streams, internet radio, vlogs, blogs, podcasts and videopodcasts. In fact I (a total moron as far as hands-on website building) entertained the thought of urging the start of something like (hosted outside the jurisdiction) as a political platform for any and all once the "green" blackout curtain was drawn on democratic political debate.
There could have been some great, bizarre videos of the Riga Municipal Police fining (who knows, maybe even arresting) politicians for talking to more than three people at once on the street. Agitation? Aha, grab that person!
Could it have been done had it been needed? I saw some interest for this idea from another blogger, Kristaps Kaupe, who runs a Latvian-language blog that is an odd mixture of extreme geek stuff on open source software, RSS feed-type and other meta-information linking technologies (tags, trackbacks and other weird sounding stuff) as well as somewhat fringe nationalist politics, opinions on music and a chronicle of the death of a mouse. Anyway, Kristaps (whose day job is in a small IT company) could have been a source of advice on how to set up and run this free-for-all, free-speech fundamentalist, basically anarchist (FCUK THE STATE!) project. These are not his politics, btw. Perhaps they are mine, but since this is a largely non-political blog, I just ask anyone interested to Google "libertarian" and judge for yourself...
While it could have been fun to show the big middle one to these idiots who want to curtail debate with a sledgehammer when other means of regulation make more sense, I am glad there is no need for this, and I hope there will be no next time around...
*honored in the breach means ignored and violated.

Thursday, May 11, 2006

Now some musings to prove I am not insane..:)

As for the earlier post, time will tell.
Meanwhile, it seems that Kenneth Karlberg of TeliaSonera was in Riga to meet Minister of Economics Aigars Stokenbergs and to hear from the horse's mouth that there is no chance he will get Lattelekom, but to get Latvian Mobile Telephone (LMT), both sides have to agree on a pricing/appraisal mechanism and then, of course, the price. The way things look, both sides will pick a kind of arbiter who will make an appraisal that will be binding to all (binding as a number, whether or not one wants to pay it is another issue). Nonetheless, it now looks like the government is serious about getting some kind of deal done in the next few months, perhaps even before more people representing the other end of the horse get elected to public office in the October parliamentary election.
That means, of course, that Lattelekom will soon be a stand-alone, state-owned fixed network operator. As I have written before, that doesn't look very good in today's telecoms world. However, there are some conditions and developments that may actually make this work. They are:

The Mobile Factor
Clearly Lattelekom will need a mobile component and, apparently, the company is working on several scenarios.
Plan A: Lattelekom, despite a change in owners, radically improves its operational/marketing cooperation with LMT. A precondition is that some people strolling to work down Ropažu Street (the LMT headquarters building is there, unless I am mistaken) about the street name) have a revelation and realize GSM IS DEAD!!(but, like any gut-shot elephant, still has to fall over). How is it dead? Well, think about HSDPA capable handsets on a flat-rate, always on internet connection and a SkypeOut capability built into the phone(that is the pre-paid, call most of the world's ordinary phones for 1.7 eurocents a minute service offered by Skype). LVL 0.012 per minute can't really be beaten, except by the price free, which also comes with the Skype when calling device-to-device. That is a price that in Latvia makes it just as cheap to call Australia (OK, I didn't check the Skype price list, but let's assume) as it is to call your neighbor on a Lattelekom phone. ).
And that is not the only threat to GSM. Think WIMAX. Think of other scenarios and you realize that it is better to have friends (Lattelekom) than to fade away alone.

Plan B: is where we start to get radical. Lattelekom could, under the right circumstances, buy the Bite Group if it were to come up for sale. That should give the combined company a strong mobile presence in Lithuania and a growing one in Latvia (also with a flock of MVNOs using and paying for the Bite network. Interest group oriented virtual operators are one way that mobile services can grow. Think again of a /the 630 00 member social network/ mobile phone service since draugiem is one of the biggest flowers growing in a greenhouse where Lattelekom is the gardener). The purchase could be financed by credit and recovered when Lattelekom does an IPO at some point (with some of the funds going into the company rather than to the state directly).

Plan C: Even crazier, but assuming the "conventional" mobile phones are all going to get hit as phone-like, always on, flat rate mobile internet devices with Skype or SIP capability take over, why not? Under this plan, Lattelekom buys Triatel, the wireless internet and CDMA450 mobile phone operator. I mean, if you are going to cannibalize part of your own DSL customer base, do it with a potential velociraptor of a system such as the EV DO evolutions that will do several tens of megabits per second on the downlink, as Triatel has indicated they will do. Besides eating your own limbs, you will chomp on potential HSDPA users on speed (assuming that the average speed of HSDPA won't be much over 3 Mbps as some analysts forecast). Certainly Triatel will come cheaper than Bite.

The Media Scenario
While still remaining a content aggregator, Lattelekom develops its portal, Apollo, into an interactive news and entertainment platform with much user generated content, including the very new and burgeoning video collection on (a kind of Latvian, perhaps soon Baltic YouTube). Dragging over the draugiem crowd, adding users/readers/viewers/listeners/comtributors/bloggers in all three Baltic States (or Tanzania for that matter..), Lattelekom becomes a medium that is as big as television in the region, and unlike television, available on demand and on any number of plaforms from 50 inch plasma HD screen to handheld to a live electronic ink tablet-like book/newspaper/magazine that is about to be invented at an affordable price.
In 2010, Lattelekom buys the flagship daily Diena and is the main plaform for interacting with a specialized business information environment formerly known as a paper I work for...

Pretending that I have smoked a bit too much of something, I will stop here. No music this time...

My DaVinci Code...:)

Who are the Siamese twin snowboarders? Answer late next week.

No, I am not crazy, just enignmatic.

10 Gigs across the Baltic

Lattelekom, which owns a majority share in a Baltic subsea optical cable (the minority owner is Sweden's Tele2) has just pumped up the bandwidth on this pipe to 10Gbps from an earlier 622Mbps. The company installed a repeaterless Siemens solution on the ca. 300 kilometer long link from Ventspils in Latvia to Nynäshamn in Sweden. The jazzed up fiber is expected to go commercial very soon, with Lattelekom convinced it will fill enough of the pipe to pay off some EUR 1 million spent on the upgrade.
One reason is that Lattelekom expects internet use and bandwidth consumption to rise with plans for boosting the last mile of its own Home DSL service to 10 Mbps in urban areas later this summer (probably). Add to that the rising mobile internet services and others (enterprises) using data transmission links, and you have the potential source for all that demand.
Meanwhile, Latvian cable TV/internet and fixed telco mogul Peteris Smidre's Baltcom Fiber plans to upgrade its current 2.5 Gbps to 2x2.5 Gbps, or a total of 5 Gbps (probably lighting up another pair). This link to Sweden via Gotland will also be repeaterless and cover around 103 km on the Latvian coastline to Gotland stretch (the other link is, I believe owned by Stokab of Sweden). Smidre, who started and later sold what is now the Tele2 mobile operator in Latvia (it was once Baltcom GSM), bought his 100 km of sophisticated fishing line (glass?) from a Dutchman who laid and buried it in the seabed and then was stuck holding the bag/roll or whatever because Foco 16, a rather dodgy "Powerpoint Company" put together by some Russian and Dutch entrepreneurs, fell apart and failed to pay. Smidre is said to have picked up the fiber link for a song (but the name was already taken :) ).
As things now stand, the price per Mbps is said to be reasonable and stable in this region, despite the more than tenfold jump in Lattelekom/Tele2's sub-Baltic capacity. There will apparently be enough demand to pay off the upgrade.

Music while this was written: Creedance Clearwater Revival, Mustang Sally, The Doors, Five to One, Jimi Hendrix, Lover Man, Quicksilver Messenger Service, Mona, Rage Against The Machine, Kick Out The Jams (MC5 Cover), Lou Reed, Sweet Jane (one of a number of versions)

Wednesday, May 10, 2006

Fun to be virtual and take out that wrench?

Telekomunikāciju grupa (TG), the Latvian alternative operator, is planning to join the growing number of virtual mobile operators of one kind or another buzzing along on Bite Latvija's network. The regulator has issued them 50 000 numbers for this purpose.
TG largely serves a business clientele, so that their virtual service will probably be business-oriented and probably linked to the launch of Bite's long-awaited business class services such as HSDPA and flat-fee mobile internet.
Meanwhile, it seems that the government can instruct the state-owned Latvian State Radio and Television Center (LVRTC) to sell its 23% stakeholding in Latvian Mobile Telephone should that be needed to complete a deal with TeliaSonera (see earlier posts). That doesn't really make the possible Chinese firedrill of a deal any easier (49 % of Lattelekom minus 23% of LMT for 28 % of LMT plus just over 11.5 % of LMT, hold the other 49 % of 23 % of LMT that Telia Sonera indirectly holds through Lattelekom. Now repeat...). Oh yes, add cash. Lots.

Tuesday, May 09, 2006

Toss another wrench into Aigars S plans

The government's plans to nationalize Lattelekom and let TeliaSonera get 100 % of Latvian Mobile Telephone (LMT) have had a wrench tossed into the works by a Latvian appeals court. The court ruled that the 23 % stakeholding in LMT (plus another 5 % held by the Ministry of Transport) that Minister of Economics Aigars Stokenbergs says he could discuss trading for 49 % of Lattelekom, actually belongs to what is now a state joint stock corporation Latvian State Radio and Television Center (LVRTC in Latvian). The LVRTC when it was a state non-profit corporation owned the 23 % but transfered it to its subsidiary, the now moribund Digital Latvian Radio and Television Center (DLRTC). This entity was charged with implementing digital terrestrial television in Latvia, with the idea being that the enterprise would be financed by dividend revenue from the LMT stake.
As is well known in Latvia, the digital TV project was essentially killed by an overzealous anti-corruption government under Einars Repse in 2003, and some of its good faith participants who were, in fact, delivering what the DLRTC had been paying for, are still being hounded in the courts as if they were common criminals, fraudsters and lowlife.
At the same time as Hercules Repse pulled the digital temple of sin and fraud crashing down around him in ruins, a lawsuit was launched to recover the LMT stakeholding for the state. The LVRTC thought that, if anyone, it should be it that got back what it had (foolishly?) given to its wanton and promiscous daughter (who was soon to be broken on the wheel, anyway). Now, it seems, the LVRTC has won (and the DLRTC is being slowly and quietly broken on the wheel).
What this means for the whole Latvian telecoms nationalization/privatization deal is that the Swedes must now turn to the independent but state-owned LVRTC and see if it is willing to sell or swap its stake in LMT.
Just to set the record straight, Stokenbergs was a little miffed when my paper (not in my article but in a blurb of sorts) suggested that he had suggested to the Swedes that they swap Lattelekom holdings and cash for LMT. He says TeliaSonera had proposed the swap, minus the cash. However, government documents from a few years back suggest that the swap of Lattelekom for LMT was favored by the government at the time. Stokenbergs indicated one future option he was willing to discuss was stakeholdings and cash, but he had not put this on the table for the Swedes yet. OK, fine. Somehow I doubt that if the price of the remaining roughly 28 % of LMT is seen as more that 49 % of Lattelekom, the Min of Econ is going to ask for rubber duckies instead of large bags of euro or kronor or whatever. But now, that deal will have to be cut with the LVRTC. Next question to ask for my paper (which again grumbles, though mildly about my performance) is whether Ivars Golsts, the head of the LVRTC, is ready to do the deal and whether Aigars S has any say in what he decides.

Meanwhile, if you're wondering about terrestrial digital in Latvia, the answer is simple. Forget for the moment, the well-meant plans of the government to implement something in the next few years. Digital terrestrial TV in Latvia is fucked. Go buy a satellite dish or get cable...

Music played (on headphones) while writing this: Jefferson Airplane, Volunteers, The Who, My Generation, The Byrds, I Was So Much Younger, Tom Petty, Free Falling, Paul Butterfield Blues Band, Two Trains Running and The Mommas & Pappas, California Dreamin'

The bees, the Lithuanian hare and the Latvian turtle?

TeliaSonera's regional honcho Kenneth Karlberg, not-quite-yet-not-really-totalled resigned to getting just Latvian Mobile Telephone (LMT) told me that ultimately, speed is what telecommunications is all about. A truism, considering that all telecom signals move at the speed of light, which is as fast as you can go in this universe, but something more when you talk about the actual speed of information, the throughput and bandwidth. In this respect, there is still a way to go before Einstein dances with Schrödinger's Cat (whatever that means), which is to say that bandwidth (and the content/experience to go with it) are the tools of competition. Karlberg is convinced that LMT can match other operators in speed even if TeliaSonera doesn't get 100 % ownership of fixed network operator Lattelekom. I think he was talking about two kinds of speed -- the speed of deployment, where wireless can beat wireline hands down (you can activate your 3G phone in a shop, but the Lattelekom installer still comes in a few days to install a wire phone and DSL) and the actual speed of the service. Here opinions vary. I am not sure we can blast gigabit metropolitan wireless without frying the crows as they fly by, but I may be wrong. Gigabit to the household by fiber is possible and said to be being done in Japan.
Anyway, even with no deal done on who ultimately owns Lattelekom and how soon the Swedes get all 100 % of LMT, one area where we don't see a race for speed is in deploying HSDPA, the fast mobile internet and data service that matches lower-end DSL speeds (around 3Mbps, some claim 14 Mbps). For one thing, there are no HSDPA phones on the market yet, though a number are coming in 2/2 2006. However, Estonian Mobile Telephone (EMT) has already launched its HSDPA service and Ominitel, a 100 % subsidiary of TeliaSonera, will launch a service in June. Both companies are aiming the HSDPA at business users and offering various laptop cards (which makes sense, considering the HSDPA at its best can be a city-wide and mobile DSL substitute).
LMT at best will do some technical tests or pilot schemes with HSDPA this year, taking the cautious route. It hopes to be the winning turtle (I can't spell tortoise) among the Baltic hares. However, according to my sources, it will be soundly beaten by the Latvian bee (Bite Latvija). I predict the bee will buzz something about HSDPA over the next few days. Watch this space.

Thursday, May 04, 2006

More on the no sale of Lattelekom

This is what I believe the present Latvian government intends to happen if the government's plans to sell only Latvian Mobile Telephone (LMT) to Sweden's TeliaSonera are implemented.
Lattelekom, Latvia's fixed network operator, is going to be an arms-length, state-owned company for a few years, probably starting its own mobile operator before being prepared for an IPO on one of the bigger regional (Nordic) or European stock exchanges. The state will probably keep a small share when that happens to get a revenue stream from what Minister of Economics Aigars Stokenbergs believes will be a stronger, more diversified and profitable Lattelekom.
Lattelekom will become a small to medium-sized regional competitor to its former half-mother in some niches (such as data communications) a provider of services that TeliaSonera doesn't offer (business process outsourcing, even with TeliaSonera as a potential customer) and a player in entirely new services such as intelligent, application-aware networks (with some help from MicroLink, the IT integrator that it recently acquired).
What the latter means is that the fixed network operator will offer a new, very sophisticated VPN layer when it connects the network to certain business customers. In other words, it will attach the corporate users to, say their Oracle or SAP application suite and have the network recognize and route. say, all their order messages and other related data traffic in a particular manner. It could even error check and, say, bounce back an order with an improperly entered number or whatever.
Such a network could also, at the VPN (maybe I am getting this wrong) layer, handle and prioritize content and services from a content provider, interact with CRM, etc. This is all from Cisco honcho Kaan Terzioglu's recent presentation. So that means that Lattelekom in Latvia and regionally could provide the backbone and hosting for this kind of stuff, grabbing up enterprise customers almost end to end, in fact, installing customized intelligent network based applications instead of just running a phone, ISDN or internet line to the enterprise. And here lies, perhaps, a threat to TeliaSonera...
Some of my sources say that Lattelekom chafed a bit under the half-mother, saying she was a little slow and conservative. In fact, some Lattelekom execs had mixed-feelings about being wholly owned by the Swedes, or at least they saw a certain downside.
This is not to say that Lattelekom going it alone as a state-owned company is all roses. When I mentioned this to my colleagues at my sometimes maligned (in this blog) paper, there was derisive laughter. They are pretty sure that once the state gets 100 % of Lattelekom, politicians will, to put it bluntly, fuck up the company. There is some truth to this, or rather, much truth. The Minister of Economics isn't really a politician, more of a technocrat and one of the few politics-connected people in Latvia who passes my "Alfred E. Newman" test (Newman is that wacko looking guy in the American Mad Magazine, who has a caption under him Not Insane).
Minister Stokenbergs has, for Latvia, some pretty sane (therefore unacceptable or at least strange on an interplanetary level to the rest of the loonies in politics) ideas, such as 1) letting Lattelekom do its business 2) changing laws so that, for example, management can get performance-based incentives, including options ahead of or after the IPO, etc.
On the downside, Lattelekom could lose the economies of scale that it enjoyed co-purchasing equipment and services with TeliaSonera, though I am not sure how much of that has been going on. At the end of the day, the Swedes may even come to an independent Lattelekom to get things done -- like some of their billing, books, network management, whatever can be done remotely over the network from the Baltics.
There is also the issue of whether Lattelekom can successfully start a fifth mobile operator in our land of 2.2 million (and falling) souls. Here the weird idea of buying Bite creeps in, but that is perhaps because I am sipping whiskey in the middle of the night on Latvia's Independence 2.0 Day. I suspect Bite could be an expensive proposition, especially if Lattelekom has to go against, say, Elisa in Finland. But at least Bite would give Lattelekom a foothold of some, say., 100 000 mobile customers in Latvia and much more if the Lithuanian bee is also bought.
This is descending into rambling hallucinations.

Music played while writing: Rage Against the Machine, Maggie's Farm, U2, Vertigo, Rolling Stones, Brown Sugar, Bachman Turner Overdrive, Let It Ride, Grateful Dead, Sunshine Daydream (a download described as Fucking Awesome, but having no good grass/or any grass in the house, I can't say.. :) :). Oh yes, and Jimi Hendrix (Live at Winterland), Sunshine of Your Love, instrumental, definitely in the Fuckin' Awesome category by me...

Wednesday, May 03, 2006

Minister says definite "no" to Lattelekom sale

Latvia's Minister of Economics Aigars Stokenbergs said "a crystal clear no" to selling 100 % of the fixed network operator Lattelekom to Sweden's TeliaSonera but said negotiations would continue on the Swedish company's offer to buy 100 % of mobile operator Latvian Mobile Telephone (LMT).
It was the first clear rejection of part of TeliaSonera's offer, told to this blogger. Stokenbergs said the main reason for rejecting the Swedish offer was not concern about market dominance voiced earlier by some government officials and analysts, but rather that Lattelekom could pursue a more independent business development strategy even if 100 % owned by the state. At some future date, the government would probably opt for an IPO of Lattelekom on one of the region's or Europe's larger stock exchanges.
More later...

Tuesday, May 02, 2006

F**K IT!!! (perhaps)

This is not so much about telecoms as it is about telecoms journalism. Last week, I got my good sources to give most of the details of the Lattelekom-Triatel deal to finish modernizing the fixed voice network using fixed wireless CDMA technology. I explained how Lattelekom would be buying the CDMA radio units, how most customers getting this modernization would continue to use their old fixed handsets, how a 100 kbps internet link would be possible for some, with high speed internet possible later and in some areas (likely at additional cost). I suspect I pretty much got most of the story ahead of anyone else and I submitted a good curtain raiser/exclusive. The newspaper shitcanned it. An exclusive, though not earthshaking story. So fuck them.
This blog is become more and more important for getting across what I know, both from attributable sources and well...others.

A later note
Just adding this note today, May 3, that I checked only the internet version of the paper last night when I first wrote this rant. It should contain the entire print edition text, but sometimes it doesn't.
The person who was news editor is relatively new to her job and, like many, clueless about telecoms stories or technology more complicated than a ball-point pen. So I am off to work to see whether the story was really canned in print as well.
The worst of it is that I spend time and effort at the editor's behest to add some comment from the side, a technique that is sometimes interesting and illustrates the impact of the story on someone the reader can identify with, other times, it is just following mindless routine. It was a bit more of the latter, as when we first revealed the Lattelekom-Triatel relationship we already quoted the managing director of the Latvian Telecommunications Association as saying this was a good thing. But I tracked down one contact (in Philadelphia) who is a businessman with a country house in some hell by the cartwheel place (for middle of f**king nowhere, Latvians say ellē ratā which really doesn't translate..:) ) and got his views, plus a short list of customers from Lattelekom who had CDMA fixed phones installed. As it is, a fucking waste of time, unless the print paper used it...
I don't have enough contacts at the local mental hospitals to find someone to say that modernizing telecommunications with wireless technologies was BAD because more demons would come to his/her head over the Satanic frequencies used by the great Satan Lattelekom. So I did my best...

Monday, May 01, 2006

Lattelekom's broadband game plan

Lattelekom has the biggest potential broadband customer base (a fair chunk of its 600 000 fixed network users) but is falling behind in the high-speed bells and whistles that some other providers can offer. Balticom, for instance, offers 10 Mbps in some Riga suburbs and a few downtown locations.
The biggest threat to Lattelekom is in the new/renovated housing market, where the inhabitants are likely to have the necessary discretionary income to buy high speed services and premium content (such as HDTV over the internet, when it become available). Here Latvenergo, the state owned energy utility and its subunit, Latvenergo Telecommunications, are putting in fiber to the home with speeds of up to 100 Mbps. While I am not sure just what you can do with 100 Mbps (show me the servers that can unload multiple streams of content at those speeds), Latvenergo has the advantage of putting in this service pretty much wherever new electricity connections are made. It has already run fiber to the residence in some multi-dwelling buildings and will soon be doing a single family home development of a number of homes.
My sources say Lattelekom has a plan to put up to 24 Mbps DSL in many Riga homes. In a major upgrade of its fiber optic network in most of Riga, the incumbent will install fiber to the curb units attached to mini-DSLAMs in local boxes that will deliver very fast DSL to an entire block of homes and businesses. This will involve replacing existing switchboxes with newer models that have back up and main power supplies, since the DSLAMs apparently need to be seperately powered. In other words, a bit of digging and installation.
Before that, you will probably see Lattelekom speeding up its existing DSL connections from the present 1 Mbps (pay LVL. 1.99 per month extra) to something like 10 Mbps just to keep up with the likes of Balticom and to at least match what Latvenergo will offer in its basic fiber to the home package.