Latvia's Prime Minister Aigars Kalvitis will be asking Microsoft chairman and chief software architect Bill Gates to consider setting up a development operation in Latvia, sources told this blogger.
Kalvitis will meet Gates on February 2 at an inivitation only Microsoft Executive Summit in Prague.
According to Edvins Karnitis, a Latvian IT specialist who often advises the government, the proposal will be for developing a specific set of technologies in which the Latvian IT sector has considerable experience.
Karnitis told this blogger (who was doing his day newspaper job) what the specific field was, but later asked that it be kept confidential until later in the week. I went along, though I hardly think the Lithuanians, Estonians or Czechs read Dienas bizness (www.db.lv) with any regularity. In any case, such information is more likely to leak through an English language platform now that I seem to have hundreds more readers/undocumented searchbots that before. So, later...
Another area where Latvia may try to entice Gates to invest, or rather, put some of his charitable donations, could be in vaccines. The Latvian pharmaceuticals and biologicals industries could make some generic vaccines (don't remember the exact list of pestilences that Gates the philanthropher is fighting) with funding by Gates' charities.
Tuesday, January 25, 2005
Monday, January 24, 2005
Why all the attention? :)
I have one of these Adsense counters monitoring this blog, and last week, like a seismograph recording a 9.0 Richter (compared to my baseline of clicks), people seem to have gone apeshit for little 'ol Telecoms in Latvia.
There could be a couple of reasons for this. One is that there are new searchbots out their and their visits haven't been filtered out yet.
The other is that there was something really interesting. Don't know what it could have been? The Man in the Middle thing? Nobody's confirmed it yet, plus, internationally, this is nothing new. It's just phishing where, thanks to the miracles of technology, you can watch the bait being taken and swallowed in real time and ram it down your victim's throat. At least I think that's how it works.
Another theory is that Coolynx, the author of the demolished www.pods.lv Latvian geek and cyberhead website, linked to the Man in the Middle article and all of his followers paid a visit. Pod.lv now is at the Berlin 1947 stage. The rubble has been removed and a skeleton of buildings is reappearing. I still can't forgive myself for not noticing how he got wiped out in November, for fuck's sake. But I guess I had no interest in reading stuff about how to install the RatBat Version 0.875 (nor did I have any idea what you do with the RatBat 0.875 once it runs), which was sort of the daily bread of the website, although it often had some inside stuff about what was going on in the Latvian IT scene, like the infamous pilfering of a school pupil database some year or two ago.
Also, I write this on a Powerbook G4 with Mac OS 10.37 or something, and most of the Pods.lv discussions are for the Linux/Wintel world. In fact, one of the more bizarre reasons cited for breaking the pot (pods is pot in Latvian) was that Coolynx was considered too much of a Linux wise-ass. Tell that to the childrens' site www.calis.lv or the town of Mālpils, whose websites went down when the server with pods.lv on it was whacked. Interestingly, they never got inside of pods, so, like with a guy who has put steel doors and alarms on his apartment, they took down the whole building with the cyber version of a laser-guided 1000 kg bomb.
Whatever the reason, please do keep visiting and do visit the new pods rising from the ashes, if you read Latvian.
There could be a couple of reasons for this. One is that there are new searchbots out their and their visits haven't been filtered out yet.
The other is that there was something really interesting. Don't know what it could have been? The Man in the Middle thing? Nobody's confirmed it yet, plus, internationally, this is nothing new. It's just phishing where, thanks to the miracles of technology, you can watch the bait being taken and swallowed in real time and ram it down your victim's throat. At least I think that's how it works.
Another theory is that Coolynx, the author of the demolished www.pods.lv Latvian geek and cyberhead website, linked to the Man in the Middle article and all of his followers paid a visit. Pod.lv now is at the Berlin 1947 stage. The rubble has been removed and a skeleton of buildings is reappearing. I still can't forgive myself for not noticing how he got wiped out in November, for fuck's sake. But I guess I had no interest in reading stuff about how to install the RatBat Version 0.875 (nor did I have any idea what you do with the RatBat 0.875 once it runs), which was sort of the daily bread of the website, although it often had some inside stuff about what was going on in the Latvian IT scene, like the infamous pilfering of a school pupil database some year or two ago.
Also, I write this on a Powerbook G4 with Mac OS 10.37 or something, and most of the Pods.lv discussions are for the Linux/Wintel world. In fact, one of the more bizarre reasons cited for breaking the pot (pods is pot in Latvian) was that Coolynx was considered too much of a Linux wise-ass. Tell that to the childrens' site www.calis.lv or the town of Mālpils, whose websites went down when the server with pods.lv on it was whacked. Interestingly, they never got inside of pods, so, like with a guy who has put steel doors and alarms on his apartment, they took down the whole building with the cyber version of a laser-guided 1000 kg bomb.
Whatever the reason, please do keep visiting and do visit the new pods rising from the ashes, if you read Latvian.
Thursday, January 20, 2005
Police know nothing of alleged bank scam
The Economic Police in Latvia have not received any formal complaint nor have they arrested anyone in connection with an alleged "man in the middle" scam involving a Latvian bank and a Latvian ISP reported on this blog. That doesn't mean that sort of stuff isn't happening.
Just to be clear-- in this scheme, it is the ISP and infrastructure along the way to the bank's website that is compromised.
I will continue to look into this with my confidential sources. As one source said: the issue needs to be publicized.
Some people are connecting this to a bizarre incident where an e-mail warning of phishing under the guise of Latvia's Hansabanka (part of a Swedish-owned banking group) was circulated, but then Hansabanka denied that any such threat had been spotted. Might have given some people ideas, however.
Man-in-the-middle (well, to be fair, hackergrrls can do this too :) ) is, of course, more sophisticated than phishing and requires some work, although the tools are out there, scattered on the internet.
Just to be clear-- in this scheme, it is the ISP and infrastructure along the way to the bank's website that is compromised.
I will continue to look into this with my confidential sources. As one source said: the issue needs to be publicized.
Some people are connecting this to a bizarre incident where an e-mail warning of phishing under the guise of Latvia's Hansabanka (part of a Swedish-owned banking group) was circulated, but then Hansabanka denied that any such threat had been spotted. Might have given some people ideas, however.
Man-in-the-middle (well, to be fair, hackergrrls can do this too :) ) is, of course, more sophisticated than phishing and requires some work, although the tools are out there, scattered on the internet.
Wednesday, January 19, 2005
"Man in the Middle" reported busted in Latvia
My sources tell me that someone pulled a "man in the middle" hack on a Latvian bank and an internet service provider, but got burned for it. Awaiting confirmation from the Economic Police that they have someone under arrest.
The «man in the middle» works as follows:
The hacker uses a nasty tool (CAIN or something like that) to corrupt the address resources of an internet service provider. He puts up a clone of a popular internet banking homepage.
The innocent internet bank customer starts to log on to his bank and thinks all is well, since he gets a secure SSL link, not to his bank, but the clone.
As soon as he starts to log on the clone, where the malevolent hacker sees the customer's information «in the clear», the hacker uses it to log onto the real internet banking page. When, as at some Latvian internet banks, the real bank site asks for a code on a preprinted card at random (please enter code 6). The hacker passes it on to the unwitting customer, who provides the code, allowing the hacker to log on to the real bank account and start stealing.
The hacker had apparently been a pest to the ISP for a long time, and now, with a serious crime committed or at least attempted, both the ISP and the bank are glad to have him/her put away.
Apparently, this rather sophisticated type of cybercrime has occurred elsewhere around the world, including Estonia. No bank is likely to confirm that it has been victimized. Nor is an ISP likely to put out a proud press release on how it was hacked.
The «man in the middle» works as follows:
The hacker uses a nasty tool (CAIN or something like that) to corrupt the address resources of an internet service provider. He puts up a clone of a popular internet banking homepage.
The innocent internet bank customer starts to log on to his bank and thinks all is well, since he gets a secure SSL link, not to his bank, but the clone.
As soon as he starts to log on the clone, where the malevolent hacker sees the customer's information «in the clear», the hacker uses it to log onto the real internet banking page. When, as at some Latvian internet banks, the real bank site asks for a code on a preprinted card at random (please enter code 6). The hacker passes it on to the unwitting customer, who provides the code, allowing the hacker to log on to the real bank account and start stealing.
The hacker had apparently been a pest to the ISP for a long time, and now, with a serious crime committed or at least attempted, both the ISP and the bank are glad to have him/her put away.
Apparently, this rather sophisticated type of cybercrime has occurred elsewhere around the world, including Estonia. No bank is likely to confirm that it has been victimized. Nor is an ISP likely to put out a proud press release on how it was hacked.
Sunday, January 16, 2005
A belated report of near-death
You sometime read about people who want to look up a seldom visited distant relative or aquaintence only to find that the person in question has been dead for XX (fill in the blank) weeks, months or years. I think the record may be held in efficient welfare Sweden, where social workers found (in the 90s), a skeleton sitting at a 10-year old breakfast with a 1986 newspaper. Nobody noticed the poor geezer was gone, money went to his account automatically and the rent was paid (including electricity).
Well, the same has just happened with a lively and informative (for those who knew what was being talked about) Latvian language IT blog or quasi-blog, www.pods.lv. Seems that some envious folks disliked the editor (nick: coolynx). Apparently some teeny-hackers, trying to get at coolynx, whacked the whole server, taking out a number of hosted sites and more or less wrecking www.pods.lv to this very day.
As someone who did look at pods (in Latvian, and very technical, sometimes) just to feel the buzz of what was going on among the sysops and people in the business, I am ashamed to say that its near-destruction passed me by, as well as a couple of other people at my day job paper who used to monitor it. We never noticed! All this seems to have happened in November. Forgive us, who slept!
BTW: pods is back, a pale shadow of itself, as the whole site and its files were apparently totally erased. Don't know if it will ever come back to life. It had extensive files, archives on various esoterica (for us laypersons) on linux, tools, software tricks, etc, and long and passionate discussions of these in Latvian.
Well, the same has just happened with a lively and informative (for those who knew what was being talked about) Latvian language IT blog or quasi-blog, www.pods.lv. Seems that some envious folks disliked the editor (nick: coolynx). Apparently some teeny-hackers, trying to get at coolynx, whacked the whole server, taking out a number of hosted sites and more or less wrecking www.pods.lv to this very day.
As someone who did look at pods (in Latvian, and very technical, sometimes) just to feel the buzz of what was going on among the sysops and people in the business, I am ashamed to say that its near-destruction passed me by, as well as a couple of other people at my day job paper who used to monitor it. We never noticed! All this seems to have happened in November. Forgive us, who slept!
BTW: pods is back, a pale shadow of itself, as the whole site and its files were apparently totally erased. Don't know if it will ever come back to life. It had extensive files, archives on various esoterica (for us laypersons) on linux, tools, software tricks, etc, and long and passionate discussions of these in Latvian.
Wednesday, January 12, 2005
Various happenings
One should not blog for the sake of blogging, and nothing much has happened for the past week, until a few days ago.
Latvia was hit by a very powerful storm, a hurricane by American standards, or perhaps a Baltic typhoon on January 9- 10. It knocked out much of both mobile phone networks, which is no surprise, since what was actually knocked out was the electricity grid. The base stations on reserve power then faithfully worked on until the batteries ran out. Few actual base stations were blown down in the wind – these and the towers they are mounted on are pretty robust. There is one rumor that Latvian Mobile Telephone (LMT) lost a station when the roof it was standing on blew away. Now if this was a roofing industry blog, I could have a lot to say about all the new shiny tin or ceramic shingle roofs that were "relocated" by the storms to places like neighboring fields, nearby trees, on top of someone's car, etc.
Both LMT and Tele2 had restored service in Latvia's approximately 26 regional center cities and towns using portable generators. As the electricity (most of it cut by millions of fallen trees) is restored, so too do the mobiles come back to life. Lattelekom's fixed network lost service to less than 5 % of its customers at the height of the storm, reserve power was available to most of its switches affected by the failure of Latvenergo's power.
There is now all kinds of talk about how municipalities should buy backup generators (they cost upwards of USD 20 000 apiece) for the next "worst storm in 40 years". So 40 years from now, they can dust off the museum piece and wonder what it was for, since the whole town may be running on a smart network of household fuel cells connected by buried cables.
The Latvian authorities should. however, consider buying a number of satellite phones, perhaps a few to each regional center, should there be another failure of the mobile networks for whatever reason. Even if the fixed network stays up and running, the portable satellite phones are useful for moving around and reporting on the situation on the ground in case of an emergency. Satellite communications worked from places wiped off the face of the earth by the tsunami, they should suffice if the world gets cut off from Moss Village (Sūnuciems to my Latvian readers) by a falling pine tree.
The Indians don't show up
Two representatives of third mobile licence contender Telecommunications Consultants India Limited (TCIL) who were scheduled to visit Latvia January 9 -15 cancelled at the last minute. Unforeseeable and unavoidable circumstances were cited. No new dates have been set. The deadline for pre-application for the auction of the third UMTS/GSM licence, with a starting price of LVL 1.3 million is February 25.
No one is attaching any special significance to the cancellation, this blogger was unable to get in touch with the person at TCIL said to be in charge of the Latvia project. Probably, the reasons must be taken at face value – something in in India or perhaps a flight cancellation in anticipation of the hurricane.
Latvia was hit by a very powerful storm, a hurricane by American standards, or perhaps a Baltic typhoon on January 9- 10. It knocked out much of both mobile phone networks, which is no surprise, since what was actually knocked out was the electricity grid. The base stations on reserve power then faithfully worked on until the batteries ran out. Few actual base stations were blown down in the wind – these and the towers they are mounted on are pretty robust. There is one rumor that Latvian Mobile Telephone (LMT) lost a station when the roof it was standing on blew away. Now if this was a roofing industry blog, I could have a lot to say about all the new shiny tin or ceramic shingle roofs that were "relocated" by the storms to places like neighboring fields, nearby trees, on top of someone's car, etc.
Both LMT and Tele2 had restored service in Latvia's approximately 26 regional center cities and towns using portable generators. As the electricity (most of it cut by millions of fallen trees) is restored, so too do the mobiles come back to life. Lattelekom's fixed network lost service to less than 5 % of its customers at the height of the storm, reserve power was available to most of its switches affected by the failure of Latvenergo's power.
There is now all kinds of talk about how municipalities should buy backup generators (they cost upwards of USD 20 000 apiece) for the next "worst storm in 40 years". So 40 years from now, they can dust off the museum piece and wonder what it was for, since the whole town may be running on a smart network of household fuel cells connected by buried cables.
The Latvian authorities should. however, consider buying a number of satellite phones, perhaps a few to each regional center, should there be another failure of the mobile networks for whatever reason. Even if the fixed network stays up and running, the portable satellite phones are useful for moving around and reporting on the situation on the ground in case of an emergency. Satellite communications worked from places wiped off the face of the earth by the tsunami, they should suffice if the world gets cut off from Moss Village (Sūnuciems to my Latvian readers) by a falling pine tree.
The Indians don't show up
Two representatives of third mobile licence contender Telecommunications Consultants India Limited (TCIL) who were scheduled to visit Latvia January 9 -15 cancelled at the last minute. Unforeseeable and unavoidable circumstances were cited. No new dates have been set. The deadline for pre-application for the auction of the third UMTS/GSM licence, with a starting price of LVL 1.3 million is February 25.
No one is attaching any special significance to the cancellation, this blogger was unable to get in touch with the person at TCIL said to be in charge of the Latvia project. Probably, the reasons must be taken at face value – something in in India or perhaps a flight cancellation in anticipation of the hurricane.
Monday, January 03, 2005
Looking forward to 2005
Well, the New Year has started and a few things may be happening in Latvian Telecoms. Later today (January 3), Lattelekom will issue a statement on its response to the Public Utilities Regulatory Board setting an interconnect tariff ceiling of LVL 0.008 (thats 0.8 santims) per minute for the incumbent. For the moment, Lattelekom is prepared to comply, although, contrary to gleeful comment from the Latvian Telecommunications Association, it will be a couple of months before any alternative operators feel the lower tariffs in their expense outlays. The fact is that interconnect accounts (in Latvia, probably elsewhere, too) are kept in traffic minutes. These are then tallied by both interconnect partners, and then a bill is sent for the agreed figure. This means that January traffic will be tallied and billed in March. Also, there is probably a set off (Operator X used 125 000 minutes of Lattelekom network time, Lattelekom used, say 25 000 minutes of X's network time).
Representatives of Telecommunications Consulting of India Ltd (TCIL), a contender for the "third" GSM and UMTS licence auction were supposed to be coming to Latvia in January. One wonders whether the tsunami disaster could have affected these plans, although TCIL is headquartered in Delhi, far from the seacoast. We may also see Denmark's TDC (through Bite GSM) clarify its position on the auction.
As I see it, TCIL is at least a known and experienced contender trying to break into a new market, while TDC needs a Latvian licence to complete its presence in all three Baltic states and be able to compete with TeliaSonera's subsidiaries in the mobile market. My guess is that these two could be serious bidders.
Meanwhile, I have received some feelers from still-mysterious International Telecommunications and Technologies (IT&T) to perhaps meet with their executives and be informed of who really stands behind this consortium (which shows up on no one's radar). It depends on whether my day job newspaper will agree to me going to either London or Beirut at IT&T's expense. A bit dodgy, but interesting. No one else is likely to get the story. I keep hearing that HuaWei, the Chinese telecoms infrastructure builder, is one of the technology partners behind IT&T, although there is no confirmation of this. HuaWei is also trying to break into the European market, they just did some kind of deal in the Netherlands.
It will be interesting to look at Triatel's figures for mobile CDMA-450 use in a couple of months. This will be a test of 3G services (fast data, mostly) takeup. If Triatel gets off the ground, it may inspire Latvian Mobile Telephone (LMT) and Tele2 to move beyond their own buildings in building out their UMTS networks. Triatel looked pretty optimistic when it upped the number of phone numbers it wanted from 40 000 to 60 000. A number of these, however, could be fixed mobiles(desktop phones) or wireless DSL-speed internet access.
DSL lines in Latvia grew by 68 % (regulator's figures) despite there being no national broadband policy coming out of the Communications Department of the Ministry of Transport. No one really knows how much broadband is used in Latvia because many 2 Mb or higher connections are resold or redistributed in apartment buildings and by smaller, semi-fly-by-night ISPs. I am pretty sure that official figures (mainly Lattelekom's DSL services) will zip past 100 000 in the first half of 2005. It would be nice if they speeded up the basic service for existing customers from the present 256 kbps (say, to 512 kbps or 1 Mb, the DSLAMs serving HomeDSL reputedly are set to 2 Mbps and then slowed by software to 256 kbps). In Sweden (home to TeliaSonera), multimegabit speeds are standard - one of my sons has 8 megs (in a Stockholm suburb), the other 10 megs (in Umeå). There is some service pushing 26 megs on posters in the Stockholm subway (there was, at least, when I was there in November).
Look, too, for some kind of merged marketing by Lattelekom and LMT, as well as the launch of a few new consumer/business products by Lattelekom, such as video on demand or digital cable TV (probably toward the second half of 2005). Both need higher basic speeds.
Representatives of Telecommunications Consulting of India Ltd (TCIL), a contender for the "third" GSM and UMTS licence auction were supposed to be coming to Latvia in January. One wonders whether the tsunami disaster could have affected these plans, although TCIL is headquartered in Delhi, far from the seacoast. We may also see Denmark's TDC (through Bite GSM) clarify its position on the auction.
As I see it, TCIL is at least a known and experienced contender trying to break into a new market, while TDC needs a Latvian licence to complete its presence in all three Baltic states and be able to compete with TeliaSonera's subsidiaries in the mobile market. My guess is that these two could be serious bidders.
Meanwhile, I have received some feelers from still-mysterious International Telecommunications and Technologies (IT&T) to perhaps meet with their executives and be informed of who really stands behind this consortium (which shows up on no one's radar). It depends on whether my day job newspaper will agree to me going to either London or Beirut at IT&T's expense. A bit dodgy, but interesting. No one else is likely to get the story. I keep hearing that HuaWei, the Chinese telecoms infrastructure builder, is one of the technology partners behind IT&T, although there is no confirmation of this. HuaWei is also trying to break into the European market, they just did some kind of deal in the Netherlands.
It will be interesting to look at Triatel's figures for mobile CDMA-450 use in a couple of months. This will be a test of 3G services (fast data, mostly) takeup. If Triatel gets off the ground, it may inspire Latvian Mobile Telephone (LMT) and Tele2 to move beyond their own buildings in building out their UMTS networks. Triatel looked pretty optimistic when it upped the number of phone numbers it wanted from 40 000 to 60 000. A number of these, however, could be fixed mobiles(desktop phones) or wireless DSL-speed internet access.
DSL lines in Latvia grew by 68 % (regulator's figures) despite there being no national broadband policy coming out of the Communications Department of the Ministry of Transport. No one really knows how much broadband is used in Latvia because many 2 Mb or higher connections are resold or redistributed in apartment buildings and by smaller, semi-fly-by-night ISPs. I am pretty sure that official figures (mainly Lattelekom's DSL services) will zip past 100 000 in the first half of 2005. It would be nice if they speeded up the basic service for existing customers from the present 256 kbps (say, to 512 kbps or 1 Mb, the DSLAMs serving HomeDSL reputedly are set to 2 Mbps and then slowed by software to 256 kbps). In Sweden (home to TeliaSonera), multimegabit speeds are standard - one of my sons has 8 megs (in a Stockholm suburb), the other 10 megs (in Umeå). There is some service pushing 26 megs on posters in the Stockholm subway (there was, at least, when I was there in November).
Look, too, for some kind of merged marketing by Lattelekom and LMT, as well as the launch of a few new consumer/business products by Lattelekom, such as video on demand or digital cable TV (probably toward the second half of 2005). Both need higher basic speeds.
Tuesday, December 28, 2004
Stealth start for Tele2's UMTS in Latvia
Tele2, the Swedish-owned mobile telecommunications operator, has quietly launched UMTS or 3G services in Latvia, limited to one base station in its offices in the Pardaugava district of Riga. The fact that the base station was operational was confirmed by Tele2's PR representative, Evita Matisone.
She confirmed that Tele2 had started the service in compliance with the licence it bought for LVL 5.8 million in 2002, but had made no public announcement. "Next year, when we are required to have coverage of 30 % of the population by the end of the year, we will announce something," Matisone said. The PR consultant explained that there appeared to be a very limited market for 3G services in Latvia due to the small number of available UMTS/GSM phones and their relatively high price.
Latvian Mobile Telephone (LMT), the leading operator owned by TeliaSonera announced the start of its 3G services aty a press event on December 13. LMT has installed a base station in its own office building and the new 26 story offices of Hansabanka. At the same time, LMT announced it would be launching EDGE, a higher-speed data service that runs on the current GSM network. A number of mid-range business class handsets now come with EDGE capability and LMT apparently used the press event to announce it was starting EDGE in January as to start up its limited UMTS service.
Your blogger was in the US at the time of the press event and cannot relay any first-hand information. However, the activities of both operators show that they are being very cautious with expanding their UMTS services, something that those vying for the new "third" licence should take into consideration.
She confirmed that Tele2 had started the service in compliance with the licence it bought for LVL 5.8 million in 2002, but had made no public announcement. "Next year, when we are required to have coverage of 30 % of the population by the end of the year, we will announce something," Matisone said. The PR consultant explained that there appeared to be a very limited market for 3G services in Latvia due to the small number of available UMTS/GSM phones and their relatively high price.
Latvian Mobile Telephone (LMT), the leading operator owned by TeliaSonera announced the start of its 3G services aty a press event on December 13. LMT has installed a base station in its own office building and the new 26 story offices of Hansabanka. At the same time, LMT announced it would be launching EDGE, a higher-speed data service that runs on the current GSM network. A number of mid-range business class handsets now come with EDGE capability and LMT apparently used the press event to announce it was starting EDGE in January as to start up its limited UMTS service.
Your blogger was in the US at the time of the press event and cannot relay any first-hand information. However, the activities of both operators show that they are being very cautious with expanding their UMTS services, something that those vying for the new "third" licence should take into consideration.
Thursday, December 23, 2004
Holiday Greetings
So as we all booze it up a little here at the offices of my day job (the editors are having some kind of seminar away from the offie, so the mice...er reporters are playing, no paper tommorrow), I will take this chance to extend warmest holiday greetings to the small but apparently loyal readership of this blog. A Merry Christmas, Happy New Year, Joyous Kwanzaa (assuming there is at least one reader of African descent) and belated Hannukah greetings! Oh, yes, and belated happy Solstice (Saulgrieži) to any Latvian Dievturi (adherents of the old Latvian Diety, who was not very much into the fire, brimstone and commandments scene, but prefered to ride his pony so gently that not even a blossom was disturbed). Plus any Russian Orthodox readers who will have barely recovered from the Latvian Christmas partying to do Orthodox Christmas and Staray Novi God and all that stuff all over again. So Happy Whatever to all!!
A homeboy unwires Daugavpils
This one flew under this blogger's radar about a month ago. It seems that Belam Latvia, a subsidiary of Belam Inc in the US, used Trade Development Agency funds to set up a pilot/demonstration largely wireless network linking municipal agencies, small town governments, libraries, etc, with private network, internet and voice-over-IP services in and around the eastern Latvian city of Daugavpils. Around USD 400 000 was spent on the project, USD 300 000 from the TDA and USD 100 o00 from Belam Inc. Belam is an agent for the telecoms equipment maker Nortel, which is headquartered in Canada, but does most of its development and manufacturing in the US.
Mark Katz, the president of Belam Latvia, is especially proud of this project, since he was born and raised in Daugavpils and has opened his home town and surrounding villages to the information age. Whether other, perhaps wealthier (Latgale, Eastern Latvia, is seen as an underdeveloped and poor region) municipalities follow suit remains to be seen. Certainly the idea of publically financed, wireless or fiber municipal area networks is once which is competing against commercial service providers in the US and Western Europe.
Christmas approaches and here at the editorial offices of my day job, we have all been sipping gluehwein (hot spiced wine), so I can be excused for makings some wacko observations. Katz of Belam was an avid fencer in high school and bears a more than slight resemblance to the American 1950s actor Guy Williams who played the swashbuckling mysterious Zorro on TV. So perhaps this homeboy from Daugavpils is a kind of Cyber-Zorro bringing the internet to the poor with the money of the rich US?
Mark Katz, the president of Belam Latvia, is especially proud of this project, since he was born and raised in Daugavpils and has opened his home town and surrounding villages to the information age. Whether other, perhaps wealthier (Latgale, Eastern Latvia, is seen as an underdeveloped and poor region) municipalities follow suit remains to be seen. Certainly the idea of publically financed, wireless or fiber municipal area networks is once which is competing against commercial service providers in the US and Western Europe.
Christmas approaches and here at the editorial offices of my day job, we have all been sipping gluehwein (hot spiced wine), so I can be excused for makings some wacko observations. Katz of Belam was an avid fencer in high school and bears a more than slight resemblance to the American 1950s actor Guy Williams who played the swashbuckling mysterious Zorro on TV. So perhaps this homeboy from Daugavpils is a kind of Cyber-Zorro bringing the internet to the poor with the money of the rich US?
Tuesday, December 21, 2004
India's TCIL may bid for a Latvian licence
India's Telecommunications Consulting of India Ltd (TCIL) may be a contender for Latvia's third UMTS/GSM licence, this blogger learned. The head of the auction commission, deputy state secretary in the Ministry of Transport Guntis Macs, told a parliamentary anti-corruption commission that an Indian company was a serious contender.
Macs misspoke the company as a Delhi Telecommunications & Consulting, but it is in fact TCIL, according to Manoj Dairola, a helpful colleague who covers telecoms for the Economic Times in Delhi.
Macs said representatives of the Indian company would come to Latvia in early January to acquaint themselves with the auction terms and the Latvian market. TCIL has participated in a number of mobile projects in India, neighboring countries and Africa.
I also chased down a rumor that Huawei, the Shenzen, China based builder of mobile infrastructure, was associated with the still mysterious potential bidder International Telecommunications and Technologies (IT&T). Huawei officials denied any association with IT&T.
Macs misspoke the company as a Delhi Telecommunications & Consulting, but it is in fact TCIL, according to Manoj Dairola, a helpful colleague who covers telecoms for the Economic Times in Delhi.
Macs said representatives of the Indian company would come to Latvia in early January to acquaint themselves with the auction terms and the Latvian market. TCIL has participated in a number of mobile projects in India, neighboring countries and Africa.
I also chased down a rumor that Huawei, the Shenzen, China based builder of mobile infrastructure, was associated with the still mysterious potential bidder International Telecommunications and Technologies (IT&T). Huawei officials denied any association with IT&T.
IT&T goes after rival, claims murky Tele2 ties
In what could be a case of the hitherto invisible pot calling the kettle black, International Telecommunications and Technologies (IT&T), one of two announced potential bidders for in Latvia's third (now extended) mobile operator licence auction, has accused the other bidder, cable-tv and telecoms enterepreneur Peteris Smidre's Alina, of having murky ties to the Swedish Tele2 group.
IT&T's representative in Latvia, Edgars Zakrizevkis told local media he would challenge any bid by Alina based on alleged ties to Tele2 as well as a lack of international experience and insufficient financing to meet the minimal requirements of the auction (guarantees that the company can put up at least EUR 25 million). Smidre, who started and built up Baltcom GSM (later sold and its name changed to Tele2), dismissed the allegations as nonsense. He said that his only direct ties to Tele2 – non-competition agreements signed when Baltcom GSM was sold - had lapsed. As for international experience, this blogger has pointed out that IT&T has never been heard of by a number of international telecoms analysts. The IT&T representative claims that Alina will be bidding as a straw man for Tele2 with the purpose of blocking competition. Interestingly, Minister of Transport Ainars Slesers also mentioned the possibility that existing operators Latvian Mobile Telephone (LMT) and Tele2 could launch a straw man operation to buy the licence (and then spend EUR 150 million on what – or lose it?)
Zakrizevskis says that the reason for IT&T being unknown ist that it is not really in the telecoms business directly, but actually a financing consortium. He says details of exactly who is behind IT&T will be disclosed when the pre-selection applications are file on February 25 (under the extended deadline). He did hint, however, that private equity funds were behind IT&T.
Smidre, regarded as an independently wealthy man in Latvia after selling his holdings in Baltcom GSM to Tele2 (he got a slice of the more than USD 200 million deal), told this blogger that he gets many offers from private equity outfits, but would never put his money in a deal that involved spending EUR 150 million to capture, at best, some 200 - 300 000 new customers (plus some churn from existing operators) in Latvia.
This blogger has suggested that the next step in the ongoing "fix the engines while flying" approach to the Latvian auction may be to change the minimum investment requirement. Good news for the Financial Times, which is now running ads changing the deadlines for the auction announced in earlier ads.
IT&T's representative in Latvia, Edgars Zakrizevkis told local media he would challenge any bid by Alina based on alleged ties to Tele2 as well as a lack of international experience and insufficient financing to meet the minimal requirements of the auction (guarantees that the company can put up at least EUR 25 million). Smidre, who started and built up Baltcom GSM (later sold and its name changed to Tele2), dismissed the allegations as nonsense. He said that his only direct ties to Tele2 – non-competition agreements signed when Baltcom GSM was sold - had lapsed. As for international experience, this blogger has pointed out that IT&T has never been heard of by a number of international telecoms analysts. The IT&T representative claims that Alina will be bidding as a straw man for Tele2 with the purpose of blocking competition. Interestingly, Minister of Transport Ainars Slesers also mentioned the possibility that existing operators Latvian Mobile Telephone (LMT) and Tele2 could launch a straw man operation to buy the licence (and then spend EUR 150 million on what – or lose it?)
Zakrizevskis says that the reason for IT&T being unknown ist that it is not really in the telecoms business directly, but actually a financing consortium. He says details of exactly who is behind IT&T will be disclosed when the pre-selection applications are file on February 25 (under the extended deadline). He did hint, however, that private equity funds were behind IT&T.
Smidre, regarded as an independently wealthy man in Latvia after selling his holdings in Baltcom GSM to Tele2 (he got a slice of the more than USD 200 million deal), told this blogger that he gets many offers from private equity outfits, but would never put his money in a deal that involved spending EUR 150 million to capture, at best, some 200 - 300 000 new customers (plus some churn from existing operators) in Latvia.
This blogger has suggested that the next step in the ongoing "fix the engines while flying" approach to the Latvian auction may be to change the minimum investment requirement. Good news for the Financial Times, which is now running ads changing the deadlines for the auction announced in earlier ads.
Monday, December 20, 2004
The trial and error auction moves along
Latvia's trial and error auction of its third GSM and UMTS mobile licence went through another iteration when the government accepted on December 20 the Ministry of Transport's proposal to extend the auction's pre-selection application deadline by two months to February 25.
The government (Cabinet of Ministers) didn't, however, change the requirement– considered excessive if not bizarre by some analysts – that the third operator spend at least EUR 150 million to build an new independent network. It merely added the requirement - proposed by the Ministry of Transport, that applicants file a detailed investment plan for how the EUR 150 million will be spent.
However, there are signs that this mininam requirement may change. Minister of Economics Krisjanis Karins (New Era) has wondered aloud why the new operator simply couldn't use the existing networks (at least to start with) on a domestic roaming basis. Infrastructure sharing is also common among competitors when building UMTS networks (Telia and rival Tele2 in Sweden, for example).
The companies, which have expressed a renewed interest in the auction, also are extremely skeptical about the need for such a high investment "floor". Jesper Eriksen, managing director of Danish TDC's Lithuanian subsidiary Bite GSM, thinks the sum could be acceptable as a spending guideline over "the life of the licence" which would probably be quite a few years. Peteris Smidre, who has declared over the weekend that his private company Alina will apply for a licence also privately says the EUR 150 million requirement is "crazy". The Latvian Telecommunications Association, where Smidre has considerable influence, also asked that the investment quota be modified.
It seems now that the next step in Latvia's trial and error process, probably before the February 25 deadline, will be steps to modify the investment requirement. That will not, of course, undo the damage to the reputation of the whole process, which started off with at least the appearance of a desperately rushed procedure aimed at having only one bidder win.
What made the deadline almost impossible to meet was not the timeframe, but the huge investment requirement plus the timeframe. If it were a question of spending LVL 1.3 to, say, 3 million, some international operators could have made a decision on short notice. But spending EUR 150 million when there are, perhaps, only 300 000 new customers to be had, is another story...
Advice to those interested – wait until the New Year. The Minister of Transport may, yet again, reconsider the terms of the auction. At the same time, don't rule out another fiasco. Until the pre-selection applications are in, there are no guarantees. Before the 2002 flop, there were also rumors that Lithuania's Bite or Radiolinja of Finland/Estonia were coming. In fact, both confirmned their interest. But on the big day in 2002 nobody came.
One more thing about the 2002 flop – the starting price was a bit high at LVL 7.6 million and all of the big operators were spooked by the huge sums spend in the big European markets that later brought some companies close to ruin. So perhaps it was mostly external factors beyond Latvia's control. In the present auction, the main factor of uncertainty seems to be precisely the unpredictable trial and error approach of the Latvian government in trying to auction off the licence.
The government (Cabinet of Ministers) didn't, however, change the requirement– considered excessive if not bizarre by some analysts – that the third operator spend at least EUR 150 million to build an new independent network. It merely added the requirement - proposed by the Ministry of Transport, that applicants file a detailed investment plan for how the EUR 150 million will be spent.
However, there are signs that this mininam requirement may change. Minister of Economics Krisjanis Karins (New Era) has wondered aloud why the new operator simply couldn't use the existing networks (at least to start with) on a domestic roaming basis. Infrastructure sharing is also common among competitors when building UMTS networks (Telia and rival Tele2 in Sweden, for example).
The companies, which have expressed a renewed interest in the auction, also are extremely skeptical about the need for such a high investment "floor". Jesper Eriksen, managing director of Danish TDC's Lithuanian subsidiary Bite GSM, thinks the sum could be acceptable as a spending guideline over "the life of the licence" which would probably be quite a few years. Peteris Smidre, who has declared over the weekend that his private company Alina will apply for a licence also privately says the EUR 150 million requirement is "crazy". The Latvian Telecommunications Association, where Smidre has considerable influence, also asked that the investment quota be modified.
It seems now that the next step in Latvia's trial and error process, probably before the February 25 deadline, will be steps to modify the investment requirement. That will not, of course, undo the damage to the reputation of the whole process, which started off with at least the appearance of a desperately rushed procedure aimed at having only one bidder win.
What made the deadline almost impossible to meet was not the timeframe, but the huge investment requirement plus the timeframe. If it were a question of spending LVL 1.3 to, say, 3 million, some international operators could have made a decision on short notice. But spending EUR 150 million when there are, perhaps, only 300 000 new customers to be had, is another story...
Advice to those interested – wait until the New Year. The Minister of Transport may, yet again, reconsider the terms of the auction. At the same time, don't rule out another fiasco. Until the pre-selection applications are in, there are no guarantees. Before the 2002 flop, there were also rumors that Lithuania's Bite or Radiolinja of Finland/Estonia were coming. In fact, both confirmned their interest. But on the big day in 2002 nobody came.
One more thing about the 2002 flop – the starting price was a bit high at LVL 7.6 million and all of the big operators were spooked by the huge sums spend in the big European markets that later brought some companies close to ruin. So perhaps it was mostly external factors beyond Latvia's control. In the present auction, the main factor of uncertainty seems to be precisely the unpredictable trial and error approach of the Latvian government in trying to auction off the licence.
Sunday, December 19, 2004
Third licence auction deadline extended
Minister of Transport Ainars Slesers has asked the government to extend by two months the deadlines for the third GSM and UMTS licence auctions. The government (Cabinet of Ministers) will meet Monday, December 20, just one day ahead of the old deadline for application to be pre-selected for the auction. Slesers has asked that a decision on the extension be placed at the top of the agenda of the extraordinary Cabinet meeting, originally called to discuss budget matters.
The Minister of Transport is apparently responding to harsh criticism of the short deadlines and other terms of the auction. Delna, Latvia's branch of the anti-corruption organization Transparency International, has said the auction should be investigated by the anti-corruption authorities because it looks like blatant state capture on behalf of one company (the elusive, Middle East based International Telecommunications and Technologies, or IT&T). Also, a parliamentary anti-corruption commission will discuss the matter at a meeting on December 21.
IT&T is the only potential applicant and bidder, although Slesers and Ministry of Transport Deputy State Secretary Guntis Macs said there were at least four contenders. It was not clear whether these four contenders would have applied for the Dec 21 deadline, or whether (more likely) they would consider applying under the extended deadline. International analysts, such as EMC's Kester Mann, have been unable to find any traces of IT&T's activities in their extensive data bases.
Both Denmark's TDC (through its Lithuanian Bite GSM subsidiary) and Latvia's Baltcom have indicated the short deadline and other terms of the auction meant they would not apply by Dec 21.
Slesers said he would not remove the mandatory minimum investment of 150 million euros, but demand, instead, that applicants supply a detailed investment plan that could be scrutinized by auditors to make sure it was not spending for the sake of spending. Analysts have said that the requirement goes completely against the grain of trends in Europe, where operators building 3G networks try to share resources even while competing on end-user pricing and services.
Slesers insists that the high level of investment will ensure that the third operator makes a long-term committment and, by cutting tariffs sharply (the minister expects a third operator to cut mobile costs by 50 %), to start recovering one's investment only after several years.
Meanwhile, sources have told this blogger that at least ten contenders have expressed interest in setting up virtual mobile operations in Latvia. Currently there is only one mobile virtual network operator (MVNO? do I have that right?), Zetcom, which sells Amigo cards and runs on Latvian Mobile Telephone's (LMT's) network. Amigo has been growing rapidly in its niche of youth-oriented pre-paid cards, a signal that it is possible to compete on the existing network. LMT has apparently decided that it is more rational to lease capacity for running several tens of thousands of lines and take a wholesale revenue stream rather than carry the cost of marketing and administering the same number of post-paid lines.
The 150 million euro investment floor is privately regarded as a crackpot scheme with little rational basis even by Latvian telecommunications officials. One wonders where the 150 million euro investment scheme will fit in with the Ministry of Transport's other scheme to build yet another independent network by merging the infrastructure assets of Latvenergo, Latvian Railways and other state companies and agencies - the Alliance described earlier in this blog? Such a small country, so many networks, so many schemes...
The Minister of Transport is apparently responding to harsh criticism of the short deadlines and other terms of the auction. Delna, Latvia's branch of the anti-corruption organization Transparency International, has said the auction should be investigated by the anti-corruption authorities because it looks like blatant state capture on behalf of one company (the elusive, Middle East based International Telecommunications and Technologies, or IT&T). Also, a parliamentary anti-corruption commission will discuss the matter at a meeting on December 21.
IT&T is the only potential applicant and bidder, although Slesers and Ministry of Transport Deputy State Secretary Guntis Macs said there were at least four contenders. It was not clear whether these four contenders would have applied for the Dec 21 deadline, or whether (more likely) they would consider applying under the extended deadline. International analysts, such as EMC's Kester Mann, have been unable to find any traces of IT&T's activities in their extensive data bases.
Both Denmark's TDC (through its Lithuanian Bite GSM subsidiary) and Latvia's Baltcom have indicated the short deadline and other terms of the auction meant they would not apply by Dec 21.
Slesers said he would not remove the mandatory minimum investment of 150 million euros, but demand, instead, that applicants supply a detailed investment plan that could be scrutinized by auditors to make sure it was not spending for the sake of spending. Analysts have said that the requirement goes completely against the grain of trends in Europe, where operators building 3G networks try to share resources even while competing on end-user pricing and services.
Slesers insists that the high level of investment will ensure that the third operator makes a long-term committment and, by cutting tariffs sharply (the minister expects a third operator to cut mobile costs by 50 %), to start recovering one's investment only after several years.
Meanwhile, sources have told this blogger that at least ten contenders have expressed interest in setting up virtual mobile operations in Latvia. Currently there is only one mobile virtual network operator (MVNO? do I have that right?), Zetcom, which sells Amigo cards and runs on Latvian Mobile Telephone's (LMT's) network. Amigo has been growing rapidly in its niche of youth-oriented pre-paid cards, a signal that it is possible to compete on the existing network. LMT has apparently decided that it is more rational to lease capacity for running several tens of thousands of lines and take a wholesale revenue stream rather than carry the cost of marketing and administering the same number of post-paid lines.
The 150 million euro investment floor is privately regarded as a crackpot scheme with little rational basis even by Latvian telecommunications officials. One wonders where the 150 million euro investment scheme will fit in with the Ministry of Transport's other scheme to build yet another independent network by merging the infrastructure assets of Latvenergo, Latvian Railways and other state companies and agencies - the Alliance described earlier in this blog? Such a small country, so many networks, so many schemes...
Thursday, December 16, 2004
Regulator cuts interconnect charges by 80 %
The Public Utilities Regulatory Board has cut the interconnect charges Lattelekom can charge other operators for using its network by up to 80 %. The agency ordered Lattelekom to slash its local interconnect (Riga and environs) to a uniform 0.8 santims per minute from 1.656 santims and also reduced the national interconnect from 3.88 santims to 0.8 santims.
Lattelekom is expected to contest the ruling in the Administrative Court. The regulator says its interconnect ceiling is based on actual Lattelekom costs. Lattelekom has said throughout the process (there were hearings on the proposed sharp cut) that no operator has passed on any interconnect savings to its customers (Lattelekom cut inteconnect charges by 20 % at the start of 2004.
Meanwhile, the hasty auction of Latvia's third UMTS/GSM licence going ahead despite there being only one potential bidder, for whom the auction appears to have been tailor-made. The somewhat mysterious Middle Eastern company, International Telecommunications & Technologies (IT&T) has, at last, put up a rather jargon-filled home page describing its services. You can see it at www.it-t.net, where just before my departure for the US (I am now back in Latvia), there was nothing. So they are making an effort.
Unfortunately, whatever the intentions were on all sides, this has the appearance of an auction with a pre-arranged winner. Whether this is true or not -- the IT&T people vehemently deny it– appearances will keep the company under some kind of cloud even if it seems to win "fair and square." Politically, it is hard to see why Prime Minister Aigars Kalvitis didn't at least extend the deadline for the pre-selection. Normally, Minister of Transport Ainars Slesers should have been called on the carpet for the whole matter, for its appearance of scandal, if nothing else. But that wasn't done, nor were pleas to change the auction terms heard. All of which fuels the impression that some kind of state capture may be behind the whole business.
Lattelekom is expected to contest the ruling in the Administrative Court. The regulator says its interconnect ceiling is based on actual Lattelekom costs. Lattelekom has said throughout the process (there were hearings on the proposed sharp cut) that no operator has passed on any interconnect savings to its customers (Lattelekom cut inteconnect charges by 20 % at the start of 2004.
Meanwhile, the hasty auction of Latvia's third UMTS/GSM licence going ahead despite there being only one potential bidder, for whom the auction appears to have been tailor-made. The somewhat mysterious Middle Eastern company, International Telecommunications & Technologies (IT&T) has, at last, put up a rather jargon-filled home page describing its services. You can see it at www.it-t.net, where just before my departure for the US (I am now back in Latvia), there was nothing. So they are making an effort.
Unfortunately, whatever the intentions were on all sides, this has the appearance of an auction with a pre-arranged winner. Whether this is true or not -- the IT&T people vehemently deny it– appearances will keep the company under some kind of cloud even if it seems to win "fair and square." Politically, it is hard to see why Prime Minister Aigars Kalvitis didn't at least extend the deadline for the pre-selection. Normally, Minister of Transport Ainars Slesers should have been called on the carpet for the whole matter, for its appearance of scandal, if nothing else. But that wasn't done, nor were pleas to change the auction terms heard. All of which fuels the impression that some kind of state capture may be behind the whole business.
Thursday, December 09, 2004
Back to timesharing a la wireless?
Back around 1965, when I was a young teenager and my father worked for Honeywell, I asked what it was exactly that he did. He said he sat at a thing like an electric typewriter connected to a computer the size of four big refrigerators. There were several other typewriters attached to the computer and this was called timesharing. The users ( a systems test team) asked the computer to do things (test routines) and checked what it printed against standards.The electric telexes, alone, could only type, but the computer gave them the full power of a mainframe of the time (about what you have in a mid-priced mobile phone of 2004, and the Honeywell mainframe cost USD 2 million then).
Now, according to Scott McNealty of Sun Microsystems, speaking at Oracle OpenWorld, the future belongs to "thin clients" connected wirelessly to servers and clusters. If the connection breaks, you can't even type on the equipment, it is almost brainless. In fact, what will put "your work" on the thin client desktop is a small chip, a kind of super SIM card, and when you take it out, someone else can snap in his and have a completely different desktop workspace. So we have come full circle in 40 years to timesharing of a new kind.
When I think of the young guys in the Latvian IT business, I always imagine that they will not even work like people did in the mid-90s, nevermind the 80s -- with clunky systems, green on black screens, the like. Legacy is not a problem, compared to the US and Western Europe, where legacy going back to the 1960s is one reaon Oracle and its competitors have to come up with elaborate solutions to make this zoo look simple again For instance, the Data Hub idea. But now it looks like we are coming around to timesharing again, when everyone feeds off the power of the once great central virtual computer.
Just some scribblings from Oracle. A great speech by Larry Ellisson, as usual, summing up the Oracle vision more clearly than some of the technobabbling and buzzword dropping heard earlier. He was only tripped up a bit and perhaps said the wrong things by washing his hands of what Oracle may be used for by the Chinese government. Ellisson correctly said that the company didn't make government policy, but the person questioning him gave him an opening by not asking a) whether there are some customers, whose oppressive uses for information are so obvious that Oracle should question selling to them b) whether the company has some ethical standards about how it allows its software to be used.
Now, according to Scott McNealty of Sun Microsystems, speaking at Oracle OpenWorld, the future belongs to "thin clients" connected wirelessly to servers and clusters. If the connection breaks, you can't even type on the equipment, it is almost brainless. In fact, what will put "your work" on the thin client desktop is a small chip, a kind of super SIM card, and when you take it out, someone else can snap in his and have a completely different desktop workspace. So we have come full circle in 40 years to timesharing of a new kind.
When I think of the young guys in the Latvian IT business, I always imagine that they will not even work like people did in the mid-90s, nevermind the 80s -- with clunky systems, green on black screens, the like. Legacy is not a problem, compared to the US and Western Europe, where legacy going back to the 1960s is one reaon Oracle and its competitors have to come up with elaborate solutions to make this zoo look simple again For instance, the Data Hub idea. But now it looks like we are coming around to timesharing again, when everyone feeds off the power of the once great central virtual computer.
Just some scribblings from Oracle. A great speech by Larry Ellisson, as usual, summing up the Oracle vision more clearly than some of the technobabbling and buzzword dropping heard earlier. He was only tripped up a bit and perhaps said the wrong things by washing his hands of what Oracle may be used for by the Chinese government. Ellisson correctly said that the company didn't make government policy, but the person questioning him gave him an opening by not asking a) whether there are some customers, whose oppressive uses for information are so obvious that Oracle should question selling to them b) whether the company has some ethical standards about how it allows its software to be used.
Tuesday, December 07, 2004
Hello from Mars (Oracle, SF)
Somehow that Latvian Eurovision (?) song seems appropriate. When you look at the statistics of use of IT among Latvian priavte business (officially, 13 percent according to the Latvian Information Technology and Telecommunications Association/LITTA, probably about twice that), then all the talk here about information driven enterprise and the grid-enabled adaptive enterprise seems that either we here in San Francisco, or Latvia are on Mars. All of this presumes a profound degree of IT penetration of entire enterprises in all of their functions (I saw how, on a business intelligence dashboard, you could drill down from a divisional level summary expense report to a record of a single expense approval made just a few days ago). This is not the case in Latvia except for some big companies. At the same time, I found myself telling people at some journalist cocktail party how advanced Latvian IT skills and services were in companies such as Dati, Exigen, IT Alise, Lattelekom, how stuff like GREID (the secret, in part, of Exigen's success). It's kind of a paradox. Gotta run now...
Sunday, December 05, 2004
New PM to review third licence auction terms
To catch up with some Latvian developments even as I write here on a sunny San Francisco morning, the new Prime Minister Aigars Kalvitis has said he wants to "review" the terms of the auction for Latvia's third GSM and UMTS mobile operator licence.
That auction was announced on November 23, the applications to be short-listed must be filed by December 21, and the auction itself will be held January 7. Applicants should be ready to bid starting at LVL 1.3 million and to invest at least EUR 150 million in a new, independent network.
All of which, as I wrote earlier, sounds suspiciously like the offer from International Telecommunications and Technology (IT&T), which appeared out of nowhere in early November. IT&T, contrary to my earlier remarks, appears to be a real company, some kind of international consortium. They have been planning to come into the Latvian market for about a year, aided by a local entrepreneur who, in the past, had done some deals in the real estate business with the current minister of transport, Ainars Slesers.
The Latvian Telecommunications Association has also demanded that the auction application deadline be extended by at least a month and that the requirement to invest a rather enormous minimal amount be striken.
All of this makes the new Prime Minister's willingness to review and perhaps modify the auction terms a reasonable gesture. The political nuance here is that even if Slesers and IT&T's local consultant had never done any business at all, the "review" amounts to questioning the judgement of the new/old minister of transport even before the ink on the new coalition government's policy declaration has dried.
That, of course, is a political, not a IT/telecoms issue, but it does not bode well for the stability of the coalition. The PM, by changing the terms of the auction would, in effect, be expressing diminished confidence in his minister of transport for something Slesers was working on in both the old and new governments. Indeed, those who actually drafted and signed the auction terms (Vilis Zvidrins of the Ministry of Transport Communications Department) seem to say the main reason the terms are as they are is that Slesers asked them to do it that way.
According to this blogger's sources, Communication Department head Raimonds Bergmanis was more than glad to be on vacation when the decision to call the auction was approved.
On the other hand, one can admire Slesers' "can do" approach to moving ahead quickly in developing a more competitive telecommunications market, just as he is understood to be behind the entry of Ryanair and Easyjet into Latvia's aviation market. But the downside of haste in getting a third (fourth, really, if you follow this blog) mobile operator up and running is that you may scare off the understandably cautious, internationally known majors such as Vodaphone or Bell Mobility (Canada) and even Latvia's Baltcom, where owner Peteris Smidre has never been known to shun risk. Then, when a little known company, which in all probablity is legitimate, comes in the way IT&T is doing it, you create a climate of suspicion of impropriety. Although, actually, such a climate is the prevailing weather system in Latvian politics...
That auction was announced on November 23, the applications to be short-listed must be filed by December 21, and the auction itself will be held January 7. Applicants should be ready to bid starting at LVL 1.3 million and to invest at least EUR 150 million in a new, independent network.
All of which, as I wrote earlier, sounds suspiciously like the offer from International Telecommunications and Technology (IT&T), which appeared out of nowhere in early November. IT&T, contrary to my earlier remarks, appears to be a real company, some kind of international consortium. They have been planning to come into the Latvian market for about a year, aided by a local entrepreneur who, in the past, had done some deals in the real estate business with the current minister of transport, Ainars Slesers.
The Latvian Telecommunications Association has also demanded that the auction application deadline be extended by at least a month and that the requirement to invest a rather enormous minimal amount be striken.
All of this makes the new Prime Minister's willingness to review and perhaps modify the auction terms a reasonable gesture. The political nuance here is that even if Slesers and IT&T's local consultant had never done any business at all, the "review" amounts to questioning the judgement of the new/old minister of transport even before the ink on the new coalition government's policy declaration has dried.
That, of course, is a political, not a IT/telecoms issue, but it does not bode well for the stability of the coalition. The PM, by changing the terms of the auction would, in effect, be expressing diminished confidence in his minister of transport for something Slesers was working on in both the old and new governments. Indeed, those who actually drafted and signed the auction terms (Vilis Zvidrins of the Ministry of Transport Communications Department) seem to say the main reason the terms are as they are is that Slesers asked them to do it that way.
According to this blogger's sources, Communication Department head Raimonds Bergmanis was more than glad to be on vacation when the decision to call the auction was approved.
On the other hand, one can admire Slesers' "can do" approach to moving ahead quickly in developing a more competitive telecommunications market, just as he is understood to be behind the entry of Ryanair and Easyjet into Latvia's aviation market. But the downside of haste in getting a third (fourth, really, if you follow this blog) mobile operator up and running is that you may scare off the understandably cautious, internationally known majors such as Vodaphone or Bell Mobility (Canada) and even Latvia's Baltcom, where owner Peteris Smidre has never been known to shun risk. Then, when a little known company, which in all probablity is legitimate, comes in the way IT&T is doing it, you create a climate of suspicion of impropriety. Although, actually, such a climate is the prevailing weather system in Latvian politics...
Your blogger is in San Francisco
I'm in San Francisco to cover the Oracle OpenWorld event for my day job (Oracle in Latvia sponsored me). If there's anything of interest on the IT side with a Latvian angle or that generates interesting thoughts about IT in Latvia (as for uses of big corporate Oracle systems, count 'em, but don't bother your left hand to help with the count if it's doing something else). Nonetheless, the keynotes by Carly Fiorina (Hewlett Packard), Scott McNealy (of Sun, the nemesis of Microsoft), Micheal Dell, etc. promise to be interesting. Hope to do an interview with Exigen, too.
If I have the time, watch this spot.
If I have the time, watch this spot.
Wednesday, December 01, 2004
Third licence contender in Latvia looks for real
One of the pleasures of blogging is that you can correct your own misapprehensions or mistakes. It now seems that International Telecommunications and Technologies (IT-T), which I dismissed as a "Nigerian letter" company in an earlier post, is more real that I thought and quite serious about buying the third Latvian GSM and UMTS licence at a hastily organized auction. I talked to IT-T's chief operating officer Nicolas Abinader in Beirut and his local consultant, the Latvian entrepreneur Edgars Zakrizevskis.
Mr. Abinader says the company is an international consortium of carriers, operators and technology providers that includes participants from Switzerland, Spain, France and the United Arab Emirates (perhaps other countries, as well). There will be complete disclosure of the composition of IT-T once the pre-selection application is filed by December 21. The Ministry of Transport, which announced the licence auction on November 23, set the starting price at LVL 1.3 million and a condition that at least EUR 150 million be invested in building an independent, nationwide network.
This, to some commentators, sounds disturbingly similar to the offer made by IT-T in the letter I wrote about earlier, where they said they would pay LVL 1.3 million for a licence (GSM, UMTS and CDMA-450) and invest between EUR 150 -220 million. Janis Lelis, the managing director of the Latvian Telecommunications Association has been outraged by the auction terms, calling the deadlines impossible to meet by any professional operator, and describing the requirements for a nationwide independent network and a minimum EUR 150 million investment as irrational, if not something worse. Mr. Lelis points out that a cost-conscious operator would try to cut investment costs while still meeting network build-out requirements.
A source speaking to this blogger with the understanding his identity would not be disclosed went even further and called the whole arrangement "corrupt" and clearly aimed at giving the licence to IT-T to the exclusion of other contenders. IT-T has been preparing to enter the Latvian market for about a year, according to Mr. Zakrizevskis, who has been the group's local consultant.
Mr. Zakrizevskis strongly denied any favoritism or that Minister of Transport Ainars Slesers, with whom he has been linked in a number of real-estate transactions some years ago, was lobbying the Lebanon-based company. He also stressed that he had had dealings with a number of persons in Latvia who later entered politics, but this did not mean any special relationships continued when they came into public office. The Latvian enterpreneur, who has mainly worked in real estate development, described his role as a generator of project ideas which he often finances at a very early stage (research, etc.) and agreed that he was something like an "angel investor" in the US.
Still, the fact that IT-T has apparently gotten the jump on everyone else (it is starting a Latvian subsidiary as required by the auction terms -- something that can take several weeks) is likely to raise eyebrows. Before it was known that IT-T was participating in the auction, several analysts this blogger spoke to (for an article in my "day job" at Dienas bizness) said they though the auction of the third would probably fail, as it did in 2002.
Mr.Zakrizevskis also disclosed that the long-term goal of IT-T, as he understood it (he did not pretend to speak for the company) was to create a demonstration project for later moving into the Russian market. He also indicated that IT-T intended to become a pan-Baltic operator, probably in all three technologies --GSM, UMTS, and CDMA-450 (although in Estonia, there already are three operators).
After all is said, the whole business does look a little strange, but I've let the parties speak for themselves, which is what a journalist/blogger must do...
Mr. Abinader says the company is an international consortium of carriers, operators and technology providers that includes participants from Switzerland, Spain, France and the United Arab Emirates (perhaps other countries, as well). There will be complete disclosure of the composition of IT-T once the pre-selection application is filed by December 21. The Ministry of Transport, which announced the licence auction on November 23, set the starting price at LVL 1.3 million and a condition that at least EUR 150 million be invested in building an independent, nationwide network.
This, to some commentators, sounds disturbingly similar to the offer made by IT-T in the letter I wrote about earlier, where they said they would pay LVL 1.3 million for a licence (GSM, UMTS and CDMA-450) and invest between EUR 150 -220 million. Janis Lelis, the managing director of the Latvian Telecommunications Association has been outraged by the auction terms, calling the deadlines impossible to meet by any professional operator, and describing the requirements for a nationwide independent network and a minimum EUR 150 million investment as irrational, if not something worse. Mr. Lelis points out that a cost-conscious operator would try to cut investment costs while still meeting network build-out requirements.
A source speaking to this blogger with the understanding his identity would not be disclosed went even further and called the whole arrangement "corrupt" and clearly aimed at giving the licence to IT-T to the exclusion of other contenders. IT-T has been preparing to enter the Latvian market for about a year, according to Mr. Zakrizevskis, who has been the group's local consultant.
Mr. Zakrizevskis strongly denied any favoritism or that Minister of Transport Ainars Slesers, with whom he has been linked in a number of real-estate transactions some years ago, was lobbying the Lebanon-based company. He also stressed that he had had dealings with a number of persons in Latvia who later entered politics, but this did not mean any special relationships continued when they came into public office. The Latvian enterpreneur, who has mainly worked in real estate development, described his role as a generator of project ideas which he often finances at a very early stage (research, etc.) and agreed that he was something like an "angel investor" in the US.
Still, the fact that IT-T has apparently gotten the jump on everyone else (it is starting a Latvian subsidiary as required by the auction terms -- something that can take several weeks) is likely to raise eyebrows. Before it was known that IT-T was participating in the auction, several analysts this blogger spoke to (for an article in my "day job" at Dienas bizness) said they though the auction of the third would probably fail, as it did in 2002.
Mr.Zakrizevskis also disclosed that the long-term goal of IT-T, as he understood it (he did not pretend to speak for the company) was to create a demonstration project for later moving into the Russian market. He also indicated that IT-T intended to become a pan-Baltic operator, probably in all three technologies --GSM, UMTS, and CDMA-450 (although in Estonia, there already are three operators).
After all is said, the whole business does look a little strange, but I've let the parties speak for themselves, which is what a journalist/blogger must do...
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