March 29, 2024

Raw Data: Deutsche Telekom, Data Use and ‘Net Neutrality’

Deutsche Telekom, the former monopoly that controls 60 percent of broadband Internet connections in the country, said April 22 that it would impose hard-and-fast download limits on all customers of its home Internet service, starting in 2016.

Deutsche Telekom said that soaring data traffic, which is expected to quadruple by 2016, would force it to impose limits that had been applied only to mobile users.

Under a new pricing plan, Deutsche Telekom would slow landline Internet customers to a rate of 384 kilobits a second, once the download limit is reached, which for many consumers would be at 75 gigabytes of downloads per month — enough to send more than 15,000 e-mails or download and watch 100 movies. The operator said it planned to sell upgrades that would let consumers increase their limits.

The Deutsche Telekom proposal is controversial not only because it would impose the nation’s first comprehensive download limits on landline broadband service; Deutsche Telekom also plans to exempt from the limits the traffic generated by its own Internet television service, Entertain. At the same time, the operator does not plan to exempt the traffic of rival services, like YouTube, from Google; iTunes, from Apple; or Facebook.

“With Entertain, customers are paying for television, so we will make sure they aren’t sitting in front of a black screen,” said Michael Hagspihl, the Deutsche Telekom head of marketing.

In Germany, the announcement has provoked scrutiny. The country’s telecom regulator, the Bundesnetzagentur, said it would review the new tariff structure for potential violations of network neutrality principles, which generally hold that the government and Internet service providers should not discriminate or charge differently, based on the customer or the type of content.

Additionally, in the European Union, operators are barred from selectively blocking services of Web-based rivals for financial gain.

The German economics minister, Philipp Rösler, said his agency would scrutinize the legality of Deutsche Telekom’s plans. So did the German consumer protection minister, Ilse Aigner.

A group representing small and midsize businesses said the new broadband tariffs would lead to significant price increases for small businesses and the self-employed, who typically spend more time than most consumers surfing the Web.

“The massive restrictions planned by the leading provider of Internet in Germany would not only significantly affect consumers but especially freelancers and the self-employed, who would be thrown back to the 1990s in terms of Internet speeds,” said Oliver Grün, the president of Bundesverband IT Mittelstand, which represents 800 small and midsize businesses.

Deutsche Telekom has said that most German consumers average 20 gigabytes of data downloads a month and will not be affected by the new limits.

But consumer groups and government overseers are wary. In Germany, two rivals, 11, a reseller of Deutsche Telekom broadband service, and Kabel Deutschland, the country’s biggest cable television operator, have both introduced download limits on their Internet services, but only on the least expensive monthly packages.

Deutsche Telekom has so far not said what its new broadband fees will be. Christian Fronczak, a spokesman for Ms. Aigner, said the consumer protection agency was worried that Deutsche Telekom would create a class system in which surfing would be available only to those consumers who could afford it.

Philipp Blank, a Deutsche Telekom spokesman, said the operator did not plan to release the fees it intended to charge for broadband upgrades until the limits were implemented in 2016.

“It is very difficult in this dynamic industry to say where prices will be in 2016,” Mr. Blank said by telephone.

But the company’s current rates at its T-Mobile Germany wireless subsidiary, where mobile phone customers can double their monthly download allowances by purchasing an upgrade for €5, should serve as “an orientation point” for where the landline fees might eventually be set, Mr. Blank said.

Article source: http://www.nytimes.com/2013/05/13/technology/deutsche-telekom-data-use-and-net-neutrality.html?partner=rss&emc=rss

DealBook: Deutsche Telekom Sweetens T-Mobile Bid for MetroPCS

A MetroPCS store in Manhattan.Mary Altaffer/Associated PressA MetroPCS store in Manhattan.

6:07 p.m. | Updated

Deutsche Telekom sweetened a bid by its T-Mobile USA unit for MetroPCS on Wednesday, after running into fierce resistance from shareholders of the target company.

The German telecommunications firm offered to cut the amount of debt that the combined company will bear by about $3.8 billion, and to reduce the interest rate by half a percentage point. It also agreed to extend a lockup period in which the company cannot sell shares in the merged cellphone service provider to 18 months from 6 months.

The move will essentially improve the overall value of the merged entity’s equity. Deutsche Telekom estimates that the lower debt and interest rate will add almost $3 a share in additional value for MetroPCS shareholders.

Under the present terms of the offer, MetroPCS shareholders would be paid about $4.09 a share and receive a 26 percent stake in the combined company.

Deutsche Telekom said that its latest proposal was “best and final.” A vote on the deal, which had been set for Friday, has been rescheduled to April 24.

The move is a win for investors like the hedge funds Paulson Company and P. Schoenfeld Asset Management, who have called for improvements to the original offer. Shares in MetroPCS risen steadily this year, as shareholders expected an improved offer to come, and people involved in the merger have said that the current offer is likely to fail if put to a vote.

Paulson Company and P. Schoenfeld have argued that the T-Mobile bid as it stands would add too much debt and at too high a price. They have called on Deutsche Telekom to reduce the amount of leverage on the combined American telecom.

Proxy advisory firms like Institutional Shareholder Services have largely sided with the hedge funds, putting additional pressure on Deutsche Telekom to consider raising its offer.

P. Schoenfeld said in a statement that it was pleased by the new offer, though it is currently reviewing its terms.

Article source: http://dealbook.nytimes.com/2013/04/10/deutsche-telekom-said-ready-to-sweeten-t-mobile-bid-for-metropcs/?partner=rss&emc=rss

DealBook: Deutsche Telekom Walks Back Prior Statement on Sweetening MetroPCS Bid

It appears Deutsche Telekom has finally settled on its response to queries about whether it will raise a bid by its T-Mobile USA subsidiary for MetroPCS.

And that answer is, “No comment.”

Here’s what the German telecom company said on Thursday afternoon:

“In response to a variety of published rumors and reports, Deutsche Telekom clarifies that it has no comment as to possible changes to the terms of its agreement with MetroPCS Communications. Deutsche Telekom continues to believe that its existing agreement with MetroPCS provides compelling value and is in the best interests of MetroPCS stockholders, especially in light of the accelerating turnaround at T-Mobile USA.”

But earlier in the day, a Deutsche Telekom spokesman gave a slightly different answer to Reuters, which had reported that the company’s board was working on sweetening the MetroPCS offer, citing unnamed sources.

“No, we can flatly deny that,” the representative told Reuters.

The German company and its advisers are weighing whether to make a better bid, as the current offer faces enormous opposition from MetroPCS shareholders. Two of the American telecom’s biggest investors have argued that the offer should be improved or scrapped, and recently won the backing of the two major proxy advisory firms.

Under the current terms of the offer, MetroPCS shareholders would be paid about $4.09 a share and receive a 26 percent stake in the combined company.

The hedge funds leading the campaign against the deal, P. Schoenfeld Asset Management and Paulson Company, have argued that MetroPCS investors should receive a bigger stake in the merged telecom. They have also contended that the proposed terms of the debt that the combined company would assume are too onerous.

Article source: http://dealbook.nytimes.com/2013/04/04/deutsche-telekom-walks-back-prior-statement-on-sweetening-metropcs-bid/?partner=rss&emc=rss

Raw Data: A New Chance to Organize the E.U. Telecommunications Industry

BERLIN — Imagine that the U.S. market for telecommunications was carved up by 200 operators owned by 45 rival companies, each able to sell phone and broadband Internet service only in individual states or, at best, small regions.

Consumers could face arbitrarily high costs just to call a neighboring state or town. Businesses wanting to sell service nationally through mergers or network-sharing arrangements could be impeded by a patchwork of conflicting market rules.

That, with a few exceptions, is the status quo in the European Union, a trading bloc of 500 million consumers and 27 countries whose fragmented legal systems and competing national agendas have largely thwarted a single Continental market in telecommunications.

For nearly 20 years, European lawmakers have tinkered on the edges, but because of national objections, they have been able to exert only limited control from Brussels, except in rare cases, like the 2007 law capping mobile roaming prices.

But with economic growth in the bloc near the top of policy makers’ agenda, the Continent’s balkanized telecommunications industry is coming under new scrutiny, which may create an opportunity to dismantle some of the structural obstacles to a single market.

Signs of those changes are beginning to appear.

In December, Joaquín Almunia, the European competition commissioner, allowed 3, an operator based in Hong Kong, to buy a rival, Orange Austria, from France Télécom, in a $1.7 billion fusion that reduced the number of national network operators in the country to three from four. Mr. Almunia had met last year privately with the chief executives of Europe’s largest operators — Deutsche Telekom, Vodafone, Telefónica, France Télécom and others — who urged him to set lower hurdles to takeovers.

This year, Neelie Kroes, the European commissioner for the digital agenda, plans a series of measures to lower national barriers to consolidation and network sharing. The most far-reaching would require operators to lease networks to competitors on fair terms, but crucial details like pricing and sanctions for noncompliance have yet to be resolved.

She also wants to refine existing regulations on universal service obligations and net neutrality to prohibit operators from favoring the data traffic of better-paying customers at the expense of the masses. By limiting an operator’s ability to exploit the existing national oligopolies, Ms. Kroes hopes to goad operators to cooperate.

“I have long said that cross-border consolidation amongst telecom operators would help reduce fragmentation in Europe,” she wrote in an e-mail message.

But Ms. Kroes, a Dutch economist who dislikes heavy-handed regulation, prefers to promote change by offering incentives to the industry. A panel of telecommunications chief executives serves as advisers, and she has no plan to mandate change from Brussels by giving real power to the Body of European Regulators of Electronic Communications, or Berec. The panel of the 27 national regulatory chiefs set up in 2011 only advises the commission and cannot set policy in individual countries.

In 2009, when Ms. Kroes’s predecessor, Viviane Reding, proposed to set up Berec, she tried to invest the agency with the power to veto national decisions. But Ms. Reding, now the European justice commissioner, was blocked by E.U. countries, which feared a veto could be used to penalize former national phone monopolies, most of them still major employers.

But without clear lines of authority, E.U. policy tinkering alone may not be enough to untangle the national barriers to a single telecommunications market and create conditions for regional, head-to-head competition among big operators.

Even the concept of regional operators is controversial. Smaller operators generally oppose letting their big rivals get bigger, arguing they could then use their clout to squelch competitors across regions, not just nationally.

And some big operators, while lobbying for easier terms for cross-border mergers, are not above trying to block those same unions when they may be to their disadvantage. In December, Deutsche Telekom, for example, filed a lawsuit in Austria to delay the 3-Orange merger, which created a bigger challenger to T-Mobile Austria, its subsidiary.

But a Vienna appeals court, the Oberverwaltungsgericht, rejected the German operator’s argument and the fusion, possibly the first of many in the sector, began on Jan. 3.

Article source: http://www.nytimes.com/2013/02/18/technology/18iht-rawdata18.html?partner=rss&emc=rss

Few Options For a Lagging T-Mobile

After ATT said on Monday that it would abandon its $39 billion proposal to buy the smaller wireless carrier, T-Mobile was at a loss to explain what its strategy will be. “There’s no Plan B,” said Andreas Fuchs, a spokesman for Deutsche Telekom, the German telecommunications company that owns and operates T-Mobile. “We’re back at the starting point.”

Industry analysts also could not predict a course for the company. “T-Mobile is probably going to be profoundly damaged by this,” said Tero Kuittinen, a senior analyst at M.G.I. Research. “They should have done some strategic rethinking instead of chasing this mirage, this dream of a merger. Now they’ve lost a lot of time.”

The merger had been seen as a last-ditch effort to salvage T-Mobile’s weak finances and dwindling pool of subscribers, many of whom were jumping to the larger carriers Verizon Wireless, ATT and Sprint. The deal dissolved after government regulators raised antitrust concerns and skepticism over the benefits of the merger.

Some analysts thought that T-Mobile might pursue a partnership with another wireless carrier, or even the satellite TV operator Dish, which had expressed interest if the deal with ATT did not go through. Mr. Fuchs declined to comment on speculation about alliances with a new partner in the United States.

Short of another merger, though, T-Mobile does not have a lot of attractive options, analysts said. “Both companies will have to go back and lick their respective wounds and consider their options,” said Craig Moffett, a research analyst with Sanford C. Bernstein Company.

T-Mobile is in a precarious position because it has not yet begun to significantly deploy its infrastructure for a speedy fourth-generation, or 4G, network. That tardiness could cause it to slide even further behind the three larger competitors.

The carrier is already far behind. This year so far, while both ATT and Verizon have each added more than five million wireless subscribers, T-Mobile lost 23,000 customers, according to Chetan Sharma, an independent mobile researcher and analyst. Even Sprint, which has struggled against ATT and Verizon, added almost 3.5 million wireless customers during the first three quarters of the year.

Even without a strong 4G network, T-Mobile’s spectrum is still a valuable asset. The company could negotiate with Sprint to share its 4G infrastructure. In the United States, carriers have historically not done that, but it is a common practice in other countries, like China, where ATT recently agreed to share a cell network with China Telecom. Recent upgrades to Sprint’s network, which is not compatible with T-Mobile’s infrastructure, have been designed to help Sprint’s towers host other spectrum bands. That could help bridge the technical incompatibility issues between Sprint and T-Mobile.

“Looking forward, the problems that existed before that would prevent Sprint and T-Mobile from working together are less problematic now, given Sprint’s new network architecture,” said Charles Golvin, a wireless analyst at Forrester Research. “And devices will increasingly be able to at least have the technology in place to access both networks.”

Other analysts are skeptical. Mr. Moffett, the Bernstein analyst, pointed out that in a conference call with reporters on Tuesday, René Obermann, the chief executive of Deutsche Telekom, made it clear that he was still actively looking for a way to withdraw the company’s foothold in the United States. Even if T-Mobile were to try a partnership with a candidate like Sprint, Mr. Moffett said, it is unlikely that it would get a green light, given the obstacles that ATT faced while trying to get approval from the Justice Department and the Federal Communications Commission.

“It’s unlikely that T-Mobile would enter into another merger in the U.S.,” Mr. Moffett said, adding that the Justice Department “wants four competitors in this market, not three.”

A few analysts say that a bid from a technology company like Google, which recently announced plans to buy Motorola Mobility, or Facebook, which works closely with Skype, or even Amazon could help those companies better leverage sales of their own devices and communication services. But they are likely “out of the question,” said Mark Winther, group vice president of telecommunications analysis at IDC, a research firm. He thinks they would be unlikely to invest in a beleaguered company caught in the middle of an extremely tough business.

“At some point the government’s going to have to say, what we’re left with are two relatively strong players, ATT and Verizon, and two really weak players — and one really, really weak player is T-Mobile,” Mr. Winther said. “Does the government really want that?”

Spectrum is increasingly crucial to a network’s quality and service, given the growing appetite among consumers for smartphones and tablets and the bandwidth-guzzling applications and services that run on them.

ATT’s chief rival, Verizon, is rapidly expanding its 4G network known as L.T.E. and recently struck a $3.6 billion deal with several cable companies for wireless spectrum. The deal has still not received government approval.

As a condition of the dissolution of the T-Mobile deal, ATT will pay Deutsche Telekom a $3 billion cash payment, as well as transfer $1 billion in wireless equipment to the smaller carrier.

But that compensation is not significant enough to finance the development of a next-generation wireless network, analysts say, at least not over the long term. T-Mobile will gain some access to ATT’s network as part of a seven-year roaming agreement that is also a condition of the breakup, but T-Mobile is likely to need more bandwidth than that to support the growing demands of consumers on its network.

“With the spectrum we’re getting, we have a better chance of expanding the network in many markets,” Mr. Obermann said during the conference call with reporters. “That is not a final solution. In the long term, we need more spectrum and network capacity. We are working on that.”

“Probably the only people rejoicing at the news are the current T-Mobile customers,” said Mr. Golvin. “Most of them weren’t happy about being pushed onto ATT.”

But even that celebratory period might be short-lived, he said.

“If T-Mobile finds itself unable to invest in the network, that leads to a decline in service for customers and no one is happy,” he said.

Kevin J. O’Brien contributed reporting from Berlin.

Article source: http://feeds.nytimes.com/click.phdo?i=6c7a56d0071e200dc4abd7dea737f375

It’s Tracking Your Every Move and You May Not Even Know

But as a German Green party politician, Malte Spitz, recently learned, we are already continually being tracked whether we volunteer to be or not. Cellphone companies do not typically divulge how much information they collect, so Mr. Spitz went to court to find out exactly what his cellphone company, Deutsche Telekom, knew about his whereabouts.

The results were astounding. In a six-month period — from Aug 31, 2009, to Feb. 28, 2010, Deutsche Telekom had recorded and saved his longitude and latitude coordinates more than 35,000 times. It traced him from a train on the way to Erlangen at the start through to that last night, when he was home in Berlin.

Mr. Spitz has provided a rare glimpse — an unprecedented one, privacy experts say — of what is being collected as we walk around with our phones. Unlike many online services and Web sites that must send “cookies” to a user’s computer to try to link its traffic to a specific person, cellphone companies simply have to sit back and hit “record.”

“We are all walking around with little tags, and our tag has a phone number associated with it, who we called and what we do with the phone,” said Sarah E. Williams, an expert on graphic information at Columbia University’s architecture school. “We don’t even know we are giving up that data.”

Tracking a customer’s whereabouts is part and parcel of what phone companies do for a living. Every seven seconds or so, the phone company of someone with a working cellphone is determining the nearest tower, so as to most efficiently route calls. And for billing reasons, they track where the call is coming from and how long it has lasted.

“At any given instant, a cell company has to know where you are; it is constantly registering with the tower with the strongest signal,” said Matthew Blaze, a professor of computer and information science at the University of Pennsylvania who has testified before Congress on the issue.

Mr. Spitz’s information, Mr. Blaze pointed out, was not based on those frequent updates, but on how often Mr. Spitz checked his e-mail.

Mr. Spitz, a privacy advocate, decided to be extremely open with his personal information. Late last month, he released all the location information in a publicly accessible Google Document, and worked with a prominent German newspaper, Die Zeit, to map those coordinates over time.

“This is really the most compelling visualization in a public forum I have ever seen,” said Mr. Blaze, adding that it “shows how strong a picture even a fairly low-resolution location can give.”

In an interview from Berlin, Mr. Spitz explained his reasons: “It was an important point to show this is not some kind of a game. I thought about it, if it is a good idea to publish all the data — I also could say, O.K., I will only publish it for five, 10 days maybe. But then I said no, I really want to publish the whole six months.”

In the United States, telecommunication companies do not have to report precisely what material they collect, said Kevin Bankston, a lawyer at the Electronic Frontier Foundation, who specializes in privacy. He added that based on court cases he could say that “they store more of it and it is becoming more precise.”

“Phones have become a necessary part of modern life,” he said, objecting to the idea that “you have to hand over your personal privacy to be part of the 21st century.”

In the United States, there are law enforcement and safety reasons for cellphone companies being encouraged to keep track of its customers. Both the F.B.I. and the Drug Enforcement Administration have used cellphone records to identify suspects and make arrests.

If the information is valuable to law enforcement, it could be lucrative for marketers. The major American cellphone providers declined to explain what exactly they collect and what they use it for.

Verizon, for example, declined to elaborate other than to point to its privacy policy, which includes: “Information such as call records, service usage, traffic data,” the statement in part reads, may be used for “marketing to you based on your use of the products and services you already have, subject to any restrictions required by law.”

ATT, for example, works with a company, Sense Networks, that uses anonymous location information “to better understand aggregate human activity.” One product, CitySense, makes recommendations about local nightlife to customers who choose to participate based on their cellphone usage. (Many smartphone apps already on the market are based on location but that’s with the consent of the user and through GPS, not the cellphone company’s records.)

Because of Germany’s history, courts place a greater emphasis on personal privacy. Mr. Spitz first went to court to get his entire file in 2009 but Deutsche Telekom objected.

For six months, he said, there was a “Ping Pong game” of lawyers’ letters back and forth until, separately, the Constitutional Court there decided that the existing rules governing data retention, beyond those required for billing and logistics, were illegal. Soon thereafter, the two sides reached a settlement: “I only get the information that is related to me, and I don’t get all the information like who am I calling, who sent me a SMS and so on,” Mr. Spitz said, referring to text messages.

Even so, 35,831 pieces of information were sent to him by Deutsche Telekom as an encrypted file, to protect his privacy during its transmission.

Deutsche Telekom, which owns T-Mobile, Mr. Spitz’s carrier, wrote in an e-mail that it stored six months’ of data, as required by the law, and that after the court ruling it “immediately ceased” storing data.

And a year after the court ruling outlawing this kind of data retention, there is a movement to try to get a new, more limited law passed. Mr. Spitz, at 26 a member of the Green Party’s executive board, says he released that material to influence that debate.

“I want to show the political message that this kind of data retention is really, really big and you can really look into the life of people for six months and see what they are doing where they are.”

While the potential for abuse is easy to imagine, in Mr. Spitz’s case, there was not much revealed.

“I really spend most of the time in my own neighborhood, which was quite funny for me,” he said. “I am not really walking that much around.”

Any embarrassing details? “The data shows that I am flying sometimes,” he said, rather than taking a more fuel-efficient train. “Something not that popular for a Green politician.”


Article source: http://feeds.nytimes.com/click.phdo?i=38c432502d7ba7005186034066bb2775