Year end WRAP- 1Q: Japan devastated by natural disasters
All this week we’ll be reviewing the biggest stories of 2011, starting today with a look at what hit the headlines in the first quarter.
The first three months were dominated by a massive earthquake and tsunami in Japan in March, and Nokia’s decision to partner with Microsoft to deploy the software giant’s Windows Phone 7 software on its smartphones.
Damage caused by the Japanese natural disasters slashed silicon production by a quarter. While output of wafers, printed circuit boards and semiconductors fell, vendor’s high stock levels of the components meant they didn’t feel the effect of the slowdown until later in the year.
Nokia revealed it had partnered with Microsoft to make Windows Phone 7 the default operating system on its high-end smartphones.
Stephen Elop, Nokia’s new chief executive, claimed the firm had jumped from a burning platform though blogger Tony Poulos questioned whether that leap took the firm onto a leaky life raft rather than the solid ground the deal was intended to deliver.
The deal seemed stacked in Microsoft’s favor, given the firm’s struggle to transfer its dominance of desktop PC software to mobile devices, and resulted in plenty of questions about what would happen to Nokia’s current handset software – which the firm later answered by handing off control of Symbian development to consultancy Accenture.
Despite the collaboration, credit agency Standard and Poor’s issued its first downgrade on Nokia citing concerns the vendor’s market share would continue to slide before the first Windows Phone 7 devices hit stores.
Google chief Eric Schmidt later admitted he was disappointed to have been beaten to the punch by Microsoft, but refused to rule out a later collaboration with the Finnish vendor.
Schmidt’s admission came a matter of weeks after he revealed he would step down from the chief’s post in April, passing the baton to co-founder Larry Page. The move didn’t signal the end of Schmidt’s involvement with Google, as he remains chairman of the board.
Huawei scored the first win in scores of patent battles that have permeated 2011, after a US district court put the stoppers on Nokia Siemens plans to buy Motorola Mobility’s infrastructure assets for $1.2 billion (€919 million).
The Chinese vendor claimed intellectual property supplied to Motorola as part of previous deals with the US firm was included in the proposed sale, leading the court to order Motorola not to disclose any confidential information to NSN.
Nokia Siemens eventually settled the suit with Huawei in April, but cut its purchase price to $975 million to account for the cost of the lawsuit.
The European Commission (EC) began scrutinizing Chinese vendors Huawei and ZTE during the quarter, first examining modem imports at the request of German firm 4G Systems, then probing government backing of the pair.
Spain and Hungary were also EC targets, with formal requests made to each country to open up 900MHz spectrum for mobile internet services.
In the UK, regulator Ofcom cleared carriers to refarm 2G spectrum for 3G services, bringing the country inline with two European Commission directives covering GSM and radio spectrum.
Mobile banking picked up speed during the quarter. Vodafone detailed a scheme in India via a partnership with ICICI Bank, the country’s largest private bank, while Telefonica established a mobile banking joint venture with credit firm MasterCard in Latin America.
French carriers France Telecom, Bouygues Telecom and SFR teamed up with European secure payments firm Atos Origin to launch a mobile payment service.
France Telecom teamed with Deutsche Telekom to cut the cost of developing new services. The initial agreement covered Wi-Fi user experience and machine-to-machine (M2M) technology, and was later extended to cover joint procurement of telecoms equipment.
Russian carriers also teamed up during the quarter, as the country detailed plans for 4G start-up Yota to handle LTE rollout for the country’s four established carriers – MegaFon, MTS, VimpelCom and Rostelecom.
Research firm Coleago Consulting claimed Sweden’s 4G auction came up short, revealing the amount raised per MHz/PoP was 63% lower than that generated in Germany’s auction. The sale raised a total of 2.05 billion Swedish Krona (€226 million).
Security firm Arbor Networks revealed mobile operators were the weak link in network security, after the number of distributed denial of service (DDoS) attacks doubled in 2010.
And the Broadband Forum aided the shift to IPv6 by approving several technical architectures to overcome perceived hurdles in the transition from IPv4.