Connect with us

Cars

Telcos flailing against tide to turn into dumb pipes

Published

on


(Image: Chris Duckett/ZDNet)

It’s a funny quirk of 21st century economics that public companies can be profitable, but just not profitable enough, and few sectors feel the need to reinvent themselves into super-profit machines more than telecommunications carriers.

In the modern day, it is an exceptional listed company that is happy to function as a data-passing business with a small percentage of profit on top without any of the bells and whistles that promise to be either the next big thing or the savior of the industry.

Thanks to being in Sydney, my primary examples will be Australian-based, but it is symptomatic of trends happening around the world.

A couple of years ago, faced with the prospect of much of its wholesale business disappearing thanks to the National Broadband Network (NBN), Telstra decided it would be moving beyond being a telecommunications company, and would now be a technology firm.

“This sentiment is behind the evolution of Telstra’s brand. Telstra is evolving from a telco to a techco — to be a world-class technology company empowering people to connect,” then-Telstra CMO Joe Pollard said in 2016.

“Our brand needs to reflect this, and demonstrate there are better ways for everyone to thrive in this connected world.”

Telstra was fresh off landing former Nokia CEO Stephen Elop, who was tasked with handling the strategy shift.

Fast forward two years, Elop is no longer at the company and Telstra’s technology plays have been hit and miss.

In the U.S., Verizon aimed to be a media player via the acquisitions of AOL and Yahoo. Those purchases combined to create Oath, but haven’t diversified Verizon’s revenue stream. Verizon will live and die with its wireless business. AT&T acquired Time Warner to break into media, but the wireless business carries the day. Resisting being a dumb pipe company gets expensive.

The most spectacular miss could end up being the AU$220 million contract signed in 2016 to construct and run the Australian National Cancer Screening Register for five years, which an audit committee called out for serious underperformance by Telstra Health and said the government should consider killing the contract or imposing penalties on Telstra.

Also see: What is 5G? Everything you need to know about the new wireless revolution | 5G technology: A business leader’s guide (Tech Pro Research) | All 5G stories | CNET: 5G is almost a reality. Here’s what it’ll really feel like

Being able to build and run IT infrastructure for a government that has a track record of handling IT badly should have been a slam dunk, but it was not to be.

At the same time, Australian telcos have been seeking to boost their offerings by including free data from music and video streaming services, and making moves into sporting rights, but Optus found out what can happen when you undershoot the demand for World Cup games.

To understand why telcos are trying anything that could make money, Telstra detailed the extent to which the NBN is carving out its revenue, at the same time as the previous rivers of gold from SMS and other fees begin to dry up and half a billion dollars annually with them.

“The NBN will have reduced Telstra’s net profit after tax by close to a half when fully rolled out. Not a few percent, half,” chair John Mullen said last week.

“To give some scale to that impact, what we are losing through this policy of half our business is approximately equivalent to a company the size of Qantas.”

Pivoting a company the size of a national telco might sound good on paper, but as reality shows, it is quite the challenge.

It is worth noting that even as these searches for revenue replacement have continued, Australian telcos remain quite good at this bit-passing business.

Also: Ericsson: 5G a ‘commercial reality’ as networks sales rise | Edge Computing: The 2 things tech leaders should know | Verizon launches first commercial 5G network, paving way for smart city growth (TechRepublic) | Trump’s FCC bets big on 5G: Here’s how it will change the US economy forever (TechRepublic) | FCC approves faster and cheaper 5G small cell deployments

The next big thing that telcos are banking on is the coming rollout of 5G, but with the Internet of Things (IoT) touted to be one of the major use cases, the future from a telco perspective looks a lot like the past — shunting bits. The tiny low-powered sensors themselves are not going to need much value-add from a telco on an individual level, just a good signal and some software networking higher up the stack.

Despite the need to create the next telco entertainment corp or telco everything-as-a-service arm, the telcos that will survive the shift and intense competition we are seeing will be the ones that are best at providing good networks at reasonable prices.

Dumb pipes might not be sexy as the Silicon Valley darlings, but they will be fundamental in a connected future.

ZDNet’s Monday Morning Opener

The Monday Morning Opener is our opening salvo for the week in tech. Since we run a global site, this editorial publishes on Monday at 8:00am AEST in Sydney, Australia, which is 6:00pm Eastern Time on Sunday in the US. It is written by a member of ZDNet’s global editorial board, which is comprised of our lead editors across Asia, Australia, Europe, and North America.

Previously on Monday Morning Opener:

Source link

Continue Reading
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Cars

Biden EV plan “the largest mobilization of public investment” since WW2

Published

on

The US government plans to replace its fleet of vehicles with electric alternatives, part of a huge public investment in equipment that President Biden says will be the largest since World War II. The goal was announced today, as Biden discussed the Buy American Executive Order and strategies to strengthen American manufacturing and create jobs in the US.

“The federal government also owns an enormous fleet of vehicles,” Biden said during the press conference, “which we’re going to replace with clean electric vehicles made right here in America, creating millions of jobs, a million autoworker jobs, and clean energy, and vehicles that are net-zero emissions. And together this will be the largest mobilization of public investment in procurement, infrastructure, and R&D since World War II.”

Certainly, there’s no shortage of vehicles being used across the government’s various departments. Each year, those departments are required to submit records on owned, leased, and commercially leased vehicles in their fleets. For 2019, civilian agencies owned more than 158,000 vehicles, while military agencies owned more than 62,000 vehicles.

The biggest fleet, however, is used by the US Postal Service. In the 2019 figures, it reported owning more than 224,000 vehicles. Tallied across all the agencies, there’s more than 445,000 owned vehicles on the books, and more than 200,000 leased in some form, with total costs of around $4.4 billion.

Typically, domestic vehicles already far outweigh the use of foreign passenger vehicles and trucks in use by the US government. Indeed, of the roughly 645,000 strong fleet in 2019, only around 6-percent were foreign-made. However, should even a small percentage be replaced with electrified vehicles, that could represent a huge shift in emissions.

The current reporting does not break down the vehicles by drivetrain type – beyond a separate category for low-speed electric vehicles (LSEV) – so it’s unclear how many might already be battery-electric or hybrids.

Still, it’s only in recent years that there have been viable options for replacing mainstream vehicles with zero-emission alternatives, and even then some categories are still awaiting production EVs. Ford and Chevrolet are both preparing electric pickup trucks, as is Tesla, and several American automakers are working on electric SUVs and sedans.

Startups like Rivian and Canoo are developing both passenger cars and SUVs and electric delivery vehicles, while Ford has an e-Transit in the pipeline, an all-electric version of its best-selling van. Earlier this month, GM announced a new brand, BrightDrop, to focus on electric logistics.

“The dollars the federal government spends on goods and services are a powerful tool to support American workers and manufacturers,” the White House said today. “Contracting alone accounts for nearly $600 billion in federal spending. Federal law requires government agencies to give preferences to American firms, however, these preferences have not always been implemented consistently or effectively.”

Full details of today’s executive order are yet to be published in the Federal Register by the government.

Continue Reading

Cars

Arcimoto is planning a tilting electric three-wheeler and it sounds epic

Published

on

Get ready for the electric vehicle market to lean over, with Arcimoto announcing it’s acquired a tilting trike specialist to use the tech in future EV three-wheelers. Based in Oregon, Arcimoto currently offers all-electric vehicles for public and business use, with its FUV – or “Fun Utility Vehicle” – available to preorder from around $18k.

Today’s deal sees Arcimoto snap up Tilting Motor Works, which offers a leaning kit for motorcycles. Its TRiO system can adapt existing bikes, promising to keep their natural lean but adding stability with a second front wheel. It’s currently offered for Harley-Davidson, Honda, and Indian models, priced at $14k plus installation.

Now, TRiO will be used for future Arcimoto trikes. The system will allow the EVs to lean into corners for more engaging driving dynamics, as well as lock upright when at a stop. The extra front wheel aids in traction too, Tilting Motor Works says, as well as improving braking; the company will continue to offer its kits for traditional motorcycles as well.

Arcimoto’s current FUV supports two occupants, sitting one behind the other. It has a 75 mph top speed from dual electric motors, and a range of 102 miles of urban driving; the doors are detachable, and rather than a steering wheel inside there are handlebars with heated grips. Currently, the company is taking preorders in Florida and on the west coast of the US.

It’s not the only vehicle Arcimoto has in mind, however. Late in 2020, the company showed off its latest prototype, a three-wheeler it called the ROADSTER. Roofless, and with a chopped-down windshield, it promises a more traditional take on the electric trike segment.

Electric drive and three wheels is arguably where some of the most interesting experiments are taking place in mobility right now. Last month, for example, we took the ElectraMeccanica Solo EV out for a spin, a single-seat electric trike that aims to reboot commuting. Based on the fact that almost 90-percent of Americans typically drive alone, it trades cabin space and seating for much cheaper running costs.

What it doesn’t do, however, is tilt. For an example of that, you have to look to something like Toyota’s i-ROAD, a distinctive electric three-wheeler that could lean into corners according to how aggressively you steered. Offered in select locations in Japan, and part of Toyota’s aggressive electrification push for the next few years, the i-ROAD was never officially offered in the US.

Continue Reading

Cars

Lotus teases sports car future as Elise, Exige and Evora face the axe

Published

on

Lotus is preparing a huge shake-up, with the iconic British sports car company confirming it’s axing three of its most memorable models to pave way for an all-new line-up. 2021 will be the end of the line for the Evora, Exige, and Elise, Lotus said today, dropping a new teaser about just what is intended to take their place.

We’ve already seen one element of that plan, in the shape of the beastly Evija hypercar. Announced in mid-2019, it promised to tap electrification for its potency, something Lotus demonstrated in action at its public debut in October last year.

Not everyone will be able to afford – or even find a spot on the waiting list for – a $2m+ EV behemoth. For that audience, Lotus has confirmed a new series sports car range, with the Lotus Type 131 expected to go into prototype production later this year.

It’ll be built at the automaker’s Hethel, Norfolk facility in the UK, which will undergo a $127m+ investment and see around 250 more engineers and manufacturing recruits added to the payroll. Helping foot the bill are shareholders Geely and Etika, which took ownership of Lotus in September 2017.

You can’t accuse Lotus of not making the most of its outgoing range. The first-generation Elise made its debut all the way back in 1995, a new model for Lotus but epitomizing its ethos of reducing weight in the name of increasing engagement. Though never the most powerful sport car, it nonetheless carved out a lingering reputation across several generations for its purity behind the wheel.

The Exige, meanwhile, arrived in 2000. A coupe to the Elise’s convertible, it built on the platform with race-focused technology to maximize performance. Come 2008, the Evora gave Lotus an entrant for the super-sports sector, tempering some of the automaker’s notorious focus on paring back creature comforts with a more luxurious, GT-minded approach.

The Type 131 range – part of what Lotus is calling its Vision80 strategy – will include at least three new models, replacing the Elise, Exige, and Evora. “Our renowned team of engineers, designers and technicians who are working on the new cars are acutely aware of the legacy from the Elise, Exige and Evora,” Matt Windle, executive director of engineering at the automaker, says. “Indeed, many were around when Elise was being developed.”

Earlier in 2020, rumors suggested Lotus could reboot the classic Esprit name for a new model. The new Esprit, it was hinted, could use a hybrid V6 powertrain, combining gas and electric power, though unlike James Bond’s car it would be unlikely to turn into a submarine.

Continue Reading

Trending