Tonomus, the first subsidiary of Neom, a region in Saudi Arabia on the Red Sea coast described as ‘building a future fuelled by the power of cognitive technology’, has announced the opening of its first digital communications facility.

Tonomus says its mission is to transform the way we live through predictive, personalised and autonomous solutions enabled by unrivalled connectivity and next-generation technologies.

The TONOMUS.NEOM Telecommunications Centre contains a high-capacity, highly efficient data centre and associated infrastructure to enhance the availability, resilience and growth of 5G, satellite and fibre cable network connectivity, and enable the provision of secure private cloud services in the Neom region.

On-site offices and facilities within the centre will support day-to-day operations and collaboration with telecommunications industry partners.

The centre is described as a key upgrade to Neom’s existing ICT infrastructure that will, it is claimed, offer some of the highest and most reliable network speeds anywhere in the world.

Strategically located in Oxagon, a city that will be home to advanced and clean industries in Neom, it will provide consistent bandwidth for secure information sharing and fast decision-making, supporting the demands of construction across the Neom region, keeping a growing number of residents and businesses connected securely and without interruption, and driving down operating costs.

The centre will power a software-driven network and secure private cloud that is projected to service up to 60 locations, some 1,800 structures, approximately 300,000 construction staff needed at Neom by 2025 and 200 million IoT devices by 2030. It will also interface with key existing and future national and international digital networks and services to offer a seamless experience to end users.

The facility site spans an area of 18,000 square metres, with a two-floor office building hosting 150 personnel. It will also serve as a hub for ongoing collaboration with telecommunications solution providers and technology partners.

Of course, the eventual demand for these services depends on funding for Neom itself. The region, which, it is said, will be 33 times the size of New York City once the project is finalised, is still in the early stages of its development. News service Middle East Eye says there has also been controversy about forcible displacement of local people.

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The group will meet today with PM Rishi Sunak to discuss the state of the UK economy and explore options for boosting the economy

Today, the UK government has unveiled fourteen chief executives that will form a new business council set to advise the Prime Minister on economic policy.

The group comprises the CEOs of AstraZeneca, NatWest Group, BAE, SSE, Google DeepMind, Sainsbury’s, Vodafone, GSK, Aviva, Shell, Sage, Taylor Wimpey, Diageo, and Barclays.

Together, they represent many of the UK’s largest industries, including banking, pharmaceuticals, retail, construction, energy, tech, insurance, telecoms, and defence.

Unsurprisingly, these companies are also some of the UK’s most valuable; nine of the companies represented are in the UK’s top 30 listed businesses, with only the relative newcomer, AI specialist Google DeepMind, not being featured on the FTSE 100.

Combined, the fourteen companies reportedly employ around 330,000 people in the UK.

“I look forward to hearing first-hand from business leaders about how we can break down the barriers they face and unlock new opportunities for them to thrive,” said PM Rishi Sunak. “The more businesses innovate and invest, the more we grow and create good jobs across the country.”

The business council will reportedly convene twice a year and will be refreshed at the end of 2023.

Today’s meeting will reportedly focus on the economic climate, inflation, skill shortages, and the ongoing impacts of Brexit.

As far as all this relates to the telecoms sector, the inclusion of new CEO of Vodafone Group, Margherita Della Valle, is noteworthy.

Della Valle was made permanent CEO of Vodafone back in April, having held the position on an interim basis since the end of 2022. Since the resignation of previous CEO Nick Read at the end of last year, she has been outlining plans to turn around the company’s dwindling fortunes, declaring its most recent financial results “not good enough”.

The company currently has plans to cut around 11,000 jobs across Europe over the next three years, including a significant number at the company’s UK headquarters, as well as streamlining operations across its portfolio.

Perhaps most notably, the company is in the process of merging its UK operations with those of CK Hutchison’s Three UK. The £15 billion deal would create a telecoms powerhouse with the scale to threaten the hegemony of BT, potentially making Vodafone the most powerful player in the UK market.

The deal is still awaiting the results of regulatory scrutiny.

“I am pleased to be joining the Business Council, an important forum to promote and support the global competitiveness of the UK. We have a vital part to play in the UK’s future, as our national communications infrastructure can help drive innovation and economic growth,” said Della Valle.

Aside from Vodafone, the other natural fit for a telecoms representative on this council would be Philip Jansen, the CEO of BT. As head of the largest UK telco, as well as one of the country’s largest employers in the country, Jansen would seem ideally placed to help steer the PM on the UK economy’s digitalisation.

However, just last week it was announced that Jansen is seeking to step down from the role of CEO over the next year, with analysts suggesting he had been on “shaky ground” for time due to the company’s disappointing results.

Shares in BT have fallen around 45% during Jansen’s four-year tenure.

Finally, it is also worth quickly noting here the lack of representation of SMEs on this business council. There are reportedly, 5.5 million SMEs in the UK, representing 99.9% of UK private sector businesses, yet none of these

The Federation of Small Businesses (FSB), one of the largest lobbying groups in the country, which represents around 160,000 SMEs, has been quick to criticise the composition of the business council, calling it full of “corporate bigwigs” and “suits”.

How much of a key role does the telcoms play in growing the UK’s economy? Join the ecosystem in discussion at this year’s Connected Britain conference, the UK’s largest digital economy event

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Latin America and Caribbean-focused multilateral development bank IDB Invest says it has closed a standby letter of credit for about US$47.5 million to service provider Colombia Móvil (aka Tigo) to support the expansion and upgrade of telecommunications infrastructure in small municipalities in Colombia.

The project, says IDB, will provide mobile broadband to 915 rural areas that are currently without coverage, allowing them to enjoy the benefits of digital connectivity and helping to close the rural-urban access gap.

The project will help improve mobile services, specifically by aiding the transition from basic 3G to 4G LTE broadband in 340 municipalities. This will allow retail and corporate customers to benefit from high-speed data connectivity, in turn facilitating access to digital services, such as e-health, online education, telework and financial services.

IDB Invest says it is also providing advisory services to support the digitalisation of small, rural and agricultural businesses in Caquetá, in the Amazon region. This, says IDB Invest, will improve their productivity, their conservation efforts and the sustainable use of ecosystems.

Two local community groups that work in sustainable agricultural processes led by young farmers are already receiving training on how to use digital tools to improve their service offering.

This is not the first time IDB Invest has put money into upgrading Colombian telecommunications. As we reported at the time, in January last year, IDB Invest offered financial support to Tigo for the deployment of telecommunications infrastructure in 177 localities that did not have access to mobile broadband.

IDB Invest says it is committed to promoting the economic development of its member countries in Latin America and the Caribbean through the private sector. It adds that it has a portfolio of US$16.33 billion in assets under management and 394 clients in 25 countries.

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The standalone 5G (5G SA) solution will allow devices to connect to both private and public networks simultaneously using a single SIM card

Orange Business has announced the launch of a new hybrid private mobile network solution, allowing simultaneous access to a private network deployed by Orange as well as the company’s public commercial network.

The “two-in-one” 5G SA solution uses a router from Cradlepoint that connects to both networks and directs data flows to the desired network based on the application or use case.

The solution also relies on network slicing, edge computing, and local break outs across the overlapping public and private 5G networks to ensure network security and guaranteed low latencies.

The solution has been successfully tested at Orange’s facilities in Arcueil, Paris.

Orange says that the hybrid network will have many uses, particularly in industrial settings, where it can be used to connect industrial equipment, objects, smartphones, tablets, human-machine interfaces, or even autonomous vehicles.

As well as providing secure connectivity for a site’s critical activities, it will also allow for connection to subcontractors and remote sites, host third parties, and provide coverage for users beyond the site’s boundaries, such as forklift drivers and freight travelling by road, river or rail.

“Companies in all sectors face modernization, competitiveness and resilience challenges. The evolution of existing networks towards a hybrid private model promises major benefits in terms of production optimization, improvement of the experience of actors in the field and technology management. Orange mobilizes its dual expertise as operator and integrator to support its customers in their transformations,” explained Valérie Cussac, Orange Business’s Senior Vice-President of Smart Mobility Services (statement translated from French).

Earlier this year, Orange announced the launch of a 5G SA network in Spain, but in other markets, including France, the company has yet to make the upgrade to the more advanced technology.

What impact will the arrival of standalone 5G have on the wider telecoms ecosystem? Join the operators in discussion at this year’s live Total Telecom Congress

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The partnership will enhance collaboration on digital issues to strengthen supply chains and reduce reliance on China for key technologies

Following the first Japan–EU Digital Partnership Council meeting held last week, Japan and the EU have signed two Memoranda of Cooperation (MoC) to advance work in crucial areas in connectivity.

As part of the deal, the two parties plan to support the development submarine cable connectivity via the Arctic, which will provide secure, reliable, and sustainable connectivity between the EU and Japan. If successful, there is possibility for these submarine networks to be extended to a wider parts of Southeast Asia and the Pacific.

The partners also signed a second MoC on semiconductors, focusing on enabling greater cooperation on R&D, advancing skills for the semiconductor industry, and subsidy transparency. The partnership will also see the formation of an early warning system for supply chain disruption, allowing each nation to better prepare for shortages should they occur.

The subtext to this agreement is the perceived need to build self-sufficiency and diversity in the global semiconductor supply chain, with both parties increasingly wary of their technical reliance on China for chip manufacturing.

“Economic security is a common concern for Japan and the EU. We share similar dependencies, and we both need to de-risk our supply chains. One of our objectives is to reduce overreliance for products that are vital for our economies, like critical raw materials and semiconductors on a handful of suppliers – many of them based in China,” said President of the European Commission, Ursula von der Leyen.

Additionally, the EU and Japan have agreed to enhance cooperation on several other, wider issues, such as generative artificial intelligence, quantum computing, data governance, and cyber security.

The co-chairs of the Japan-EU Digital Partnership Council are set to meet again in 2024 to reviews the progress of the deal.

Join in the conversation about digital security at this year’s Total Telecom Congress live from Amsterdam

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A summary of all the essential financial news in the telecoms world 

Ericsson’s Q2 sales drop 

In a recent financial report, Swedish telecoms equipment vendor Ericsson noted that while the company’s net sales were up 3% from last year, to SEK 64.4 billion $6.3 billion, the company’s Q2 sales had fallen. The company’s organic sales fell by 9% in Q2 and EBITA halved from SEK 7.5 billion ($730 million) to SEK 3.7 billion ($360 million).  

Network sales fell by 13%, despite vast sales improvements in Oceania, Southeast Asia, and India, where the company now has a leading market share. The steep fall in North American sales was not offset by the improvements in Eastern markets. 

The tech giant cited the knock-on effects of high inflation and rising interest rates for their falling sales. 

Indeed, Börje Ekholm, President and CEO of Ericsson, noted the challenging market conditions, stating “performance in Q2 was in line with our expectations, despite the uncertain macro backdrop and significant changes in market mix.” 

“The firm forecasts similar outcomes for Q3 and hopes for improvements by the end of the financial year: Q3 will benefit from an early impact of our strong focus on cost-out execution. Overall, we thus expect Q3 EBITA margin to be in line with or slightly higher than Q2, followed by a seasonally stronger Q4,” he added. 

“Based on the expected recovery of the mobile networks market towards the end of the year, we remain focused on reaching the lower end of the 15-18% EBITA margin long-term target range in 2024.” 

After the report’s release this morning, Ericsson’s shares were down 8%. 

Nokia reduces annual sales forecast 

Nokia is one of many companies feeling the effects of slower consumer spending and a reduction of consumer inventory levels, because of rising interest rates and high inflation. 

In an effort to combat this, the firm has lowered their net sales forecast from €24.26–26.2 billion to €23.2–24.6 billion. They have also narrowed their operating margin from 11.5–14% to 11.5–13%.  

The company commented that that “Nokia will continue to take measures to ensure it remains on track towards its long-term targets of growing faster than the market and delivering a comparable operating margin of at least 14%.” 

Despite the announcement, the firm still expects net sales of £4.8 billion this quarter. 

Since the news, Nokia’s shares were down 9.6%, the lowest since April 2021. 

Cisco suffers from Bank of America downgrade 

This week, Bank of America analysts lowered Cisco Systems share rating from ‘buy’ to ‘neutral’.  

“Street estimates are looking for a soft landing to Cisco’s product revenue growth, expecting it to grow 3% year-over-year in fiscal 2024 and 2% in fiscal 2025, after (estimated) growth of 13% in 2023 and 6% in 2022,” noted Bank of America analyst Tal Liani, who is responsible for the stock’s downgrade.  

He added: “However, these estimates lead to fiscal 2024/2025 product revenues that are much higher than historical levels. Since fiscal 2012, Cisco’s product revenue has remained at around a $36 billion to $39 billion range, mostly attributed to the timid growth of Cisco’s legacy products. It appears that the analysts deem the expected revenue too high, and therefore too much of a risk. The downgrading of the stock is a reflection of these concerns. 

Cisco shares dropped by 18% on the news. 

Huawei seeks to increase intellectual property revenue 

The firm, which made $560 million from licensing last year, is looking to increase total in 2023, this week releasing new royalty rates. 

Huawei’s smartphone revenue has taken a huge hit since US sanctions began in 2019, thus increasing revenue from other streams is now increasingly important. 

The new rates will apply to a number of Wi-Fi 6 devices, IoT products, and 4G and 5G handsets. The royalties for Wi-Fi 6 consumer devices is $0.5 per unit, while the rate caps for 4G and 5G handsets are $1.5 and $2.5 per unit, respectively. For IoT, the standard rate is 1% of the net selling price, capped at $0.75, while ‘IoT-Enhanced devices’ range from $0.3 to $1 per unit. 

Huawei currently has nearly 200 patent licensing deals, which it hopes to increase in the future. The company is the one of the largest patent holders in the world, with only IBM, Samsung, and Taiwan Semiconductor Manufacturing Company (TSMC) holding more patents as of 2022.