Happy Thanksgiving

A very happy holiday to all the turkey gobblers across the pond. Here in Britain we are thankful for our universal right to untrammelled internet access, er, d'oh!

A little more conversation...

I find it equally amusing and depressing when I hear telcos speak, as they frequently do, about the secret to value creation being in their content strategy. For shareholders, perhaps that's true (I'm deeply skeptical), but for customers and society at large, clearly the greatest value created in communications is in enabling interactions and transactions, or as my friends at Telco 2.0 frame it, "removing friction."

So here's some friction. This morning I took my daughters to school, to find the headmaster and several other members of staff standing at the school gates holding hastily printed signs which read, "Unfortunately, we have to cancel school for all of year 1 and class 9 due to health and safety reasons." From what we could gather, there was a flood overnight, affecting classrooms in one section of the building.

Luckily, (or unluckily, they might say) neither of my daughters was in the affected groups. However, there are around 100 kids who were, and the first notice their parents received of this less-than-minor inconvenience was when they arrived at the school shortly before 9:00. Some of these kids don't live all that close to the school, so their families will have made unnecessary car or bike journeys, while others will have had contend with no childcare backup and unsympathetic employers. The employers, sympathetic or not, will have lost productivity. Overall, this one incident affecting nominally 100 children also affected at least 100 adults and probably nearly as many businesses.

Now, I'm guessing that the school caretaker or some other members of staff were aware of the problem at least an hour or two before the parents and children arrived, but it would have been impossible to phone every affected household to let them know they needed to make alternative arrangements - or so I'm sure the defensive administration would respond. However, phoning every household is a very 1980s sort of solution, and totally unnecessary in 2009.

It's safe to assume that every parent in the school has a mobile phone, so either the local education authority should have an SMS alerting service for this sort of situation, or the school, which seems to pride itself on its level of IT literacy, should set up a Twitter account and encourage parents to follow and/or activate SMS tweets. Some effort would be required, and inevitably this strategy won't cover everyone, but it's a start, and surely it's better than disrupting something like 300 lives and imposing a cost on people/businesses who are just trying to get on with earning a living. And for those delivering the bad news, surely it's a more pleasant alternative to having to stand in the rain with a limp sign encountering withering looks from outraged parents. We have the tools, so why don't we use them?

Tweeting selectively from the Citi credit conference

www.twitter.com/jimiinc #Citi

The best scam email of all time

That's a bold statement to make, but you have to admire the genius of a scam "cleverly" disguised as a compensation program for scam victims. What was the old saying about "Fool me once..."? I particularly like the professional-sounding "We shall feed with you more modalities..." phrase, as well as the fact that the email address for correspondence is in, of course, the yahoo.com.hk domain. Keep trying guys, at least the entertainment value is continually rising.

<><><><><><><><><><><><><><><><><><><><><><>

ECOBANK NIGERIA PLC
SCAM COMPENSATION OFFICE DEPARTMENT
ECOWAS NATIONS STATE/UNITED NATIONS
2009 SCAM VICTIMS COMPENSATIONS PAYMENTS.

YOUR REF/PAYMENTS CODE: ECB/06654 FOR $500,000 USD ONLY.

This is to bring to your notice that our bank (ECOBANK INTL. PLC) is
delegated by the ECOWAS/UNITED NATIONS in Central Bank to pay victims of scam
$500,000 (Five Hundred Thousand Dollars Only). You are listed/approved for
this payment as one of the scammed victims to be paid this amount.

On this faithful recommendations, want you to alert you that during the last
U.N. meetings held at ABUJA (WEST AFRICA), it was accessed/accumulated of
reported cases of fraud that the money lost by variousindividuals to Africans
scam artists operating in syndicates all over the world today is over $239
Million United States Dollars in year 2007 to fraud in USA alone.

http://www.techspot.com/news/29644-US-Citizens-lost-239-million-from-Internet-
fraud-in-2007.html

In other to compensate victims, the ECOWAS/UNITED NATIONS is now paying
victims of such scam $500,000 (Five Hundred Thousand Dollars Only Each ).in
accordance with the UNITED NATIONS recommendations.

The payments are to be remitted by ECOBANK PLC NIGERIA as corresponding
paying bank under funding assistance by CENTRAL BANK OF NIGERIA. Benefactor
of this compensation award will have to be first cleared by ECOBANK and
confirmed as a victim from Africa Scam before scam payment can be effected.

We shall feed you with further modalities as soon as we get response from you
on how you can receive your compensation payment award.

Send a copy of your response via email or call your remittance officer
quoting your PAYMENT CODE NUMBER(ECB/06654).


NAME: MR.KEN OSAZUWA
SCAMMED VICTIM/REF/PAYMENTS CODE:
ECB/06654 $500,000 USD.
TEL : +234 7025669085

Email: scamvictimstransfer@yahoo.com.hk


Yours Faithfully,
Mrs. FRANCA OSARO
PUBLIC RELATIONS OFFICER

Another incumbent buys open access fiber

Private-equity owned companies are frequently the subject of ridicule, due to a perception that they're purely run for cash, by shareholders who are always looking for the exit, and who, in some cases are clueless. That point of view is often justified, and there are other situations where very bright and talented people who are genuinely committed to the business end up in untenable situations, but there are also some comparatively rare situations where the PE sponsors genuinely seem to understand how to build value and innovate in ways which public companies struggle to match.

Take TDC, whose shareholders were not only bold enough to basically pay the record industry to shut up, but are now following KPN into open access fiber, purchasing c.60% of the network assets (apart from those involved in monitoring the grid) of the unfortunately named DONG Energy, for DKK325m cash plus an additional DKK100m in earn-out structured as a revenue share. The key difference here is that DONG has built out much more extensively than Reggefiber has. Two summers ago, when on vacation in North Zealand, I remember driving through small villages, remote by Danish standards, where fiber was being rolled.

By allowing DONG to take the capex and commercial risk in deploying the network, TDC avoided having to listen to lenders complaining and fretting, until the asset was mature enough to buy in. (It always fascinates me that investors prefer M&A to capex.) From DONG's perspective, it seems as though the company struggled to build a customer base in the absence of third party carrier relationships, which of course TDC has in abundance, so it probably was an inescapable outcome that DONG would sell out and leave the telco-ing to the telco.

Britain's Embarrassing Travesty?

If you're planning to make an inspirational video about fiber which makes the viewer contemplate suicide within the first three minutes, I think I have a template for you to follow. "Patience is a virtue of the past." Indeed. In fact, it looks like patience in some quarters was exhausted some considerable time ago. Note the call to action towards the end:

If Ofcom will not lay down the law on this one, or at least issue some guidelines or a Code of Practice about NGA marketing to stop this in its tracks, I will personally pay a bunch of very cheap workers to spend as long as it takes out on the Internet making sure that as many websites as possible have either a forum post, blog comment, banner ad or similar on it saying something along the lines of "BT's BET is NOT next generation broadband. Complain now. Boycott BT."

Funny how these things can spread virally and unpredictably, which is something I thought marketing departments were supposed to understand by now. I notice that there currently seems to be no Facebook group with a title such as "BET = Britain's Embarrassing Travesty." Not that I'm advocating that someone start one. But if they did, I would join it.

My big fat Greek restructuring

Well, looks like the third party interlopers in the WIND Hellas situation waited a bit too long to show their hand. However, the investment from Weather only delivers EUR50m in additional liquidity to the company, with the remaining EUR75m going to consent fees and transaction costs. Once the subordinated debt holders have been crushed (the FRNs are quoted 3 - 5, and the PIK notes are looking extremely hot at 1/16 - 9/16), the company should save c.EUR95m in interest costs before taking into account the margin increases for the senior lenders. In short, the company should be stabilized by this deal, but things are going to be tight for a long time, and the market still needs to consolidate, so let's call it Chapter One.

A question for European equipment vendors

Q: How do you compete with a privately held national champion with a $30bn credit line?

A: Maybe you don't.

(P.S., Starent is in the process of being acquired by Cisco, so you'll probably be seeing them around a bit more too.)

Tuesday morning drive-by

Still trying to recover from eComm last week in Amsterdam, and get caught up on other things. I would love to do a lengthy post on eComm, but I don't have the time, unfortunately. Stated simply, I think it is the finest event of its type on the planet. Lots of short and punchy presentations, many of them challenging and provocative, covering a wide range of aspects around communications (note my omission of the prefix "tele"), with a low tolerance level for bullshit, and good representation from people who are actually doing innovative things. Not many carriers were present (I counted four), but then why would carriers be interested in new developments in communications? And no IMS, HADOPI, or any other toxic and delusional acronym-based strategies were to be found - heaven! I gave a 15-minute talk on day one, and moderated a panel on day two. Wish I could have stayed for day three, which sounds like it was very interesting indeed. Take my advice - bookmark the next event and just go. You won't regret it.

Speaking of interesting events - tomorrow I'll be moderating a panel at Telco 2.0 in London, which has apparently seen a huge level of interest and registrations. I'm looking forward to the event and the Thames River cruise which follows. Hope to see you there!

I've come to the conclusion that my "social media brand" strategy is inevitably doomed to be one of fragmentation. Sometimes I have something to say or point to which is suitable for this blog, but which I just don't have time to write a proper blog post on. If you're interested in capturing any of that stuff, you may wish to follow me on Twitter. I know it is probably over-hyped as a medium, but it is imminently suitable to certain types of expression, such as "31bn? That's 3x BT's market cap, or one national FTTH network. What's that burning smell?" Alternatively, you may just wish to friend me - I already consider my mega-uber value readers to be friends I haven't met, so why don't we formalize things?

So, on to the industry/market:

Data centers - You have to love data centers, well I do anyway. The unsung heroes of the web services revolution, they work away in quiet anonymity and throw off disgusting amounts of cash if run properly - and we don't have nearly enough of them. We tried like hell to get a Greater London project funded while at Merrill Lynch, but timing and the parlous state of the firm's balance sheet thwarted us, sadly. Judging from Telecity's statement from yesterday, our investment case still stands.

Ride that high yield bubble - Virgin Media, which is a company I have a lot of time for, despite my frequent mocking posts about open street cabinets, continues to demonstrate that continuity issues in the CFO's office need not be an impediment to sound financial management. Following last week's acceptance of its senior facilities amendment, the company is wasting no time in lining up refinancing options for the lower parts of the capital structure, which is exactly what it should be doing given the opportunity which the market's thirst for yield has created. What looked to be a very steep mountain to climb at the start of the year, has been handled masterfully in my view, and the second lien debt, which is something we loved at the beginning of the year at 50, is now quoted 93.5. I don't often think of congratulating company treasurers, but here's to a job well done.

Greek consolidation - This is a topic we did an awful lot of work on at Merrill Lynch, and the ongoing WIND Hellas saga has been very much on our mind since the beginning of the year. Now a "wild card" bid has reportedly emerged from what most would regard as an unlikely source. However, I have previously worked closely with some of the people involved behind the scenes here, so I, for one, am not surprised, and I think things are going to get very interesting from here.

Waving from afar

Folks, a very altruistic Palladium Class mega-uber value reader has commented on my previous post to let us know that he has a surfeit of Google Wave invites, and that if you ping him and ask nicely, he'll pass them on to you. Thanks Peter!

Calling all Bulgarians!

If you're Bulgarian and have any views on broadband, my friend and fibrous co-conspirator Benoit Felten needs your help in completing a survey for the good of the country, so get yourself over to the site and take part, faster than you can say Ivo Papazov.

Waving goodbye

Okay good people, I have two major problems. Firstly, a number of people have posted requests with no email address. Google Wave makes you more productive, apparently, but not psychic. Secondly, and more importantly, something seems to have gone terribly wrong. Wave crashed earlier and prompted me to refresh, and when I did my remaining invites were gone. I had dished out five and still had three left. I've retained the details of those requests I wasn't able to honor, and if I get more invites, or my remaining ones are restored, your requests will be honored. For those I was able to fulfill, be advised that it may take some time, as it seems there are some scaling issues.

Waving, not drowning

Still trying to recover from the eComm experience and catch up on other things, so drowning is not far from the truth, but meanwhile, I have eight [8] Googlewave invitations for first-comers.