Shameless self-promotion 3.1

I'm very happy to have been asked to speak at the upcoming Society for Computers and Law event - Legislating for Web 2.0 - Preparing for the Communications Act? - which will take place on 22nd/23rd September in London. Apart from me, it's a very impressive list of speakers, and damned good value at only £600 for both days for non-members - at the current rate of Sterling devaluation, that should be something like EUR50 by the actual date ;-(... Organizer/curator/ringmaster Chris Marsden, who has craftily already taken the best title in the event, "May the Phorm be With You," has placed me in the first panel, which is either a blessing or a curse, I'm still not sure. In any event, I hope to see you there.

Misery loves company

So the old adage goes, but I'm thinking more of this sort of misery, or perhaps the Amityville Horror with a spin (instead of "For God's sake, get out!" it would be "Fix my broadband first for God's sake, then - but only then - get out!"). This is an amazing story, and one the telecom industry should perversely be proud of. You've achieved something which only a handful of industries (electricity, gas, water, food, tobacco, alcohol, gambling) have cracked - creating a product that customers consider absolutely indispensible once it's embedded in their lives (note that the poor unhinged customer in question had a huge backlog of work to deal with, and her career is clearly deeply dependent on working from home). They almost certainly don't love you, but you don't have to give them reasons to hate you.

Via the excellent Hermes Project

More Chrome trivia

Google Analytics is now showing Chrome at 7.8% of my site traffic from yesterday, for what it's worth.

The state we're in

It's time for another installment in Akamai's ongoing series of quarterly reports on the state of the internet, catchily entitled, "The State of the Internet" (registration required, but it's worth it). It's the usual compendium of DNS hijacks, DDOS attacks, site hacks and other web nightmares, with a lot of connectivity data by country as well. Standouts which surprised me were that Japan tops the list of countries of origin for attacks this time (もーれつ!), and that Akamai's analysis seems to show no obvious correlation between percentage of high bandwidth users (defined as >5Mbps) and proportion of attacks. Most appalling to me, as a (lapsed) American is the revelation that 16% of internet users seen by Akamai in Washington D.C. appeared to have access speeds below 256k, i.e., on a par with Malaysia and a few points worse than Colombia. In an election year where the internet has proven to be such a powerful tool, to have nearly a fifth of people in the capitol of the world's (currently) most influential nation muddling through with glorified dial-up speeds (regardless of what the FCC says) is/should be the source of a profound sense of shame.

Chrome trivia

As you may be aware, Google Analytics breaks out Google's own newly-released Chrome browser (in case you have been on another planet for the past week) in its breakdown of visitor browsers. Two days ago Chrome accounted for 1.5% of my site traffic, and today it is over 3%. I don't know how representative my readership is of internet users generally, but the quantum of the growth is quite interesting to me, especially considering that Safari is consistently in the 6 - 7% range. I'm intrigued to see how this trend develops.

New BSG report on costs of fiber deployments

The UK Broadband Stakeholder Group (BSG) has just this morning released a report from Analysys Mason on the likely costs of fiber access in the UK. I've only had a chance to read the summary conclusions so far, but it all seems pretty consistent with what we've seen elsewhere:

• FTTC is likely to dominate at least initially
  
• FTTH will initially probably only be deployed in areas of new build
  
• infrastructure sharing with other utilities (ahem) may materially reduce civil costs
  
• OFCOM should consider the long-term implications of "stranded" investment by multiple operators at street cabinet level
  
• 1/3 of the UK population may not be economically viable to cover without some creative public/private coordination.

More comments as I wade through this beast.

UPDATE: Very interesting "geotype"-based cost analysis contained here, which seems to bear out what I've heard anecdotally from a number of people actively involved in fiber deployments - namely that the cost differential between PON and P2P is on the order of only 10 - 15%, at least in high density areas. That's the good news. The bad news is that someone is going to have to come up with £25 - 30bn for universal national PON/P2P coverage - that's the equivalent of 8 - 10 years of capex for BT at the current run-rate. On the positive side, 2/3 of the country could be covered for a more modest £10 - 12bn (for perspective, BT's market cap is currently £13.5bn). Obviously, FTTC/VDSL is dramatically cheaper, apparently allowing coverage of 60% of the country for £2bn, which puts it within BT's capex envelope and unsurprisingly is the direction the company has taken so far.

For the remaining 1/3 of the country which I assume will be left out in the near term, in more normal economic conditions, I would assume that local initiatives and entrepreneurial capital could fill the gaps (we have seen it before and there are other examples taking shape elsewhere) to some extent, but I'm struggling to see that happening in the UK in the current climate. Nor do I envisage much political vision given the current Punch-n-Judy state of UK politics. My initial sense is that, in the absence of the kind of partial mutualization of infrastructure between BT and Virgin envisaged as one scenario in the report, what we are likely to end up with for the foreseeable future is an urban-focused battle between FTTC and DOCSIS 3.0, with BT opportunistically cherry-picking desirable areas with FTTH, and Virgin, carrying four turns of leverage, having not a lot of scope to respond. I hope I'm wrong...

It's official - Snap Shots do in fact suck

I've seen enough in the survey results - 92.3% of you apparently think they are annoying and distracting, and a few of you have been kind enough to leave some highly amusing comments, such as, "They suck hard - if you have to ask, you already know..." Another points out that the experience is particularly painful on a mobile browser. Fair enough, Snap Shots are hereby banished into Room 101.

More squandered opportunities

I've moaned about this previously, albeit a bit more under the radar, but the extensive gas network refurbishment work going on in our area continues. A lot of trenches are being dug, and a lot of disruption created, but not one strand of fiber in sight.

Yours in coax,

Disgusted of Dulwich

The week ahead

Assuming the world doesn't actually come to an end on Wednesday, this should be an interesting week. I'm catching up with a number of fascinating people I haven't seen in some time, and I am determined to post in a more consistent manner. Should also be another challenging week in the financial markets, on the heels of some exceptionally nasty developments (this latter example is really discouraging, considering that cars were strictly rationed in the UK until 1968 - just kidding).

Do Snap Shots suck?

I've been using Snap Shots previews on this blog for some time now, but I have received an impassioned email from a Platinum Club mega-uber value reader imploring me to remove the service from the site. I've previously thought that it was helpful for readers to be able to preview links, and that the ability to play video clips, etc., without leaving the site was pretty handy. However, if they are a distraction to the readership, then perhaps I need to think again. Let me know - take the EuroTelcoblog survey.

Got 15 minutes?

The good and clever people over at Telco 2.0 have a survey they'd like you to fill out, on the topic of internet video distribution and its implications, a theme which we spent a lot of time working on when I was part of the Thundering Herd. We looked at a number of interesting investment opportunities in the value chain, but could never get comfortable enough to commit, preferring instead to look at some of the enablers, beneficiaries, and potential victims of the phenomenon. Anyway, enough about me - please help out and take the survey, and in return, you'll receive the summary survey results when it's completed.

Ouch of the day, 3rd September

When I first joined an unnamed previous employer a number of years ago, I was on the receiving end of a corporate email experience like this, but the executive in question had erroneously circulated a list of potential hires (with highly personal comments and salary details), rather than fires. To make matters worse, the message was accidentally copied to a large number of clients as well as employees. This email genius has since gone from strength to strength in the company, demonstrating the frequently inverse relationship between basic technical competency and career development.

Feeling defensive?

One of the few good things about getting sacked from a bank is that, if you're a Bloomberg user, you occasionally get a free trial subscription to the service for 60 days after your "right-sizing". Mine was just activated today, and it's nice to be able to play around with this wonderful tool again after a hiatus (one strange aspect of the "consultation period" in UK employment law being that, once identified as being "at risk of redundancy", you are sometimes thereafter treated as a de facto outsider, and barred from accessing corporate IT, at least this was the case for me - really gives you a warm, fuzzy sort of feeling...).

Anyway, rant aside, I was getting back in the loop of market technicals today, and downloaded this chart of ranked returns in the DJ STOXX 600 industry groups. Historically, I think many analysts, including yours truly on some occasions in the past, have argued that telco is a defensive sector in a market downturn (as it was at least for three months following 9/11). It's therefore interesting to note that telco, on a year-to-date basis, is 14th out of 18 sectors (down 26%), and the ones below it are non-bank financials (i.e., consumer credit, et al), construction and construction materials, retail, and banks.

In other words, telco is just managing to outperform the four sectors universally acknowledged as obvious casualties of the credit hangover. But wait, broadband and mobile are established as essential services, like electricity and water - what's going on here? De-leveraging is complete, the era of stupid M&A (DT aside) is over, "market repair" is complete or underway in a number of markets, so what's the problem?

I'll be honest and say I don't really know. Looking at the rankings on a one month basis, telco rates 12th out of 18, on a three-month basis it's number seven, and on six months, number 14. So clearly there's a lot of volatility in investor sentiment, but in all four cases, the financials are somewhere close in the rankings. I'm sure telcos would love to be acknowledged as serious financial services players, but there are no examples yet in Europe to warrant such an association - and I can't see any obvious factors to explain such an apparently strong correlation.

Shameless self-promotion, 3.0

The good people at TEN in the UK have invited me to moderate their upcoming event, tantalizingly entitled "The Broadband Customer Expectation Dilemma: Why What You See Isn’t What You Get." With a title like that, especially in the UK market, one could easily expect the discussion to cover a couple of days, but sadly it's limited to a single evening, 15th September. Should be a colorful exchange. Hope to see you there.

What's in the AlcaLu chalice?

Apart from the Franco-American culture clash poison with which Pat and Serge consummated their suicide pact, I'm not really sure. I have an awful lot of respect for Ben Verwaayen and the turnaround he achieved at BT, but that was a very different kettle of fish and chips. Yes, it was an overstretched, over-leveraged empire which had engaged in a lot of strange M&A and joint ventures with very strange put/call terms with partners. An aggressive 3G license acquisition strategy certainly didn't help the balance sheet - in fact BT's decline from net cash position to rescue rights issue and de-merger of O2 was nothing short of stunning, if only for the sheer velocity with which it occurred.

But, apart from all the crap, underlying the company was a (relatively) stable, cash-generative, regulated monopoly business in the UK, with smarter management and more customer inertia than many might have thought at the time, which gave it some sort of visibility on restructuring, repositioning and continuity. I wouldn't want to trivialize the turnaround of BT - it wasn't a lay-up - nor by any means would I judge it an unmitigated success (21C, Fusion, anyone?). But financially speaking, it's a historical fact, and one that Mr. Verwaayen can be proud of.

Then again, BT didn't have private, national champion competitors in its core market with presumably near-infinite financing sources. I hear through the grapevine that it is not uncommon for pricing in competitive situations to be 30% below the lowest bid from the usual suspects, with vendor financing well north of 100%. I think this is bound to be an intractable problem at AlcaLucatel. We may recall that three years ago, many commentators cited this as precisely the situation which ultimately ensured Marconi's demise, in the tender process for - wait for it, BT's 21C. I trust Mr. Verwaayen has a good appreciation of historical irony, but I don't envy his position.

Ouch of the day

I've met quite a few people over the years who came out of Oracle and went on to do interesting things, but never anyone who went back - particularly not after only nine months with one of the "hottest companies on the planet" (which was apparently ready to reward stamina). God knows what's behind this, but it can't be very pleasant or satisfying for either side.

Family Affair

For anyone interested in the changing dynamic of how companies in search of growth capital will access funds in a time of mounting financial pain, there is an interesting piece in the second half of the BBC World Service's Business Daily show today (UPDATE NOTE on 9 September 2008: originally this link pointed to the specific program in question, but as far as I can see, the BBC posts links to this show on a seven-day rolling basis, meaning that old content apparently just disappears - STUPID. If anyone knows otherwise, please let me know, but I can't find the original broadcast.) focusing on the growing numbers of foreign family offices setting up in London. Coupled with the sovereign fund wild-card and those hedge funds with both dry powder and imagination, I assume these investors are going to disproportionately reap the rewards of what's happening now. Presumably, if anyone were interested (which I think is questionable), there's more than enough raw material out there now to build a brand new investment banking franchise from scratch...

Rudolf is Sub-Zero

I imagine young Mr. Van Der Berg will be getting some colorful email in response to this little gem. I have so few points on which to disagree here that it's not worth adding anything. Just read and enjoy, unless you're one of the many large and possibly deluded organizations which he consigns to the Uncool Vortex.

Presentations partially restored

I am working to restore a number of links to presentations and reports/notes, which can be found here and here. Only those which point to Scribd are live - I'm struggling to locate some of the older ones, to my dismay. I'll amend as (and if) I am able, though going back through the blog and trying to re-do individual links is probably above my tedium threshold.

From the bottom of Lake Woeisme

What passes for summer in the UK has ended, the kids are back to school next week, and frankly I've been feeling a little sub-prime in confronting my new status, or lack thereof. None of this is helped in the least by newsflow. The Centre for Management Buy-out Research at Nottingham University last week released stats (oddly, not on their site yet) showing that the value of private equity transactions in Europe was down by nearly two-thirds in the first half of 2008. Disheartening, but hardly unexpected. European venture investing is tracking historic lows. We're all facing some very ugly systemic problems in the credit markets (check out the very scary charts on credit spreads in this particularly gloomy read from the ever-excellent John Mauldin), and Christmas is definitely going to be canceled for an awful lot of people in my industry as the investment banks aggressively eviscerate themselves and engage in M&A (either under political duress, or out of desperation). You could be forgiven for thinking we were on the eve of destruction, living on a dead-end street - and you may yet be right.

However, at times like these, we have to take delight in small pleasures and rare snippets of good news. Taking a break from my dark reflections to check my site traffic earlier today, I saw a number of hits from two sources I haven't seen in ages. Old blog buddy Dean Bubley claims I was an inspiration, which I consider very gratifying, to say the least. There I was thinking that I was just one in 4,000, or maybe even just half a man, but Martin Geddes, the godfather of disruption, says I'm "The One". Don't know how I will ever live up to that, but it's just the ray of light at the bottom of the black lagoon which I needed to see right about now. Many thanks gents, you don't know what it means.

These go to 11

BT's latest HomeHub billboard assault. Caption reads: "Up to twice the wireless range of any other UK broadband provider, so you get a better connection." Available in black - very heavy metal.

What's Swedish for "I remember when you were cool"?

Today we made a day trip across the water to southern Sweden, stopping off in the lovely town of Lund. Snapped this along the way, the mighty Bredbands Bolaget, now branded under Telenor's limp, three-winged roomarang. More normal blog service should resume next week, when I'm back in the Big Smoke. Meanwhile, thanks to the ever-impressive Benoit for the kind words (one of my proudest moments was in hounding him into blogging in the first place, and he has never once let me down!), as well as to Dan York and Alec Saunders. Whoever said nobody loves you when you're down and out was waaaaay off target.

Fiber, to a thatched cottage near you

FTTH, to a thatched cottage near you
Originally uploaded by jimiinc

I'm with the family in a rented summer house in the forest in North Zealand in Denmark, about an hour north of Copenhagen. While I'm having a mostly self-imposed web hiatus during the holiday, I figured I might as well blog this as I was posting the photos to Flickr. This photo was taken in the village of Vejby (my guess is there are maybe 100 households), where the unfortunately named Dong Energy is apparently in the midst of a fiber roll. I have seen similar scenes in other nearby villages, and am highly impressed, even envious.

Hangin' in the WiHood

Podcast, moi? When I was cut down in my subprime and returned to this humble bloglet, I determined that I wanted to do things differently this time around. As a case in point, here's an interview with Thomas Anglero, a friend and passionate entrepreneur, about his new venture, WiHood. WiHood weds e-learning with SaaS and cloud computing, delivering a unique, portable, virtual desktop aimed at students, and I think it deserves a lot more attention than it is getting so far. Thomas has a lot of interesting things to say about the process of establishing a start-up, cutting through the noise, dealing with VCs and staying motivated. There's obviously a lot more he could have said about the specifics of WiHood, but we wanted to try to keep it light. Hope you enjoy it.

Interview, 31:57 (warning, performance is variable may be slow to load)

WiHood promo video

New addition to the English language

Thanks Damien, for "uberbolloxmegashame". I couldn't agree more, but couldn't find the words to articulate it - until now!

Every time it rains, it rains...

Eurodata from heaven... A super-prime polyglot Palladium Class mega-uber value reader thankfully responded to my plea for pan-European data on subscriber satisfaction/network performance data, with some interesting input on France and Germany.

France: Grenouille has some very detailed and assiduously-maintained measurements and rankings, including some fairly damning assessments of Numericable's 100 Mbps offering. What the hell, never mind the leverage, it's Pierre's problem now...

Germany: An interesting and comprehensive ranking of operators here. I'm intrigued to see cable operators, which have historically suffered from a hugely asymmetrical funding and capex legacy, scoring on a par with, or slightly better than, many of their DSL competitors (on a 1-to-5 ranking). In particular, the results turn up as: Kabel BW (cable) 4.1, ish (cable) 3.6, Primacom (cable) 3.4, Kabel Deustchland (cable) 3.3, Unitymedia (cable) 3.1, iesy (cable) 2.9. In contrast, many of the DSL players rate below 3.0 (i.e., average), including DT's own offerings. Not hugely impressive. I am particularly depressed to see Versatel at a ranking of 2.2, given that many regard this company as the jewel in the crown in any German infrastructure roll-up scenario - the company has unparalleled infrastructure assets in its four major regional markets, but has significant issues on the retail front, an unwelcome challenge for Apax, who are presumably looking for a get-out-of-jail card sooner rather than later.

Speaking of which, am I alone in assuming that there must eventually emerge an unholy alliance between the alternative DSL players and the Level 3/4 cable players in Germany to create an alternative to DT's monolithic infrastructure "vision"? Perhaps I'm a conspiracy theorist, but I find it really interesting that Kai-Uwe Ricke, former CEO of DT (whose DNA is very definitely magenta), left the company under pressure (God knows the CEO role at DT is something you would only wish on your worst enemy), and ran straight into the arms of private equity (as an advisor to BC Partners, majority shareholder in Unitymedia, and as an advisor to KabelBW) and also earlier this year joined the advisory board of United Internet, DT's major irritant. Dr. Ricke is nobody's fool, and I'm sure he doesn't hang out with German cable and altnet companies just for the comic value. Something is going to happen here, mark my words.

Who knows what lurks in the heart of your ISP?

Sam knows, at least in the UK. I assume a number of other countries have similar sites/services, so please send me some links, no matter how insurmountable the language barrier may seem. I'd be particularly interested in seeing some performance comparisons between cable and DSL in the German market, if anyone knows of such data, and also anything from Eastern Europe/Turkey would also be appreciated.

Shameless self-promotion, revisited

Well, my newfound idleness has already resulted in a couple of invitations to speak at conferences, the dates for which I will provide nearer the time. One presentation is to focus on my old flame, FTTH, with an emphasis on real-world issues. So, if you're involved in a real-world FTTH project, or are trying to get one funded, I'd be interested in speaking with you in order to make your experience part of my message. Ping me.

James Enck, 3.0, beta

Dearest mega-uber-value readers, the last time I wrote anything serious here was in April 2007, as I was embarking upon an amazing journey into the world of principal investing within a major Wall Street bank. Recently you might have noticed that I started posting again, albeit in a fairly sparse, cryptic and non-committal way. This was because I wanted to prime the pump for a return in a non-controversial way while waiting for the paperwork to be signed off and final paychecks to clear. Well, this has all come to pass without a hitch now, so I can do a bit of explaining, to the extent that I am able.

I think a number of you seemed to work out that a job-imposed hiatus from blogging, followed by a sudden return, probably pointed to impending unemployment - and you were right on the money. In July I was "right-sized", along with a number of my team. Many of you have sent me some very kind messages welcoming me back to the blogosmos, and while I share your sense of enthusiasm, it is far from a straightforward thing for me emotionally, as I feel intensely frustrated and disappointed at the ultimate outcome of my "reinvention" - not to mention the fact that I now find myself unemployed for the first time ever.

No matter, I will resolve this in time, potentially with your help. For now, perhaps I should try to paint a picture, for those who are interested (I must assume that most of you who seek this site out are to some extent interested in the person behind it), of what has transpired (to the extent that I am actually free to speak) in the past 16 months since we last met. I have spoken with or corresponded with a number of you during that period, and I have frequently encountered confusion as to the precise nature of my role, such that I eventually determined that the best way to answer questions was in the form of - duh - Q&A. So, I hope this helps to give some useful background. Apologies to those with a more sophisticated knowledge of the financial markets - I have assumed a very low level of knowledge in this regard.

Q: Why did you stop blogging?

A: I was hired in April 2007 by the Principal Credit Group of Merrill Lynch (a.k.a. Merrill Lynch PCG - typically a low-profile group, though some limited internet footprint exists), and while my bosses and colleagues there seemed to be hip to the value of blogging and the ensuing potential network effects in the investment process, Merrill Lynch has some very clear policies which prohibit this. This is entirely understandable, given the potential abuses which could arise across the firm, but I guess this also illustrates the extent to which a firm-wide dragnet internet policy is also potentially counterproductive in terms of its effects on individual business units. In any event, the blog had to die.

Q: What was the Principal Credit Group of Merrill Lynch?

A: This was a unit set up in 2002, to look for investment opportunities in the distressed end of the market, i.e., good companies with troubled finances, or bad companies with valuable assets which were undervalued due to the lack of market confidence in the management or market dynamics. For those of you too young to remember, 2002 pretty much marked the nadir of the post-dot.bomb era, and Merrill Lynch made a financial commitment to allow this group to invest the firm's own capital to focus on this space to maximize returns in its favor. In other words, it was an internally-funded hedge fund, or in Wall Street parlance, a "balance sheet group," "principal investing group," or "prop desk". Our Chief Investment Officer was a great guy named Boris Ehsani, and I reported to the fabulous Mark Devonshire, who was an absolute joy to work with. While the group started out as a primarily credit (i.e., corporate debt)-focused unit, as pricing in the credit markets became more questionable, and the credit market became more crowded with newcomers who further exacerbated these distortions, the group gravitated more towards public and private equity situations, which is where I came into the mix.

Q: So, how did you end up as part of this team?

A: In the summer of 2004, I got an email from a great man named Tim McDonald, from Merrill Lynch PCG, who expressed an admiration for my humble bloglet and an interest in maintaining a dialogue. Tim had previously written his own extremely impressive blog, and seemed to understand what I was trying to do as a sell-side analyst. We continued to speak regularly, and when I ended up in NYC as a presenter at a Columbia University event in autumn 2004, I had a chance to meet him and Boris in person. Beyond the ongoing dialogue and friendship which developed between Tim and me, there were a number of informal meetings which took place over the next two years, during which it seems Tim championed my cause internally. All this culminated in a formal interview process in late 2006, and finally a job offer at the beginning of 2007.

Q: Why you?

A: You'd have to ask the individuals involved, to be honest. However, if I had to make a guess, it would be that (to a large extent due to this blog) I had/have a network of contacts which could/can deliver interesting and funky proprietary investment opportunities, independent of a major investment bank advisor or private equity sponsor. Looking back at my transaction pipeline, I determine that my own personal network alone delivered over $300m in investment opportunities during my time in the group, roughly 1/3 of which I would describe as "high conviction".

Q: So, how was it?

A: I loved every minute of it, apart from the getting fired bit. I genuinely loved working with my colleagues (respect, people, if you're reading this), our bosses were great, the atmosphere was one of mutual respect and intellectual rigor. It was a fundamental research-driven approach, at heart, which on one or two occasions was frustrating when I could see purely short-term speculative investment cases being compelling, but that was the DNA of the group, and its track record (as portrayed in this article) was hard to argue with. As my bosses used to chant at opportune moments, we were investors, not traders.

Q: So, what did you actually do?

A: I had a beautifully wide mandate. While I was brought in to diversify investment opportunities on the private equity side of things, as one of the team of global sector analysts, my other duty was to identify and analyze opportunities in the public credit/equity markets. In practice, >85% of my time was spent developing investment opportunities in the private equity space from my own network, and the remainder was spent looking at secondary public market positions in credit and equity, as well as a handful of primary deals (keep in mind that, of course, the primary markets were mostly closed within a few months of my arrival on the scene). Opportunities I focused on (please note that I am under NDA with a wide range of companies) include, generically: energy-efficient datacenters with a bias towards managed services in the virtualization space; datacenter virtualization OS developers; WAN optimization solutions for financial trading platforms; next-gen satcomm; P2P-assisted CDNs; wireless towers; 4G wireless; a variety of FTTH deployments; account provisioning systems for open-access FTTH networks; P2P video platforms; targeted ad-insertion platforms for telco IPTV deployments; enterprise 2.0 voice and messaging platforms; a couple of take-private scenarios for busted (i.e., zero liquidity) tech IPOs; and one broadband roll-up vehicle in an unnamed European market.

Q: What did you enjoy most about it?

A: Apart from the people I worked with, the thing which really impressed me about being part of the Thundering Herd was the extent to which being associated with a credible brand could open doors and command people's attention. What I personally liked most was getting interesting young companies/entrepreneurs in through the door and spending hours talking about what makes them tick. One gets a very rich education from people who have spent years working in a particular industry vertical, which in turn makes one's holistic understanding of the industry much richer. And hopefully those on the other side of the table got something out of it too, in the form of advice, contacts, brainstorming, or maybe just free coffee! I'm proud to now call a number of these individuals friends, so something good must have been happening. Most of all, I viewed the eclectic nature of the role, ranging from quasi-venture to traditional private equity, as well as public equity and credit, as being an exciting and fulfilling mix.

Q: So what now?

A: Good question. I'm having a number of interesting discussions with a number of interesting people, as you might expect. My ideal scenario would be to resume the sort of role I had within PCG (i.e., free reign across the capital structure, globally, public and private) with a properly funded, understanding, and supportive structure behind me. I enjoy the investment process and believe I am well-suited to it. Moreover, I think we're entering an era of tremendous upheaval, which will present the prepared mind (and well-stocked wallet) with huge opportunity. However, I remain open-minded overall - the point for me is to find THE job, as opposed to A job. Any ideas/suggestions would be warmly welcomed. For now, I'd like to extend thanks to the good people from ML PCG - I loved working with you and wish we'd gotten to where we had hoped to go.

Baaad mutha

It may be "fibre optic" service (disclaimer: I am actually very happy with my Virgin connectivity), but the billing system behind this broadband juggernaut canceled my direct debit payments for no good reason in June. According to the call center operator, this seems to have coincided with a billing system consolidation/migration exercise. The old jokes are always the best...

(UPDATE: I neglected to mention that my friends over at VoiceSage have some slick routines for dealing with these sorts of scenarios, keeping the customer informed and engaged, rather than shocked and annoyed.)

I am... already bored

Unspeakably large billboard at the corner of Oxford Street and Charing Cross Road/Tottenham Court Road. The future was once bright, now it's just baffling and silly...

My fortune cookie today

Macabre sense of humor, these Chinese waiters...

The way we were

If, like me, you find yourself with a bit of time on your hands, and, like me, you also spend some of that time pondering the erosion of American economic hegemony in the world, you might like to take a bittersweet journey through the outstanding Prelinger Archives, one of my favorite stops on this Interweb thingy. Thrill to swinging futuristic commercials, fascinating history lessons, cutting-edge technological innovation, and hard-hitting exposes of life in other cultures. Enjoy.

We interrupt this silence to bring you breaking news...

Mega-uber value readers of the world (if there are any of you left out there), following 15 months of dormancy, EuroTelcoblog (and little brother Chaotica) will soon be making a comeback. There are some outstanding logistical issues which make a precise date impossible to define at this point, but please watch this space for more info as it becomes available. The best is yet to come, I hope...

While you're on hold, please enjoy these audio nuggets from a happier bygone era in telecom:

Nortel corporate musical, circa 1996 - 27 minutes and 46 seconds of pure torture - my favorite is "I Want an OC192 for Christmas"

Female employee chorus of KPN, late '60's - they really rock Hava Naguila!

James Enck 2.0

Mega-uber value readers of the world, by now it is probably blindingly obvious to even the most forgiving among you that the volume of posts to this blog has dropped dramatically since early February. As you may have detected from some relatively unsubtle hints, there is a reason for this, which I have already shared with many of you with whom I have more direct contact. I am now ready to come clean, as all the t's are now finally crossed.

After six-and-a-half years, I left Daiwa eleven days ago, and will next week take up a new role within the principal investing team of a well-known Wall Street investment bank. One reason I find this a particularly gratifying turn of events is that, just as I may be no ordinary analyst, this is also no ordinary team. It has developed deep industry expertise and generally applies a greater level of focus in its investment process. It has been very successful in recent years investing in metropolitan fiber assets and portable/mobile broadband (two areas, you probably realize, which are near and dear to my heart). I think it's clear that my future colleagues do their homework and get involved early, well before the consensus has formed specific views on a space, and they take a broad thematic view across the full value chain (another nice area of fit) for investment opportunities, and search far and wide to find unique sources of information and market views. Perhaps most interestingly to me, the team has the mandate to invest in both public and private securities.

To say that I am very excited by this opportunity would be an understatement of epic proportions. However, one side effect of this move is that this humble bloglet, which ironically celebrated its third birthday on 30 March, the same day I said goodbye to my fellow Daiwans, must cease publication.

Judging from the reactions from those of you whom I have already briefed on this development, there may be a fair amount of dissatisfaction about this turn of events. I consider this to be a wonderful compliment. To think that (judging from the Bloglines subscription data I have, and my own tracking of site traffic) several hundred of you per day have given even a few precious minutes in your busy days to my ramblings over the past three years is more than enough – the thought that the blog might actually be missed is almost inconceivable to one who started with essentially no expectations. Recall that in my inaugural post I stated that the blog was essentially an experiment, an expression of frustration, a cry for help. That it has ended up being anything more significant to any of you is, if I'm honest, pretty damned surprising, and extremely gratifying.

However, lest we get caught up in the potentially negative interpretations of the move to a non-blogging me, let me explain a little about why I think this development is actually a very positive outcome within the confines of the "Web 2.0" weltaunschaung.

About six months after EuroTelcoblog moved from being an email blast to an online point of presence, I got an email out of the blue from the fund manager who was ultimately responsible for bringing me onboard at my future employers. He had stumbled across the site and found it useful. At the time it was just one of many interesting contacts which were coming my way from the blog – bright, inspired people with whom I would have almost certainly never had any contact if not for the fact that I had, via the blog, become visible (and accessible) to the world outside the confines of the investment banking research walled garden.

However, as was thankfully the case with many of the contacts which came my way via the blog, this particular dialogue became a sustained exchange of information and opinions. This process eventually led to some face-to-face meetings and culminated in a formal recruitment process, which brings us to the current situation. I hope that the other ongoing dialogues which have also arisen from this adventure in the blogosphere will also continue in the days ahead. Indeed, for those individuals and companies intent on innovation and disruption, there is probably, now more than ever before, a rationale for us to connect and share ideas and opinions.

But back for a moment to my statement that my current situation constitutes a positive outcome within the confines of the "Web 2.0" weltaunschaung. My view is that none of this would have been possible in the absence of a parallel social dynamic, and the tools which have accompanied/enabled it, towards a decentralization of information flows. The effects of this ongoing trend are pretty much impossible to predict from a macro perspective, but from where I sit, very much at the micro end of the spectrum, the message seems to be all too clear. Whoever you are, whatever your situation, if you have ideas which you are passionate about, and if you can find a voice with which to adequately express them, then the tools are there in abundance to do so, and the results may end up being surprising and life-transforming, so you might as well have a go and see where it leads.

So, that's pretty much it in a nutshell. I want to extend my respect and eternal gratitude to each and every one of you who has ever been kind enough to drop in, even to those of you who have vehemently disagreed with what I have said. I genuinely, literally, could not have kept this up for the past three years without your suggestions and ideas. I also wish to thank those individuals at Daiwa (you know who you are/were) who were supportive of some fairly unconventional research approaches on my part over the past four years, once I awoke to the need to do things differently.

As a parting gesture, I will be upgrading all mega-uber value readers to full Palladium Club status at no additional charge, as a sign of my undying appreciation. :-) Ping me if you're interested, and I'll let you know my future coordinates and contact details. Hopefully, at some future date, I may return to the blogosphere, and if so, trust that I will find some way to make my presence known. Until then, many thanks to all of you for a most wonderful and enriching three years. I've never known anything like it. It's had a profound effect on my life, and that's the whole point.

UPDATE on 11 April: When I was a kid, my mother used to regularly lecture me about always wanting to have the last word, but this really is the last word. I am truly humbled by the huge number of emails coming in, many from people I have never communicated with before. Thank you, and stay in touch! JE

No peace in the valley

My last remaining grandparent died last week, and I spent the week in the States for the funeral, entirely offline. So I know there was a lot I missed (my bet is on Deutsche Telekom), much of which is past its shelf-life for commentary. However, in catching up with my emails, the following items have caught my eye, FWIW:

• A mega-uber value reader in Finland alerts me to a tender (Swedish) underway in the tiny island municipalities of Brando and Kumlinge for an open FTTH network. Apparently it's envisaged that customer premises will only be connected to the network if they agree to subscribe to at least one service on offer from one of the service providers who are hoped to materialize. Entry level pricing is said to be EUR16 per month. Yet another example of local activism looking to plug the holes in incumbent broadband rollouts.
• I notice with interest that the Tor project has secured funding from Google for a handful of developer spots at Summer of Code. Interesting contrast in light of anxiety over a Net Neutrality about-face from the Big G. A good friend also points out that it's counterintuitive for Google to be investing time and money in something which could facilitate skamming AdSense - maybe this is about threat intelligence.
  
• Jeremy Penston at IPDevNet has been on a bit of a hotstreak, producing a couple of interesting and informative pieces on online video. Well worth the read.
  
• Adobe has gone live with a public alpha of Apollo, a video preview of which I linked to here. I agree with Dean that there is some very exciting stuff ahead.
  
• UNESCO has published what looks to be an interesting report on the ethical implications of new technologies, now added to my pile of must read material.
  

Lost and found

Sky ad 03 07
Originally uploaded by jimiinc.

I know I haven't posted anything in some time. I've had a lot of loose ends to tie up and have been otherwise distracted, so apologies. On the bus to a meeting today I passed a lot of very prominent Sky advertising like this, which highlights that Virgin Media customers in the UK are to lose content like "Lost" and "24" due to the public bust-up between Virgin and Sky. One other billboard I saw pulled no punches: "Get Jack Back," it screamed, followed by a succinct explanation about Virgin's apparent decision to drop Sky content and ending with the message "To subscribe to Sky, call..." What amazes me about all of this is the sheer speed with which Sky has been able to move. What was a public spat a week ago has been turned into a national ad campaign virtually overnight. At lunch today someone reminded me that this is exactly the sort of advertising at which Richard Branson excelled ten years ago during his bitter war with British Airways.

Test

This is a test. Apparently some people are experiencing problems with Blogger.

Power server

A Platinum Club mega-uber value reader points me to this interesting study published last week by Dr. Jonathan G. Koomey of Stanford University, which attempts to assess the power consumption of the servers which power our beloved internet. Power consumption by servers worldwide doubled between 2000 and 2005, and the total cost for the world in 2005 (including cooling and associated infrastructure costs) was $7.2bn. Not covered by the findings is the cost of energy consumed by delivering connectivity to end-users, which must certainly be even more staggering. The report notes that power consumption by servers and associated infrastructure in the US in 2005 accounted for 1.2% of the national total, an amount comparable to the total installed base of color television sets in the nation. Also of interest to me is the fact that the cut-off point for the data, 2005, really predates the net video/virtual world explosion we're seeing now, so I would love to know how the current situation differs from the growth trend observed here.

Four cool things

Lately I've been a bad blogger, but with good reason. All will be revealed. Anyway, here are four things which came my way today, all of which caught my interest:

• NeufCegetel ups the French FTTH stakes with the acquisition of fiber specialist Erenis. With aspirations of achieving 15k subs by March of this year, Erenis is clearly not the kind of acquisition which brings serious scale. But that's not the point - I think it's about tapping into the limited pool of people with true expertise in fiber deployments, as Iliad did with its October acquisition of Citefibre. No transaction value is stated, but I have to assume this deal makes a nice return for Iris Capital, et al, who funded Erenis just over a year ago.
• My friend and Palladium Club mega-uber value reader, Lee Dryburgh, spent several days last week locked away in ITU meetings, which seem to have produced, somewhat remarkably, some hopeful-looking ideas on how telcos can position themselves as vital links in the chain of identity and reputation management. Check out the slides here. Will those of us who have spent the past four years (or more) chanting the mantra "telcos just don't get it" find reason for a re-examination in late 2007? As always, I'm skeptical, but nonetheless this is something to follow with interest.
• A Pollonium Club mega-uber value reader points me to an apparently popular but still little-known corner of UK geekdom - the free cable TV via Linux phenomenon. Seems that a growing number of people are buying Nokia dbox2 set-top boxes from Germany with a Linux hack which allows them to do all sorts of cool things, including decrypting premium cable channels for free. Watch those RGUs, Virgin Media!
• This interesting survey from japan.internet.com and goo Research covers awareness in Japan of Second Life. As usual, the research covers a sample group of 1,073 internet users ranging in age from 10 to 60, and discovers that nearly 19% of them have at least heard of Second Life. I agree with the authors' conclusion that, for a US-based virtual world with no Japanese language support at this point, this is quite an impressive number. Only 1.1% claim to have actually used it, however, but given the tendency for the Japanese to come up with homespun adaptations of ideas from abroad, I wonder whether this low uptake points to an opportunity for a domestic rival?
  

Best guesses

Hello, mega-uber value readers. Apologies for my recent silence. I have been busy and very distracted with some major news, which I will share with you in coming days. Meanwhile, my cyberfreund Keith has been doing such a wonderfully irreverent job of covering the quarter's results, M&A foibles, and other oddities, that I am nearly speechless.

Nearly, that is. I am inspired by Telenor's results today to break my recent silence. How extraordinary it is that the best performing company in the European sector over the past two years finds itself in the position of having to publish estimates of the results of its own largest source of EBITDA, due to a court injunction over releasing financial information resulting from legal action by a partner (Storm LLC, which holds 43.5% of Kyivstar and is controlled by Altimo). Up to now the ongoing disagreements have been an area of concern, but without any visible impact on the share price. Altimo seems to have demonstrated powerfully today that throwing stumbling blocks in Telenor's way to cause uncertainty and a lack of visibility is enough to do serious damage after all - in this case a 9% decline in market cap.

Hot off the presses

The good and clever people over at Stratix Consulting in the Netherlands have put together an exhaustive survey of the current state of FTTH in the Dutch market, which you should download and read now. I will too, once I finish breakfast.

FTTx in suburban London

At last, a Pollonium Class mega-uber value reader pings me with news which we have been anxiously awaiting/expecting: an apparently open network FTTH deployment to a nearly 10k unit new-build development in Kent. If anyone out there has any additional info, please get in touch.

How many zeros are in a Googlewatt?

How fitting that, being here at the FTTH Council Europe event in Barcelona, where all 1,200 delegates are debating how much bandwidth is enough and how fast, while simultaneously jockying for position near scarce power sockets for a quick recharge of depleted laptops, today my friend and Palladium Club mega-uber value reader Vincent Dekker of Trouw in the Netherlands, breaks the story of a massive new data center being built in the northern Dutch backwater of Eemshaven. Though no official confirmation is forthcoming, the word is that this new data center's primary tenant will be Google, with space for 100k servers, and conveniently located near a 2.4Gigawatt power plant, a windfarm, a "green" power cable making landfall from Norway, and a harbor which will in future house an LNG terminal. Do we see a pattern here? What's also interesting is that Google is reportedly the largest occupant of the current largest server farm in the Netherlands, Zernike, just up the road in Groningen. Looks like when planning for its future bandwidth and power demands, Google is a believer in the immortal words of Jerry Lee Lewis, "Enough is good, more is better, and too much is just about right." Except that "too much" continues to prove very difficult to gauge.

EuroTelcoblog Exclusive Offer of the Day!

Step right up! The kind people at Fon have offered EuroTelcoblog readers in the UK (sorry, only UK readers need apply) an exclusive claim to a free Fonera while supplies last. Head here to claim yours. Be quick and good luck. (Disclaimer - I have no connection, financial or otherwise, with Fon. I simply like what they are doing, and they are keen to engage with bloggers. I am honored to be chosen.)

UPDATE on 7 February: The folks at Fon inform me that the initial response to their offer is over four times what they expected. I always knew my mega-uber value readers were value-conscious!

Big Fon

I'm jetting off to Barcelona early tomorrow to hang out with the fiber geeks for a couple of days, at the FTTH Council Europe's annual trench-dig. Fun though that may sound, I hear that the real Fun will be taking place to the southwest, in Madrid, where Fon will be celebrating its first birthday. Remember that this feisty contender requires from the end user a hardware, not just a software, commitment, so don't expect anything like Skype user numbers after year one. But then consider that we're talking about viral access here, and an opportunity for some mainstream carriers to assert themselves virtually in the wireless domain. We've already seen it with NeufCegetel in France and a host of other, smaller players. What might lie ahead in 2007? Ignore at your peril...

Will steal for AdSense revenue

A friend pointed out a blog called voipniche, which has some interesting posts in it. Like this one, this one, and even this one. If they look familiar to you, it's because they have lifted them from this blog, verbatim, with no attribution.

Let's see if this is an automated process, or if there is a real live thief behind this AdSense scam.

VOIPNICHE.COM REPOSTS ITEMS FROM EUROTELCOBLOG WITH NO ATTRIBUTION AND WITHOUT PERMISSION

I'll be curious to see if this post turns up there later today.

UPDATE: Less than two minutes later, the post indeed appeared on the site. Looks like voipniche is a direct RSS-reader-to-splog bot of some sort. What a wickedly ingenious development! I used Centralops to look up the domain. Seems to be registered to someone in Mumbai, but the traceroute ends in Brazil. Who knows, who cares? Enjoy that AdSense money, whoever you are!

Friday fun

A mega-uber value friend alerts me to this very clever viral marketing tool based on Carphone Warehouse's TV ad campaign. Here's my first effort, entitled "Come back, Arun." I don't know how much this will do to change people's perceptions of the broadband product after the beating it has taken in the UK press, but at least perhaps it will give people a way to amuse themselves while they wait on the customer help lines.

Baltic tigers

A Palladium Club mega-uber value reader points me to the latest broadband scorecard from ECTA. I used to get ECTA press releases, but it seems that they don't love me anymore... Anyway, my friend out there in cyberspace points out that the most fibered country in Europe is Estonia (17% of total connections in Q3 2006). After second place Sweden (14%) comes, that's right, Lithuania (6.2%), and Latvia is giving Italy a run for its money at 2.2%. In this Eurovision bandwidth contest, there's an awful lot of big countries scoring nul points.

Friday catch-up

This week seems to have gone in a flash, what with the Vodafone/Sky double-header on Wednesday and France Telecom yesterday. Still playing catch-up today, but here are a few things which caught my eye.

Keith has a nice write-up of the Vodafone results, which he refers to accurately as the quarterly game. I can't think of many other companies where the management consistently start the presentation by repeating that they think the KPIs they are about to report are of diminishing relevance in gauging performance. In that case, why not report quarterly results with a full set of financial statements? Surely that's preferable to the current system.

As for Sky and FT, there were a lot of interesting facets to their respective results, but the thing that really struck me most was the sharp contrast between the two broadband deployments. Sky has clearly ramped up the rate at which it is connecting new customers quite dramatically (from c.11k per week in the December quarter, to over 16k per week in January), 87% of its subs are unbundled, and 70% of that group has opted for a product carrying an additional charge (i.e., a higher bandwidth package). Orange UK, on the other hand, added only 34k broadband subs in Q4 (a connection per week rate of less than one quarter that of Sky's), and only 16% of its subscriber base is unbundled. On top of that, the company only added 50k net contract mobile subs, so clearly whatever the appeal of free broadband for contract spend of over GBP30 per month, it is not really having any visible impact. Keep in mind that Sky is concentrating on its existing base for the most part (only 18% of new broadband customers were completely new to Sky), while Orange's addressable market is arguably the entire contract mobile subscriber base of the UK, yet it seems to be making very feeble headway.

One other thing about the Sky presentation which I found impressive was James Murdoch's comments on positioning the brand in terms of social and environmental responsibility. I'm sure a lot of people would have some reservations about accepting this at face value given the source, but leaving Murdochophobia aside and taking a neutral view, it's a brilliant line to take. Committing to this is not only the right thing to do ethically, but it's the right thing for consumers to see you doing. Brands which don't position themselves adequately here may indeed risk creating a gulf between themselves and the consumers they aim to engage. As with so many other things, I think Sky is ahead of the curve here, and many others will follow in its wake.

Now back to my bandwidth obsessions.

The fact that 70% of Sky's unbundled customers take a higher bandwidth product, for which they have to pay an additional charge, seems to underline again that demand is indeed on the rise. I think James Murdoch must have used the word "bandwidth" at least 50 times in the course of the presentation. I wonder if he had seen the news that, only a couple of weeks after the HD DVD bombshell, Blu-Ray has also fallen victim to the tireless efforts of cryptogeeks, the first file weighing in at a healthy 22GB. What a bruiser.

A friend and Prix D'Or mega-uber value reader also drew my attention for the first time to some stats tracked by the Australian Bureau of Statistics, which show bandwidth consumption among business and residential internet users. Notice that between March 2005 and June 2006, the number of broadband households nearly doubled, but data consumed nearly trebled. The next update is due on 16 February, and should be interesting.