Top executives are gathered in Barcelona for the annual Morgan
Stanley Technology, Media and Telecoms Conference.
This year's conference takes place as the recovery in
advertising that started at the turn of the year gathers pace,
boosting revenue and profits at media companies that are also
adapting to new devices like computer tablets.
Telecommunications companies, meanwhile, are attempting to
balance loss of revenue from traditional voice calls and regulation
of mobile termination rates with how to make the most of the data
explosion driven by smartphones.
Meanwhile, global economic challenges remain, as companies look
to emerging markets to offset weaker demand at home.
Following are the top stories from the conference, which
concludes Friday.
Vivendi SA (VIV.FR) would like to buy out Vodafone Group PLC's
(VOD) 44% stake in French operator SFR some time next year, but is
waiting to receive the rest of the proceeds its NBC Universal stake
sale to start negotiations, Chief Executive Jean-Bernard Levy said
Friday.
Deutsche Telekom AG (DTE.XE) is confident it can deal with the
impact of potential cuts in German mobile termination rates, CEO
Rene Obermann said. "Whatever happens, the impact on us will be
affordable," he said.
Cable-TV and Internet provider Virgin Media Inc. (VMED) hasn't
seen any impact from BT Group PLC's (BT.A.LN) new fiber-based BT
Infinity broadband service, CFO Eamonn O'Hare said Friday, and
indeed hopes to benefit as more customers look for high-speed
services.
Capgemini SA (CAP.FR) is looking for acquisitions in China and
the U.S. but finding the right target isn't easy as prices are
often too high, CFO Nicolas Dufourcq said Friday, conceding that
"the percentage of emerging markets business is too low" at the
company.
Stories from Thursday
The Spanish economy is past the worst, but the recovery is
likely to be small, slow and protracted, Telefonica SA (TEF)
executive Santiago Fernandez Valbuena said Thursday. "We feel much
better about Spain than the average guy on the street. "We think
that the doomsday scenarios of Spain going into the ocean are
wrong, and that's not because we are die- hard optimists but
because we've been through a few of these [economic downturns],"
said Valbuena, who recently changed roles from chief financial
officer to chief strategy officer at the Spanish telecommunications
giant.
Vodafone Group PLC (VOD.LN) Chief Executive Vittorio Colao said
Thursday he expects "something to happen" with Verizon Wireless at
the end of 2011, in reference to the U.S. company resuming dividend
payments. Verizon Wireless, 45% owned by U.K.-based Vodafone,
hasn't paid a dividend since 2005. Its other shareholder is Verizon
Communications Inc. (VZ) of the U.S. Earlier this month, Vodafone
Chief Financial Officer Andy Halford said he expects Verizon
Wireless to resume paying a dividend in 2012 following its recent
strong performance.
Microchip designer ARM Holdings PLC (ARM.LN) has an "active
technical dialogue" with Google Inc. (GOOG) that extends to Google
TV, Chief Executive Warren East said Thursday. East's comments come
after Dow Jones Newswires reported late Wednesday that ARM was in
preliminary discussions with Google on a potential cooperation deal
linked to Google TV, which lifted its stock.
U.S. ad giant Omnicom Group's Inc.'s (OMC) chief executive is
positive about advertising market growth next year, despite
economic uncertainties, he said. Advertisers are still finalizing
2011 marketing budgets, but John Wren said early conversations with
clients are giving him a "good feeling" about next year.
Franco-U.S. telecom equipment maker Alcatel-Lucent (ALU) has
ample cash, a spokesman said, following speculation it will need to
raise capital. "We aim to be free cashflow neutral in 2011," VP of
investor relations Franke Maccary said. He was responding to
research from Credit Suisse, which Thursday downgraded the stock
due to expectations it would continue to burn through cash in the
first half of next year.
ProSiebanSat.1 Media AG (PSM.XE) is now more optimistic for the
crucial fourth quarter, Chief Executive Thomas Ebeling said. "We've
said before we expect [sales in our German free-TV business] to
grow by a low-to-mid single digit percentage - as of November we
can say we expect solid mid-single digit growth," he said.
Dutch navigation equipment and digital map maker TomTom NV's
(TOM2.AE) crucial fourth-quarter sales are in line with
expectations so far, Chief Executive Harold Goddijn said. Echoing
last year, he said TomTom will go big again on Black Friday in the
U.S., the traditional start of the Christmas shopping season, and
working with retailer Wal-Mart Stores Inc. (WMT) to push sales
there.
Franco-Italian chip maker STMicroelectronics NV's (STM) chief
executive is confident the company's wireless joint venture
ST-Ericsson will start to improve "materially" in the second half
of next year, he said Thursday.
Stories from Wednesday
News Corp. (NWS) hasn't considered disposals to secure
regulatory approval for its proposed takeover of U.K.
pay-television group British Sky Broadcasting Group PLC (BSY.LN),
the media group's Chief Executive of Europe and Asia, James
Murdoch, said Wednesday. Asked if the subject of disposals has come
up for discussion, Murdoch told reporters: "No, it hasn't," adding
that it is very early in the regulatory process. (News Corp. owns
Dow Jones & Co., publisher of this newswire and The Wall Street
Journal.)
BSkyB should produce good margin growth over the next few years,
underpinned by developments in its content, broadband and phone
services, Chief Executive Jeremy Darroch said, even as he remained
cautious about the consumer environment in the U.K. Asked about the
takeover proposal from majority shareholder News Corp., Darroch
said their relationship was "very good" and that BSkyB's operations
haven't been affected by the bid. Regulatory reviews of the deal
could run into the summer, he said.
Time Warner Inc.'s (TWX) Chief Financial Officer John Martin
said Wednesday that online access to HBO--a service the company
calls "HBO Go"--will be available to a majority of the network's
subscribers by the end of the year, and he expects it to spread to
the rest of the subscriber base rapidly next year. Martin said "HBO
Go" has been slow to catch on with consumers so far because it
hasn't been widely available. Investors are concerned that the
business is facing competition from Netflix Inc. (NFLX) and other
alternative, online video services.
WPP PLC's (WPP.LN) organic revenue growth continued to rise
sequentially in October and the ad giant now expects a figure of
between 3% and 4% next year, Chief Executive Martin Sorrell said
Wednesday. "We saw strong like-for-like growth in the third quarter
and the sequential improvement continued in October," Sorrell said.
Revenue in the U.S. in October continued to grow at a similar rate
to the third quarter, he said, reiterating recent comments that
such strong growth won't continue forever. Clients continue to be
cautious about next year amid economic uncertainty, Sorrell also
said.
French advertising company Publicis Groupe SA's (PUB.FR) chief
executive Wednesday said advertising market trends next year will
likely be broadly similar to those seen this year. Maurice Levy
said that so far indications for 2011 are positive, notably as
growth in the U.S. ad market continues to be solid. "We're not
seeing a decline of U.S. growth yet. It's slowing down a little bit
but still very solid," Levy said. The U.S. advertising market has
recovered faster than expected this year, boosting advertising
companies' revenues. Europe, however, will likely remain a
challenge next year, Levy said.
Portugal Telecom SGPS SA (PT) is confident it can seal its deal
with Brazilian telecommunications group Tele Norte Leste
Participacoes S/A (TNE, TNLP4.BR), or Oi, before the end of March
2011, Chief Executive Zeinal Bava said Wednesday.
Chipmaker Infineon Technologies AG (IFX.XE) will execute a share
buyback once it has drawn up a plan and shareholders have approved
it, CEO Peter Bauer said. Following its recent strong quarterly
earnings, Bauer said he sees higher demand for its chips in the
multimarket segment and customers in the auto sector are more
bullish.
-By Ruth Bender, Archibald Preuschat, Lilly Vitorovich and Nat
Worden, Dow Jones Newswires