Verizon Wireless Settles Local Tax Disputes in Missouri
By Teresa von Fuchs
Verizon Wireless and has finally settled disputes with several hundred municipalities in Missouri over tax rates charged to wireless carriers. Several carriers have been arguing that city governments were trying to implement a new tax, which under state law requires the approval of the people, but local authorities have argued that the fees they are trying to charge carriers are the same taxes long paid by wired phone companies.
Under the terms of the settlement Verizon Wireless has agreed to pay back taxes of nearly $30 million to several hundred municipal governments throughout the state. The carrier also agreed to tax rates ranging from between less than 1% to 11% of their customers' bills. The carrier passes these fees on to customers as surcharges on their bills. Of the $30 million Verizon is obligated to pay, the carrier has put aside $12.5 million in an escrow account. Local governments had asked for another eight years worth of back taxes, but Verizon Wireless has avoided those charges.
Meanwhile, Sprint Nextel has reached an agreement with the city of St. Louis, but still has more than 150 suits to settle with other local governments around the state. Under the terms of its agreement with St. Louis, the carriers tax rate will decrease to 7.5%, from 10%.
Sprint Nextel says it still disputes the legality of the local governments attempts to tax wireless carriers, but spokesman John Taylor told the Dow Jones Newswire "We also recognize that it's in the interest of our customers, our shareholders and the cities to resolve these disputes on terms that are reasonable and fair."
AT&T is also involved in many of the same suits, but has yet to reach a settlement.
ITC to Investigate Nokia Handsets
By Teresa von Fuchs
The U.S. International Trade Commission has said it will begin investigating certain 3G handsets made by Nokia, based on a complaint filed last month by InterDigital.
InterDigital filed a compliant in August with the ITC saying that Nokia was engaging in unfair trade practices involving two InterDigital patents related to certain WCDMA handset components. The handsets under review include Nokia's N75 phone.
Nokia claims that InterDigital called the patents in question "essential" to the WCDMA standard, therefore committing to license them on fair, reasonable and non-discriminatory terms. "For the proper functioning of the standardization process and continued industry innovation, Nokia believes companies should refrain from seeking injunctions for standards essential patents," Nokia said in a statement.
The ITC said it plans to complete the investigation within 45 days.
Apple Cuts Price of iPhone, Announces iPod Touch
By Teresa von Fuchs
Along with its announcements about the latest line of iPods, Apple yesterday also slashed prices on the iPhone. The 8 GB handset will now cost $399, down from $599 on its initial release, only two months ago. Apple also announced plans to phase out the 4 GB model.
Apple has said that anyone who purchased an iPhone within the past 14 days can get a refund on at least the difference in prices.
Many iPhone early adopters were upset with the news of so soon a drop in price. As well as Apple's release of the new iPod Touch, an iPod with a touch screen just like the phone's, as well as wireless connections and a Web browser. The new iPod Touch will allow users to download music to the iPod directly, without having to first download music to a computer and sync the device.
In an interview with USA Today, Apple CEO Steve Jobs said, "If anybody is going to cannibalize us, I want it to be us. I don't want it to be a competitor."
Apple and Starbucks also announced a deal that will allow people to access the iTunes store at Starbucks locations without paying for Wi-Fi connection fees. The service will debut at more than 600 Starbucks in New York and Seattle starting October 2, and will come to other major cities throughout the year and into 2008.
Terms of the partnership were not disclosed.
HP Announces Two New Smartphones
By Teresa von Fuchs
HP announced two new handsets yesterday, as the company looks to expand its handheld offerings into the mobile phone market.
First is the iPAQ 600 Series Business Navigator, HP's second cell phone, a 3G handset using a traditional 12-key keypad, which also includes a navigation wheel, a 3 megapixel camera, Wi-Fi, including VoIP capabilities and navigational features including 3-D maps. HP has not yet announced pricing or availability, but did say the phone should be available by the end of the year and would be compatible with most U.S. carriers.
The company also announced the iPAQ 900 Series Business Messenger, a smart phone with a full keyboard that comes with many of the same features of the 600 series, including Windows Mobile 6, Wi-Fi capabilities, Bluetooth, a 3 megapixel camera and large display.
Gene Wang, vice president of marketing for HP's handheld unit said in a statement, "It's less that the PDA business is going away, and more that, especially with the new 3G networks coming out, you can put so many new features and services to work."
Google Files for Mobile Payment System Patent
By Teresa von Fuchs
Google has filed a patent for a mobile payment system that uses text messaging and includes the terms gpay and gbuy. The patent application was filed in February of last year, but was just published last week.
The application said "The payment process may occur through the simple composition by the payer of a text message."
It also presented several possible scenarios where the technology might be used, including a farmer's market or flea market where vendors typically only accept cash. Google believes that such vendors are "also likely to have a cellular telephone or similar mobile device" and using this new technology could accept payment via SMS. Other scenarios include paying into an escrow account, where users could present payment but then finalize a transfer of funds after work was completed satisfactorily and vending machine payment system, where people use their mobile devices to make purchases through technology equipped machines.
Motorola is Considering Touchscreens in U.S. Handsets
By Wireless Week Staff
Motorola said is considering incorporating touchscreens, similar to Apple's iPhone, into upcoming handset designs in the U.S.
Speaking at a Citigroup investor's conference, Motorola Chief Financial Officer Tom Meredith, said the iPhone's user interface is "exceptional," and the company "may introduce touch-screens in the U.S."
Meredith also pointed out that Motorola has marketed phones with some touch-screen controls in Asia for several years now.
Catalyst Closes Private Equity Funds
By Rhonda Wickham
Catalyst Investors, a private equity fund with a focus on telecom and Internet services, has closed two funds - Catalyst Investors II, LP and Catalyst UK Partners, LP - with $170 million in aggregate committed capital. Catalyst Investors II, LP expects to invest in 10 to 15 small and medium companies over the life of the fund and has made four investments to date. Fund investors include a range of leading institutions as well as current and former senior executives of leading companies within the sectors targeted by the fund.
According to Brian Rich, managing partner of Catalyst, media, communications and Internet services continue to "offer some of the best investment prospects" in terms of organic industry growth. He also pointed to the fund's strategy in targeting smaller companies, which makes them ideal for consolidation or roll-up opportunities.
Two of the four companies the firm has invested in are in the wireless broadband space: Denali Spectrum Manager and Oneida Broadband. Denali was formed to acquire spectrum in the Advanced Wireless Services (AWS) auctions in partnership with Leap Wireless International. It won the 10 MHz license covering the Great Lakes region. Oneida Broadband has acquired and intends to build-out and operate broadband wireless access networks using next-generation WiMAX technology. Oneida was founded by telecommunications veterans Harold Furchtgott-Roth, former FCC commissioner, and Bill Wilson, former Arch Wireless executive vice president and CFO.
In the wireless space, Rich said the private equity firm targets primarily service providers and spectrum in areas that it believes might be early leaders to growth, such as in WiMAX and 4G. The strategy was reflected in Catalyst's earlier investment in Clearwire and Aloha Partners, both of which had significant spectrum holdings. Clearwire recently teamed with Sprint Nextel to deliver its WiMAX network, and Aloha holds 700 MHz spectrum, which it plans to use for mobile TV offerings.
(Catalyst Investors provided funding for Advantage Business Media, which is the parent company of Wireless Week.)
News Briefs for September 6, 2007
Companies in today's briefs include: AT&T, Publicis, Phonevalley, Trapeze Networks, Konami Digital Entertainment
• AT&T announced a new international calling plan that combines the benefits of low wireline calling rates with the mobility of a wireless phone. AT&T Unity Worldwide Calling allows subscribers to get AT&T's best overall international long distance calling rates when using their home or wireless phones to call more than 220 countries, including Mexico, Canada, Japan, Australia and France, for only $4.99 a month.
• Advertising giant, Publicis has brought Phonevalley, a Paris-based mobile marketing and communications agency. Phonevalley has a presence is in five European countries and will continue to implement its offering in Europe throughout Publicis' networks. This acquisition makes Publicis Groupe the first exclusive mobile communications marketing group with a global presence. Financial terms of the deal were not disclosed.
• Trapeze Networks, a provider of Smart Mobile wireless solutions, announced that sales of its branded products increased by more than 100 percent compared to the same period in 2006, as the company substantially expanded its distribution channels, sales force, and global footprint. The company also announced that it has begun shipping SmartPass software, a new solution that promises to provide control over guest access on wireless networks. SmartPass promises to provides comprehensive controls over every guest user's access including restricting access by time of day, day of week, range of dates, and so on, as well as implement controls over bandwidth usage, quality of service, network resource access, security levels and other parameters.
• Konami Digital Entertainment announced today that two of its mobile games, Professor Fizzwizzle and Frogger 25th, have received gold National Parenting Publications Awards (NAPPA) from Parenthood.com and United Parenting Publications. As a result of these award wins, Professor Fizzwizzle and Frogger 25th will now be included in the NAPPA holiday gift guide stories in more than 35 top regional parenting publications nationwide.