Nokia to Acquire Enpocket

On September 17th Nokia and Enpocket announced that they had entered a definitive agreement for Nokia to acquire Enpocket, a provider of mobile advertising. Enpocket provides technology and services to allow brands to plan, create, execute, measure and optimize mobile advertising campaigns globally.

Recommended Competitive Responses

► Google should be prepared to buy its way onto handset home screens, but becoming a carrier or handset vendor makes no more sense than becoming an ISP or PC vendor.

► Microsoft should dramatically expand its mobile advertising efforts, as it has a successful mobile OS on which it can piggyback, along with mobile services.

► Motorola should actually do nothing. It needs to focus on getting its mobile device line-up in order, and until it has regained momentum – and profitability – in its core business, it cannot afford to dabble in software that does not directly affect device usability. Partners and revenue sharing can provide most of the upside without any of the risk of Nokia’s approach.

► Service providers already using Enpocket – such as Sprint, Telefonica and O2 – can safely stay the course for now. Nokia will need to build ad inventory as quickly as possible and, at least in the short term, it will not risk existing relationships as it ties all of its software and services initiatives together.

► All players in this value chain – from service providers to handset manufacturers – are advised to look beyond the hype of mobile advertising and do the basic math. The value of the current market is tiny and its prospects unknown. The current mobile content services market (specifically, service providers’ non-voice data revenues) is also tiny. The future of the mobile advertising market implies the risk of consumer alienation, value chain disruption and plenty of ‘x’ factor; this is anything but a ‘sure thing.’

| Client Access - Wireless Services - Europe |

Telia Launches Consumer DSL Gateway For New Raft of Services

On September 12, 2007 Telia launched Telia Smart, a DSL gateway with a broadband modem, a built-in wireless network, IP telephony adapter and firewall. Telia Smart Start costs SEK 29 per month with updates and on-line support. In addition to an Internet connection, VoIP and IPTV, Telia's smart also offers music and entertainment services. During the fall, services that have not previously been associated with broadband providers, such as home security, will also be offered.

Recommended Competitive Responses

► Capping the DSL head end in the home with a gateway box is a very good way to mask technology issues. However, competitors need to analyze where their revenues are coming from because maintenance issues can quickly remove any profit margin.

► Competitors should consider a different pricing strategy where the box is free for subscribers to new paying services. Simultaneously, they should highlight this aspect of the Telia offering.

► B2 and Glocalnet should look to compete on signal quality by offering several grades/contention ratios of DSL depending on the services the customer is interested in. As video services (and P2P services) grow, network congestion will get worse and customers will be more willing to pay for quality.

► Set-top box competitors should emphasize that this gateway solution does not integrate the signals from the Swedish terrestrial digital network, so customers still need two boxes (that do not talk to each other). By retaining the set top box as the core connectivity piece, the household gets a much better viewing experience.

| Client Access - Wireless Services - Europe |

Cable & Wireless Launches Secure Mobility RAS

On September 6th Cable & Wireless introduced Secure Mobility, a managed global remote access service with WiFi, 3G, dial and DSL mobile for the workforce offered on a fixed-cost, per-seat basis. Secure Mobility is based on the iPass endpoint security and access footprint, although Cable & Wireless will also expand its own 3G access partnerships.

Recommended Competitive Responses

► BT can point out the advantages of MobileXpress, its position as an integrated operator and its future roadmap with its leadership position in the FMC market.

► Vodafone UK can highlight that its VSRA service strongly complements the Vodafone Application Service proposition and together they give Vodafone UK the upper hand in the market, as compared to fixed network operators.

► Orange Business Services should point out that Business Everywhere has a stronger WiFi footprint, extensive dial and DSL capabilities and strong ICT integration capabilities.

► UK managed service providers such as THUS, COLT and Easynet need to talk a lot more about enterprise mobility and try to differentiate their global remote access solutions, as they are being out-marketed by the larger operators such as BT, Cable & Wireless and Orange Business Services as well as mobile operators such as Vodafone.

| Client Access - Enterprise Mobility - Europe |