WCA September 2009

As estimated by industry media, there are more than 70 million mobile phone subscribers in the UK. Vodafone had 18.7 million UK mobile customers at the end of March, the company said, while Deutsche Telekom had 16.7 million, according to its website. An acquisition of Deutsche Telekom’s UK operations, including connections for Virgin Mobile subscribers, would boost Vodafone’s UK users tomore than 35 million. Simon Thiel and Marcel van de Hoef, of Bloomberg News , observed that five companies offer services in the congested UK mobile phone market in which Vodafone operates, compared with four in Italy and three in France. They wrote, “Bringing together its UK mobile operations with those of Deutsche Telekom may fit into the strategy of Vodafone chief executive officer Vittorio Colao, who took over in July last year. He is pushing managers to bolster existing operations and squeeze more profit from them” rather than expand in new markets. (“Vodafone May Bid for Deutsche Telekom’s UK Unit.” 29 th June) Both Vodafone and T-Mobile UK declined to comment on whether a deal is under discussion. If it does come to pass, it would strengthen Vodafone’s competitive position, said Koris Franssen of Kempen Capital Management, in Amsterdam, who monitors both companies. Mr Franssen told Bloomberg , “Fewer players in the market often means more stable pricing, which will make the business more profitable.” Alcatel-Lucent to serve ads to willing mobile-phone customers in Germany Alcatel-Lucent on 29 th June announced a deal with the German wireless carrier E-Plus Group that offers a glimpse into the mobile advertising of the future. E-Plus is a member of the KPN group of companies, which according to the KPN website has 31 million mobile phone customers in Germany, Belgium, and the Netherlands. Now, E-Plus is using Alcatel-Lucent’s new Advertising Selection Server to offer its mobile users advertising for a variety of retail goods.

Eight telecoms plan the subsea fibre optic network Asia-Pacific Gateway

In response to mounting demand for high-bandwidth communication, including enterprise network services and the Internet, eight of Asia’s biggest telecommunication companies have signed a memorandum of understanding to build a new submarine fibre optic network in a region vulnerable to subsea earthquakes. The Asia-Pacific Gateway, a 4,970-mile network with a minimum design capacity of four terabits per second, is intended to go into service in 2011. As reported by Asia-Pacific correspondent Ek Heng on Telecommagazine.com (3 rd June), the proposed network will connect Japan, Korea, mainland China, Taiwan, the Philippines, Hong Kong, Vietnam, Thailand, Malaysia, and Singapore. The signatories to the development agreement are China Telecom, China Unicom, and Chunghwa Telecom; NTT Communication (Japanese), Vietnam Post and Telecommunications; Korea Telecom; Philippines Long Distance Telephone; and Telekom Malaysia. The companies will jointly finance and co-own the network. The Asia-Pacific Gateway will offer alternative communication routes and nodes to counter the effects of subsea earthquakes or accidents. Its high redundancy will minimise the impact of breakdowns in service provided by regional fibre optic networks. Advanced DWDM (dense wavelength division multiplexing) technologies will ensure interconnectivity with existing and planned high-bandwidth communication systems in the region. Three of the telecoms in the consortium – Philippines Long Distance Telephone, Vietnam Post and Telecommunications, and Telekom Malaysia – also are participants, with 15 others, in the 12,420-mile Asia-America Gateway project scheduled for completion by the end of this year. The $550 million network will link Southeast Asian countries – Malaysia, Singapore, Thailand, Brunei, Vietnam, Hong Kong and the Philippines – with the West Coast of the United States, Guam and Hawaii.

The finalised plan, including a deployment contract with Australia’s Pipe International, is to be put before the Kordia board for approval in September. An acquisition of Deutsche Telekom’s British wireless unit would strengthen Vodafone’s competitive position Vodafone Group Plc (Newbury, England), the world’s largest mobile phone company, is considering a bid for T-Mobile UK Ltd, the British wireless unit of Deutsche Telekom AG, the Sunday Times (London) reported on 29 th June, citing a source familiar with the situation. T-Mobile UK had sales of $5.6 billion last year. The deal would create an entity with 50% of the mobile market of the United Kingdom.

Of related interest . . .

State-owned New Zealand com- ✆ ✆ munications provider Kordia is reported to be pushing ahead with a plan to roll out an alternative submarine cable system linking the country with Australia across the Tasman Sea. As noted by TeleGeography (3 rd July), the govern- ment had second thoughts about the project, but Kordia CEO Geoff Hunt said the $200 million needed could be funded by its potential customer telecoms, equity from the company, and bank finance. The proposed system would com- pete with the existing Southern Cross network, partly owned by incumbent Telecom New Zealand, and would bring down the cost of international bandwidth for New Zealanders. In Mr Hunt’s view, the project is essential in light of the government’s recent $953 million commitment to developing ultra-fast broadband.

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Wire & Cable ASIA – September/October 2009