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Wire & Cable ASIA – March/April 2008
Alcatel-Lucent sells
its stake in a
Dutch fibre vendor
Draka Comteq BV was formed in
2004 when Amsterdam-based Draka
and
Paris-based
Alcatel-Lucent
combined their optical fibre and
communications cable assets. Now,
AlcaLu is selling its 49.9% stake in
the fibre vendor to Draka Holding
NV for $301 million in cash. What
has prompted the sale? International
news editor Ray Le Maistre posed
the question in
Light Reading
for 18
th
December, and solicited this answer
from an AlcaLu spokesman: “[We]
had a good opportunity to get out of
this non-core asset and to help Draka
further develop its business. Draka
Comteq’s development has been
very successful so far, and now the
company needs to further develop
with other partners. We believe that
for further development, Draka needs
to have full control of Draka Comteq.”
Mr Le Maistre noted that analysts had
been suggesting for some time that
AlcaLu should reconsider its position
in the mobile infrastructure market, ‘an
increasingly cut-throat sector that’s
had a negative impact on AlcaLu’s
financial performance in 2007.’ He
also cites ‘industry chat’ to the effect
that the vendor has been considering
selling some of its assets to free up
cash for acquisitions, and that the
Draka stake sale might be the first of a
number of divestments.
Profit outlook for
T-Mobile USA disappoints
its German parent
Deutsche Telekom AG, Europe’s
largest telephone company, said
investments in its American mobile-
phone unit T-Mobile USA will hurt
the division’s profitability growth over
the next two years. As reported by
Kenneth Wong of
Bloomberg News
,
T-Mobile USA Chief Executive Officer
Robert Dotson told a conference in
Phoenix on 9
th
January that spending
on networks and on faster wireless
services will prevent the profit margin
from reaching a ‘mid-30s’ per cent
target. The fourth-largest US wireless
company had budgeted $10.3 billion
in capital spending in the three years
through 2009. (‘Deutsche Telekom
Spending to Hurt US Profitability,’
10
th
January)
Mr Wong reported that Rene
Obermann, the CEO of Bonn-based
Deutsche Telekom, is expanding
T-Mobile to make up for more than
four years of declining fixed-line
phone revenue in Germany. Last year,
T-Mobile USA agreed to buy SunCom
Wireless Holdings Inc for $1.6 billion,
adding about 1.1 million mobile-phone
customers in southeastern US and
Puerto Rico. T-Mobile International,
which sells services across 11 Euro-
pean countries and the US, last year
also acquired France Telecom SA’s
Orange mobile-phone unit in the
Netherlands.
Mr Dotson told
Bloomberg
that
T-Mobile USA has not seen any signs
of cooling customer demand for
wireless data services. “[That is] a
steep curve that goes north,” he said
at the investor conference in Arizona,
organised by the banking giant
Citigroup. Deutsche Telekom bought
Voice-Stream Wireless Corp, now
T-Mobile USA, for $35 billion in 2001.
T-MobileUSAadded857,000 subscribers
in third-quarter 2007 for a total of
27.7 million at the end of September.
It lags behind AT&T, Verizon Wireless,
and Sprint Nextel Corp in numbers of
subscribers.
In the same week that Deutsche
Telekom delivered the sobering
news of its US unit, the largest US
phone company – AT&T Inc – said
that its consumer business faces
‘softness’ because of slowing
economic growth, triggering the
biggest drop in the company’s
stock value in more than five years.
AT&T said the pressure comes
from its having disconnected great
numbers of home-phone and high-
speed Internet clients for failure to
pay their bills. The softness has
not, the company said, spread into
the mobile-phone unit.
Elsewhere in telecom . . .
As reported in the
Economic Times
for 10
th
January, India’s Department
of Telecom reconsidered the
applications of six companies for
telecom licences, which it had
rejected only two days earlier on
technical grounds. The companies
– Allianz Infratech, S Tel, Spice
Communications,
Indiabulls-
owned Selene, Parsvnath, and
Cheetah Corporate Services –
were expected to be issued letters
of intent permitting them to offer
their services in the areas (‘circles’)
covered by their applications.
✆
✆
T-Mobile UK and 3 UK announced 31
st
December that they are combining
their third-generation networks in a move to save each of them $1.5 billion
over the next decade. Vodafone and Orange, two other British mobile phone
companies, have been talking about going the same route at least since
February of last year. In theory, at least, such agreements make good sense.
In 2000, European mobile phone companies spent some $145 billion on
3G licences, then spent billions more building networks intended to generate
enormous profits through the enhancement of mobile Internet services.
Now, seven years have passed, and mobile phone operators still struggling
to market their 3G wares. Pooling their networks would lighten operating
costs while they wait for their subscribers to become willing to pay for slower
3G connections that net them portable Internet.
So far, however, paying customers have exhibited a stubborn determination
to stay with the faster download speeds offered by fixed-line broadband
connections. If that can be broken, and fairly soon, the industry will likely
see more such network-sharing agreements beguiling the time – and easing
the financial strain – while the phone companies bring their 3G technology
up to speed. Faster speeds are again being promised, this time by way of
a High-Speed Downlink Packet Access, or HSDPA, which is being billed as
several times faster than the original 3G networks. T-Mobile UK and 3 UK are
creating what they say will be the largest HSDPA network in Europe. Analysts
are adopting a wait-and-see attitude toward both the new technology and
the usefulness of network-sharing short of outright merger. Many believe that
only consolidation across the industry will spell success for 3G. Meanwhile,
T-Mobile and 3 UK have begun their own consolidation. Like a touring
company, they will be trying out their network-sharing in rural areas first.
Watched by Europe, two British mobile phone
operators join forces to share networks