Telecoms Weigh BT Wireless Plan To Share Networks in Netherlands
By ALMAR LATOUR
Staff Reporter of THE WALL STREET JOURNAL
LONDON -- The wireless unit of British Telecommunications PLC has proposed that five operators share just two networks for third-generation mobile-phone services in the Netherlands, rather than building five separate facilities.
The proposal by BT Wireless, which is being considered by the other operators, is the latest sign of attempts at increased cooperation among European mobile-phone operators, a trend that promises to eat into the revenue of companies that make telecommunications equipment.
The talks over consolidating mobile infrastructure in the Netherlands include subsidiaries of BT, Vodafone Group PLC, KPN NV, France Telecom SA and Deutsche Telekom AG, said Peter Erskine, the chief executive of BT Wireless.
"I would not be surprised if we end up with just two networks in the Netherlands," Mr. Erskine said. "All of us are working toward it and talking to each other to make it happen. The Dutch government is being very open-minded and pragmatic."
"It could take up to six months, however, before cooperation deals are struck, cautioned Marc Gommers, director of corporate strategy for Dutchtone NV, a subsidiary of France Telecom, and one of the smaller Dutch operators.
New third-generation wireless services are expected to allow consumers to use their mobile phones for such things as sending e-mail and downloading music and video clips.
Initially, BT proposed that the five Dutch operators construct just one network, but that plan was ruled out last week when the Dutch government said network sharing was allowed but insisted that there be at least two network systems.
The Dutch talks to share third-generation networks, if successful, would intensify already-tough competition among network-equipment manufacturers such as Sweden's Telefon AB L.M. Ericsson and Finland's Nokia Corp. The sharing of third-generation infrastructure means fewer customers, and more pricing pressure, for the companies that build the networks.
The telecom sector has already been hit in recent weeks by slowing handset sales and scaled-backed spending plans by service operators. Adding to shareholder concerns last week were Vodafone Chief Executive Chris Gent's comments that Vodafone was slowing the construction of its advanced mobile-phone networks.
Mobile operators are keen to share the cost of constructing third-generation infrastructure after shelling out some $100 billion (114.7 billion euros) to win licenses auctioned by European governments. Network sharing means that operators would split the costs to erect a third-generation telecom network -- including masts, wires, switches and building sites -- and the operators would then each get to tap into the network's capacity.
European governments have grown increasingly sympathetic to operators seeking to share the cost of developing third-generation networks. Last month, network operators in Germany agreed to jointly construct and use new networks, while BT Wireless agreed with Deutsche Telekom to share third-generation networks in Germany and Britain. |
