Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Nortel Networks (NT) -- Ignore unavailable to you. Want to Upgrade?

To: Kenneth E. Phillipps who wrote (3306)	9/11/1999 2:08:00 PM
From: Kenneth E. Phillipps	Read Replies (1) \| Respond to of 14638

September 10, 1999 By Carlos A. DeJuana BUENOS AIRES (Reuters) - Argentine data transmission company Impsat plans to spend at least $2 billion in the next five to six years creating the largest high-speed fiber optic network in Latin America, its general manager said Friday. In the first stage, "we are investing a little more than $250 million and expect to invest approximately $2 billion in the whole project, or even more maybe," Marcelo Girotti, Impsat's general manager for its Argentine operations, told Reuters. "If we get a very good response from our clients, that time frame will get even shorter," he said from his office overlooking Buenos Aires' downtown skyline. Impsat -- owned by Argentine holding Grupo Pescarmona (59 percent), Morgan Stanley Dean Witter & Co. (21 percent) and British Telecommunications Plc (20 percent) -- also plans to offer its customers long-distance voice services starting in November 2000 and has plans for an initial public offering (IPO) in the United States. "We're evaluating which is the best moment," he said. "We hope it takes place as soon as possible." Outside his window, an array of antennas is pointed at Buenos Aires' financial center providing backup for the two fiber optic cables that lie underneath a shipping canal separating Impsat's office from downtown. In only 10 years, Impsat has claimed as customers a large portion of those companies whose headquarters are downtown. Two of Argentina's largest operations -- oil company YPF, now part of Spain's Repsol-YPF group, and state-owned Banco Nacion -- are clients of Impsat. Nationwide, it has 45 percent of the data-transmission market. Impsat has also set up operations in Brazil, Colombia, Ecuador, Venezuela, Mexico and the United States. Like other Latin American telecommunications firms, Impsat has grown at a rapid pace in the past years. Its customer base expanded to 1,467 customers in seven countries at the end of 1998, from 125 customers in two countries at the end of 1992. Revenues grew more than tenfold in that time to $208.1 million from $20.5 million. Yet most of that still comes from Argentina, which posted revenues of about $101 million last year. In hopes of further developing existing operations, Impsat recently announced it is in the process of hiring Canada's Nortel Networks to build the first phase of IMPSAT 2000, the name for its pan-Latin American network. The project is expected to generate revenues of $244 million for Nortel over the next two years. Impsat has also signed an agreement with Bermuda-based Global Crossing Ltd., an undersea fiber optic cable operator with worldwide operations. The deal will allow the two to link their networks. IMPSAT TO OFFER LONG DISTANCE Even though Impsat plans to offer its corporate clients long-distance voice services in November 2000, when the Argentine government allows new competitors into the market, Girotti said the focus would remain on data transmissions. "Voice telecommunications have seen a lot of competition in the last years from services which make it unnecessary to use one's voice," he said in reference to communications tools like faxes or e-mail. "We're going to have more and more applications that will allow you to integrate your voice in your communications system," Girotti said. "I think (voice) telephony has its days numbered." Still, voice communications still have room to grow in Argentina, where high costs have kept utilization historically low, he added. Impsat will join Telefonica de Argentina, Telecom Argentina, Movicom, and CTI next year in Argentina's long-distance market. The last two will only begin offering their services this October, when the country's market is partially deregulated after a nine-year monopoly by the first two. Data transmissions firm Comsat and Techtel are also expected to join the long-distance market in 2000.