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Technology Stocks : Vodafone-Airtouch (NYSE: VOD) -- Ignore unavailable to you. Want to Upgrade?

To: Jules Shear who wrote (2980)	10/4/2000 12:34:17 PM
From: MrGreenJeans	Read Replies (1) \| Respond to of 3175

Lex Column - FT To investors still digesting the enormous sums spent by mobile phone operators on spectrum for third generation services, news that researchers are starting work on fourth generation technology sounds rather alarming. In truth, it is not. Ericsson says it will take a decade before 4G becomes a reality. And most technologies described as such are complimentary to 3G - for instance ultra high-speed mobile local area networks. When fourth generation arrives it will probably coexist with enhanced 3G for some time and companies with strong 3G businesses should be able to migrate customers to 4G. Moreover, companies are buying spectrum - the raw material of mobile telephony - which could be reused under new technologies. Several operators, such as Vodafone, needed more just to cope with demand for voice and messaging. Demand for spectrum should explode as bandwidth-hungry mobile devices proliferate (for instance, with communications systems in cars). Indeed 4G may be required to find ways of exploiting more spectrum. Buying spectrum, then, is not simply a punt on 3G. But there is risk - albeit small - that 4G could employ spectrum so efficiently that operators would need less to do business. Given the expected technology cycles, investors should be uncomfortable with 3G business plans that take much more than a decade to earn an adequate return.

To: Jules Shear who wrote (2980)	12/17/2000 11:06:57 AM
From: MrGreenJeans	Read Replies (1) \| Respond to of 3175

Vodafone-Verizon on the Horizon? Jules: 1. Your thoughts on the Bulgarian GSM withdrawal by Vodafone which just happened...do you think this may mean they may purchase Sonera?... 2. Your thoughts on the article below. My own thoughts are that Vod-Verizon is a merger waiting to happen... Daily Telelgraph: City Comment: Vodafone should make a call to America City Editor's comment by Neil Bennett THE market worked itself into a lather last week with the news that Vodafone is trying to buy 15 per cent of Japan Telecom. Admittedly the deal, at £1.7bn, was small beer for a company capitalised at £155bn even after the telecoms stocks slump. But it showed that the great white shark of the telecoms industry is on the prowl once again after digesting Mannesmann. Perhaps because of the scale of the Mannesmann deal or maybe because it has been relatively quiet in recent months, the market seems to have forgotten what a large and hungry animal Vodafone is. It devoured two enormous telecoms groups, Airtouch and Mannesmann, in less than a year and still has an appetite to mop up any minority stakes in its empire as a digestif. Vodafone's mission is simple. It wants to be the world's largest mobile telecoms operator. By any yardstick, it is less than halfway there, despite its enormous market value. Yes, it dominates Europe and has useful investments in dozens of other countries. But it still owns minority stakes in most of them, not least in the US, which is not only the world's largest mobile phone market but also one of the most underdeveloped. Vodafone's other problem is that it has also outgrown its equity market. It is a very large shark in a small tank. It accounts for more than a tenth of the entire FTSE100 Index, and the City's traditional fund managers are extremely wary of increasing their exposure in the company or even maintaining their weighting in it, for fear of being too exposed to the gyrations of one stock and one earnings stream. If Vodafone wanted to do another huge deal for shares, it would find it almost impossible to place the paper with the Prudentials and Schroders of this world. But Vodafone cannot simply sit around, waiting for something to turn up. Its rivals are determined to overtake it. France Telecom is floating Orange next year with the thinly veiled aim of mounting an effective global challenge to its British rival. Deutsche Telekom would love to do the same. I suspect we may see a further very large deal from Vodafone in the New Year to put some clear blue water between it and its rivals. As part of that deal, the group must look to the US. Any telecoms operator with global pretensions must control one of the leading US telcos. Well, Vodafone has a ready-made candidate in the US. It is just that the market does not realise it yet. The group owns 45 per cent of the wireless arm of Verizon, America's leading local telecoms operator. Verizon Wireless is also the US market leader. Just suppose that Chris Gent, Vodafone's desperately persuasive chief executive, could organise a Vodafone-Verizon merger. The resulting company could have a joint listing in London and on Nasdaq, which would enable Vodafone to escape from the relative backwater of the London equity market. It would bring Verizon Wireless firmly into Vodafone's orbit and enable it to construct a truly global network. The enlarged group would have to determine what to do with Verizon's local wires business, which is a solid cash generator. There would be other benefits. Vivendi, Vodafone's joint venture partner in Vizzavi, the mobile internet portal, landed in the US earlier this year with its Seagram takeover. Data transfer and wireless internet services are still virtually unknown in the US. A Vodafone-Verizon merger would offer tremendous opportunities to roll out Vizzavi throughout North America and transform it into a global new media platform. Gent is always one step ahead of the rest of us, so I suspect all this and more has probably occurred to him. But I doubt he would do anything other than an agreed deal. American corporations are virtually impervious to hostile bids and, besides, Verizon is already a strong partner and Gent would not want to alienate it. I also reckon Gent would do anything to avoid another battle after his bruising takeover of Mannesmann. So for now perhaps he is waiting for the right moment to make a proposal, or waiting for Verizon's management to come round to his way of thinking. If history is any judge though (and it usually is) you would be on pretty safe ground if you predicted that Vodafone would do another mega deal before long.