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Technology Stocks : Newbridge Networks -- Ignore unavailable to you. Want to Upgrade?

To: Chris Stovin who wrote (8171)	12/2/1998 3:06:00 AM
From: pat mudge	Respond to of 18016

From the Financial Times, lower inter-exchange fees, increased competition, heightened need for carriers to upgrade: <<< TUESDAY DECEMBER 1 1998 Telecoms CANADA: Boost for phone market By Scott Morrison in Toronto The Canadian telecommunications regulator yesterday announced it had lowered the rates that former telephone monopolies could charge competitors for using their facilities to provide local services to customers. It is not yet clear whether the rates have been lowered sufficiently to enable competitors freely to enter the local market but at stake is the future shape of the C$8.5bn (US$5.5bn) local telephony market in Canada. A number of long-distance service providers and wireless operators have announced their intention to enter local markets across the country. They have been waiting for the announcement by the Canadian Radio- television and Telecommunications Commission (CRTC). Officials at Sprint Canada and AT&T Canada were not immediately available yesterday. One analyst said the commission appeared to have lowered the interim rates by about one third in order to allow a handful of efficient competitors into the market while preventing a number of smaller, less efficient companies from launching a local service. Yesterday's announcement covered local loop rates - the rates which companies must pay to use an incumbent's local network facilities. The services covered by the decision also include access to the 911 emergency service and message relay services. Bell Canada and Telus had requested that the loop rates average more than C$30 per month per line, far higher than rates in many US states, such as California, where local loop rates average C$13.84. The rates vary according to a number of factors, including population density. The regulators set the rates based on a formula that enabled the incumbents to cover their costs plus a 25 per cent mark-up. But determining the true cost of providing a local service was a key area of contention among the telephone companies. The CRTC last year set interim rates based on what the local telephone companies said were their costs. Other possible service providers, such as Sprint Canada, owned by Call-Net Enterprises, had argued that the interim rates filed by the telephone companies were much higher than corresponding rates in the US and would effectively prevent competitors from entering the Canadian market. Local services have long been subsidised by long distance revenues. >>>> <<< WEDNESDAY DECEMBER 2 1998 Telecoms Debut for Spain's third fixed-line operator By Tom Burns in Madrid Spanish flag>Spain yesterday took a big step in the liberalisation of its telecommunications sector. This came with the start-up of Uni2, a third fixed-line carrier - controlled by France Telecom - which will initially operate long distance calls. Under the open market guidelines, more than 20 providers of niche telephony services have applied for licences to the Telecommunications Market Commission (CMT), a newly created independent regulator, which will supervise the sector. British Telecommunications, which already operates a data transmission company in Spain and is a main backer of Airtel, a second mobile phone carrier, is likely to add basic telephony services to its Spanish business early next year. To encourage competition, the CMT has lowered the reference price for the interconnection fees that new operators will negotiate for the use of lines owned by Telefónica, the former monopoly operator. The reduction of up to 30 per cent in existing fees came into operation yesterday, but Telefónica said it would contest this in court. Uni2 will compete with Retevisión, a carrier launched by Telecom Italia in January as Spain's second fixed-line provider, as well as with Telefónica. It plans to invest Pta207bn ($1.4bn) over the next 10 years in order to gain 7.5 per cent of the domestic market by 2008. The new operator, which is 69 per cent owned by France Telecom, was the sole bidder in May for the third fixed-telephony licence awarded by the government in the run-up to deregulation. It was beaten by Retevisión in its attempt to gain the third mobile licence, awarded in June. The government plans to dispose of its 30 per cent stake in Retevisión through an industrial sale before year-end, and Retevisión will begin to offer cellphone services in January. Uni2 now hopes to enter Spain's cellular market using new mobile systems that have still to be approved by the European Union. The Spanish telecom market represents one of the brightest investment opportunities in the EU. There are some 40 telephones per 100 inhabitants against the European average of over 50 and the number of mobile phone users is forecast to grow from 4m to 10m over the next three years. Airtel accounts for 30 per cent of domestic cellular business, and Retevisión has some 8 per cent of the long distance calls market. >>>> >>> WEDNESDAY DECEMBER 2 1998 Telecoms SERVICE DELIVERY: Oftel turns eye to local loops By Alan Cane David Edmonds, the UK telecommunications watchdog, yesterday addressed the problem of "local loop unbundling" prior to the publication of an Oftel consultative document this week. The "local loop" - the final connection between the exchange and the home or office - is one of the most complex issues Oftel has tackled. Most local loops in the UK are owned by British Telecommunications, which charges other operators for delivering their traffic. Mr Edmonds said at the Financial Times World Telecoms conference in London the local loop had the technical potential to deliver new services such as high-speed internet access and video-on-demand. "The question I face is how to get that potential released in the UK. What, if any, regulatory changes are needed to help?" He described a Brussels proposal to compel operators with significant market power to rent their local loops to rivals at cost-based prices as "drastic". This would raise difficulties because operators might be reluctant to invest in networking infrastructure if they were forced to rent their cables to competitors. He said the new telecoms world might never conform to a freely competitive model. "My guess is that the provision of mobile networks and conditional access systems is always likely to be done by a small number of players." Sir Iain Vallance, BT chairman, told the conference regulation had to be based on competition policy supplemented by checks and balances rather than prescription. He said his attitude to regulators had changed. "I have been known to belabour regulators without mercy. Nowadays they have all my sympathy. Their responsibility is immense and their task almost impossible." >>>>