Editor’s Note: RCR Wireless News goes all in for “Throwback Thursdays,” tapping into our archives to resuscitate the top headlines from the past. Fire up the time machine, put on those sepia-tinted shades, set the date for #TBT and enjoy the memories!
Shifting tides for Motorola
Any industry that converges with the Internet has seen its entire model be destroyed and rebuilt. Like a tidal wave, it crashes and levels the playing field. For many, this tsunami of change is a disaster, destroying those caught unprepared. But this so-called disruptive technology also serves to rise otherwise sinking ships, setting them in a new body of water in which their struggling vessels may thrive. This latter scenario has proved beneficial to the many upstarts challenging the incumbents in the wireless industry. It also has been valuable to one once-struggling stalwart of the wireless industry-Motorola Inc. Once upon a time, Motorola was on top of the world. It was the undisputed leader in wireless equipment, both infrastructure and handsets. But like Humpty Dumpty, Motorola had a big fall. It got caught unprepared for the digital phone revolution and lost much of its handset market share to rivals Nokia Corp. and L.M. Ericsson, from 51 percent in 1996, to 17 percent last year. Critics accused Motorola of being arrogant and not partnering with others. Two years ago, analysts faulted the firm for not pursuing partnerships with third-party software developers and others. … Read more
Telstra as a “New Age” company
NEW YORK-Telstra Corp., Australia’s dominant telecommunications provider, “hates to be considered an incumbent because we transitioned to a New Age company years ago,” said Philip Wise, managing director of its Mobile Consumer Division. To provide a full suite of services, the company is involved in a three-pronged initiative aimed at “mobile, international aspirations and broadband, which is our next wave,” he said during a presentation here in late June. “The recent joint venture with Pacific Century CyberWorks is key to our expansion into Asia … Our pan-Asia strategy is that we see real opportunities to leverage our strength in mobile wireless, Internet and mobile multimedia linkages,” he added. “We will make a number of investments in developed and undeveloped markets to build a portfolio of linked networks with the goal of being the partner of choice and build what could become a major regional cellular operator.” In April, Telstra agreed to invest $3 billion in Pacific Century CyberWorks Ltd. to form two separate ventures with the Internet investment group. One pools their cable television assets; the other the Hong Kong wireless assets of Cable & Wireless HKT with those Telstra owns outside Australia. The Australian carrier will own 40 percent of the joint venture. … Read more
Security concerns arise with global telecom mergers
WASHINGTON-As Congress raises national security concerns about global telecom mergers, Nippon Telegraph and Telephone Corp.–the Japanese parent company of arguably the world’s top mobile-phone Internet operator–confirmed last week the FBI is scrutinizing its proposed $5.5 billion purchase of a Colorado Internet firm. “All that we know is the FBI is interested because of legal issues,” said Nathan May, of Fleishman-Hillard, on behalf of NTT. The emergence of national security fears-manifested in new telecom legislation and in a high-profile congressional correspondence to Federal Communications Commission Chairman William Kennard-could alter the dynamics of future mergers between U.S. and foreign telecommunications companies. For example, with the WorldCom Inc.-Sprint Corp. deal all but dead, Deutsche Telekom AG may be ready to make a play for Sprint’s long-distance, Internet and national wireless properties. Deutsche Telekom is majority-owned by the government. Newly introduced legislation would ban-without exception-firms more than 25-percent foreign-government owned from buying U.S. telecom firms. In other words, if the legislation were enacted, Deutsche Telekom would be denied its strategy to have a major presence in the United States. … Read more
Merger madness and wary regulators
Let the bidding frenzy begin. Possibilities are blowing open now that Sprint Corp. and WorldCom Inc. ended their $115 billion merger plans and reports of suitors for VoiceStream Wireless Corp. circulated last week. Germany’s Deutsche Telekom AG and a partnership of Japanese operator NTT DoCoMo and Hong Kong’s Hutchison Whampoa Ltd. are said to be making separate bids for VoiceStream Wireless Corp. But a new wild card–national security concerns–suddenly casts a cloud over possible telecom takeovers by overseas firms, particularly those indirectly owned by foreign governments. Sen. Ernest Hollings (D-S.C.), ranking minority member of the Senate Commerce Committee, and other lawmakers are stepping up pressure–through legislation and brow-beating letters to federal regulators–to block purchases of U.S. telecom carriers by foreign-government-owned telecom firms. In light of the Department of Justice’s plan to take its opposition to the merger to court, WorldCom and Sprint concluded the conditions DOJ demanded would compromise customer and financial benefits of the merger. DOJ also would be unable to take the case to trial before 2001, and the companies did not want to pursue protracted litigation. The merger was thought dead weeks ago after antitrust czars at the DOJ and the European Union rejected the transaction. The collapse of the deal, punctuated with angry parting words from WorldCom head Bernard Ebbers, now leaves Sprint PCS, Nextel Communications Inc. and VoiceStream the three remaining independent wireless carriers that offer near-nationwide service. … Read more
SBC/BellSouth merger faces objection from small carrier
WASHINGTON-The joint venture between BellSouth Corp. and SBC Communications Inc. to create the sixth nationwide wireless carrier hit a speed bump in its cruise for approval last month when a small Michigan cellular operator objected. Thumb Cellular L.P. filed papers with the Federal Communications Commission claiming that SBC could not transfer control of its license to the new, as yet unnamed, venture because it no longer controlled any interest. “SBC intends to transfer or assign to [the joint venture] an interest in TCLP. [This] contemplates a continuation of the ruse in which SBC claims a cognizable interest in TCLP,” said Thumb. SBC and BellSouth strongly disputed the claim and said the issues raised in the Thumb objection were better handled by a state court. “The petition to dismiss or deny filed by [TCLP] does not challenge any aspect of the proposed [commercial mobile radio services] joint venture of SBC and BellSouth … This transfer of control proceeding is not the appropriate forum to consider Thumb’s claims. Its assertion that Ameritech was not a partner raises state law issues that, under well-established policy, are to be left to the courts,” said the companies in response. This is the second time this year this issue has surfaced. … Read more
Telecom players navigate an IP world
NEW YORK-The interplay between intelligent networks and Internet Protocol is a battle of the Titans, according to David Berndt, director of wireless mobile technologies for The Yankee Group. Carriers must avoid getting caught in the crossfire while emerging from this transition as winners that take the best parts of both worlds. “The rapid rise to prominence of IP has surprised many players in the telecom industry. It has caused a radical re-think of how networks are designed and implemented … The technology of this next-generation network is extensible to cellular networks as well,” said a recent Ovum report on Mobile IP from Iain Stevenson. Over the longer term, IP offers three transformational promises, said Pulin Patel, co-founder and chief technology officer of IPmobile. It will lower barriers of entry, enabling a host of new players, including carriers and software applications developers, to add value to the telecommunications marketplace. It will permit seamless and ubiquitous access by end users to various networks that are now distinct, including cellular, digital subscriber line, cable television, wireline and fixed wireless. It will offer billing tied to an individual person so that, for example, a person seeking to recharge a prepaid account could do so “as if he were buying gas and found a gas station, instead of having it done on a provisioning basis through an IN platform,” Patel said. … Read more
Check out the RCR Wireless News Archives for more stories from the past.
