HELSINKI, Finland—Vattenfall and Swedish power sector ally Birka Energi have reached a preliminary agreement to use their combined electricity systems as springboards to build new stations for third-generation (3G) networks, offering masts and antennae, as well as maintenance and electric power to telecom operators.
The utilities are concerned that telecom operators will fail to put 3G products onto the market by 2003, when Sweden plans to have a network reaching 100 percent of the population. 3G coverage plans in other key European markets suggest far more modest targets than those in Sweden.
Vattenfall has described its end objective as a “serious solution to a serious situation.”
“Our plans and fears are well grounded in plain logic. After 12 months of research, we do not believe there is sufficient demand out there to absorb the services planned by the 3G network operators right now,” said Leif Jonsson, the head of Vattenfall’s 3G Project Division. “We are a player in this market, and a player operators will want to work with.”
Elsewhere, Jan Uddenfeldt, Ericsson’s technology development chief, confirmed that the company “expects to start shipping” 3G handsets in volume during the final quarter of 2002. Nokia too remains committed to shipping first 3G handsets in time for the Christmas market next year.
While 3G handsets will be more expensive than the current second-generation (2G) handsets, Uddenfeldt explained the bulk of the cost increase would be due to the handsets’ greater functionality and the introduction of color displays.
The 3G transmitter element of the phone will be initially just 25 percent more expensive than an equivalent 2G module. “Prices will fall, and continue to fall, once volume shipment hits the right note,” said Uddenfeldt. “By year-end 2002, Sony Ericsson Mobile Phones will be operational. It is reasonable to assume the handsets will be shipped under the new brand and not as Ericsson handsets.”
