Editor’s Note: The RCR Wireless News Time Machine is a way to take advantage of our extensive history in covering the wireless space to fire up the DeLorean and take a trip back in time to re-visit some of the more interesting headlines from this week in history. Enjoy the ride!
McCaw financing rescues Iridium
Is it a bird? A plane? No, it’s Craig McCaw, swooping in to rescue yet another struggling satellite wireless phone company-leading a group of investors to provide $74.6 million in interim financing for the bankrupt Iridium L.L.C. This is McCaw’s second performance in his satellite superhero role. With his Teledesic broadband satellite company and Eagle River Investments L.L.C. financial arm behind him, McCaw led the charge to save bankrupt satellite carrier ICO Global Communications late last year. Far from bailing out the struggling Iridium completely, the $74.6 million debtor-in-possession financing will fund Iridium operations through June 15. During that time, McCaw and the investors will develop arrangements for a complete financial restructuring, which may include McCaw buying Iridium’s assets. … Read More
Wireless growth, new services bode well for tower sector
Tower companies are sitting pretty and poised for even greater prosperity in 2000 and beyond as domestic demand for their properties grows. Prime movers in this rosy scenario are the “booming” cellular and personal communications services providers, whose voice traffic and subscriber numbers are “going through the roof,” said John Bensche, senior wireless analyst for Lehman Brothers Inc. The New York-based investment bank recently accelerated its projections for 70-percent wireless penetration in the United States, he said. Lehman had expected this milestone would be reached in 2007 but now anticipates it in 2002. … Read More
BellSouth to issue Latin American tracking stock
BellSouth Corp. said last week it could issue a tracking stock for its highly successful Latin American operations by late April or early May, a move that will allow investors to more accurately value the company’s international assets. BellSouth’s Latin American business consists of properties in 10 countries and has estimated earnings before interest, taxes, depreciation and amortization of $800 million, expected to grow at a compound rate of 50 percent during the next three years, said analysts with Morgan Stanley Dean Witter. Issuing a tracking stock will give BellSouth a “lower cost of acquiring assets in what will likely be a year of major consolidations in the South American telecommunications industry,” said Eric Strumingher, analyst with PaineWebber. … Read More
Vodafone AirTouch now focused on smaller acquisitions
While Vodafone AirTouch plc last week advanced its merger with Germany’s Mannesmann AG, the company indicated it may look to fill in its footprint with smaller acquisitions. In particular, the company has been closing in on a bid for a stake in Spain’s second-largest mobile phone company, Airtel. A shareholder meeting Feb. 22 could allow Vodafone AirTouch to take control of the company. Vodafone and British Telecommunications plc have been competing for several months to buy a 30.5-percent stake in Airtel now held by Banco Santander Central Hispano. Vodafone currently owns 21.7 percent of Airtel. … Read More
Carriers anxious for GPRS handsets
General Packet Radio Service technology is a powerful proposition for Global System for Mobile communications operators anxious to comb in the huge revenues packetized wireless Internet access promises. That’s why they want GPRS handsets this year. Product delays have been part of the wireless industry since its inception, and it doesn’t look any different for GPRS handsets. Many European and some North American GSM operators were hoping to introduce full-blown commercial GPRS networks this year. “Base-station technology is ahead of handsets,” said David Island, vice president of sales for wireless in the United States with Alcatel, which three months ago decided to focus on the U.S. GSM market. “That will be the gating issue to GPRS deployment.” … Read More
Web hacking just one obstacle to wireless e-commerce
As wireless e-commerce struggles to establish itself as an industry mainstay, it faces major legal, technical and security challenges like the cyber attacks of last week that temporarily shut down several popular Web sites and triggered a Justice Department probe of such activities. With forecasts that wireless devices will be major drivers of e-commerce in the future, the latest wave of cyber attacks have major implications for the industry in the emerging Net economy. Last week’s Web hacking, which points up the vulnerability of doing business on the Internet, is just one of the obstacles facing wireless e-commerce. Privacy, taxation, fraud, and information theft are suddenly on the radar screen in the brave new world of wireless e-commerce. … Read More
NGA chairman says telecom carriers are over-taxed
Gov. Michael Leavitt, chairman of the National Governors’ Association, last week released a report that he says shows that telecommunications carriers are over-taxed. “We are suggesting with this paper that the telecommunications industry is over-taxed,” said Gov. Leavitt (R-Utah). The paper, “Telecommunications Tax Policies: Implications for the Digital Age,” is being presented as part of Leavitt’s theme of helping states to govern in the global economy and is one of a series of papers that will be released this year, Leavitt said. Due to NGA policy guidelines, the paper will not be presented to Capitol Hill but parts may become part of NGA’s lobbying efforts, he said. … Read More
Carrier-reseller relationships strained by industry growth
Oral arguments began Feb. 10 in a case that offers a glimpse of the ways some carrier-reseller relationships are strained due to wireless telephony’s transition from luxury to commodity. Autosound & Cellular, an Old Bridge, N.J., retail agent, and Palm Springs Auto Resort, an Edison, N.J., wholesale agent, allege that Comcast Cellular Corp., Philadelphia, violated state franchise law when it terminated contracts with them in June 1994. The jury trial, with Judge Richard Plechner of N.J. Superior Court, Law Division, presiding, will rule on the facts of the case. If the panel of six women and two men find Comcast guilty, a separate proceeding with a new jury will determine and assess the monetary damage award. … Read More
Mixed feelings remain between technology camps
Public skirmishes over third-generation technology died last year when the wireless industry embraced a harmonized CDMA-based standard, but old feelings between camps die hard it seems. The CDMA Development Group, the interest group that represents Interim Standard-95 carriers, said it is testing just how much European standards makers are willing to open their process to outsiders. The CDG is trying to gain membership as a market representation partner with the European Telecommunications Standards Institute’s 3G Partnership Project, a standards group ETSI established in 1998 to develop GSM-based 3G technology, primarily W-CDMA technology. … Read More
Long-term debt defaults hit record high in 1999
Publicly held long-term debt set an unwelcome record in 1999 as 147 corporate and sovereign issuers defaulted on $44.6 billion in bonds, more than double the $21.2 billion of defaults during 1999. Moody’s Investors Service Inc., which released its year-end 1999 bond default report in late January, attributed the poor performance to two primary factors: a surge in issuance of lower-rated bonds and a hangover effect from the Asian economic crisis, which began in 1997. The United States continued its dubious distinction as the largest single source of defaults throughout 1999, contributing to 95 defaults on $23.2 billion of long-term debt. … Read More
