HELSINKI, Finland-BrainHeart Capital, a Stockholm-based group dedicated to investments in wireless technologies, has decided against investing in the third-generation (3G) industry, 3G company stocks and 3G projects, in what amounts to a further vote of no confidence in a sector that is already struggling under the weight of heavy debts, rollout deferrals and recurring losses.
The Swedish company plans to raise and invest US$2 billion in new technology and mobile communications projects during the next six to seven years. The global sector niche that is targeted is GSM technology, with a special focus being placed on pubic wireless local area network (WLAN)-related investments.
“We will avoid investing in 3G technology, at least for now. In our estimation, if we want to see a healthy return, we would be better advised to invest in existing technologies such as GSM,” said Ulf Jonstromer, chief executive officer (CEO) of BrainHeart.
BrainHeart’s investments are primarily concentrated on five segments, including industrial wireless applications, mobile virtual network operators (MVNOs), wireless Internet service providers (WISPs), mobile messaging/e-mail and vertical applications.
According to Jonstromer, a “good deal” of investment potential still remains in GSM technology. Investments will be focused on “high-return” markets in Central and Eastern Europe and Asia.
Nevertheless, and despite its clear reservations about 3G, BrainHeart intends to invest in public WLAN services. “PWLAN is without doubt the hottest area nowadays for investment,” said Jonstromer.
“Our standard will be to invest in companies and technologies where we will see a return in three to four years. This rules out 3G and mobile data services, including mobile commerce,” said Jonstromer.
Earlier this year, BrainHeart incorporated a company, SweFour, to operate the fourth GSM license in Sweden. “There are still handsome opportunities out there to woo customers and traffic away from fixed operators,” said Jonstromer.
