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Belgacom plans to cut down on acquisition finances (Belgium)

  • November 20th, 2008
  • 12:16 pm

Belgacom, the Belgian mobile operator, has plans to cut down on the amount of $5.1 billion-$6.3 billion for potential acquisitions amid scarce credit due to the global financial crunches. No financial plans have been revealed following the announcement but the operator has confirmed it is still mulling possible targets.
   

Belgacom posts Q3 revenues of $1.89 billion, down by 2.6% (Belgium)

  • November 10th, 2008
  • 5:43 am

Belgiums leading telcoms company, Belgacom reports net profit of $276.8 Million, observing a fall of 7.3% in Q3′08 and revenues of $1.89 billion, down by 2.6% since last year, caused by economic breakdown.
The company said that despite all the challenges from strong competition and pricing regulations, its core results were “solid” for the quarter.
Its mobile operator Proximus added 33,000 new mobile subscribers.
The company continues to look for new acquisition opportunities outside Belgium but good deals that create shareholder value are “not that common.”

   

Belgacom may go for wholesale market consolidation (Belgium)

  • September 24th, 2008
  • 10:38 am

In the whole sale sector Belgacom International Carrier Services (ICS) calls for a reduction in the number of players. According to Daniel Kurgan, CEO of Belgacom ICS, Economically there is a need for consolidation in this business. It should be the objective of every carrier to create the best platform they can and drive volumes while keeping their cost base as flat as possible, he said. Considering the scenario of the market, as the market remains crowded, prices will continue to decline, even though the rising number of new services coming to market this implies that the business of providing wholesale services is becoming more intricate. To help wholesale carriers streamline their costs and stave off a growing price war across the industry consolodation is needed. He also claimed that most operators subsidise their wholesale voice operations with their retail divisions. This model is not sustainable in the long term, he said. There are some obsatcles to this consolidation:
Lack of Transparency in the business

Non-Economic Barriers
Kurgan mentioned the importance of implementing clear governance and decision-making processes following a merger in order to meet the needs of customers and therfore reponding apidly to rivals and to other market forces. I believe that consolidation is the future. It will generate value for shareholders, better services for customers, and will position carriers to take advantage of possible synergies during future rounds of consolidation, Kurgan added.

Belgacom considers an investment of USD7.23 billion in developing countries (Belgium)

  • September 23rd, 2008
  • 5:29 am

Belgacom, according to Chief Executive Officer, is thinking of an investment of upto USD7.23 billion in foreign assets. The CEO, Didier Bellens, will consider the investment in developing countries, diverging from it’s former strategy of smaller European acquisitions in recent years. ‘We may go further than just Europe for mobile companies, but prices were very, very high. The prices have adjusted dramatically, and I believe there is growth in these countries’, said Bellens.
   

Belgacom’s Tele2 Luxembourg acquisition finalised (Luxembourg)

  • August 7th, 2008
  • 1:22 pm

Belgacom announced the completion of Tele2 Luxembourg purchase, which was due on 26th June. The company confirmed it will continue to operate the Luxembourg subsidiary under its current residential ‘Tango’ brand, offering both mobile and broadband services.
Belgacom is also in process of finalising the Tele2’s Liechtenstein operations purchase and the purchase price for the two operators is around EUR210 million (USD330 million).

   

Belgacom fined USD4.85 million for delay in lower tariffs (Belgium)

  • July 29th, 2008
  • 1:08 pm

Belgacom, Belgium’s leading mobile operator, will be fined EUR3.09 million (USD4.85 million), as a result of the operator’s failure to pass on lower mobile termination rates to subscribers, following regulator rulings in October 2006 and May 2007, announced Belgian Institute of Postal services and Telecommunications (BIPT) in a statement. The BIPT had previously warned Belgacom in January of this year that it must comply, but the lower rates were not fully implemented until July 2008.

   

Belgacom takes over Mobile-for (Belgium)

  • July 18th, 2008
  • 9:15 am

Belgacom said it is taking over Mobile-for, a specialist in mobile payments for parking services.Belgacom’s takeover of Mobile-for fits in with its strategy to invest even more in the growing mobile payments market and to expand its offer.

Mobile-for has successfully launched the SMS parking solutions in 7 cities in Belgium already.

Mobile-for will now becom an independent entity of the Belgacom Group, causing no impact on Belgacom’s relationship with it’s existing customers and partners.

The service will be available in Bruges from October 15 and by December 2008 Mobile-for expects to offer the SMS parking service in some 10 cities.

   

European incumbents in process of transformation

  • May 2nd, 2008
  • 2:29 pm

Telcos speak out on metamorphosis into softcos, partnering and new revenue streams.
The growing importance of software in the telecoms space is requiring telecoms operators to change their business models, and this transformation means new ways of generating revenues. 

“We are already transforming ourselves [into] more than a software company,” said Denis Guibard, VP of innovation and new ecosystems at France Telecom, addressing delegates at this year’s Sofnet event in London on Wednesday.

“[There is] still value in providing access and connectivity,” he said, adding that in addition to moving further into software, France Telecom is also focusing on areas such as content and advertising.

“[We are] becoming more and more a softco… but not exclusively,” he insisted.

Meanwhile Belgacom is also ringing the changes.

The Belgian incumbent has reorganised its fixed, mobile and ICT operations around a single platform, known as ‘explore’.

“It stands for the transformation” to future services, said Belgacom vice president Hendrik Van de Velde.

The telco is aiming for “all customers, all services on one network… We have an excellent technology. It’s called MPLS,” he added.

“What’s really important is the services we bring on that platform,” Van de Valde reminded attendees.

The operator may not want the customer to care about network technology, “but you want your customer to pay,” interjected session chairman, Roberto Saracco, head of future centre and technical communications at Telecom Italia, introducing a subject close to the heart of all telcos, among them U.K. incumbent BT.

“We’re having to focus on ‘what are the new ways of making money?’” said JP Rangaswami, managing director, service design at BT.

Rangaswami used the analogy of an airport to explain the changes happening within the U.K. incumbent.

“An airport is an open, multi-sided marketplace,” he said. “What we are doing at BT is pretty much the same thing.”

Rather than looking at what customers want to have for free, “our concentration at BT is on figuring out what’s not free,” he said.

“Some people will pay for immediacy… some people will pay for interpretation,” he went on.

In TV shows like American Idol, “entry is free… the money is made in the voting,” he explained. Similarly, while Prince gave away many copies of his latest CD, the revenue was in the concerts.

“You have got to listen to your customers,” said Telecom Italia’s Saracco. Our customers tell us that what we offer is “perfect… just give it to me for free!” he said. The telco has many employees with innovative ideas, he added “They might even fly as services if you give them connectivity for free.”

But talk of free entry and free connectivity is still uncomfortable for operators.

Revenue is still in providing basic services, such as fixed broadband said Guibard of France Telecom. Even though prices have fallen due to intense competition, “we’re not going to give that away for free,” he insisted.

He believes the answer is in bundling more services for a flat fee, that might even be perceived by the customer as being free. In addition, “these new services may be financed by advertising,” he said.

Power in partnerships
The key message from Wednesday’s debate was clear: telco businesses are evolving, but the telcos will not be able to go it alone.

Innovation will be critical for telecoms operators, but this innovation can come from outside the company, said Sapthagiri Chapalapalli, client director at Tata Consultancy Services.

“Build a network of partners and participants,” he urged. This is vital to the transformation journey. Otherwise, investment in next-generation networks “is not going to work.”

France Telecom is already taking that advice.

“IT and software [are] very important to the trend towards convergence,” said Guibard, outlining the various steps his company is taking towards convergence, a journey that will culminate in the deployment of IMS.

“We are not doing that alone,” he added.

Meanwhile, dismissing suggestions that telecoms operators moving into software would hurt his company, Chris Bray, telecoms industry solution sales at IBM Software Group, also highlighted the importance of working with partners.

“Service providers are going to have to learn to partner a little better,” he said, adding that some cultural change will be required.

“Use the data,” he urged, referring to the amount of subscriber information held by the telcos. Service providers have not made significant investments in that data historically, “but I suspect that’s about to change,” said Bray. Software companies can interrogate that data, he said.

France Telecom believes it is already well on the way to becoming a strong player in software.

“We are already a software company,” said Guibard, explaining that the telco has begun developing software and licensing it to other players.

We’re not Google, “but starting to change in that direction,” he said.

Telcos need to “compete [with] or complement the Web as a platform,” added Bray, suggesting they “have to take innovation lessons,” and boost speed to market if they are going to move forward.

“[But] BT is not about to become Google, [and] Google is not about to become BT,” he said, adding that “Google owns probably more dark fibre than most of the service providers in the world.”

And in a warning to telecoms operators, quoting Charles Darwin, Bray noted that it is not necessarily the strongest or the most intelligent that survives, “it’s the one that’s most adaptable to change.”

   

 

 

Belgacom to buy Scarlet for EUR 185 million (Belgium)

  • February 15th, 2008
  • 2:21 pm

Belgacom will acquire Scarlet, a communications service provider in the Netherlands, Belgium and the Netherlands Antilles, for EUR 185 million. Scarlet offers its international customer base of 180,000 broadband clients a variety of products with a “no frills” positioning which Belgacom will continue under the Scarlet brand. Scarlet will continue to operate as a separate business unit. The transaction is on a debt and cash free basis.

   

Cableco merger riles Belgacom (Belgium)

  • January 14th, 2008
  • 7:27 am

Belgacom has filed a complaint with an Antwerp court against the four Flemish cable television companies which have signed a preliminary agreement with cable operator Telenet for the sale of their television activities, a company spokesman said. Financial daily De Tijd says the move will slow down the deal by at least two months. The agreement, signed between Telenet and Interelectra, Integan, WVEM and PBE (collectively Interkabel) in November, will see the transference of 800,000 Flemish customers - one third of the market there - to Telenet for EUR300 million. Belgacom’s complaint centres around the fact that the deal is between a private company and the municipally-owned cable operators, and should therefore be negotiated through an open procedure. ‘Our objective is not to simply delay the agreement, but to question its legality. We worry that it could damage the market and create a monopoly for Telenet,’ a Belgacom spokesperson said.