Lanka Bell may not be sold (Sri Lanka)
If reports are to be believed, loss-making fixed-wireless telco Lanka Bell, which was recently put up for sale, may rethink its decision because it is on the verge of achieving profitability.
According to sources, from last year August onwards the company’s profits are good, the firm’s fortunes have been helped by a cost control programme as well as regulatory directives on minimum floor prices on call charges and a new interconnection regime.
From February last year, Lanka Bell was seen as dragging down the profits of its parent group, Distilleries Company of Sri Lanka’s (DCSL). The source stated that the floor price on calls granted all telcos a comfortable zone while encouraging them not to compete in an unhealthy way.
Suntel ups network expenditure on back of loan
Fixed line operator Suntel plans to invest LKR3.5 billion (USD33 million) in 2007 to expand its network, company officials said on Friday. Suntel, backed by Sweden’s TeliaSonera, spent around LKR3 billion this year to roll out CDMA-based services to remote parts of Sri Lanka. On Friday, the firm signed up for a LKR3 billion syndicated loan, to partly offset this year’s expansion costs and meet funding requirements for 2007. ‘This loan grant will help us develop our network infrastructure which in turn will enable us to expand our business to every part of the island,’ Suntel’s managing director Jeremy Huxtable said in a statement. Part of the funds will be used to upgrade its switches to provide full redundancy in the event of a major disaster and enhance the quality of service for its CDMA customers. In addition, Suntel plans to offer advanced data services with higher bandwidth to its corporate and business customers. Suntel’s net profit for the six months to 30 June dipped by LKR93 million year-on-year to LKR290 million, whilst revenues virtually doubled to LKR3.31 billion, compared with LKR1.96 billion a year earlier. ‘The growth in net profit for the year ending December 2006 is expected to reach up to 46%,’ the MD’s statement said. The company is the largest fixed line competitor to incumbent SLT, and reported in March 2006 that it had a total subscriber base of 188,000, ahead of CDMA rival Lanka Bell with around 100,000. However, according to TeleGeography’s GlobalComms database, Lanka Bell has provided much stiffer competition since rolling out faster CDMA2000 1x WiLL infrastructure, and reached a total of around 180,000 subscribers by the end of June 2006.
Source- telegeography Wireless Mobile Telecom
