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(1) sells out of mgti (2) sharing with vodafone

  1. Grant62

    4,875 Posts.
    95
    Two stories of interest today concerning Telstra. Also, a major new report on telstra, by ABN Amro.

    The first concerns the sharing of GSM /GPRS network infrastructure on a piloting basis bewteen Telstra and Vodafone.

    The 2nd concerns Telstra, this morning, selling out of Indonesia's wireline carrier - MGTI.

    Both stories concern:
    1)
    Telstra tidying up its business position in an increasing number of areas;
    2)
    Telstra setting aside some of its competitive differences, and looking towards embracing the co-sharing model arrangements which are now all the rage in Europe (particularly with Vodafone and with Hutchison); and
    3)
    Telstra positioning itself to pursue a possible Plan "B" option in the event of T3 either stalling, or further changes to the T3 concept being required.

    In effect:
    1)
    the sharing of network infrastructure (even, if only on a pilot basis);
    2)
    the classification of aspects of the Asian experiment as non-core (particularly, in regards to Indonesia's MGTI);
    3)
    the shifting of sands and bodies (Ted's, in particular),
    ....
    all go to supporting a closer level of co-operation between Telstra and Vodafone in the future.

    Telstra now appears to be:
    1)
    willing to step away (or at least to consider this) from fixed line communications in the region; and
    2)
    may well be considering becoming Vodafone's Asian franchised wireless partner.

    These developments also suggests that Telstra is fast hatching out Plan B (in order to secure T3, etc) - namely, spinning out wireline from wireless, with wireline remaining 50:50 owned (or reverting to majority public owned), and wireless being privatised.

    This then begs the question as to broadband - hybrid owned, or privately owned. And for an answer here, the Feds must reconfigure the meaning of the USO obligations. More likely though, broadband will go the same way as wireless (ie: future "core", and future privatised).

    Interesting times, and interesting developments. Some classic re-birthing /re-engineering of business positions also seems to be underway.

    ------------------------------------------------------
    REPORTS:
    ------------------------------------------------------
    FROM RWE 24 SEPTEMBER 2003:
    ------------------------------------------------------
    Telstra sells out of Indonesian fixed network unit

    09:10, Wednesday, 24 September 2003
    Sydney - Wednesday - September 24: (RWE) - Telstra Corporation
    has agreed to sell its 20.4 per cent shareholding in Mitra Global
    Telekomunikasi Indonesia (MGTI), a fixed-line telecommunications
    operator in Central Java, Indonesia.
    Telstra and all the other MGTI shareholders will accept a cash
    offer from PT Alberta Telecommunication, a subsidiary of Saratoga
    Investama Sedaya.
    PT Alberta will acquire 100 per cent of MGTI for about $US266
    million enterprise value.
    Telstra international managing director Asian business
    development Mr Brian Pilbeam said the offer represented full value for
    its investment.
    "The disposal of our shareholding in MGTI is part of Telstra's
    continuing process of divesting non-strategic investments, allowing our
    international operation to focus on driving value from our existing
    major properties," Mr Pilbeam said.
    "Telstra has built up valuable experience and we continue to
    believe that Indonesia is a market with potential.
    "We will continue to evaluate opportunities against our
    investment criteria as and when they arise," he said.
    Shares in Telstra yesterday rose 1c to $4.87.

    ------------------------------------------------------
    COMMS DAY (24 SEPTEMBER 2003)
    ------------------------------------------------------
    Telstra & Vodafone to trial shared regional GSM, GPRS infrastructure

    Vodafone Australia and Telstra have embarked on a radical
    experimental trial that will assess the viability of sharing mobile network
    infrastructure in a bid to maximise the value from their existing network
    assets supplied by common vendor Ericsson.
    The pilot project, to be conducted in central regional Victoria, is the
    first network sharing arrangement of its kind in Australia but mimics
    current European trends where rival carriers are sharing deployment and
    network costs for 3G rollouts while using a common vendor as the project
    facilitator.
    The trial between Vodafone and Telstra Wholesale is centred around their existing GSM and GPRS
    infrastructure and will endeavour to determine the feasibility of sharing base stations in areas where duplicate
    coverage exists. While both carriers’ told Communications Day that this initial project does not include the
    assessment of potential of 3G infrastructure sharing arrangements, it will serve as a litmus test for the
    commercial viability of such partnering agreements for next generation rollouts. Both Vodafone and Telstra are
    currently deciding on whether to partner or invest in further infrastructure for 3G deployments and are expected
    to announce their decisions in late October, and December, respectively.
    “Lets face it, customers don’t care who operates the base stations, they just want the best possible service
    and choice in mobile providers. Network partnering that maintains that customer choice while reducing costs is a
    smart and logical solution that benefits all,” Vodafone Australia MD Grahame Maher told Communications Day.
    He added that the concept would benefit both parties and their regional customers, while improving the
    standard of network service and ensuring its financial viability in regional Australia. “If all goes according to plan,
    we will rollout the network partnering approach to benefit more customers,” Maher said.
    Ericsson will also supply additional network sharing software to complement existing software capabilities in
    both networks that aim to create operational efficiencies in the disparate networks.
    Telstra Wholesale MD Deena Shiff said that this new commercial model, while bringing down carrier costs,
    will also assist in promoting competition in services to customers.
    Natalie Apostolou

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