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December 7, 1993

FRENCH, GERMAN STATE PHONE GIANTS TO COMBINE DATA

By CBR Staff Writer

Brussels is the venue and 1995 is the date for the tryst between France Telecom and Deutsche Bundespost Telekom: the two state telecommunications monopolies will be tossing 4,000 employees and some $1,700m of annual business into the new equally owned Brussels company. The assets to go into the new company include France Telecom’s Transpac and Telekom’s Datex-P X25 packet networks, the Eunetcom facilities management joint venture, and the French Numeris Integrated Services Digital Network. It does not include their digital cellular networks and would not lead to a full merger when the two companies are privatised ahead of liberalisation of the European telecommunications market in 1998, but cross-shareholdings are on the agenda. The pair intend to invest $1,200m to the end of the century, and will offer X25, Frame Relay and Internet Protocol intelligent routing services, virtual private data network services, international end-to end digital circuits and very small aperture terminal satellite services, international virtual private voice networks and other voice value-added services. It will use a single backbone network and have common network management systems. The two megaliths hope to rally foreign partners to take them into North America and Asia, but no specific mention was made of AT&T Co, which is looking for a European pole for its embryonic WorldSource telecommunications services business, and is understood to have been in talks in Paris and Bonn.

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