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March 21, 1996

JOINT EFFORT ON INTERACTIVE MULTIMEDIA IN ALCATEL-SHARP PLAN

By CBR Staff Writer

As part of their agreement last week on Groupe Speciale Mobile portable phones, Alcatel NV and Sharp Corp also expect to collaborate in the future on interactive multimedia equipment, the companies said. We have been looking for a long time for a partner in microcomputing and consumer electronics. Sharp responds to both of those needs with fundamental technologies, particularly flat-panel screens, said Jozef Cornu, chief executive of Alcatel Telecom. Cornu outlined the elements he believes are holding back the development of the market for multimedia terminals – the cost of long distance communications and access technologies. Obviously, Sharp has nothing to do with the first, but for the second it’s important for us to have someone with expertise in terminals, either personal computers or televisions, he said. Cornu added that Alcatel will introduce some technologies this year that make me believe that we will soon be able to offer subscribers 25Mbps. The Personal Digital Assistants that the two companies expect to introduce in the first half of 1997 will conform fully to the Groupe Speciale Mobile standard, Cornu said, adding that the two are studying what to do about the North American market. We have not taken any decision about how to penetrate that market.

Totally clear

The PCS [Personal Communication Services] operators have chosen CDMA. It has become totally clear that CDMA has no advantage over GSM, Cornu said. In the meantime, Alcatel expects the agreement, and Sharp’s reputation in the consumer electronics market, to double its Groupe Speciale Mobile terminal sales to 1m units this year, or 10% of the market. The consumer market has begun to take on importance in Europe, and we expect it to be 30% in 1996, said an Alcatel spokesman. In 1995, Alcatel sold 560,000 terminals, for 8% of the market, half of which were OEM sales to the likes of DeTeMobil GmbH, British Telecommunications Plc and Telefonica de Espana SA. The company is also counting on selling more personalized telephones that include a blue button that immediately connects the user to the bank’s services. Cornu said the agreement was not exclusive, but that it would be hard to imagine having another agreement of such depth with someone else. Sharp will not, however, be selling Alcatel’s Groupe Speciale Mobile phones in Japan, since Japan does not use the European standard.

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