Viasource Communications updated 4th-quarter revenue and earnings guidance Mon. It predicted total revenue for 4th quarter would be $54-$56 million, with adjusted earnings before interest, taxes, depreciation, amortization (EBITDA), special compensation charges, satellite and wireless revenue deferral in range of $1.7- $2.6 million, which will result in loss of 6-8 cents per share. Pres. Craig Russey said satellite and wireless business “transitioned during quarter as midpower conversions ended” and new high-powered “retail fulfillment installations reached record levels,” but DSL connectivity business has been “big disappointment.” Russey said company “experienced earnings pressure” from costs of rollout of nationwide fulfillment services for satellite and wireless sector along with major changes in DSL industry. Company plans to announce results for 4th quarter and fiscal year 2000 after close of market March 1.
Vodafone is acquiring 34.5% stake in Mexican wireless carrier Grupo Iusacell for $973.4 million in shares purchased from Peralta Group. Iusacell is 2nd largest wireless operator in Mexico with 1.5 million subscribers. Vodafone is joining Iusacell investor Verizon, which already has 37% stake in carrier. Vodafone and Verizon run largest U.S. wireless operator through Verizon Wireless venture. Vodafone Pres. Americas Asia William Keever said Iusacell transaction marked carrier’s entry into Latin American wireless market. “With only 2.2% company subscriber penetration in its 4 cellular regions, Iusacell represents an extraordinary growth opportunity for Vodafone,” he said. Vodafone is paying for Iusacell shares in cash in deal that is expected to close in this quarter.
Cingular Wireless and CWA finalized 4-year contract that covers more than 2,100 workers in Ill., Mass., N.Y. and Md. and includes 15.3% pay increase over life of accord. CWA said negotiation was first with Cingular, which includes merged wireless arms of BellSouth and SBC. Agreement provides for card check recognition, which allows company to recognize union when majority of employees sign cards saying they want representation. System already exists for wireless workers in SBC territory but hadn’t been for larger Cingular entity. Agreement also creates first pay progression system at Cingular, from entry to top levels, CWA spokeswoman said. While deal covers wage increase, most workers will receive additional boosts under progression plan. Contract creates grievance, mediation and arbitration procedure and keeps existing retirement, health care and education benefits, CWA said. Union now represents 10,000 Cingular employees. Agreement with Cingular came after SBC and CWA late last month broke off negotiations for contract renewal covering Southwestern Bell, Pacific Bell/Nevada Bell, Ameritech and Southern New England Telephone. Contracts don’t expire until April 1 but company and union had hoped to wrap up talks before Dec. holidays.
Ericsson will upgrade network of Ukraine’s Kyivstar to General Packet Radio Service (GPRS) under $100 million contract. Companies said that marked first GPRS agreement in Ukraine. Contract includes addition of GSM 1800 MHz for dual-band capacity and GPRS/GSM core and radio access infrastructure that will allow wireless Web access. Ericsson said wireless Internet services were expected to be in operation in 2nd half of year.
Ind. Utility Regulatory Commission (IURC) will hold hearing Jan. 16 on Ameritech’s proposed $1 million settlement for continuation of price cap regulation. Under agreement with Office of Utility Consumer Counsel, Ind. Intelenet Commission and AT&T, Ameritech would invest $832 million in next several years to improve its infrastructure, including replacement of all analog electronic network switches with digital, and upgrading substantial portion of central offices to provide high-speed Internet access. Agreement also would require Ameritech next fall to cut residential rates $62 million and business rates $106 million. Separately, bill introduced in Ind. Senate would give IURC legal jurisdiction over mergers of parent holding companies that own telephone, energy and other utilities operating in state. Legislation by state Sen. Timothy Lanane (D-Indianapolis) addresses 1999 Ind. Supreme Court ruling that IURC lacked legal authority over SBC-Ameritech and Bell Atlantic-GTE mergers.
Rep. Oxley (R-O.) may have lost his bid to lead Commerce Committee, but he still could have influence on telecom policy. He introduced bill (HR-235) to require FCC to eliminate its restrictions on newspaper-broadcast cross-ownership. Meanwhile, Rep. King (R-N.Y.) offered bill that would authorize FTC to issue new regulations on telemarketers. He has 9 initial co-sponsors, including Oxley. Also, two more lawmakers quickly brought back bills from last year: (1) Rep. Portman (R-O.) reintroduced his bill to repeal 3% telephone excise tax (now HR-236), with 30 initial co-sponsors. Bill passed House by 420-2 vote last year but never got vote in Senate. It then was folded into appropriations legislation that was vetoed by President Clinton. Bill again will go through Ways & Means Committee. It’s expected to get more favorable reception from incoming President Bush. (2) Rep. Holt (D-N.J.) reintroduced his measure (now HR-113) to prevent spamming on wireless devices. Introduced late in last session, Holt’s bill never got serious consideration.
U.S. Navy has authorized Boeing Satellite Systems to begin production of 11th in series of UHF Follow-On (UFO) satellites, which provide global communications for armed forces. UFO F-11 will carry UHF payload for narrowband 2-way battlefield connectivity and EHF payload. Subsystem provides enhanced antijam telemetry, command, broadcast and fleet interconnectivity communications, using advanced signal processing techniques.
France Telecom plans to float up to 15% of shares of Orange PLC, its subsidiary European wireless carrier, in London and Paris. Share price will value Orange at 70-80 billion euros. Further 5% will be available to investors in convertible bonds, exchangeable for Orange shares at up to 1/3 above price. Prospectus will be published at end of Jan. Flotation comes after mobile phone sector racked up debt in recent 3G license auctions.
New technology may allow engineers at NASA’s Goddard Space Flight Center in Greenbelt, Md., to stay home and do their jobs. Service provided by eTrue may allow engineers to use biometric authentication to log on from off-site computers or repair unmanned space craft. After test project is completed within year, NASA will test 3 other biometric products and select one to implement in 2 years.
Astrolink signed $30 million contract with ViaSat to develop and manufacture service provider gateways for Astrolink system, companies said in joint statement. Contract includes development, integration and delivery of gateways supporting Astrolink’s service rollout in 2003. Viasat produces advanced digital satellite telecom and wireless signal processing equipment for commercial and govt. markets. Other products include information security devices, tactical communication radios, communication simulators. Astrolink is global broadband company owned by Liberty Media.