No funding for Econet and Telecom to lay off 700

, posted: 18-Oct-2006 10:08

Jenny Keown at the Herald has looked into Econet and its Memorandum of Understanding for funding that was announced by the company last month. GEMS in HK and Communications Venture Partners in the UK were to pump in hundreds of millions into Econet, which would then build that elusive third mobile network.

However, the reality seems different according to the story, and there's no money for Econet from investors.

I'm wondering how long Econet can go on like this. It's been operating in New Zealand for six years with nothing to show for it. The trial 3G network in partnership with Huawei that was announced earlier this year has been canned, and now auditors Deloitte say the Econet NZ is dependent on funding from the parent company. Without the funding or separate capital injection, Deloitte's says Econet NZ could fold.

Telecom's feeling the pain from competition already, it seems. The Herald and the NZPA have a story that says around ten per cent of staff, or 700 people, will get an unwanted Christmas present: redundancy. It looks like Gen-i staffers are in the firing line, but nobody's job is safe. Well, bar the ones in TG's executive team of course.

This quote is interesting though:

Telecom is combining calling, mobile and broadband services for an all-in price, aimed at overcoming predicted declines in its fixed-line revenue and the effect of the Government's regulatory review.

Telecom is clearly looking at making the most of being both a fixed and mobile operator, and I bet you a package deal with a single easy bill combining voice, broadband and mobiles will sell like hotcakes. This also vindicates Vodafone's strategy of buying a fixed-line ISP, although you have to wonder if it'll be very effective here in NZ because of the slim wholesale margins Telecom offers.

Other related posts:
TDD vs FDD for LTE
Huawei TDD LTE demo aboard the Shanghai MagLev train
Apropos that new Telecom logo

comments powered by Disqus


Google News search
IT News
PC World New Zealand
Computerworld NZ
PC World and Computerworld Australia
PC World US
Computerworld US
NZ Herald
Virus Bulletin

Content copyright © Juha Saarinen. If you wish to use the content of my blog on your site, please contact me for details. I'm usually happy to share my material as long as it's not for spamblogs and content farms. Please attribute with a link back to this blog. If you wish to advertise on my blog, please drop me an email to discuss the details.
Comments policy All comments posted on this blog are the copyright and responsibility of the submitters in question. Comments commercial and promotional in nature are not allowed. Please ensure that your comments are on topic and refrain from making personal remarks.