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The Economist: Telecommunications

Alcatel-Lucent: Bring down the barriers
Thu, 04 Sep 2008 12:30:35 -0000
Ben Verwaayen’s talents will be sorely tested in his new roleAFTER Alcatel SA merged with Lucent Technologies Inc two years ago, almost the last thing the new company could afford to worry about was balancing the interests of its French and American parts. But although less than half of the combined group’s turnover comes from its home countries, Alcatel-Lucent failed to transcend its national origins. Two small, weak telecoms-equipment firms became one big, weak one, beset by low-cost competition from new Chinese rivals and struggling in a business that internet technology was changing beyond recognition. Worse, demand has been weakening across the industry. Appointing people on the basis of nationality rather than ability is never a good idea; in conditions like these, it spelled disaster.Cost savings either failed to materialise or were swallowed by falling prices; despite hacking 16,500 jobs from a workforce of 88,000, Alcatel-Lucent made losses for six consecutive quarters and its share price fell by more than half. At the end of July it said that Serge Tchuruk, its French chairman, and Patricia Russo, its American chief executive, would depart. This week their replacements were named: a French chairman, who lives in America, and a Dutch chief executive, who will be based in Paris. Both Philippe Camus and Ben Verwaayen have the personality and experience that could iron out the beleaguered telecoms group’s problems. ...
Alcatel-Lucent: Goodbye and adieu
Thu, 31 Jul 2008 12:10:21 -0000
The architects of a big telecoms-equipment merger decide to hang upWHEN Alcatel, a French maker of telecoms equipment, announced its plan in 2006 to merge with Lucent, an American rival, reactions were mixed. There was general agreement that bigger was better and that the combined firm would benefit from greater geographical reach. But there was also scepticism that its French and American managers would be able to get along. With good reason, it seems: on July 29th Alcatel-Lucent announced its sixth consecutive quarterly loss and the resignations of Serge Tchuruk, its French chairman, and Patricia Russo, its American chief executive. Their firm’s troubles stem in large part from its internal clash of cultures.This clash was an unhelpful distraction, given that the entire telecoms-equipment industry is suffering. The bonanza of 2000-05, when European operators upgraded their mobile-phone networks to new “third-generation” (3G) technology, is winding down. Sales growth is slowing, and even Ericsson, the industry leader, has seen its share price fall by 50% in the past year. Margins have also been squeezed by the rise of Huawei and ZTE, two Chinese firms. Their prices are sometimes 40-50% lower than those of Western vendors. ...
Tech.view: Home warriors
Fri, 25 Jul 2008 07:24:51 -0000
Telecommuters need more than e-mail and a broadband connectionTHE best thing about being a foreign correspondent is not having to commute to the office every day, attend dreary meetings, dress soberly, and generally get distracted from the nitty-gritty of doing the job. The worse thing is being out of touch with colleagues at head office, with little say over how your stories are treated. But if you can handle the patchy feedback and total lack of control, the freedom pays dividends in productivity and sheer job satisfaction.Being one of the most portable jobs on the planet, journalism provides a daily reminder that work is something you do, not some place you go to. For the past quarter of a century, your correspondent has smirked about the time and energy he’s saved through not having to travel to work. ...
Telecoms in Mexico: Slim’s pickings
Thu, 10 Jul 2008 13:30:55 -0000
More competition should help to drive down exorbitant phone chargesIT HAS become quaint, in the era of Skype and unlimited calling plans, to worry too much about the cost of phone calls. But it is a textbook case of the old saying: “Them as has, gets”. The well-connected executive can use any number of voice-over-internet services to make free calls; but the rural poor, if they have phones at all, must pay high rates. Perhaps nowhere is this more true than in Mexico, where Carlos Slim, by some estimates the world’s richest man, dominates the telecoms industry. He controls Telmex, which has 81% of the fixed-line market, and Telcel, which has 72% of the mobile market. In the first quarter of 2008 Telmex had a profit margin before interest, taxes, depreciation and amortisation of 48.7%; for Telcel the figure was 52.1%.This is well above the global average for telecoms firms of 35%, says Martin Lara, an analyst at Vector Casa de Bolsa, a research firm. Base tariffs have fallen in Mexico in recent years, but they do not include things like international calls or calls to mobile phones. Competition has not helped much, because smaller firms have been reluctant to undercut Mr Slim’s companies by very much—and high prices boost their profits, too. “No one wants to destroy these profits overnight,” says Mr Lara. ...
Telemedicine: Telemedicine comes home
Thu, 05 Jun 2008 14:04:15 -0000
Medicine: Telemedicine permits remote consultations by video link and even remote surgery, but its future may lie closer to home FEW places on earth are as isolated as Tristan da Cunha. This small huddle of volcanic islands, with a population of just 269, sits in the middle of the South Atlantic, 1,750 miles from South Africa and 2,088 miles from South America, making it the most remote settlement in the world. So it is a bad place to fall ill with an unusual disease, or suffer a serious injury. Because the islands do not have an airstrip, there is no way to evacuate a patient for emergency medical treatment, says Carel Van der Merwe, the settlement’s only doctor. “The only physical contact with the outside world is a six to seven day ocean voyage,” he says. “So whatever needs to be done, needs to be done here.”Nevertheless, the islanders have access to some of the most advanced medical facilities in the world, thanks to Project Tristan, an elaborate experiment in telemedicine. This field, which combines telecommunications and medicine, is changing as technology improves. To start with, it sought to help doctors and medical staff exchange information, for example by sending X-rays in electronic form to a specialist. That sort of thing is becoming increasingly common. “What we are starting to see now is a patient-doctor model,” says Richard Bakalar, chief medical officer at IBM, a computer giant that is one of the companies in Project Tristan. ...

BBC News | Business | World Edition

US rules out new economic package
Fri, 05 Sep 2008 23:19:26 -0000
White House says it does not see need for new measures to stimulate economy despite sharp rise in unemployment.
Key US lenders to face new curbs
Sat, 06 Sep 2008 10:21:45 -0000
US officials plan to put troubled mortgage giants Freddie Mac and Fannie Mae under strict federal control, media say.
US Boeing workers set to strike
Sat, 06 Sep 2008 02:40:49 -0000
Workers at the world's biggest aircraft manufacturer, Boeing, are to go on strike in the US.

NYT > World Business

Now Europeans Are Slower to Spend, and It Shows
Sat, 06 Sep 2008 05:23:19 -0000
For the first time in more than a decade, consumers in much of Europe are buying less than they did a year earlier, helping to slow economies that may have fallen into recession.
U.S. Rescue Seen at Hand for 2 Mortgage Giants
Sat, 06 Sep 2008 04:47:30 -0000
The plan would replace the leaders of Fannie Mae and Freddie Mac and virtually wipe out their shareholders but let them continue to work with the government standing behind their debt.
Big Summer Sell-Off Hits the Russian Stock Market
Sat, 06 Sep 2008 05:21:00 -0000
Russia’s stock market is suffering its worst correction in nearly a decade as sliding oil prices, political attacks on private companies and instability after last month’s war in Georgia spook investors.

 

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