related
Guides:
Networks
& the GII
Information
Economy
related
Profile:
Telco
Boom &
Bust
Aust & NZ
Telecoms
Telco
Privatisation
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This
page highlights mergers and acquisitions in telecommunications
sector, including network operators such as Global Crossing
and British Telecom and equipment providers such as Cisco.
It covers -
The note supports the discussion of the 1990s telco sector
bubble and the more detailed
guide on Networks & the
Global Information Infrastructure. It is complemented by a
separate note on telco privatisation.
Introduction
In discussing the telecommunications sector bubble - which
featured both rational (although sometimes unfortunate) spending
by network operators and infrastructure suppliers and "irrational
excess" - we have noted eight drivers -
- a
search for economies of scale in the operation of fixed
line and wireless networks
- a
complementary drive for critical mass, for example to have
sufficient resources to acquire 3G wireless network licences
from governments (with the winners of most licence auctions
subsequently being perceived as the governments rather than
bidders who overpaid and in some instances thereafter relinquished
the licences
- expectations
of a sustained and significant increase in corporate and
residential voice and data traffic, encapsulated by the
claim that "internet traffic doubles every 100 days"
- perceptions
of a window of opportunity, with for example hype by some
pundits and financiers regarding a 'once in a lifetime'
chance to enter or dominate markets through establishment
of new networks
- ready
access to capital for takeovers and infrastructure deployment
- corporate
opportunism and defensiveness, with for example acquisition
of competitors to preempt their takeover by/of a network
operator's peers
- privatisation
of operators, introduction of competition and loosening
of restrictions on foreign direct investment
- a
deregulatory zeitgeist, with government agencies sitting
on their hands or tacitly encouraging champions to build
scale at the national, regional or global levels
It
is unclear whether much of the merger and acquisition activity
created substantial and lasting value. Deflation of the telco
secto bubble saw major declines in the market value of some
organisations, the demise of some peers, surrender of licences,
departure from particular regions and acquisition of some
infrastructure at huge discounts.
North America
[under development]
Europe
[under development]
Asia
[under development]
Oceania
[under development]
Africa
[under development]
Latin America
[under development]
landmarks
This chronology is indicative only. Context is provided by
the broader timeline elsewhere
on this site.
1984 establishment in US of Regional Bell Operating Companies
(RBOCs), aka 'Baby Bells'
1990 Telefónica gains control of Chilean CTC
1991 buys Telefónica de Argentina
1991 AT&T buys NCR for US$7.4bn
1992 LDDS merges with Advanced Telecommunications for US$850m
1993 LDDS buys Resurgens Communications Group and Metromedia
Communications for US$1.25bn to create fourth-largest US long
distance phone network
1993 Sprint merges with Centel to become only major US telco
providing long distance, local and wireless services
1994 AT&T buys McCaw Cellular for US$11.5bn
1994 LDDS buys IDB Communications Group for US$936m
1994 BT takes 20% stake in MCI for US$4.3bn
1995 LDDS buys (Williams Telecommunications Group (WilTel)
for US$2.5bn, changes name to WorldCom
1996 US Telecommunications Act
1996 Nynex and Bell Atlantic merge
1996 AT&T spins off Bell Laboratories as basis of Lucent
Technologies
1996 AT&T sells NCR
1996 WorldCom buys UUNet and MFS Communications for US$12bn
1997 Daewoo invests US$1.4bn in Kazaktelekom
1997 Southwestern Bell buys Pacific Telesis for US$16.5bn,
becomes SBC
1998 WorldCom buys MCI for US$40bn and Brooks Fiber Properties
for US$1.2bn
1998 Telefónica buys Telesp (Brazil) for US$4.9bn
1998 GTE and Bell Atlantic announce US$53bn merger as Verizon
1998 MCI buys Embratel for US$2.2bn
1998 SBC buys Southern New England Telecommunications
1998 Nortel buys Bay Networks for US$7.68bn
1999 SBC buys Ameritech for US$60bn
1999 Olivetti buys Telecom Italia for US$64bn
1999 Nortel buys Qtera for US$3.25bn and CoreTek or US$1.43bn
1999 BCE absorbs Teleglobe for C$9.6bn
1999 AT&T buys MediaOne for US$62bn and TCI for US$54bn
1999 Qwest absorbs USWest in US$36.5bn merger
1999 Marconi pays US$6bn for Reltec and Fore Systems
1999 Telecom Italia pays US$1.1bn for 38% of Empresa Nacional
de Telefonos (ENTEL) (Chile)
1999 Deutsche Telekom buys One2One.com in UK and Siris in
France
1999 Mannesmann buys control of Omnitel and Infostrade (Italy)
1999 Mannesmann buys Orange (UK) for US$31bn
1999 Telecom NZ buys 78% of AAPT
1999 Ozemail acquired by WorldCom for $520m
2000 Vodafone buys Mannesmann
2000 France Telecom buys Orange mobile network in UK
2000 VoiceStream buys Aerial Communications for US$5.6bn and
Omnipoint for US$7.2bn
2000 Microsoft invests£1.5 billion in UK cable operator
Telewest
2000 Sprint sells stake in GlobalOne for US$1.4bn
2000 US and EU regulators block WorldCom US$115bn merger with
Sprint
2000 BCE buys CTV for C$2bn
2000 US$53bn merger of GTE and Bell Atlantic as Verizon
2001 C&W America buys Exodus Communications for US$800m
2001 Deutsche Telekom buys VoiceStream and PowerTel
2001 TelstraSaturn buys Clear to form TelstraClear New Zealand
2001 Deutsche Telekom sells nine German regional cable networks
to Liberty for US$5bn
2001 AT&T spins off AT&T Wireless
2002 AT&T sells AT&T Broadband to Comcast for US$47.5bn
2003 Telmex pays US$207m for assets of AT&T Latin America,
inc fibre network that cost US$1bn to build
2003 Microsoft offloads Telewest stake for £3
2003 América Móvil pays US$625m for BellSouth's
stake in BCP Telecomunicações
2004 Telefónica pays Latin American assets of BellSouth
for US$5.9bn
2004 Cingular buys AT&T Wireless for US$41bn
2004 AT&T Latin America sold to Teléfonos de México
2004 Sprint buys Nextel for US$41bn
2004 Telstra buys Kaz Group for $333m, Trading Post publications
for $636m and 50% of Hutchinson 3G Australia for $450m
2004 Optus acquires Uecomm for $227m
2005 SBC acquires AT&T for US$16bn
2005 Verizon buys MCI for US$6.7bn
2005 Time Warner and Comcast buy Adelphia for US$17.6bn
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