YOU ARE AT:Archived ArticlesGERMANY'S RWE USING NETWORK TO COMPETE IN MOBILE MARKETS

GERMANY’S RWE USING NETWORK TO COMPETE IN MOBILE MARKETS

German powerhouse RWE Energie AG has its telecom engine revving, awaiting a license to drive. The diversified conglomerate has an extensive telecom network already in place and is gearing up to compete head-to-head with Deutsche Telekom, currently the monopoly telephone operator.

As a European Union member, Germany must open all its telecommunications markets no later than Jan. 1, 1998. When it does, RWE’s telecommunications company, RWE Telliance AG, plans to march in, the company said. Headquartered in Essen, Germany, RWE Telliance was organized last year to bundle the company’s telecommunications activities, which now comprise seven RWE Telliance subsidiaries.

While a handful of players occupy Germany’s cellular market, Deutsche Telekom has a monopoly on landline phone service. As such, it limits choice for other telecom operators, which are allowed to use only Deutsche Telekom’s network for the fixed-line portion of their transmissions.

RWE proposes becoming an alternative network to Deutsche Telekom in the forthcoming marketplace. The company operates the largest privately owned wireline network in Germany, already capable of servicing an area corresponding with 50 percent of the population, said the company.

“Very few German companies can have their own network,” said Pach. The German government granted RWE permission to operate a telecommunications network for internal use in 1928, the company said. The digital transmission network has been used for energy and utility purposes, explained RWE, as well as internal telecommunications. RWE’s success competing against Deutsche Telekom “will substantially depend on having access to the entire telecommunications chain,” said RWE, which includes offering telecommunications services and marketing to the customer. RWE plans to construct a wireless local loop to enable commercial deployment of wireless services.

How the German government plans to designate fixed-line operators, once the market is opened, is not yet clear, explained Pach. “At the moment, it looks like no limitations,” she stated, so long as a candidate proves financially and technologically competent.

RWE’s subsidiaries run the gamut in wireless communications. Talkline GmbH was organized in 1990 to market mobile telephone service for the three wireless operators. At present, Talkline counts about 130,000 subscribers, RWE*said.

Three operators occupy Germany’s wireless market. DeTeMobil, a DT subsidiary, and Mannesmann Mobilfunk both began operating Global System for Mobile communications networks in 1987, said Luca Tassan of Economic and Management Consultants International Inc. in London. DeTeMobil also provides analog service. DeTeMobil GSM reported about 1 million subscribers in April, said Tassan, a 20 percent increase from year end 1994. Mannesmann’s subscribers totaled slightly less than $1 million in April, up 16 percent in the same period. E-Plus, which began operating a personal communications network using DCS 1800 technology last May, reported 59,000 customers in April.

Other RWE subsidiaries offer mobile satellite service, specialized mobile radio, paging and mobile data.

Teleport Europe GmbH is the company’s mobile satellite division, which provides both point-to-point and multipoint international transmissions. The mobile satellite field has been liberalized for years, said RWE. RWE and Vebacom each own more than 49 percent of the company.

RWE’s trunked radio, or SMR, subsidiary was established three years ago after acquiring 8 of 14 regional licenses to provide SMR service. Terrafon GmbH & Co KG is constructing radio networks with plans to enable both voice and data applications. RWE is a majority owner with 74 percent.

MiniRuf GmbH acquired one of two paging licenses awarded by the Ministry of Post and telecommunications last September and recently began commercial operation in Berlin, said Pach. RWE and Vebacom each own 40 percent; Telekom Denmark AS holds the remaining 20 percent. MiniRuf uses the European Radio Messaging System standard.

Last year RWE created Gesellschaft fur Datenfunk mbH after receiving license to operate a mobile data network. GfD is in final stages of constructing a RAM mobile data network. RWE owns 34 percent of GfD.

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