OTE reckoning on Internet and Romania operations to to offset declining revenue
Greece’s main fixed-line operator OTE telecom, whose market share has been whittled away by competition and mobile operators, will count on its Romanian and Internet businesses to help offset a drop in fixed-line revenue, it said yesterday. The former monopoly, the highlight of the government’s privatizations agenda for 2007, is being restructured with management seeking to turn the company around and make it more attractive to a foreign buyer. «We are in a race with time,» OTE Chief Executive Panagis Vourloumis said at a company presentation in London. «We have to use the time now that we are still strong, to capitalize and build.» Expecting fixed-line revenue to drop by about 5 percent in 2007-09, OTE wants to increase its broadband ADSL customers to about 1.7 million by end 2009, from about 500,000 at end-2006, it said in a presentation of its three-year business plan. «Broadband is a big franchise for OTE, we want to exploit it to the biggest possible extent,» the group’s Chief Financial Officer Iordanis Aivazis told analysts. «ADSL will be the name of the game in the next few years.» OTE is targeting a market share of broadband connections in Greece of 68 percent, the plan showed. Key to OTE’s plans is Romania, where its fixed-line Romtelecom unit has struggled to compete with mobile operators Orange and Vodafone. Revenue from data services jumped almost 150 percent in the fourth quarter last year, a positive sign. OTE forecasts ADSL customers in Romania will rise to 700,000 by the end of 2009, from 100,000 at the end of last year. OTE also said it expects operating expenses to drop by about 6 percent to 7 percent per year, while revenues for the 2007-09 period are expected to grow at an annual rate of about 6 percent to 7 percent. (Reuters)
