PPC in telecoms move
When in September 2000, electricity utility Public Power Corporation (PPC) submitted an application to the National Telecommunications and Commission Post (EETT) for a fixed-line wireless telephony license, many mocked the move and predicted its failure. Two years later, PPC has confounded the Cassandras as it sets about realizing its objective of becoming the second leading telecoms operator nationwide. The strategy includes offering a full range of voice and data services and value-added services. PPC is hoping to capitalize on its network, its massive customer base of 6.6 million households and companies and the technical expertise of its partner, the French-Italian telecoms company Wind. Two weeks ago, the company finalized the details of its telecoms venture at meetings in Athens and in the Netherlands where Wind-PPC Holdings is headquartered. PPC Telecommunications, a subsidiary of PPC, holds a 50-percent-plus-one share in the telecoms company, while Wind owns the remaining 50-percent-minus-one share. Also, PPC’s board of directors has approved a 19.5-million-euro offer from US company Corning to lay a fiber optic cable next to its network of electricity lines. Corning’s offer was the lowest of five bids. PPC’s board of directors also approved a 70-million-euro equity increase for PPC Telecommunications, with the proceeds to finance its investments for the period 2003-2005. EETT had previously given the green light to a change in the ownership of Energy, which is jointly controlled by PPC and three banks, National Bank, Alpha Bank and General Bank, and set up specifically to acquire a telephony license. The change allowed PPC to buy out the banks’ shares. It is currently negotiating to take control of Energy from Wind-PPC Holdings and also to transfer the telephony licence from PPC Telecommunications to Energy. Two weeks ago, PPC completed discussions with Wind on three supplementary agreements. The board of directors at Wind-PPC Holdings has already signed these deals. Wind and PPC’s strategy for their telecommunications venture sets out a period of August 2002 to April 2003 for the delivery of the trunk network and its commercial launch in November. The company aims to acquire an 18-percent share of the business market and a 15-percent share of the residential sector by 2005. Key to achieving this is the company’s division of its customer base into five categories: major clients, small and medium-sized enterprises, small enterprises, and major and small residential clients. In the first phase, the focus of activities will be on Athens and Thessaloniki which cover 80 percent of businesses, 50 percent of the population and 80 percent of fixed lines. Companies can become connected via the local metropolitan area network. Small and medium-sized enterprises will be offered voice services and connection to the nearest metropolitan area network. Households, in turn, can be connected to PPC’s network via telecoms operator OTE’s centers of existing and leased lines. The Commission classifies its recommendations in three categories, regarding fiscal matters and the markets for labor and products, respectively.
