Telecoms takes centre stage

Last week was again telecoms-oriented, with the Verizon win for MCI dominating the international scene, despite new initiatives by Qwest Comms, and the second national operator (SNO)/Tata announcement taking centre stage locally.

* The formal announcement that Tata Group, via its local operation, Tata Africa Holdings, will be the final SNO shareholder. Tata is expected to invest substantially in the SNO.

* In a deal valued at about $9 billion, including the value of MCI`s debt, two of the four remaining large US telecoms companies are merging, leaving both BellSouth and Qwest Comms out in the cold. The deal gives Verizon/MCI a similar share to that of AT&T/SBC re the wired line telecom market, with each combined unit having about 28%. If BellSouth and Qwest combined, they would have about a 17% share of the same market.

* Good interim figures from Faritec. Revenue up about 10% and back in the black to about 2.5% of turnover.

* Satisfactory interim numbers from Business Connexion Group. Revenue only slightly up but attributable profit well up following the sale of its shareholding in Mosaic Software. Without this contribution and the increase in investment income, profit would also only be up a small amount.

* A positive trading update from Mustek.

* A trading update from AST indicating better interim results, but still showing a loss for the period.

* Telkom said it would not appeal the least-cost routing ruling that the process is legal.

* The re-branding of Information & Logistic Consultancy as Lerumo following a black empowerment initiative in which the majority of the shares were sold to a consortium of businessmen.

* Labat Africa disposed of Acme Stores.

* The proposal that AST changes its name, following the Gijima deal, to Gijima AST Group.

* The death of Rafiq Hariri, owner of Cell C, in a car bomb attack in Lebanon.

There has been some talk of a fourth cellular operator for SA. Is Celtel in the frame as a contender?

Paul Booth, MD, Global Research Partners

* The Nigerian Federal Government has approved a N40 billion (US$300 million) contract for the implementation of the Nigeria communication satellite, which is expected to be launched next year and thereafter generate about US$200 million annually over a 15-year period.

* The appointment of Campbell Utton as CEO of MTN Cameroon as of 1 April.

* Esquire Technologies was appointed as the southern African distributor for Kworld multimedia PC products.

* A partnership between Microsoft and Nokia will see Windows Media 10 installed on Nokia handsets.

* The planned disposal of Cypress Semiconductor subsidiary, Silicon Magnetic Systems.

* A formal investigation by the US`s SEC into Sipex`s revenue accounting.

* The appointments of Tom Bogan as chairman of Citrix Systems, Bob Cohn as chairman of Adomo, Robert Hussey as CEO of Digital Lightwave, Kirk Mandy as CEO of Zarlink Semiconductor, and Mark Wattles as CEO of Ultimate Electronics.

* The resignations of James Green as president and CEO of Digital Lightwave, Peter van den Heuvel as COO of PinkRoccade NV, and Dave Workman as president and CEO of Ultimate Electronics.

* Analyst upgrades for Brocade Comms, Forrester Research, Gateway, Google, Itron, Micron Technology, Network Appliance, Novell, Nvidia, OmniVision Technologies, Photronics, Redback Networks, Regent Comms, Rudolph Technologies, Seagate Technology, SPSS, Symantec, Synopsys, TI and Xilinx.

* Analyst downgrades for Advanced Digital Information, Alvarion, Atari, CCC Information Services, Cognizant Technology Solutions, ePlus, F5 Networks, France Telecom, IAC InterActiveCorp, Input/Output, Lexmark, LTX, MSC Software, NetScout Systems, Pixar, Sycamore Networks and Vastera.

* Negative result warnings from Chordiant Software, Cypress Semiconductor and Molex.

* Stock repurchase announcements from API Electronics Group, JDA Software, Plantronics and Univision Comms.

* Job loss announcements from TeliaSonera, Verizon Comms and Zarlink Semiconductor.

* Private funding obtained for DataPower, a networking device maker; eSilicon, a supplier of custom ICs; IM, an e-commerce search engine developer; Intelliworks, a CRM software provider; Similarity Systems, a data quality start-up; TriCipher, an authentication provider; and ViryaNet, a provider of integrated mobile and Web-based software applications.

* A private placing of stock by MEMC Electronic Materials.

* Stock offering announcements from Cogent Comms and Smith Micro Software.

* Share split announcements from Cogent Comms (reverse 20:1) and II-VI (2:1)

* Unisys` possible acquisition of UK-based Marlborough.

* The acquisition of mobile-phone manufacturer, Chi Chi Comms by Hon Hai Precision Industry, Taiwan`s largest electronics manufacturer.

* The acquisition of Italian telecoms giant, Wind, by Blackstone, the US buy-out group.

* PDA shipments grew only 6.6% to 12.28 million units in 2004, according to Gartner Dataquest, but allowing for a massive increase in Research in Motion`s contribution, the market for the other vendors shrank in unit terms.

* Worldwide PC shipments are projected to total 199 million units in 2005, a 9% increase from 2004, according to Gartner. Growth in mobile PC shipments will outpace desk-based PC shipments by 17.4% to 6.1%.

* JSE All share index: Up 1.7%

* Nasdaq: Down 0.9%

* Top SA share movements: Beget Holdings (-20%), Business Connexion (-9.1%), Grintek (+9.4%), Metrofile (+10.5%), Pinnacle (+9.9%), Stella Vista (+33.3%), Synergy (+14.3%), Trematon (+16.3%), Vesta (+25%), Y3K (-9.1%) and Zaptronix (+66.7%).

* Top international share movements: AXS-One (+25.5%), Copper Mountain Networks (+27.4%), Commerce One (-22.5%), Dataram (-24.1%), FiberMark (+150%), Firstwave Technologies (+26.5%), Royalblue Group (+23.3%), Ultimate Electronics (-39.2%), Ultrasis (+34.3%) and WJ Comms (-24.9%).

Celtel, Africa`s third largest cellular operator behind MTN and Vodacom, is preparing for a listing in London by mid-year and possibly in Johannesburg. It is set to become a more powerful force on the continent at a time when the US telecoms industry is undergoing a major consolidation process. There has also been some talk of a fourth cellular operator for SA. Is Celtel in the frame as a contender? Celtel is well worth watching, especially over the next few weeks.