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Hutchison UK on a postive stance - report

April 26, 2003

Market research group Current Analysis has offered a ‘slightly positive stance’ on Hutchison Whampoa’s 3G mobile venture in the UK, ‘3’, in a recent report on the company’s plans to set up a UMTS network, according to an article from the Register, an IT news website.

A number of analysts had previously been sceptical of the company’s plans because it is a new player in the realm of mobile telephony and without a pre-existing GSM/GPRS network in the country and the customer base that would accompany such a network.

The researchers highlighted other criticisms, namely the significant costs to the company of rolling out a 3G network, and the total lack of enterprise-targeted services - a group that most analysts expect to be amongst the first to take up the new service, particularly as it has the finances to purchase what will be a very expensive product, which in turn is another concern of analysts. 3G phones from Hutchison start at E287 (£199).

However, the analysts feel that Hutchison’s decision to sell dual mode handsets as part of a roaming agreement with O2 as a good omen. The researchers also feel comfortable with what Hutchison is doing because they say that the company is following in the footsteps of mobile operator Orange, a company that was itself a UK mobile market virgin once upon a time, which has now more than established itself. Orange was initially owned by Hutchison Whampoa, and a number of Hutchison 3G’s top executives used to work for Orange.

The analysts also approve of the company’s focus on content, which include deals with the UK FA Premier League and the BBC - clearly premium content providers - and with nine game developers.

On the whole, Current Analysis’ prediction is that success for Hutchison 3G is a case of when and not if.

 


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