Kate Bulkley, Media Analyst.

Gasmen buck trend with big telco investment

By Kate Bulkley

The Independent

25 October 2001

The telecoms network unit of Lattice has announced its second long-term, multimillion-pound contract in as many months, bucking the recent dismal trend of the sector, where many similar companies like Energis and Colt are under severe financial pressure.

Lattice's telecoms arm, 186K, signed a 10-year deal with the car park giant, NCP. The agreement follows a 20-year deal signed last month with the Hutchison Group for its planned third generation (3G) of wireless services.

So far, Lattice has invested 450m in 186K, of which about 330m has been spent to build a 2,000-kilometre optical fibre network alongside the national gas pipelines owned by another Lattice unit, Transco. The London portion of the network, is being built in a 34m joint venture with Thames Water. The entire national network should be operating by the end of this year.

186K's chief executive, Lawrie Haynes, said the two long-term contracts are part of his "hard-headed approach" made necessary by the current economic climate. "We have to be extremely steady in our approach. We only make capital expenditures which are underpinned by revenue," he said.

Analysts said 186K's deep-pocketed parent company could put it ahead of rivals, which include other alternative telecom providers as well as British Telecommunications.

Maureen Coulter, senior analyst at Gartner Dataquest, said the market is very competitive and customers are not asking what the price is for telecom services. "What they're really interested in is will you be in business next year," she said.

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