If Orange is German, then it's buying AOL

Otherwise, it's T-Systems

By Guy Kewney, NewsWireless.Net • Get more from this author

Posted in Telecoms, 4th July 2006 09:27 GMT

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Widespread enthusiasm for the Orange takeover of AOL's UK business has followed a speculative report in the UK's Sunday Telegraph - but reports from inside the bidding auction are now talking of "indignant German bidders" - and claiming that, in fact, T-Mobile's parent, Deutsche Telekom, will be the buyer.

One report, which found the Orange/Wanadoo takeover puzzling, speculated that it was to prevent Sky taking it over - but since BSkyB already owns EasyNet, that is worth doubting.

The Telegraph is (it says) aware of Sky's plans, and sees Carphone Warehouse as the main threat to the Murdoch empire. The link between T-Mobile and Carphone Warehouse is already established, however.

And despite the dismal failure of Web'n'Walk so far, it's a given that T-Systems wants to expand, not pull out of, UK internet.

A source close to German telco Deutsche Telekom told NewsWireless that the deal was done, and would be announced this week.

But if the deal does go this way, it looks as if there will be tears behind the scenes, as Wanadoo has apparently been told by the organising bank, Citigroup, that its offer was the highest at the weekend.

It isn't possible to find anybody in Deutsche Telekom prepared to say anything about the bidding process, and calls to Orange went unanswered by press time. But if T-Mobile's bid turns out to be higher than the weekend French bid, then there will be recriminations, and demands to know how the auction was conducted. And if it wasn't, then other questions will be asked.

By the end of this year, all the major broadband ISPs will have had to forge a link with a mobile telco. The Virgin link with NTL will now become a major question for speculation, as T-Mobile currently provides the Virgin mobile network in the UK. That may now be re-evaluated.

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