Feeds

KPN trades fixed line for IP telephony

Goodbye to POTS

The smart choice: opportunity from uncertainty

Dutch telco KPN joins BT by turning off its public switched telephone network (PSTN) in less than three years. Eelco Blok, the CEO of KPN's fixed network, told German magazine WirtsschaftsWoche it will abandon its 100 year-old fixed line network in 2010 in favor of IP telephony.

By ripping out its legacy networks, including traditional telephone exchanges and copper wires, and replacing it with a nationwide fibre-to-the-kerb system that will deliver broadband services at 30-50 megabit speeds, KPN hope to drastically reduce costs. The group expects it can lay off 8000 workers, almost half of its fixed network work force.

In the UK BT announced similar plans to phase out its public switched telephone network (PSTN), replacing it with a multi-service internet protocol (IP) based network which will carry both voice and data services.

Plans for its ambitious All IP project were already outlined last year, but KPN didn't say it would end its traditional phone business that soon. "We need to because we face fierce competition," Blok told WirtschaftsWoche.

KPN is rapidly losing customers to Dutch cable operators which offer telephony at low prices. Sales of its fixed line business in 2006 dropped 3.4 per cent, despite adding over 500.000 VoiP customers.

KPN today reported an 8.9 per cent rise in 2006 net profit, which disappointed investors. Full year earnings are up slightly from €1.45bn to €1.5bn. Broadband continued to grow in Q4 with VoIP as the key driver. KNP's mobile telephone division, which includes E-Plus in Germany and Belgian provider Base, reported a 12 per cent rise in sales to € 6.45bn, nearly half of all KPN's revenues.

For 2007 KPN expects flat earnings and operating results. The migration to the all-IP platform and the merger of the firm’s fixed line and mobile operations by 2010 would place a drain on earnings, CEO Ad Scheepbouwer warned, but the sale of real estate and more than 4,000 job cuts would balance those investments. ®

Mobile application security vulnerability report

More from The Register

next story
Yorkshire cops fail to grasp principle behind BT Fon Wi-Fi network
'Prevent people that are passing by to hook up to your network', pleads plod
Major problems beset UK ISP filth filters: But it's OK, nobody uses them
It's almost as though pr0n was actually rather popular
Apple orders huge MOUNTAIN of 80 MILLION 'Air' iPhone 6s
Bigger, harder trouser bulges foretold for fanbois
Microsoft unsheathes cheap Android-killer: Behold, the Lumia 530
Say it with us: I'm King of the Landfill-ill-ill-ill
All those new '5G standards'? Here's the science they rely on
Radio professor tells us how wireless will get faster in the real world
US freemium mobile network eyes up Europe
FreedomPop touts 'free' calls, texts and data
'Two-speed internet' storm turns FCC.gov into zero-speed website
Deadline for comments on net neutrality shake-up extended to Friday
Oh girl, you jus' didn't: Level 3 slaps Verizon in Netflix throttle blowup
Just hook us up to more 10Gbps ports, backbone biz yells in tit-for-tat spat
prev story

Whitepapers

Designing a Defense for Mobile Applications
Learn about the various considerations for defending mobile applications - from the application architecture itself to the myriad testing technologies.
How modern custom applications can spur business growth
Learn how to create, deploy and manage custom applications without consuming or expanding the need for scarce, expensive IT resources.
Reducing security risks from open source software
Follow a few strategies and your organization can gain the full benefits of open source and the cloud without compromising the security of your applications.
Boost IT visibility and business value
How building a great service catalog relieves pressure points and demonstrates the value of IT service management.
Consolidation: the foundation for IT and business transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.