Italy's Fourth Mobile Carrier to Begin Operations

ROME (05/12/2000) - Blu SpA, Italy's fourth mobile phone operator, will begin commercial operations on Monday, the company announced today.

The carrier aims to have 300,000 customers by the end of the year and has set itself the medium term objective of conquering 10 percent of the Italian cellular market, Blu Chief Executive Officer Enrico Casini told a press conference here today.

Blu expects to become a break-even operation in 2004, Casini said. The carrier plans to hire 1,500 staff over the course of this year and to invest around 3 trillion lire (US$1.4 billion) in its business over the next two years, he added.

Winning a UMTS (universal mobile telecommunications system) license in the forthcoming license competition is a fundamental plank of Blu's strategy, Casini said. The carrier has been promoting itself by running television advertisements featuring a single blue sperm swimming in competition with lots of white spermatozoa.

"The company has already achieved a national and European record: it has been the quickest to begin commercial operations since obtaining a license, in the space of less than 10 months," Blu Chairman Giancarlo Elia Valori told today's press conference.

Among the value-added services to be provided by the company will be the choice of easily memorized numbers and online share trading, which will be offered in conjunction with the Banca Nazionale del Lavoro, one of the partners in the Blu consortium. Other consortium partners include motorway company Autostrade SpA, British Telecommunications PLC, international telecom operator Distacom, the Italian media and broadcasting group Mediaset SpA, and the Benetton fashion group's investment company Edizioni Holding SpA.

Blu will be competing with dominant cellular carrier Telecom Italia Mobile SpA (TIM), the largest single operator in Europe, which had 19.2 million customers at the end of March.

TIM is already being strongly challenged by the second longest established Italian mobile carrier Omnitel Pronto Italia SpA, which overtook TIM for the first time ever by signing up more new customers than its rival during the first quarter of this year. Omnitel signed up 800,000 new customers, as compared to 700,000 new TIM subscribers in the same period, to achieve a total of 11.2 million customers, according to published reports.

The third player in the Italian cellular market is Wind SpA, a joint venture between electricity utility ENEL SpA, France Telecom SA and Deutsche Telekom AG.

Blu, based in Rome, can be reached on the World Wide Web at http://www.blu.it/.

TIM can be contacted in Rome at +3906-3900-2491 or on the Web at http://www.tim.it/. Omnitel can be contacted in Milan at +3902-4143-3241 or on the Web at http://www.omnitel.it/. Wind can be contacted at +3906-8311-5855 or on the Web at http://www.wind.it/.

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