Hutchison drops GSM, focuses on CDMA, 3G

While cutting ties with Optus on the one hand -- with a $53 million bow out of the GSM market, HutchisonTelecommunications (Australia) has partnered with the SingTel company to strengthen its CDMA and 3G networks.

Effective immediately, Hutchison has sold its GSM mobile base of about 260,000 customers to Optus for $43 million. Afurther $10 million is being added to the deal so Optus will continue to service Hutchison customers during thetransfer period, which is expected to take several months.

Hutchison had been reselling the Optus digital mobile service for over six years.

Also part of this deal, Optus will sell its GSM service through 50 Orange dealers in NSW and Victoria.

In a separate agreement, Hutchison and Optus have signed a long-term transmission capacity deal, worth more than $60million, that also includes an ongoing operation and maintenance contract.

The deal will link Hutchison's Sydney, Melbourne, Brisbane, Adelaide and Perth operations and will also support thetelco's existing CDMA network and future 3G network.

A memorandum of understanding for Optus to provide a national roaming service for Hutchison's 3G customers has alsobeen signed.

The Hutchison 3G Australia alliance, including parent company Hutchison Whampoa, Hutchison Telecommunications(Australia) and Telecom Corporation of New Zealand, signed up Ericsson Australia in June to supply and install itsthird-generation (3G) mobile network, in a deal worth $830 million.

The 3G network will cover Sydney, Melbourne, Brisbane, Adelaide and Perth and is set for a staged commercial rolloutby early 2003.

Kevin Russell, chief executive officer of Hutchison, said the GSM resale had been discontinued, as it was not a corebusiness. "As we move forward we are focusing on our CDMA and 3G operations where we own network infrastructure."

Optus will contact current GSM Orange customers regarding their mobile service.

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