Although Cable & Wireless Plc is declining comment on a Sunday Telegraph report that it is in talks with Nynex Corp about a trans-Atlantic strategic alliance, it seems highly likely that the story is good, and such an alliance would be a very good deal for both companies. Nynex does not have any current ties […]
Although Cable & Wireless Plc is declining comment on a Sunday Telegraph report that it is in talks with Nynex Corp about a trans-Atlantic strategic alliance, it seems highly likely that the story is good, and such an alliance would be a very good deal for both companies. Nynex does not have any current ties to Cable & Wireless, but the two companies know each other of old, because Nynex wanted to hold the US end of the Cable & Wireless PTAT-1 transatlantic fibre optic cable until it was barred from doing do by Judge Harold Greene. The US end of the cable ended up with Sprint Corp. But Nynex has wriggled out of the regulatory straitjacket to become the originator and largest shareholder in Flag Ltd, the company formed to build the so-called Fibre-optic Link Around the Globe, which will run from the UK via Spain to Italy, to very interesting places such as Egypt, United Arab Emirates, India, Thailand and Malaysia, and on to Hong Kong, South Korea, China and Japan. Cable & Wireless initiated and has a share of the first private Pacific cable, which completes the global loop, and while Nynex brings Flag to any alliance, Cable & Wireless brings priceless expertise in doing business with developing countries, and, crucially, China. A deal with a company like Cable & Wireless (and there is no such thing: the company is unique in the world for the strength and diversity of its international ties) is essential if Nynex is to realise its dream of becoming a major player on the international stage and winning 10% of the world market with its international ventures in the early years of next century. In the UK, the company has floated its Nynex CableComms Plc, and an alliance between their parents could repair some of the very scratchy relationships between UK cable television operators and Mercury Communications Ltd, which could be made the preferred long-distance carrier for Nynex’s local telephony customers. Apart from its relationship with Sprint, Cable & Wireless also has North American ties with Canadian carrier BCE Inc, which has 20% of Mercury, and US West Inc, which has 50% of Mercury One-2-One Ltd.