This sums up much of my thinking - I hold a few and swing trade a few and even trade intraday sometimes ......

I think there is a lot of slack that management can cut out of the costs and would also anticipate sector consolidation ..... good value currently and have been holding their own in a falling market. Lot of US interest.

ains


Edited by Dominic White
(Filed: 08/02/2003)


Texting makes MmO2 sexy but it's also risky

More and more Britons are discovering the joys of textual intercourse. In the month of December, we fired off more than 50m mobile messages a day, and next Friday (that's Valentine's Day, folks, in case you'd forgotten) we'll send considerably more than that.



It emerged this week that the chief beneficiary of this craze is MmO2 . BT's former mobile phone division revealed that it gets a higher proportion of revenues from texting than any of the other three operators.

Revenue from messaging grew at its fastest rate ever in the last quarter, up 19pc, and data services as a proportion of MmO2 's revenue rose to 17.7pc from 15.6pc.

More good news was the rise in MmO2 's average revenues per customer. ARPUs, as nerdy analysts like to dub them, grew by 5pc to 243 in the UK and by 9pc in Germany to 212.

MmO2 now has 19.1m subscribers and in Britain it may be the smallest player, with 11.9m users, but it is growing faster than its rivals - testament to the success of its rebranding from BT Cellnet.

Only 114,000 of its 503,000 new UK subscribers were higher-spending contract customers, but MmO2 claims its pre-pay customers have started spending more than before.

Customer growth in Germany, which continues to be dominated by T-Mobile and Vodafone, is less impressive and the MmO2 share price ascribes little or no value to this part of the business.

That seems unfair, given the fact that the group has attracted higher-spending customers and has made a decent fist of turning the operation around. An eventual sale or merger is almost as inevitable as a disposal of the Dutch unit, which is losing customers.

MmO2 's larger rival Vodafone is trading on a free cashflow yield of 6pc, while at 49p this week, MmO2 's equivalent valuation remains negative. It might not have Vodafone's scale or profitability but there is room for upside. A risky buy.

ainsoph

You seem to be all over this stock, can you tell me if this stock is easy to trade?

One of the easiest - I mostly swing trade but also happy to have a core holding.

You need to look at the newsflow and the charts


ains

Friday, February 14, 2003 Posted: 0816 GMT



LONDON, England (Reuters) -- WILLUBMINE? :)

British mobile phone users are expected to show their love 60 million times with romantic text messages on Valentine's Day on Friday -- about one text for every man, woman and child in the country.

The huge number of texts -- a record for Valentine's Day -- will dwarf the amount of cards traditionalists mail to their loved ones on the day reserved for lovers, the Mobile Data Association (MDA) said on Thursday.

"Last year 57 million text messages were sent on Valentine's Day but this year we are expecting at least 60 million," said a spokeswoman for the MDA, which collates data from Britain's biggest mobile operators.

"Only 12.5 million cards were sent last year so text messages were more popular by about five to one," she said.

Although the outpouring of mobile love will be huge, Britons fired off more than 100 million texts to celebrate New Year's Day this year.

About 45 million texts are sent every day in the UK, more than 16 billion annually.

Are you a mobile one percenter?
By Antony Savvas at 3GSM World Congress in Cannes [17-02-2003]

Bleak outlook for 3G, say analysts
Less than 0.01 per cent of mobile users are currently accessing services via European 3G, despite licences being granted three years ago, delegates at the 3GSM World Congress were told today.
Moreover, less than one per cent of the world's subscribers currently use GPRS, two years after it was launched as the big step towards 3G.

Michele Scanlon, research director at wireless analyst EMC, said that there were 4.3 million GPRS subscribers worldwide, with 2.6 million of these in western Europe. The total subscriber base is 1.134 billion.

The lack of enthusiasm among users to access more data on the move is further illustrated by the small numbers of UK users using multi-media messaging (MMS), or picture messaging, a key application operators are promoting on their underused GPRS networks.

By the end of last year, Orange and Vodafone combined had sold just 150,000 MMS handsets in the UK.

These figures are very poor considering MMS handsets have been heavily subsidised, came with three months free picture messaging and operators spent millions of pounds on marketing campaigns.

Rupert Reid, a consultant at analyst ARC Group, estimated that over half of all handsets would include MMS technology by the end of 2004, provided users want such services when they are bundled

Although SMS was bundled with a large number of phones from the early 1990s, the text messaging explosion didn't happen until the late 1990s.

Scanlon said that a big jump in the availability of 3G networks would take place between the end of this year and 2004.

But poor take-up of the current crop of data services, apart from the popular SMS technology, would likely further delay 3G networks.

Reid explained that data currently makes up around 10 per cent of operator revenues and that it would take another technology to increase this share to 30 per cent.

More than 16 billion text messages were sent last year according to the latest government figures.

The year end figure was confirmed with the announcement of December's text messaging figure of 1.6 billion, an increase of more than 100 million on November 2002.

December's figure takes the daily average to 52 million compared to 42 million in December 2001 and 24 million in December 2000.

Mike Short, chairman of the Mobile Data Association (MDA) said: "It has been a great year for text messaging."

Seem to be holding their own within a tight trading range of 48/50p .... looking for outperformance within sector and market after the war .....



ains


17:35 Tuesday 18th February 2003
Graeme Wearden


Mobile phone base stations have been given a clean bill of health, but with public opposition still high, operators have been urged to work closely with local communities
For the second year running, the UK's mobile phone masts have been given a clean bill of health.

The government announced on Tuesday that the latest study into emissions from mobile phone base stations had found no evidence that safety guidelines are being exceeded.

A total of 109 mobile phone masts were tested by the Radiocommunications Agency (RA) during 2002, of which 82 were sited on schools and 27 on hospitals. Of these sites, the one with the highest emission level -- at Aintree Hospital in Liverpool -- was still over 700 times lower than the maximum allowed under international guidelines.

2002 was the second year that the RA conducted a survey of mobile phone masts, and the second time that they were given the all-clear. The government intents to conduct a third study over the course of this year.

"We are aware of public concerns and it is important to give the public the information they need. These results continue to show that exposure levels of the public are well below recommended limits," said a statement from e-commerce minister Stephen Timms, whose responsibilities include the telcoms sector.

A significant proportion of UK residents are concerned about the safety of mobile phone masts, as has been illustrated by a stream of protests across the country against mobile phone operators. Some county councils, including Kent, have even voted to ban the installation of any more base stations on their property.

The government acknowledges that feelings are high over this issue, and wants mobile operators to take this into account when planning the rollout of their networks.

"I urge the mobile phone industry to work closely with communities and each other when putting up masts and base stations," Timms said.

"They should consult with local groups, to lessen any impact on communities, and share infrastructure where possible. Building public confidence is essential to building a strong future for the industry," he added.

Some in the industry are concerned that public protests could hamper the mobile phone industry's attempts to roll out 3G networks.

O2 suspends email-to-phone service
10:51 Wednesday 19th February 2003
Graham Hayday, silicon.com


The mobile phone operator is making 'improvements' to its email-to-phone service, resulting in the service being taken offline
O2's email-to-phone offering has been temporarily suspended as the company carries out what it describes are "improvements" to the service.

By the time of publication the mobile operator had been unable to provide any information about the nature of the "improvements" or when users can expect the functionality to return.



The full notice which greets anyone now trying to use the online service says: "Unfortunately, we regret that the 'Email to mobile' service has been temporarily suspended. Don't worry -- the service is not being completely withdrawn, but is offline whilst essential improvements are carried out. We apologise for any inconvenience this may cause, but are confident that the service will resume shortly."

This isn't the first occasion O2's customers have had such problems.

One silicon.com reader said: "It was good until Genie 'upgraded' about two years ago since when it has been, at best, erratic. The worst time was January last year when [O2's] entire email service (Web/WAP/POP3) was down for a week or so."

Meanwhile, O2 -- which sponsors the England rugby team -- is appealing for the safe return of some life-sized cardboard cut-outs of several players which have gone missing in mysterious circumstances.

According to a report on Planet Rugby, O2 produced the figures as part of an MMS promotion which took place during the games against Australia, New Zealand and South Africa last November. The company invited supporters to have their picture taken next to their "heroes".

O2 had hoped to continue this marketing activity during the Six Nations championship which kicked off last weekend -- until it emerged that the cut-outs had been stolen.

O2 is appealing for news of the figures. A spokesman is quoted as saying: "Whilst O2 does not condone theft in any shape or form, we have decided to create a cardboard cut-out amnesty. If the cut-outs are returned safe and sound to Twickenham, there'll be no questions asked and we'll say no more about it. However, we understand if you cannot bear to part from your heroes -- just let us know that they're safe."

02/19 05:17
MMO2 May Use EDGE Technology to Cut Network Building Costs
By Dex McLuskey


Cannes, France, Feb. 19 (Bloomberg) -- MMO2 Plc, the fastest- growing U.K. wireless carrier, may cut the cost of building networks by adopting technology that allows data to be carried faster on existing systems, Chief Executive Peter Erskine said.

MMO2's Global System for Mobile Communication, or GSM, networks may add Enhanced Data-Rates for GSM Evolution, or EDGE, technology to increase data capacity and speed, Erskine said in an interview.

``It's a much lower investment cost'' than so-called third generation faster wireless services, Erskine said. ``I'm not saying it's nothing, but it's not a lot of money.''

European mobile operators are seeking ways to make more money from existing networks after spending more than $100 billion on permits to offer so-called third-generation wireless services. The companies have introduced games and photo messaging to tempt customers to spend more. Existing networks need to be upgraded to allow such data to be transferred quickly.

EDGE technology allows data such as e-mails to be transferred at speeds as much as five times faster than on General Packet Radio systems, Mike Short, Chairman of the U.K. Mobile Data Association, said in an interview. U.S. operators, such as AT&T Wireless Services Inc., already use EDGE because they can't get additional radio spectrum for faster services, he said.

MMO2 won't consider adding EDGE to its networks until handset makers such as Nokia Oyj, the world's biggest maker of mobile phones, can supply devices that allow subscribers to make calls on both EDGE-enabled networks and 3G systems. London-based MMO2 will begin 3G in Germany by the end of 2003 and in the U.K. in the second half of 2004.

``Some of the vendors are saying they're getting EDGE handsets, but we're yet to be convinced,'' Erskine said. ``Once we can see that there is a reasonable range of handsets that will use EDGE and migrate to 3G then we're very interested.''

Nokia has introduced a phone, the 6200, which uses EDGE and which is also compatible with third-generation networks.

MMO2's shares, which have lost 22 percent of their value in the past year, fell as much as 2 percent, or 1 pence, to 48.75p and were trading at 50p as of 9.30 a.m. in London.

see bbc for fulll story


Mobiles 'let you control your life'

By Jane Wakefield
BBC News Online technology staff in Cannes


Mobile phones are used by people to decide how and when they communicate with the rest of the world, say researchers.
The findings are the result of a three-year study into the evolution of consumer mobile behaviour, entitled Me, My Mobile and I, by a team at Lancaster University in the UK.

The report, presented at 3GSM World Congress in Cannes, suggest that mobile devices are increasingly offering people a way to control their relationships, location and self-image.

This idea likely to provoke mixed feelings of fear and excitement in operators determined to exploit the potential of mobiles by offering a wide variety of services.

flat with sector and market marginally up - US futures marginally off fair value

ains



20 Feb 2003 09:33 GMT

Mobile industry struggles in wireless Web

By Lucas van Grinsven
CANNES, France (Reuters) - Tens of billions of dollars are riding on the future of fast, mobile Internet services, but industry leaders leaving the world's top wireless trade show are still struggling to justify the investment.

At the annual huddle on the sunny French coast, the 28,000 visitors as usual overloaded the local mobile phone network, underlining that the young industry still faces basic problems as it seeks to rekindle sales with advanced, data services.

European mobile carriers have sunk over 100 billion euros in third-generation (3G) wireless networks, but they no longer seem convinced that video and fast wireless access to corporate information will push up revenues.

"Operators (in Cannes) suggested an unwillingness to invest heavily in 3G until more signs of life for mobile data services emerge. In general, there is a lack of conviction in the return on investment of new mobile data services," said Jeffrey Schlesinger, a U.S.-based analyst at UBS Warburg.

As exhibitors and visitors pack up their stands and bags for another year, Motorola Inc -- the U.S. telecoms equipment group -- acknowledges the problem.

"The business model still has to evolve," handset chief Tom Lynch conceded in an interview with Reuters. Asked if consumers will ever use enough video services on their mobile phones to pay for the investments, Lynch shrugged: "To be determined."

Wary about predicting consumer appetite for potentially costly new services, companies are pooling resources. They have too much to lose after taking one of the largest gambles in corporate history on an untried technology.

"3G technology is ready. The thing is now to turn it into a mass market product," said Kurt Hellstrom, the head of the world's largest mobile network maker, Ericsson of Sweden. "Many different players need to work together," he said.

COMPLEX COOPERATION

Mobile communications have grown into a business with one billion users across the world largely because 15 years ago, European companies decided to back a single technology standard known as GSM (Global System for Mobile communication).

This means a person in London can now send a text message from a mobile phone to a friend in Hong Kong.

But now that the industry needs to take this model to the next step, by enabling consumers to send pictures, play games, get their calendars and receive email on tiny mobile devices -- and cooperation is increasingly complicated.

Despite alliances between providers of software, hardware and services announced in Cannes, analysts are sceptical about any end to traditional recriminations between operators and vendors about who is to blame for delayed services.

"Go back two years, and commentary on mobile services had a uniform message: operators had promoted services well in advance of their arrival, prompting disappointment all round," said Chris Alliott, London-based telecoms analyst at Nomura.

"This year at Cannes we can't help but feel that services are arriving faster than operators know what to do with them."

He pointed at video messages, shown here as the key application for which fast networks are needed, even before the industry has figured out how to send still pictures between different handsets across Europe.

But at least the paralysis of last year, when the mobile market was suffering from its first revenue decline after a decade of stellar growth, has been replaced by hope.

"A year or two ago people were still feeling sorry for themselves in the industry. Now they are cleaning up their balance sheets, changing management, forging partnerships," Nokia Mobile Phones vice president Erik Anderson told Reuters.

"It's not optimism but pragmatism," he said.

SEEKING PROOF

This is certainly true for the handset makers. Four of the top five handset makers were profitable again in 2002, compared with just two in 2001. But it has also become a market in which mobile phone makers are less willing to take risks.

Japan's leading mobile operator NTT DoCoMo admitted here that had it not splashed out 40 billion yen in subsidies for handset makers to develop another ten 3G models, the phones would not have arrived.

"Since the 3G handsets are not selling very much ... makers were not able to get a return on their investments," DoCoMo's Chief Technology Officer Kota Kineshita told Reuters.

It is not up to operators to decide if 3G is worth it. Businesses also need to figure out if they want to invest the millions needed to give their employees access to email and business applications on expensive mobile devices.

Microsoft says a company recoups its costs if employees are in the field at least 30 percent of their working week.

For those who see no future for 3G, network vendors here came up with a once-heralded but since forgotten intermediate technology called Edge -- also known as 3G Lite.

Edge enables almost the same services as 3G but video is of lower quality and the speed, while faster than current networks, is still slower than fully-fledged 3G.

It is certainly cheaper to upgrade networks with Edge, for which no new radio spectrum and radio base stations are needed. The Chief Executive of British mobile operator mmO2, Peter Erskine, said Edge could delay fully-fledged 3G further.

"A year ago hardly anyone had heard about Edge. Today everybody is talking about it," he said. Still, the largest network vendors believe Edge will have no impact on sales.

20 February 2003

Telegraph brings mobile in-house
Justin Pearse

The Telegraph Group has launched an in-house mobile marketing initiative, with plans to integrate SMS into its existing print, outdoor and online ad offerings.

The first major campaign from Hollinger Telegraph New Media is an integrated aboveand below-the-line push for retailer Muji.

The company has partnered with Brainstorm to license its ASP mobile marketing solution M-Brand, enabling the full development of mobile marketing campaigns.

'This shows just how the mobile marketing industry is moving on,' said Brainstorm CEO Craig Massey. 'More and more companies, such as media owners and ad agencies, will realise they can bypass specialist mobile marketing agencies.'

This is a position agreed on by HTNM strategic development manager Robert Bridge. 'The early mobile stuff was fairly basic so we wanted to take the tools in-house, with a guiding hand,' he said.

The company is now looking to develop tailored integrated advertising packages, in particular to add interactivity to its print ads.

'We want to use mobile more and more so that a reader can react immediately,' said Bridge. 'It's potentially a very good mechanic for lead generation, enabling readers to reply to, say, car ads.'

It also plans to build its own database of mobile users.

Product news
received on 21 February 2003
from Zyray Wireless

Baseband puts new spin on dual-mode 3G handsets
The rapid development of dual mode GSM/GPRS and WCDMA handsets is a significant step closer following the introduction of Zyray Wireless' Spinnerchip 1.0 WCDMA baseband processor solution.

The rapid development of dual mode GSM/GPRS and WCDMA handsets is a significant step closer following the introduction of Zyray Wireless' Spinnerchip 1.0 WCDMA baseband processor solution.

Sampling began ahead of schedule and a complete dual mode WCDMA and GSM/GPRS solution was demonstrated this week at the 3GSM World Congress in Cannes.
Proven to connect to a majority of market-leading GSM/GPRS baseband solutions, Zyray's Spinnerchip 1.0 single chip WCDMA FDD baseband processor began sampling last month.


The solution uses a standard memory interface to connect to existing GSM/GPRS baseband processors.

O2 reaffirms its committment to 3G
21/02/2003
O2 Ireland has reaffirmed that it will meet the 3G rollout requirements of its licence here, despite Peter Erskine talking about delays at 3GSM.



The reassurance came as the chief executive of its parent, mmO2, said it is considering using slower Enhanced Data Rates for GSM Environment (EDGE) technology in the rollout of 3G.

Although slower than the WCDMA platform which many 3G companies are delploying, EDGE is a cheaper alternative and will allow the company trim its overall expenditure on 3G.

MMO2 chief executive Peter Erskine told the 3GSM World Congress in Cannes that because of the delays and expense related to 3G deployment, the company is considering EDGE. O2 Ireland spent E114m acquiring its Irish 3G licence which runs for 20 years. According to an Irish Independent report, an O2 Ireland spokesperson said that the company had yet to make a final decision on the deployment of EDGE but that all options were being considered.

Not having much effect as OOM is outperforming sector and market at plus nearly 3%



CSFB UPGRADES VODAFONE AND CUTS MMO2

Investment bank Credit Suisse First Boston has upgraded mobile phone giant Vodafone VOD.L to "outperform" from "neutral" but has downgraded sector peer mmO2 OOM.L to "neutral" from "outperform".

Analysts at the bank said Vodafone was gaining market share and also had the potential to reveal a 6-7 billion pound share buy-back, possibly at its annual results in May.

But CSFB said it expected mmO2 to remain volatile in the short term and did not expect a takeover of the whole group in the near future. As well as downgrading the stock, CSFB cut its price target on mmO2 to 50 pence per share from 75p.

Separately, Morgan Stanley also sounded a bullish note on Vodafone, raising its target price to 131p from 128p and reiterating an "overweight" rating on the stock.

"The primary driver for the increase in estimates is higher revenue forecasts from the December KPIs," analysts wrote in a research note.

Credit Suisse First Boston upgrades its recommendation on Vodafone Group PLC and downgraded smaller rival mmO2 PLC, dealers said.

Vodafone was upgraded to 'outperform' from 'neutral' by the broker, which kept an unchanged price target of 125 pence. It also downgraded mm02 to 'neutral' from 'outperform', cutting is shareprice target to 50 pence from 75. On mmO2, CSFB worried that the sale of the firm's lossmaking O2 Germany unit could be delayed until 2004 or 2005. This led the broker to cut its breakup valuation to 60 pence per share, to reflect the ongoing drag on free cashflow. It also made a 6.1% downgrade to medium-term EBITDA forecasts, citing recent events including the Oftel decision to lower connection charges.

CSFB thinks the sale of mmO2's German operations will be delayed after the firm signed a deal to pay to T-Mobile 137m to gain the right to roam on T-Mobile's 3G network in Germany in the future. This deal puts mmO2 in a position where it is now prepared to fund the build in Germany to 25% population coverage this year, CSFB reckons.

It believes the firm is under no pressure to sell until it has to provide capital expenditure for a 50% population roll-out, which could be two years away. "A takeover of the whole group also does not look imminent to us," CSFB added. CSFB's moves also follow presentations from both mobile phone companies yesterday at the Cannes GSM conference.

Yesterday in Cannes, mmO2 chief executive David Finch presented on mmO2's current performance and prospects. He reportedly confirmed the firm's target of 10% service revenue growth and 30% EBITDA margin guidance for the UK business in 2004. Finch also told analysts that long term investment levels are expected to be lower than recent history and said that mm02 remains open to all options for its Dutch and German businesses. Goldman Sachs was pleased, saying the presentation "reinforced ...confidence in management's control of the business and its pragmatic approach to mmO2's strategic options - both regarding 3G and consolidation". The US broker reiterated an 'outperform' rating on mmO2 shares and left forecasts unchanged.

Mobile firms 'got off lightly'
By Dominic White (Filed: 24/02/2003) Telegraph

Britain's mobile phone operators, who have been ordered to cut the cost of calls between networks, narrowly escaped more punishing proposals that would have forced them to make an immediate one-off reduction of 50pc.

The Competition Commission last month told the four operators to cut so-called "termination charges" by 15pc with immediate effect, and make similar reductions each year for the next three years.

Operators attacked the proposals as unfair. At least two are preparing to take the commission's investigation to judicial review. Vodafone is expected to file documents in the High Court this week.

It has now emerged that the commission originally proposed an immediate halving of termination charges followed by annual reductions, a move backed by the National Consumer Council.

A one-off cut of such size would have made it hard for operators to adjust their handset subsidies and call prices to compensate for the loss of revenue from termination charges.

A senior source at one of the operators said: "Symbolically, the original proposals would have been worse than the final result." Mobile phone company share prices would have come under huge pressure, he said.

The commission wrote to the four operators - Vodafone, mmO2, Orange and T-Mobile - last summer setting out the plans. This led to a fierce campaign and lobbying of the Government, which got a 22.5 billion windfall from auctioning next generation mobile licences.

Operators are now kicking themselves for going to the commission, after rejecting far less swingeing proposals by Oftel, the telecoms watchdog.

They have two main complaints: the commission's final findings do not take into account the 22.5 billion, and do not specify how fixed-line rivals such as BT should pass on to consumers the reduced charges they will pay to access mobile networks.

If i can get this at 50p i`ll be taking out a massive short, its a no-brainer
Target price 20p

Seems a strange approach - waiting for 50p when they are at 48p .... when you expect 20p .... go for it - short them now and wait for 20p



ains

Ains

I like getting the top
Know what i mean?
I think that they will possibly never see 50p again so i may move soon

Mobile bosses cautious over 3G

By Jane Wakefield
BBC News Online technology staff


Third generation telephone networks have taken a backseat in speeches by the bosses of two of the UK biggest mobile operators.

O2 boss fed up with regulation
The chief executives of both O2 and Orange delivered keynote addresses at the annual 3GSM conference in Cannes last week but neither seemed to have 3G uppermost on their minds.

Peter Erskine, head of O2 used the Cannes platform to complain about recent demands from UK telecoms watchdog Oftel that mobile operators slash the costs of making calls to other networks.

Coupled with European regulatory attempts to reduce the costs of making foreign calls, Mr Erskine said it added up to too much interference in the industry.

Growing up

Describing it as "small picture thinking" Mr Erskine accused the regulators of stifling creativity and competition.

"It is a constant battle between regulators and operators and places us in uncertainty," he said.

It was time, he said, to let mobile firms stand on their own two feet.

"There has been talk of the mobile industry being in its infancy but such comparisons have outlived their usefulness," he said.

Regulation, he said should be "colossally light-touch" and looked to new super regulator to adopt a hand-off approach to the mobile industry.

Sharing networks?

Mr Erskine reaffirmed O2's long-term commitment to 3G, describing the technology as "too extraordinary, too life-enhancing" not to happen,

But he also hinted that the industry was about to go through a period of consolidation with mergers and partnerships.

O2 could favour network-sharing rather than rolling out its own dedicated 3G network, he said.

He said that 3G was no longer a field of dreams adhering to the philosophy that if you built it, users will come.

"Now the attitudes are more pragmatic and led by market demand," he said.

People power


We might suggest ways customers might like to use services but at the end of the day they will be defined and deployed by the street

Jean Francois Pontal, Orange
The new focus on customer demand and need was central to the speech made to the Congress by Orange's outgoing boss Jean Francois Pontal.

He compared the challenges facing the mobile industry as those faced by the music industry, a need to keep a constant eye on what ordinary people were doing.

"The next big thing is here already, in clubs, warehouses and bedrooms," he said.

Despite the best-laid plans of operators to move users to multimedia services, the real decisions will be made at grass-roots level he said.

"We might suggest ways customers might like to use services but at the end of the day they will be defined and deployed by the street," he said.

Old-fashioned voice was likely to remain the core business for mobile operators for the next decade he said.

Mr Pontal admitted that Orange was not at the bleeding edge of 3G rollouts.

"Clearly we won't be first with 3G but it is not about the technology, more what the technology can do for people," he said.

He urged incoming boss Solomon Trujillo to keep his mind fixed on the voice business as the company moved forward.