TELECOMS & MOBILE
Speculation mounts over Vizzavi disposal
19-08-2002
by
Vivendi may sell its 50 percent share in Vizzavi to Vodafone for EUR150 million, bringing the future of the Ireland's e-merge wireless portal into question.
According to a report in the Wall Street Journal, the sale would form part of Vivendi's drive to offload more than EUR10 billion in assets over the next two years, in order to reduce debt.
Vodafone and Vivendi have invested more than EUR1 billion in the portal, which aimed to bring multimedia content such as music and video to the users to high-end mobile phones. But, the limited availability and slow uptake of wireless broadband has meant that demand for Vizzavi's content has been limited.
Vodafone's Irish subsidiary has its own wireless portal known as e-merge, which came as part of its acquisition of Eircell. The consequences for the e-merge portal are unknown, but it may not make sense for Vodafone to maintain a separate wireless portal in Ireland. Spokespeople for Vodafone were unavailable to comment on the future of e-merge.
Because of the limited availability and uptake of high-speed wireless services in Ireland, e-merge has focused upon providing text-based content for mobile phone users, such as news, e-mail and games, rather than providing broadband media offerings.
Recent speculation that Vodafone may not take up its 3G phone license in Ireland also calls into question its commitment to providing wireless broadband services and content in Ireland.
E-merge's experience may be a microcosm of the problems experienced at Vizzavi. According to Vivendi's 2001 annual report, Vizzavi had a loss of EUR386 million last year. In January, the unit laid-off 100 of its 800 staff and focused on mobile phone users rather than general Internet users. However, it is understood that this has not stemmed the losses at the company.
In early August, Vivendi's new chairman, Jean-Rene Fourtou, said the company had decided to stop investing in Vizzavi, which raised questions about its future as a part of the media conglomerate.
The company is also selling book publishers Houghton Mifflin. Other assets that have been identified as possibly being for sale are Telepiu, the Italian pay-TV arm of Canal Plus, its 10 percent stake in Echostar, the US satellite company and the international assets of Canal Plus.
If Vodafone gain complete control of Vizzavi it is likely that it will be rebranded as part of Vodafone's global rebranding policy.
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