Now raising intellectual capital

D.Telekom JV could jump Sprint hurdles


ATHLETICS/Deutsche Telekom is struggling in two of its most important international markets and desperately needs to find a quick fix. Its proposed joint venture with France Telecom is a graceful way to establish a leading position in the UK market. But buying Sprint Nextel in the United States looks far less sensible.

A takeover of its rival would catapult Deutsche Telekom past AT&T and Verizon to U.S. number one position. However, the deal looks a costly way to get its operations there growing again. Talk of a bid for Sprint Nextel by T-Mobile USA — the business Deutsche Telekom acquired when it bought VoiceStream in 2000 — is hardly new.

But Monday’s fall in the German company’s share price on the latest report that it is looking at a bid suggests investors still have misgivings about the idea.

After all, Deutsche Telekom forked out $25 billion in shares and cash to buy VoiceStream at the top of the market, piling on debt which almost brought the telecoms group to its knees but failed to deliver the major market presence it wanted. Its strategy since then has been all over the place. It first looked at selling  the U.S. business, before apparently changing tack by considering buying a rival.

Has Europe’s hottest site got what it takes?


LONDON, Aug 5 (Reuters) – Spotify is enjoying a fairy-tale success as Europe’s hottest Internet start-up this year, thanks to music industry support and rapid adoption by avid listeners. The trouble is that the young company appears to have no special technology or business model that will help it compete in an online market where many consumers expect music to be free.   The company, founded by two Swedes, combines some of the best features of other music discovery sites with the aim of taking on no less a rival than Apple Inc and its iTunes media store. It has certainly caught on — despite being on the market for only 10 months, the advertising-supported service has attracted 2 million users in the UK, Sweden and other European countries.

Unlike iTunes, which sells songs or videos by the download, Spotify is one of the many services that offer consumers streaming access over the Web to a more or less unlimited library of songs. In Britain, Spotify has rocketed to become the 10th most visited music site, up from 27th a few weeks ago, according to Web measurement firm Hitwise.

It still ranks behind sites like BBC Radio 1,, the pioneering music discovery site, and a newer rival, the ad-supported site, which is backed by musician Peter Gabriel. Spotify also has competition from social network sites like MySpace and Nokia’s Comes with Music service on phones, among many others.