KPN in talks on 3G cost-sharing plan

Dutch firm KPN Telecom said today it was talking to several firms about sharing the cost of developing a third-generation (3G…

Dutch firm KPN Telecom said today it was talking to several firms about sharing the cost of developing a third-generation (3G) mobile network in Germany, but had reached no deal yet.

KPN won a third-generation UMTS licence in Germany last year for euro 8.4 billion, but its erstwhile partner Hutchison Whampoa pulled out of the deal soon after, leaving KPN and its partner BellSouth to foot the bill.

Spain's Telefonica indicated previously that it was looking to share the 3G outlay cost but did not specify further.

Telefonica hopes to have a cost-sharing agreement in place by the end of the summer, around the end of the third quarter, a source close to the Spanish telecoms company said today.

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The Financial Timessaid an agreement with leading Dutch telecoms operator KPN could save Telefonica around one third of the euro 6 billion cost of building a 3G network.

One source familiar with the negotiations said an agreement was possible as soon as this month. Another said, however, that the talks were at a very early stage.

Telefonica and KPN held failed merger talks last year.