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Interfax: France Telecom's Polish TP plans to adopt Orange brand, cut workforce win analyst praise

14.3.2007 17:51
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WARSAW. MARCH 14. INTERFAX CENTRAL EUROPE - France Telecom's Polish incumbent Telekomunikacja Polska (TP) plans to merge on the operational level with its mobile arm PTK Centertel and replace its TP brand with the mobile arm's Orange brand, according to unconfirmed press reports viewed positively by analysts Wednesday.

"From the point of view of the convergent offer, we see the operational merger with PTK Centertel as positive, while the introduction of the Orange brand is neutral," DI BRE analyst Michal Marczak wrote in a daily comment. "France Telecom is likely to introduce the [Orange] brand fee for TP, which is at 1.4% of revenues in the case of Centertel."

TP is already paying fees for the use of France Telecom's logo in Poland, which it plans to drop along with its TP brand, unpopular because of monopoly connotations. The company hopes to generate high savings on the merger with PTK Centertel, unifying not only the brand, but also key departments and IT systems, as well as preparing new layoffs, press reports suggest.

"The scale of changes in Centertel is the biggest in the company's 15-year history," business daily Puls Biznesu wrote Wednesday.

TP has recently nominated executive director Grazyna Piotrowska-Oliwa as the new PTK Centertel executive in charge of the coordination of the planned merger.

"With every coming month, the role of Centertel as an organization will be weakening," an unnamed manager at TP is quoted as saying by the daily. "The best managers are already being transferred to TP along with the key departments. A new layoff process is also to start soon."

The operator plans to cut costs in view of the increasingly competitive mobile market and the shrinking landline business and the related erosion of margins, analysts also said Wednesday.

"All the actions are supposed to cut the operating costs of the operation, which in our view will have increasing problems with maintaining its revenue level," DI BRE's Marczak said.

ČTK

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