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Ringing up big numbers out east

Europe's largest telecoms operators have a new ambition. Having lost monopolies at home, they now want to build networks that stretch across Europe all the way to Vladivostok. Charles Piggott reports on the telecoms battle for central and eastern Europe.

Deutsche Telekom's 'logical expansion'

A few months ago journalists quizzed Pat Gallagher, president of BT Europe, about the size of British Telecom's war chest for eastern European expansion. They expected an answer in the billions. BT has already invested some €2.4 billion ($2.425 billion) in western Europe. Gallagher's reply was more surprising than a multi-billion dollar figure. He explained that BT had "no investment constraints" at all to get into eastern Europe's fast-growing telecom market. "BT will invest whatever it takes," he told the press after the launch of a major investment push into new markets in the east. Analysts speculate that BT's war chest for central and eastern Europe may top £3 billion ($4.8 billion).

BT is not alone in its ambitions, rather it's the latest contestant in a battle that began several years ago. Deutsche Telekom has been aggressively expanding into eastern Europe for more than five years and already has a considerable head start on many of its western rivals. It has built up stakes in Hungary's Matav, Croatia's Hrvatska Telekom, Austria's max.mobil and Poland's PTC and has other ventures in the Czech Republic, Russia and the Ukraine.

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