Germany to Open Its Telecommunications Market in 1998

The German telecommunications market, the most lucrative in Europe, will be open to all qualified competitors once Deutsche Telekom’s monopoly is dismantled early in 1998, according to guidelines to be unveiled today by German officials.

The decision is likely to be welcomed by many of the world’s telecommunications giants, such as AT&T;, British Telecommunications and Britain’s Cable & Wireless, which have been forming alliances with German companies to prepare for competition.

There has been nervous speculation over the past few months over the number of licenses likely to be awarded.

But Wolfgang Botsch, the German post and telecommunications minister, has decided against awarding only a set number of licenses, because of fears the action would violate a constitutional right of freedom of trade.

“We are not going to say that everybody who wants to can, but rather that everybody who wants to may--as long as they fulfill the criteria,” an official said. These will include financial standing, telecommunications experience and ability to guarantee the integrity of the communications network.

Most European countries will be forced to open their telecommunication markets to competition--in both infrastructure and services--after Jan. 1, 1998. Only the United Kingdom and Sweden now operate fully open telecom markets.

Government-owned Deutsche Telekom is set to be privatized next year, when some $9.75 billion worth of shares will be put on the market.

British Telecom said Sunday that it welcomes Botsch’s decision. The firm formed an alliance earlier this year with Viag, a diversified energy company which owns an extensive fiber-optic network.

Other groups likely to feel the benefit are Thyssen, the German steel maker, which has formed a joint venture with Bell South; Veba, a German energy and chemicals group which has an alliance with Cable & Wireless, and Daimler Benz, which is linked with Northern Telecom of Canada.

Botsch was expected to give further details today on how he envisages the structure of the German telecommunications market after 1998.