Thirty-five percent of telecommunications customers are as likely to purchase bundled services (local, long-distance and electric/gas services) from an electric/gas provider as they are from a local telephone service provider, according to a J.D. Power and Associates residential telecommunications bundling report. However, consumers interested in purchasing multiple telecommunications services from a single provider are now more likely to choose their local telephone company than in the past. Six major companies that provide bundled services were included in the study: ALLTEL, Citizens, Frontier, GTE, SNET and Sprint. These companies provide local and long-distance services to 4.9 million households, a 63% increase over 1997.
"These findings indicate that there is a potential threat to telecommunications companies that currently offer bundled services," said Peter Dresch, director, telecommunications market analysis at J.D. Power and Associates. "Electric/gas utility providers enjoy significant levels of customer satisfaction and clearly have an opportunity to enter the telecommunications marketplace as their own industry is deregulated and competition becomes more widespread."
The report also analyzes consumer perceptions about cable/satellite service providers. When consumers interested in bundled services are asked from whom they would purchase local, long-distance and cable/satellite services, only 22% would choose their cable or satellite TV provider. Such a low number indicates less satisfaction among such customers when compared to other bundled service competitors.
Research and Development Spending to Increase Total expenditures in research and development in the United States are expected to increase to nearly US$236 billion in 1999, according to the annual Battelle-R&D Magazine forecast. The increase represents a considerable one-year leap in research and development spending, which continues to climb after stagnating in the early 1990s.
"Barring any major economic downturns, the increase in 1999 will be part of a trend that will continue into the 21st century," said Jules J. Duga, a Battelle senior researcher and co-author of the report. "A strong economy, a federal budget surplus, and a clear interest in breakthrough innovations for commercial products have fueled this cycle."
The major predictions for 1999 include: - Industry, which continues to dominate the amount and growth of research and development spending, will increase research and development spending to US$157 billion, an increase of more than 9% from last year. The expenditures are growing at a rate that significantly exceeds inflation. - The U.S. government will spend US$68.1 billion for research and development in 1999. This is a slight increase over 1998 spending, barely keeping pace with inflation. The federal budget continues to give mixed signals relative to the support of research and development. While the budget has authorized greater amounts of funding, the actual expenditures remain relatively low.
TransEnergie to Build Australian Transmission Line TransEnergie U.S. Ltd., a subsidiary of Hydro-Quebec, will play a key role in the construction and operation of Directlink, a new interconnection linking the states of New South Wales and Queensland, Australia. The US$70 million project will be completed early in 2000 using new ABB high-voltage direct current light technology. Another subsidiary, Hydro-Quebec International, has become a co-owner of the new interconnection in partnership with the Quebec Solidarity Fund-the investment arm of the Quebec Federation of Labor-and NorthPower, an Australian electric distribution company.
West Sahara to Receive Power Over the next 16 months, the disputed Western Sahara will become connected to the power network of the Office National de l'Electricite (ONE), Morocco's state-run electricity authority. ONE will spend 534 million dirhams (US$58 million), with 265 million dirhams (US$28 million) going toward a 21 MW power station in Dakhla, an Atlantic fishing port south of Rabat. The rest of the money will be dispersed to other new power projects throughout the country.
Emdersa Bought by GPU Emdersa, a holding company that owns three distributors, has been bought by GPU Inc., a registered utility holding company. GPU paid US$435 million for the Emdersa companies Edesa, Edelar and Edesal, which serve customers in northwest Argentina. According to GPU, the purchase was scheduled for completion in January or February.
Transend to Upgrade Grid Transend Networks Pty Ltd., a state electricity transmission company in Tasmania, plans to upgrade the state's power grid by investing A$500 million over the next 10 years. According to Richard Bevan, chief executive of Transend, many pieces of the company's equipment are above the average age of other companies' equipment in Australia.
"Unless we continue to invest in the system, performance will deteriorate. That's why we're planning to invest A$50 million a year over the next 10 years to improve the transmission system in Tasmania," he said.
Southern California Edison To Enter Phone Market Southern California Edison Co., a subsidiary of Edison International, could become the first electric utility in California to provide local phone service. The California Public Utilities Commission approved Edison's request late last year. Edison plans to service local phone companies, Internet service providers and other telecommunications businesses using 19% of its existing fiber-optic networks. The company has been restricted from using money earned through its electricity operations to finance its new telecommunications service.
Regional Distributors to Privatize The Colombian government has set a timetable for the sale of 10 to 14 state-owned distributors. The government is planning to complete the first sales by the middle of 1999. The first calls for bids were scheduled for late January or early February. The distributors slated for sale serve the departments of Choco, Narino, Cauca, Quindio, Huila, Tolima, Boyaca, Cundinamarca, Caqueta and Meta. In addition, the government is deciding whether to seek private investors for distributors in Norte de Santander, Santander, Caldas and Antioquia.
Yorkshire CoGen Sold to PowerGen Yorkshire Electricity Group, a regional electricity company in the United Kingdom jointly owned by American Electric Power and New Century Energies, has sold Yorkshire CoGen Ltd. to Britain-based PowerGen plc. The transaction included 232 MW of operational or contracted generation, or generation under construction. The sale is part of Yorkshire's larger strategy to reduce debt by divesting generation assets.