Start-ups in talks with Deutsche Telekom

The weakening dollar was presenting local telecom companies with an opportunity to increase their presence in Europe.

cellphone biz 88 248 (photo credit: Bloomberg)
cellphone biz 88 248
(photo credit: Bloomberg)
Four Israeli telecom start-ups are holding talks with German communications giant Deutsche Telekom with a view to signing deals with the telecoms giant, The Jerusalem Post has learned, as the weak dollar offers local companies better opportunities to expand their activities in Europe. Maiki Yoeli, Deputy Director-General of the Israel Export and International Cooperation Institute, named the companies as Decell, Aeroscout, Zlango, and Triplay. Yoeli added that 13 other Israeli mobile companies were in premilinary talks with Deutsche Telekom, but said it was too early to name them. The news came ahead of the prestigious 2008 Mobile World Congress conference in Barcelona set to commence on Monday, in which 60 Israeli companies - a record number - are expected to take part in. A third of the Israeli participants, 20 companies, are start-ups, the Export Institute said. Yoeli stressed that the number of Israeli participants at the Barcelona conference had increased by 50 percent, as a result of the Institute's efforts. The summit, held annually, attracts around 55,000 visitors, and is seen as an agenda-setting event for the global mobile industry, where deals are often signed or initiated between industry players. Joining forces with the Industry, Trade, and Labor Ministry, and the Israel Industry Center for R&D, the Export Institute has been working to connect Israeli innovative companies with European hi-tech giants, Yoeli told the Post. The Export Institute stressed that the weakening dollar was presenting local telecom companies with a unique opportunity to increase their presence in Europe. According to figures released by the Institute, in 2007, local communication exports to the European Union reached $871 million, an increase of 6% compared to 2006. In contrast, Israel exported $931m. worth of telecommunication equipment to North America in 2007, marking a moderate increase of 2% from 2006. Yechiel Assia, Chairman of the Export Institute, said on Sunday that he expected that trend to continue, adding that the European market was a "most important target for Israeli communications companies." Assia said that the Institute's main focus was to help "open the doors to European telecoms giants" for Israeli start-ups. Assia highlighted cellular services, cable broadcasts, satellite, and especially wireless internet as being sectors of rapid growth, adding that Israeli companies had "an advantage in innovative technologies and value added services." "We found that when we connected Israeli innovation companies with the hi-tech big players in Europe, business went up," said Yoeli. "In each sector within the mobile industry, when we represented Israeli companies, we saw great results for them, leading to deals." Addressing the weakening dollar and the slowdown in the US economy , Yoeli said the decreasing demand in the US was leading local companies to make forays into the European and Asian markets. Other European corporations in touch with Israeli companies include British Telecom, Sony Ericsson, and Orange. "We are placing at the disposal of Israeli companies the best platform for creating strategic cooperation with communication providers and leading companies in the global mobile market," said Yair Amitai, Chairman of the Industry Center for R&D. "Joint research and development programs were allowing funding from Israeli and foreign government to be made available to Israeli companies." The increase in transactions between Israeli and European companies is a continuation of a six year trend, Boaz Hirsch, Deputy Director-General of the Industry, Trade, and Labor Ministry said. During that time, he said, "long-term strategic connections with leading communication companies in Europe were made through trade attaches, which ended with many deals."