Telecom firms prepare to bid for GSM

That's the figure people in the "telecom family crowd" are anticipating from the Communications Ministry when it opens the tender for Global Systems Mobile (GSM) at the end of the month.
"We need to get this from the horse's mouth," said Janusz Luks, president of Polskie Telemedia, a subsidiary of Optimus. But officials at the Communications Ministry would not comment on the amount.
"We only have the assurance that it won't be less than $100 million," said one of the contenders who asked not to be identified.
The probable winner will offer closer to $200 million, said Lech Zdziech of ICC Millennium consulting firm. ICC has been closely following the GSM tender process.
"Right now people are relying on interviews with potential bidders and sources within the ministry for strategies with regard to finances," Zdziech said. "The official tender probably won't differ much (from the preliminary questionnaires), but a single word could mean a major change in strategy for companies."
The minimum bid and other details, such as the deadline to submit bids, will become official when the Communications Ministry opens the tender Sept. 28, ministry officials said.
The tender was to be opened in mid-September, but the Communications Ministry needed more time to analyze the feedback from companies that returned the preliminary packets. Telecommunication companies will then have from one to three months to submit three sealed envelopes.
The first envelope is to contain legal information, confirming that the firm has bought the tender documents, has a notarized lawyer and has paid the proper value-added tax.
The second envelope should summarize the project and company experience, including details of technical and marketing plans and company ownership structure.
The third envelope will contain the actual bids for the GSM contracts. It will not be opened by the judging committee until the committee declares the first two envelopes satisfactory. The sequence is designed to prevent bid amounts from prejudicing committee members when looking at company profiles.
While the ministry has granted itself more time, some companies are concerned that even three months may not be enough time to prepare the detailed proposals.
"It is a tight schedule for something of this size but not impossible," said Ian Hume, vice-president of business development at Ameritech. "Companies have been working at this for some months."
Interested companies are in the process of forming strategies and consortia, which must contain at least 51% Polish ownership.
"It is unclear how long analysis (of the official tender) will take," said Marek Laskiewiec, public relations manager of Centertel.
"It depends on how much the official tender will differ from the preliminary documents. The longer we have, the better. Offers need to be very specific," he said.
The winner will be picked by a special committee appointed by Communications Minister Andrzej Zielinski. The decision likely will be based on more than the amount a consortium bids, according to sources familiar with preliminary tender documents. Additional factors include the price and extent of services, network implementation and shareholder structure.
If existing data is any indication, the GSM licenses may be especially profitable in Poland, where the average existing cellular phone is in operation 380 minutes a day compared to 180 minutes in Western European countries, according to Zdziech.
The Communications Ministry plans to announce the winner by the end of the year and expects the GSM system to be working by the beginning of 1997.
Telekomunikacja Polska SA, the state-run telecom giant, has promised to cooperate with whomever the winner is in changing its existing networks.