'Baby Bell' teams up with KL firm

'Baby Bell' teams up with KL firm

KUALA LUMPUR (Reuter): One of America's "baby Bells" has formed a US$1.4 billion joint venture with a new but well- connected telecommunications company to create multimedia networks in Malaysia, company executives said yesterday.

US WEST, which runs the former Bell telephone network in the western United States, is teaming up with Binariang, a company that has been given a clutch of licenses to launch and operate Malaysia's first satellites and its first private telephone network.

"We felt like if we didn't participate in Asia, we were signing up for a declining market share in the world," US WEST chairman Richard McCormick said in an interview.

McCormick said US WEST has taken a 20 percent stake in the joint venture, which is committed to investing 3.5 billion ringgit ($1.4 billion) over the next three years.

Binariang has been given a license to launch and operate Malaysia's first two telecommunications satellites. MEASAT I, built by Hughes Aircraft Company, will be launched in December.

The second, providing backup services and enlarging the "footprint" to include Australia as well as most of Southeast Asia and the Indian subcontinent, will be launched in July 1996.

Binariang has also been given licenses to operate a mobile communications system as well as a telephone line network. It will operate an international gateway for voice, video and data lines and provide multimedia networks, including interactive and information services.

McCormick said the licenses gave US WEST "an extraordinary opportunity" to penetrate a new market over a broad telecommunications front.

Binariang emerged last year as the latest venture of Ananda Krishna, a low-profile businessman with close ties to Prime Minister Mahathir Mohamad.

Binariang said that by the year 2000 it expects to have over one million customers, with an annual turnover of four billion ringgit ($1.6 billion).