Competing for Local Partners
Siemens AG Austria, Cellular Communications International, Inc., and T-Mobile GmbH

In the contest for Austria’s second digital cellular license, winning the right local partners was the crucial first step for Cellular Communications International Inc. (CCII). Local partners of the right caliber would provide market expertise as well as important local political influence.

But New York-based CCII was a company with fewer than 20 employees. It faced stiff competition for local partners from some of the largest cellular players in the world, including Bell Atlantic, Vodafone, BellSouth, and Telia. Nearly all these heavyweights were targeting Siemens Austria, the local subsidiary of the worldwide electronics manufacturer, as their preferred local partner.

At that time, Sequent founder Thomas Tesluk was senior vice president of CCII. Against all odds, he convinced Siemens management that even a small piece of the Austrian license would mean more to CCII than winning the entire license would mean to a Bell company. Siemens would benefit, he argued, because no other partner would provide them with greater commitment and focus than CCII.

As proof of this, even before a partnership agreement was reached, he assigned critical planning staff from New York to Vienna to develop a joint business plan with Siemens for operating the license. This material was then presented to the Siemens board, which endorsed both the project and Siemens Austria’s choice of CCII as their principal partner.

The Siemens-led consortium, named Max Mobil GmbH, went on to beat the competition for Austria’s second national GSM cellular license. Consortium member T-Mobile eventually bought out the other partners, who sold their shares at a substantial profit over their investment costs. Today, Max Mobil (now known as T-Mobile) is one of Austria’s most successful cellular operators, with more than 2 million customers.