My 1999

Such a large investment, even if it is spread around the world, will certainly not be hidden from Lao Li, who also targets the European telecommunications industry.

"Xu Sheng thinks the telecommunications industry has reached rock bottom now?"

Looking at the direct looks in the eyes of the father and son, Xu Liang said with a smile: "I don't know if it's the bottom, but I personally judge that the telecommunications industry has reached an inflection point."

Ordinary people are aware of the Nasdaq crisis that broke out in 2000.

Little did they know that in this year, a crisis in the telecommunications industry that affected the world broke out in Europe - the 3G bubble.

In the 1990s, 2G had reached its peak.

In 1996, the global telecommunications industry officially launched the global standardization of 3G under the name IMT-2000.

The bright future of 3G has made the telecommunications industry and society have high hopes for it.

However, due to incompatibility with GSM, WCDMA cannot be implemented through upgrading the original network, thus requiring new spectrum.

Therefore, most countries started issuing 3G licenses and spectrum auctions in 2000.

Almost all EU countries have given up on such a suitable opportunity to make money.

The more populous and economically developed a country is, the more valuable it is to take photos.

Therefore, the big baby that was auctioned at the beginning exploded.

The British auction ended in April 2000. The total auction price of the five license plates reached 35.3 billion U.S. dollars, and the lowest price was as high as 6.3 billion U.S. dollars.

Even more popular than the Big Baby is the German tank with the highest GDP and the largest population in the EU.

The six winning bidders each paid US$7.6 billion, for a total of a staggering US$46 billion!

The huge license fees caused a stir around the world.

The Netherlands, Belgium, Italy and other countries have all come to an end.

Leaders of various countries shouted to the global capital: Come on, our ‘knives’ are ready.

It's a pity that after being fooled a few times, the capitalists became stupid.

The license is so expensive, coupled with the huge investment in base stations, when can we make money?

Fuck, I quit.

The 3D license plates of latecomers such as the Netherlands and Belgium were either priced lower than expected or simply failed to sell.

Although telecom giants and international capital woke up in time, it was already too late.

As of 2001, license fees across Europe totaled 171.5 billion euros, and network construction required another investment of about 132.1 billion euros. This huge investment has saddled operators with heavy debts.

The capital-liability ratio of telecommunications companies in Germany, Britain, France, the Netherlands and other countries increased by 120% to 210%.

If you can make money by investing in 3G, the higher the debt, the higher the debt. There are many financing methods, and you can still earn back the money invested.

pity.

WCDMA, which had high hopes, did not live up to expectations.

Due to the immaturity of the technology and the frequent updates of standards, many technical problems such as the mutual switching between WCDMA and GSM have not yet been solved, and the development of mobile phones has not progressed, making the WCDMA productization process even worse.

The technology is not good, the business is blocked, and the mobile data multimedia service market has not shown any signs of starting. This has greatly damaged the confidence of operators, resulting in the failure to start the construction and commercialization of 3G networks as scheduled.

As a last resort, Europe's announced or planned 3G commercialization plans have been postponed.

From 2001 and 2002, it was generally postponed to 2003 and 2004.

Although the Japanese telecommunications giant NTT launched the world's first WCDMA commercial service in October 2001, the results were far from expectations, making the industry even more pessimistic.

The situation in the 3G industry has taken a turn for the worse, and operators are heavily in debt.

Manufacturers were also in trouble, related industries were also implicated, and investors lost confidence, causing stocks to plummet.

Telecom companies laid off a large number of employees, the 3G craze finally came to an end and the bubble burst.

The world's communications industry has thus entered the so-called "winter of the telecommunications industry."

So what does this winter have to do with Lao Li?

This has to be mentioned, the classic battle that established Li Jiacheng's business status and became the uncrowned king of Chinese businessmen - the sale of Orange.

People in the industry call it ‘Superman selling oranges’.

In 1997, Hutchison Whampoa, owned by Lao Li, terminated its second-generation wireless phone business and launched a new generation of communications business, which later became the famous mobile telecommunications company Orange, and arranged for his favorite general Huo Jianning to be personally responsible for the business. develop.

With the vigorous development of the new generation of communication services, within a few years, Huo Jianning turned Orange into the third largest mobile phone operator in the UK.

The working emperor is really awesome and very capable.

In 1994, Orange had only 3 million users, but by 1999, this number had increased to 35 million.

In 1996, Lao Li also listed Orange plc with Orange as the core on the London Stock Exchange and the NASDAQ in the United States.

It has become a constituent company of the London Financial Times 100 Index and is the best-performing stock.

But when Orange was in great glory, Lao Li always paid attention to risk management and anticipated crises in advance.

But under the sunny weather, I thought about how to deal with the storm if it came.

Lao Li recalled his worries at that time in a later speech.

He said that he saw three problems with Orange:

First, voice services are becoming more and more popular. Although the growth rate is very fast, the competition in the industry is already very full, and the possibility of increasing marginal profits is already very low;

Second, the proportion of data transmission services is increasing, and the growth rate is higher than that of voice call services;

Third, under the wave of the Internet, the market value of mobile communication companies has reached its peak.

Lao Li is indeed awesome, and his strategic vision is absolutely top-notch in the world.

And when it’s time to carry the bucket and run away, there’s absolutely no procrastination.

But for Orange, in addition to the industry reaching its peak, there is also a huge pressure.

Although Orange is already the third largest in the UK, it can only be the third largest. Fierce competition has made the company's life increasingly difficult, and the competition is getting more intense.

At that time, Europe's top two telecommunications giants, Vodafone (UK) and Mannesmann (Germany), had already regarded the British market as a must-win place and were fighting fiercely for the leading position.

The so-called case of the boss fighting with the second child and finally killing the third child is not uncommon in business wars throughout the ages.

Faced with many disadvantages, Lao Li was ready to escape.

The following operations proved that Lao Li was indeed worthy of the name of Superman and was very smooth.

Lao Li saw the shortcomings of Orange as the third party, but he also saw the unique value of Orange as the third party - Vodafone and Mannesmann, whoever can buy Orange can become the real boss.

If we can inspire two companies to bid for Orange, we will definitely be able to sell it at a good price.

Following the boss's idea, Huo Jianning quickly turned a battle between the boss and the second child, which might have killed the third child, into a new situation where the snipe and the clam were fighting, and the fishermen benefited.

They let it out that they wanted to sell Orange.

As soon as the news got out, Vodafone and Mannesmann were scrambling to get the door, followed by difficult negotiations.

On October 21, 1999, Lao Li happily announced the final result in Xiangjiang:

After a week of negotiations, Hutchison Whampoa and Mannesmann finally reached an agreement and decided to sell a total of 49.01% of its shares in Orange to Mannesmann.

The total consideration of the transaction includes: HK$26.4 billion in cash, three-year euro floating-rate notes issued by Mannesmann equivalent to HK$21.4 billion, and 10.2% of Mannesmann's shares.

A rough calculation shows that Orange sold nearly HK$150 billion in value.

At the beginning, Hutchison Whampoa's investment in establishing and investing in Orange was only tens of billions, and a considerable amount of the principal was recovered through the listing.

This also means that from this transaction, Hutchison Whampoa gained a net profit of more than 100 billion Hong Kong dollars.

As the news spread, global capital markets also exploded.

It’s also too profitable.

In the end, after professional financial accounting, Hutchison Whampoa obtained a net profit of HK$118 billion from this transaction, which also created the largest profit record for a company in a single year since the opening of Hong Kong.

And this is not all of Lao Li's achievements.

It was less than half a year after Mannesmann acquired Orange.

Vodafone, which lost Orange on its doorstep, couldn't swallow its sigh of relief, so it directly packed up Mannesmann and wrote the most arrogant merger and acquisition in this century with a transaction amount of US$185 billion.

As an important shareholder of Mannesmann, Hutchison Whampoa accepted the deal and eventually received 5% of the shares of the new company after the merger.

This equity allowed Lao Li to once again gain a net profit of HK$50 billion.

In only about 6 years, Lao Li turned a small-scale business that was in trouble into a big business with a profit of HK$168 billion through a transaction.

Since then, the name ‘Superman’ has spread throughout the world.

Lao Li's status in the business world has also reached the peak of his life.

but.

As mentioned before, the general background of Superman selling oranges is that he saw the general background of the development of the Internet.

The foundation of the Internet is 3G.

In the year after "Superman Selling Oranges" in 2000, Lao Li announced that Hutchison Whampoa would launch 3G business in Europe, with a total planned investment equivalent to HK$200 billion.

What did HK$200 billion mean to Mr. Li at that time?

In 2001, Hutchison Whampoa's total assets were only HK$431.2 billion.

In other words, Hutchison Whampoa will invest nearly half of its total assets in European 3G business.

The huge investment in base stations caused Hutchison Whampoa to quickly fall into losses, with a total loss of HK$18.3 billion in 2003.

Only halfway through 2004, the loss was already close to HK$20 billion, and the full-year loss was close to HK$40 billion.

In order to raise funds, Hutchison Whampoa had to sell off its assets to obtain non-recurring profits and hedge against the huge losses in its main 3G business.

In 2003, Hutchison Whampoa sold its European bottled water business and made a profit of HK$1.683 billion.

It sold its minority shares in Vodafone and Deutsche Telekom and made a profit of HK$2.627 billion.

Seeing that the losses are increasing, the business is not improving.

Lao Li was also a little unable to sit still.

Seeing that Hanhua was also investing in the telecommunications industry, especially in the 3G field, I wanted to ask for his opinion.

After all, for more than four years, Boss Xu’s excellent vision in investment has been recognized globally, and he has not suffered a single loss so far.

"inflection point?"

Li Jiacheng looked like he was all ears.

“The key reason why the 3G bubble appeared around 2000 was technological immaturity.

This problem has now been gradually resolved.

The content of 3G terminals, mobile phones, has gradually become richer.

Pictures, music, novels, and even some short videos can all be browsed through mobile phones.

I believe that with the continuous development of technology, there will only be more and more 3G subscribers. "