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Telecoms expect pickup in sector

Vodafone CEO Arun Sarin says the future looks good for the industry
Vodafone CEO Arun Sarin says the future looks good for the industry

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GENEVA, Switzerland (CNN) -- The telecommunications industry, still struggling to shake off the effects of a slumping market, is on the verge of a "decade of sweet innovation," according to the head of mobile phone giant Vodafone.

Arun Sarin, addressing the ITU Telecom World trade fair in Geneva, said he was optimist the sector would rebound as more signs appear that the global economy is recovering.

"The revolutionary products promised in the year 2000 will indeed be coming to the market. 3G (third generation) will fundamentally change how customers conduct business and how consumers receive information," he told the conference Tuesday.

"The wireless industry is on the verge of another decade of sweet innovation."

The industry has suffered a downturn in the past three years, due mainly to heavy debt loads, weak demand and economic uncertainty.

Sarin's optimism for the sector was shared by chief executives from other multinational corporations attending the trade fair.

Solomon Trujillo, the head of French mobile phone group Orange, told CNN that his company would expanding its market by using new technology to offer existing customers extra services.

Orange, which is controlled by France Telecom, has about 45 million customers, including in France and Britain, where growth is almost saturated in the mobile phone market.

Orange is Europe's third-largest phone company, behind Vodafone and Deutsche Telekom's T-Mobile.

Trujillo, who was appointed Orange's chief executive in March, said he was confident Orange would remain competitive despite the tough market environment.

"For me, the exciting part of our business going forward is the relationship that we can keep on growing and expanding," he said.

"This happens in every industry and every market, in terms of those who know their customers best and can leverage the technology best -- not introduce new technology to customers -- but leverage it into services and applications."

But some industry observers take a dimmer view of the sector's changes for recovery.

James Enck, European telecoms analyst at Daiwa Securities, told CNN that mobile phone operators face increasing competition from new players offering new services.

"The market has stabilized but there is a new wave of stuff coming up and it could potentially take business away from those already in the industry."

The Geneva conference, which is held every four years, is organized by U.N. agency International Telecommunications Union.

In addition to corporate leaders, the fair attracts heads of state, government ministers and industry experts.

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