SanomaWSOY's subsidiary Startel Oy and Helsinki Telephone's subsidiary Oy Radiolinja Ab will establish a company to produce economic information services for WAP telephone networks and dedicated Internet. The services can be accessed e.g. by WAP telephones independent of place and time. The name of the new company will be announced in a few weeks once it has been registered.

The new media co-operation between Startel and Radiolinja will create a new type of electronic information service package, which will be launched in spring 2000. The new economic information portal will offer wide news coverage and background information services to businesses and individuals.

Strategic base for co-operation

SanomaWSOY is Finland's leading content producer and Radiolinja is a top specialist at mobile networks. The co-operation will offer totally new operating possibilities between the media corporation and the net operator. Establishment of the new media company is a long-term strategic solution, a leap towards electronic publishing, strategic co-operation in content production and electronic distribution channels. This will permit SanomaWSOY to dedicate increased resources to new media, and Helsinki Telephone Corporation group will diversify its activities from the conventional field of operations of a telephone company.

"The new company will support SanomaWSOY's growth strategies and its ambition to become the leading content producer also in the new media sector. At the same time this co-operation will strengthen SanomaWSOY's Internet strategy announced during the autumn, with the objective of developing comprehensive service packages to various consumer categories", says SanomaWSOY's President and CEO, Mr. Jaakko Rauramo.

"Radiolinja will invest significant resources in new wireless distribution channels which provide new service forms both to users of economic information and of other utility data. The sales from wireless net operations have already exceeded the sales from dedicated line networks and will continue to grow clearly faster. The rapid evolution of the information society requires that the availability of services should not be tied to time or place", says Helsinki Telephone's President, Mr. Matti Mattheiszen.

"The two companies will contribute their best expertise to ensure excellent content and first-class wireless online connections as competitive advantages", mentions Radiolinja's Board Chairman, Mr. Jarmo Kalm.

Ownership structure 60-40

Startel will hold 60 % and Radiolinja 40 % of the new company. Shareholder's equity of the company is FIM 35 million. Its workforce will initially number about 10 but is expected to grow rapidly. Net sales for the first year of operations are estimated at FIM 7-8 million.

It is generally anticipated that the volume in minutes of wireless telephone communications will at least double in the next five years, and the use of text services is expected to grow even faster.

The services of the now established new media company will be available through Radiolinja's and Helsinki Telephone's shop networks, in Radiolinja's mobile portals and in other online service channels of the Helsinki Telephone.

The new media company will give Startel enhanced possibilities to produce also services connected with e-business. To Radiolinja, the new company will provide the possibility to combine the development of mobile portal and content creation.

The new company will be responsible also for the technical implementation of Taloussanomat's web service, and will produce and develop its wide range of additional services. The company will also manage the implementation of the Internet service designed for small and medium-sized companies announced by Startel and Helsinki Telephone during the autumn, participate in content production for WAP services and develop electronic publishing systems.

"Startel has been seriously developing its online economic information service for two and a half years now. We have gained valuable experiences and feedback from customers both about content and marketing. We have tested an operational model in a genuine market environment; this provides a good starting point for the success of the new media company", mentions Startel's President, Mr. Antti-Pekka Pietilä. The services and operating models have been developed in co-operation with TietoEnator Oyj. Their suitability for the market has been tested and experimented before commercialisation and large-scale marketing.

Sanoma-WSOY Oyj


Raija Kariola
Vice President, Investor Relations and Group Communications

Distribution: Helsinki Stock Exchange, principal media