Anyone still following this stock, page-6

Before determining the benefits of the FNT merger, one must consider the advantages /dis-advantages of pre-paid calling cards, and whether this is a growing segment of the market, or not.

In the last 5+ years, pre-paid calling cards has been on a growth curve in Europe, as most operators benignly encouraged the greatest spread across the population curve (ie: in ppst- and pre-paid categories).

Going forward, Europe's pre-paid growth curve is fast flattening out at zero growth, and most European operators have been developing /rolling-out strategies, to take existing pre-paid customers into a post-paid billing environment, where the ARPU values are higher, and the overall financial risks, lower.

FNT's position in the UK may well still be on a growth curve, but in a market segment where overall growth is slowing to a canter.

FNT's interest in migrating to wider pastures, therefore, is understandable, and the added value of the China experiment could be interesting.

But, before anyone gets too excited over the value proposition represented by the Chinese excursion, one needs to consider the ARPU values of the Chinese which at <$US 17 per month are not all that high.

Food for thought.