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David R. Coughlan President - Tyco Telecommunications David Coughlan is the President of Tyco Telecommunications, the world’s leading fully-integrated supplier of undersea fiber optic cable networks and a global provider of network services on the Tyco Global Network (TGN). Mr. Coughlan was appointed to this position in July 2002, where he facilitated the integration of Tyco Telecommunications with Tyco Electronics. Prior to his current role, Mr. Coughlan held the position of Senior Vice President of Business Development at Tyco Electronics, a division within Tyco International Ltd. Prior to joining Tyco Electronics, Mr. Coughlan served as Director of Business Development for Tyco International Ltd. He was responsible for coordinating Merger and Acquisition activity between the Corporate group and various divisions. Mr. Coughlan has been awarded a Master of Business Administration from the Whittemore School of Business and Economics, as well as a Bachelor of Science from Lehigh University.
How would you rate the current health of the industry?
The last two years have been very tough for all of us in the telecommunications industry. I personally am thankful that Tyco Telecommunications, with our three lines of businesses, has been able to weather the recent market conditions. Recent indications are that the telecommunications market, including undersea telecom, is recovering at a prudent pace. The system supply market, in fact, saw $250 million of new repeatered business booked in 2003. The marine maintenance sector has been extremely competitive, but there is a definite shift back towards a collective regional maintenance approach by most cable owners, and that should help stabilize the situation. And, finally, increased demand for capacity services and price stability have returned to the carrier market. The Tyco Global Network has grown its client base from 10 customers to over 100 customers over the past 18 months! So there are good reasons to be optimistic for everyone in the industry.
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Where do you see new market opportunities in the future?
Filling in the regional gaps that still remain after the construction boom that ended in 2001. The Middle East presents some obvious near-term opportunities. The coasts of Africa are expressing needs. Many island nations are still lacking sufficient connectivity to promote domestic economic growth. On the major transoceanic routes there is sufficient capacity, but it is dispersed inefficiently and could 12
benefit from consolidation. We see opportunities to help re-engineer those networks into linked structures, which will bring cost benefits to the entire carrier industry.
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What is the longer-term outlook for marine maintenance providers such as Tyco Telecommunications?
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We recognized several years ago that the trend was moving back toward consortium maintenance structures, and Tyco Telecommunications is now actively participating in several zone agreements. Of the four ships recently contracted in the ACMA 2004 Agreement, Tyco Telecommunications was successful in securing two of those assignments. In addition to maintenance activities, our fleet also provides turnkey marine installation services and a la carte services to meet our customers’ needs (see Figure 1). We have continued our costcutting efforts and now have one of the most cost efficient, flexible fleets in the industry. By controlling our costs and working cooperatively to maintain the global infrastructure, I think the market can sustain a few global maintenance providers and several regionally-focused maintenance providers.
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How are new installation projects being managed differently than in years past?
In the past, customers focused on maximizing network capacity – the more traffic the network carried, the more valuable the network. Today, because of the financial constraints on network operators, there has been a shift in focus from