A strategic alliance

Microsoft Corp. and media company Bertelsmann AG are considering whether to jointly acquire the cable network of Deutsche Telekom AG along with Deutsche Bank AG and other firms, the weekly news magazine Der Spiegel said. The magazine, in the summary of an article to appear in its next edition, said Bertelsmann was mulling a price of $4.5 billion to $5 billion, compared to more than $16 billion as envisioned by Deutsche Telekom. A member of Telekom_s management board told Spiegel that Telekom Chief Executive R. Sommer planned a strategic alliance with an unnamed U.S. telecoms firm in which the cable television unit would be bundled. Neither Telekom nor Bertelsmann spokesmen would comment on the report. Earlier this year Deutsche Bank said it would only buy Deutsche Telekom_s cable television unit as a temporary investor and did not want to become the full-time operator of the nationwide network, the world_s largest with around 17 million subscribers. On Wednesday Telekom declined to comment on a report in weekly Die Zeit that Microsoft had set aside $1 billion to invest in the German phone company, which plans to merge with Telecome Italia SpA. Die Zeit said that if Microsoft did not invest the money in Deutsche Telekom directly, it might invest in the cable television network.