Things change fast in the telecommunications industry. Last week's news that one of Telecom's strategic alliance partners, Telia (Sweden), was in talks with Esat Digifone's partner Telenor (Norway) is being watched with interest.

One attentive observer is Moodys Investors Service which believes that the Norwegian-Swedish combination could create a strong regional Scandinavian alliance. However, it notes that a number of obstacles need to be overcome ahead of any successful combination, including the formal approval by both governments.

It also points out that the companies are currently part of different alliances Telia is linked to Unisource and Telenor to Telenordia which means there may be conflicting interests among the other alliance members such as British Telecom.

When Telecom Eireann sold part of the company to Telia and KPN (the Dutch state telephone company) it made great play of the Unisource alliance and its possibilities for Telecom cheaper international calls for example. However, the composition of that alliance has since changed with the departure of the Spanish telephone operator, Spanish Telefonica.

One of the criticisms aimed at Esat, which provides alternative fixed-line telephony services mainly to the corporate market, is that it doesn't have a strong global partner.

But Esat chairman, Mr Denis O'Brien, has often said that current alliances will have broken up within a few years. At this rate of going, he might yet be proved right although cynics might point out that he was quick enough (and wise enough, certainly in this particular case) to bring in Telenor as a partner for Esat Digifone. The Scandinavians' knowledge of the mobile telephony is acknowledged as second to none.

Esat investors remain unperturbed by the Scandinavian shenanigans. Esat Telecom group, which floated on the Nasdaq last year at around $13.5 (£9.6) is now trading at just over $17.