(FORTUNE Magazine) – So Olivetti's $58 billion hostile bid for Telecom Italia is supposedly the wave of the future in Europe. How can an ordinary investor make money from the region's rapidly changing telecommunications landscape? Easy. Ignore the big guys, which are only going to lose market share from deregulation, and focus on small players like Colt Telecom, Equant, and Global Crossing. All three are listed in the U.S., either directly or via an ADR.

London-based Colt, which builds fiber loops around major European cities, has no profits and expects none before 2002. But revenues rose 164%, to $357 million, last year. Colt plans to operate in two dozen locales by the end of 2000 and eventually interconnect them all. Its other main attraction is CEO Paul Chisholm, who ran the Boston network of Teleport Group, a well-regarded local operator.

Global Crossing boasts another Teleport recruit--CEO Robert Annunziata. Based in Beverly Hills and Bermuda, Global is building an undersea fiber network to connect 50 of the world's biggest cities. Its stock has already blown way past the 12-month price target of $29 that Salomon Smith Barney set in September.

Then there's Amsterdam-based Equant, which developed out of the airline industry's 50-year-old reservations network. Equant sells data network services worldwide to businesses, with links to 220 countries.

Want to play Olivetti-Telecom Italia? Forget it. To understand that one, you need to know Italian politics, not telecommunications.

--Janet Guyon