BTwatch Report #223 July-August 2011 Snapshot
31 August 2011
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Table of Contents
1 Executive brief
4 BT Group
4 BT Q1 FY11-12 results
4 BT profits continue to rise, but revenue still declining
4 BT Group financial highlights, Q1 FY11-12
5 BT pension deficit hit by market woes
5 Retail and Wholesale revenue prompt worries
5 Openreach and Global Services offer some comfort
5 BT Group, performance by unit, Q1 FY11-12
6 Financial reports
6 Broadband a highlight, but new wave growth still meagre
6 BT Group, revenue by product type, Q1 FY11-12
7 Digital Britain
7 Vaizey looks for DEA solution
7 BT’s capacity for cost cutting apparently undiminished
7 Capital expenditure rising, and set to rise more
7 BT Group, capital expenditure, Q1 FY11-12
8 Advertising
8 Fixed line numbers keep rising, but not for Retail
8 BT Group, KPIs, Q1 FY11-12
8 Retail grows broadband share, Orange flatters Wholesale
9 Pension
9 BT pensioners criticise switch to CPI
9 BT Group, broadband KPIs, Q1 FY11-12
9 BT stands by outlook, but divisional expectations change
10 Government loses Crown Guarantee appeal
10 Cash flow mountain to climb for the year
10 People
10 People movement highlights
11 Suppliers
11 Ribbit
11 BT kills off Ribbit developer platform
11 Same old BT, or an opportunity to evolve?
12 Strategy
12 Williams outlines strategy for growth
12 Divisions taking individual responsibility for growth
12 Building customer accounts and international expansion stressed
13 Acknowledgement BT strategy needs to be about more than cost cutting
15 BT Retail
15 Q1 FY10-11: BT Retail
15 Broadband flatters, but decline barely slowing
15 BT Retail, financial highlights, Q1 FY11-12
15 New business areas faring little better than traditional business
15 BT Retail, revenue by product type, Q1 FY11-12
16 Advertising
16 Fibre shows first signs of significant traction
16 BT and BSkyB leading the way in broadband
16 Broadband customer numbers (’000), Q1 FY11-12
17 Operations
17 BT to add 280 jobs at Harton Staithes…
17 …Centre’s purpose shifts towards commercial services
17 Calls and lines, customer numbers (’000), Q1 FY11-12
18 Privacy
18 Could YouView enable genuine BT assault on Sky?
18 Pay TV customer numbers (’000), Q1 FY11-12
19 Wireless networks
19 Monthly ARPU, Q1 FY11-12, UK fixed line market
19 Broadband
19 Ofcom sees broadband speeds rise, but behind claims
19 Average UK broadband download throughput speeds
20 Regulator claims more than half of country has NGA access
21 BT Payphones
21 Ofcom maintains pressure on ISPs for clear advertising
21 Digital content
21 BT MPA piracy case loss could be good news for ISPs
22 BT Enterprises
22 Blocking looks impractical for all but most serious offenders
22 BT could be hit by service disruption
22 BT campaign of resistance may be bearing fruit with government re think
23 BT Expedite
23 Survey identifies rising interest in mobile commerce
23 Wider response spotlights need for entente between ISPs and rights holders
24 Television services
24 CC to rule on BSkyB pay TV dominance
24 Further cuts could bolster YouView launch
26 OnLive
26 OnLive sets date for UK launch
27 BT Ireland
27 BT Fresca
27 Fresca signs fashion brands
27 BT completes NI NGN project first phase
28 BT Northern Ireland wins civil service contract
28 Network there, but where’s demand?
29 BT Global Services
29 Acquisitions and disposals
29 BT sells Accel Frontline stake…
29 …Commitment to Asia Pacific emphasised
29 Q1 FY11-12: BT Global Services
29 Orders up as BT chases new business at Global Services
29 BT Global Services, financial highlights, Q1 FY11-12
30 BTGS focused on share of market, not customer wallet
31 BT insists new revenue will be profitable
31 The UK market a target despite headwinds
31 BT Global Services, revenue by product type, Q1 FY11-12
32 BT International: Asia
32 BT opens New Delhi Showcase centre…
32 Contracts
32 BT wins Brazilian Post Office contract
32 Tangible evidence of GS promised growth — but from lower profile target
33 …BT commits to India, Tech Mahindra investment
33 Public sector contracts
33 BT wins £8m Sunderland City Council contract
33 MPs renew calls to cancel BT’s NPfIT contracts
34 BT International: Europe
34 BT wins new Netherlands state contract
34 DoH accused of “clearly” overpaying BT
34 NHS reforms also threaten project
35 BT International: Middle East
35 BT continues to emerge in better light than rival
37 Financial services
37 Russian Uralsib joins BT Radianz
37 BT launches collaboration services suite in Canada
37 Financial services spotlighted as cloud pioneers
38 BT partners TeleWare for mobile recording service
39 Products and services
39 BT launches authentication service, builds security suite
40 Tech Mahindra/Mahindra Satyam
40 Strategy
40 BT exploiting re-useable solutions from NHS deals
40 Vertical targeting trumpeted, focused account management highlighted
41 Tech Mahindra/Mahindra Satyam
41 Future direction could see new verticals added
41 Suppliers
41 BT selects Soft-ex for Hosted IP Telephony
41 Deals see established relationship continue to expand
42 Tech Mahindra
42 Tech Mahindra reports improved profit, less BT business
42 BT tendering more widely for projects
43 Legal
43 BT Wholesale
43 BT wins CAT appeal on non-geographic MTRs
43 Q1 FY11-12: BT Wholesale
43 Wholesale shows worrying signs of contract troubles
44 BT Wholesale, financial highlights, Q1 FY11-12
44 Overall revenue at least stabilising, broadband another worry
44 BT Wholesale, revenue by product type, Q1 FY11-12
45 Executives
45 Stagg to replace Davis as Wholesale problems emerge
46 Signs of weakness again see board changes at BT
48 Network
48 BT extends ADSL2+ rollout, slows pace?
48 Extension hides possible deadline slip
49 Regulatory
49 Ofcom orders rural broadband price reductions
50 BT sanguine, smaller players criticise regulator
50 Ofcom denies BT access to Virgin Media cable ducts
51 Would BT talk to Virgin on wholesale access? Could Plusnet cause trouble?
52 Openreach
52 Q1 FY10-11: Openreach
52 Openreach positioned as BT’s good news story
52 Openreach, financial highlights, Q1 FY11-12
52 Openreach, revenue by product type, Q1 FY11-12
53 BT cautious on state fibre contract wins
53 FTTP could become a greater part of fibre mix
54 Network
54 Openreach adds 92 new apprentices in London
54 Work to begin on physical infrastructure sharing
54 BT broadband rollout criticised as “patchy”
55 Index
Index
A
Accel Limited, 29
- Accel Frontline, 29
ADP, 6
Advertising Standards Authority, 8, 21
Alcatel-Lucent, 10
Apple
- iPad, 26
Aurora Fashions, 27
B
BAE Systems, 41
Barclays, 18
Belgacom, 26
Berkeley Group Holdings, 54
Bharti Group
- Bharti Airtel, 41
British Broadcasting Corporation (BBC), 7, 18, 21, 23
Broadband Delivery UK (BDUK), 53
BSkyB, 10, 16, 17, 18, 19, 20, 21, 24
- Sky Movies, 24
- Sky Sports, 24
BT Group, 4, 5, 6, 7, 8, 9, 10, 11, 12, 19, 20, 21, 22, 26, 27, 29, 31, 35, 42, 43, 44, 46, 49, 50, 52, 54
- Asia
- – Tech Mahindra, 7, 33, 40, 41, 42, 45
- BT Global Services, 4, 5, 6, 7, 9, 10, 11, 12, 15, 23, 29, 30, 31, 32, 33, 34, 37, 38, 39, 40, 41, 46
- – BT Brazil, 32
- – BT Counterpane, 10
- – BT Frontline, 29
- – BT India, 10
- – BT International, 32, 33, 34, 35
- – BT Managed Authentication, 39
- – BT Managed Fraud Service, 39
- – BT Managed Security Solutions, 39
- – BT Onevoice, 11
- – BT Radianz, 37
- – ITS.Netrix, 37
- – URU, 39
- – Virtual Data Centre, 11, 23
- BT Innovate & Design
- – Ribbit, 11
- BT Pension Scheme, 5, 10
- – Crown Guarantee, 10
- BT Retail, 5, 6, 7, 8, 9, 11, 15, 16, 17, 18, 19, 21, 22, 23, 24, 26, 41, 45, 46, 50, 51
- – BT Broadband, 19, 21
- – BT Business, 10, 15, 45
- – BT Conferencing, 45
- – BT Directories, 45
- – BT Engage IT, 45
- – BT Enterprises, 45
- – BT Expedite, 23, 45
- – BT Fresca, 27
- – BT Infinity, 8, 16, 20
- – BT Ireland, 27, 28
- – BT Local Government, 17
- – BT Northern Ireland, 27, 28
- – BT Openzone, 19
- – BT Payphones, 21, 45
- – BT Redcare, 45
- – BT Vision, 18, 24, 41
- – Buzby, 16
- – Cleanfeed, 22
- – dabs.com, 45
- – OnLive, 26
- – Plusnet, 17, 19, 51
- – Timeline, 22
- BT Tower, 16
- BT Wholesale, 4, 5, 6, 7, 8, 9, 10, 11, 15, 31, 43, 44, 45, 46, 48, 49, 51, 52
- – IP Exchange, 11
- – IPStream, 48
- – IPStream Connect, 49
- Executives
- – Blakesley, Neil, 40
- – Boustridge, Michael, 10
- – Boville, Howard, 37
- – Davis, Sally, 10
- – Gallindo, Sérgio Paulo, 32
- – Garfield, Olivia, 52
- – Kelly, Jeff, 30, 31, 46
- – Livingston, Ian, 4, 5, 8, 16, 30, 43, 46
- – Marks, Kevin, 11
- – Martinez, Jose Antonio, 37
- – Milner, Simon, 21
- – Murphy, Bill, 45
- – Nicholson, Andy, 38
- – Pannell, Alex, 48
- – Patterson, Gavin, 46
- – Schmidt, Jeffrey, 39
- – Seth, Arun, 10
- – Stagg, Nigel, 10, 45, 46
- – Stanton, Ray, 10
- – Sutherland, Graham, 27
- – Swarts, Rogier, 34
- – Taylor, Kevin, 33
- – Williams, Sean, 12, 13
- – Wingrove, Gary, 10
- – Yeo, Stephen, 29
- Ex-executives
- – Bross, Matt, 11
- – Cox, Tony, 9
- – Davis, Sally, 10, 45
- – Lalani, Hanif, 46
- – Marks, Kevin, 11
- – Rangaswami, JP, 11
- – Robertson, Steve, 46
- Innovate & Design
- – Adastral Park, 11
- Openreach, 5, 6, 7, 8, 9, 15, 43, 46, 50, 52, 53, 54
- – Physical Infrastructure Access (PIA), 50, 54
C
Cabinet Office (UK), 35
Cable&Wireless Worldwide plc, 31
Thus, 33
Caixa Econômica Federal, 32
Channel 4, 18
Claranet, 54
Community Heartbeat Trust, 21
Competition Appeals Tribunal, 43
Competition Commission, 24
Computer Sciences Corp, 33, 34, 35
D
Department for Business, Innovation & Skills
- Vaizey, Ed, 7, 22
Department of Enterprise, Trade & Investment (DETI) (UK), 27
Department of Finance & Personnel Northern Ireland, 28
Department of Health, 33, 35
Digital Britain, 7
Digital Economy Act (UK), 7, 22
Digital Entertainment Content Ecosystem (DECE)
- UltraViolet, 23
DTV Services
- Freeview, 18
Ministry of Infrastructure and Environment (Rijksdienst Infrastructuur en Milieu, Netherlands), 34
E
Empresa Brasileira de Correios e Telégrafos (ECT, Brazil), 32
European Union, 27, 50
- European Regional Development Fund, 27
Everything Everywhere (Orange UK, T-Mobile UK), 8, 16
F
Facebook, 26
Financial Services Authority, 38
Football Association, 24
- Premier League, 24
France Télécom
- Orange, 8, 16, 19, 44
Frontline Technologies, 29
Fujitsu, 53
G
GB Group, 39
Getronics NV, 34
H
HBOS, 41
High Court, 21
House of Commons
- Public Accounts Committee, 33, 34
Huawei Technologies, 11
I
IAS 19, 5, 10
International Paralympic Committee (IPC)
- Paralympic Games, 16
Internet Service Provider Association, 23
Israel Electric Corporation (IEC), 35
ITV, 18
K
Kahuna Network Solutions, 34
Kuppinger Cole, 39
L
Lloyds TSB, 18
M
Mahindra Satyam, 40, 41, 42
Manpower, 17
Martec International, 23
Microsoft, 40, 41
- Mediaroom, 41
Motion Picture Association (MPA), 21
N
National Audit Office, 33
National Health Service (NHS, UK), 33, 34, 35, 40, 41
- N3, 41
- National Programme for IT, 33, 34, 40
Nationwide Building Society, 41
Newzbin2, 21, 22, 23
Northern Ireland Assembly, 27
Northern Ireland Civil Service, 28
Northern & Shell
- Channel Five, 18
O
Ofcom, 8, 19, 20, 21, 22, 24, 28, 43, 48, 49, 50, 51
- LLU, 5, 8, 9, 43, 44
- Price controls, 49
OnLive, Inc., 26
Open Rights Group (ORG), 23
Oracle, 39
OT2010 (Holland), 34
P
Post Office, 32
- Royal Mail, 41
R
Redknee, 40
S
Salesforce.com, 11
SamKnows, 19
Santander
- Alliance & Leicester, 41
Soft-ex, 41
Standard & Poors, 6
Sunderland City Council, 33
T
TalkTalk Telecom Group plc, 7, 8, 16, 17, 19, 20, 48
Tech Mahindra, 7, 33, 40, 41, 42, 45
- Mahindra Satyam, 40, 41, 42
Technology
- Broadband, 5, 6, 8, 9, 10, 12, 15, 16, 17, 19, 20, 21, 26, 27, 28, 31, 43, 44, 46, 48, 49, 50, 51, 52, 53, 54
- – ADSL, 19, 53
- – ADSL2+, 7, 19, 20, 48, 49, 53
- – DSL, 9, 16, 20
- Ethernet, 5
- Fibre, 7, 8, 15, 16, 19, 20, 27, 35, 51, 52, 53, 54
- – Fibre-to-the-cabinet (FTTC), 53
- – Fibre-to-the-premises (FTTP), 53
- HD, 26
- ICT, 6
- IP, 11, 23, 32, 41
- ISDN, 17
- LLU, 8, 17
- MPLS, 40
- Next-generation access (NGA), 20, 54
- Next-generation networks (NGN), 27
- SMS, 38
- Unified communications, 30, 32
- VoD, 41
- VoIP, 11
- Web Services, 11
- Wi-Fi, 19
Telefónica, 16, 21, 32
- Telefónica Europe (O2), 19
- – UK, 19
TeleWare, 38
Tiscali SpA, 16
Translink, 27
Twilio, 11
U
UK Government, 27, 28
- Joint Intelligence Committee, 11
Uralsib Financial Corporation, 37
V
Virgin Media, 8, 16, 17, 18, 19, 20, 21, 24, 50, 51, 53
W
Walt Disney Company, The, 21
Warner Brothers, 21
Y
YouView (Project Canvas), 18, 24
About BTwatch
Report: #223
Covering: July-August 2011
Published: August 2011
Next report: September 2011
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