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BTwatch issue 2010.05 Executive Brief

23 June 2010

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Executive Brief from BTwatch, issue 2010.05. Click through for: an Extract from this month’s report; the Issue Snapshot; or to contact us for more information about the full 40-page issue, this industry standard monthly report service, and ongoing subscription access.

  1. The European Union broadly backed Ofcom plans to enable BT Group to offer a virtual unbundled service for fibre through Openreach. However, the European authorities stressed that this should be seen as a stop gap measure until full physical access to the BT network becomes viable. In a potentially significant development, the EC also called on Ofcom to more closely regulate the product’s pricing on a cost basis, rather than using the less restrictive equivalence of inputs basis as planned. [pp.8-9.]
  2. BT announced a strategic agreement with OnLive, a gaming company that streams live video games into the home, with BT the exclusive UK partner. The “cloud based” gaming service could be streamed to home computers or televisions. BT also became a small shareholder in the US company, which is not expected to launch a UK service until spring 2011 at the earliest. [p.14.]
  3. BT Global Services launched a BT Virtual Data Centre in Brazil, offering major corporations and government bodies a “dynamic and virtualized infrastructure platform”. Customers will be offered access on a “try & buy” basis, but there are practical restrictions on the type of data stored using the infrastructure as-a service offer. BT is thought to be commercialising internal virtual data centre systems for the new offering, which is supported by NetApp. [p.27.]
  4. BT committed to an additional £1bn fibre investment that will see Openreach attempt to bring a form of fibre connectivity to two thirds of the UK population by 2015. The investment, which will be contained within ongoing capex levels of around £2.6bn, is dependent on the economic environment, but nevertheless represents a clear sign that momentum is building, and that the economics of the rollout are becoming more viable. Meanwhile Greater London is expected to see fibre connectivity available to 87% of homes and businesses in time for the London Olympic Games in 2012. [pp.33,35.]
  5. BT GROUP released its results for FY09-10, which were warmly received amidst signs that cost cutting programmes are beginning to improve the bottom line, although genuine growth still remains elusive. Full coverage of the results and the accompanying Investors Day are to feature in the upcoming special BT Report .
  6. BT is said to be planning to dispose of its 31% stake in Tech Mahindra by the end of the current financial year, but is holding out until Satyam is fully integrated in the expectation of a higher valuation. [p.4.]
  7. BT became more deeply embroiled in a pay dispute with the Communications Workers Union, as a revised two year salary deal failed to prevent the union commencing a vote on strike action. BT is offering CWU members a 2% raise this year, followed by 3% in 2011, plus cash bonuses, but the union is holding out for 5% in 2010. BT is reportedly looking to bring in support from contractors Carillion and Telent, and return management to frontline roles, should a strike be called. [pp.5-6.]
  8. BT settled a legal dispute with chipset maker MediaTek over alleged unauthorised use of BT patented technology. [p.7.]
  9. The adoption of open source software within BT was reported, and the executive responsible acknowledged that initial internal resistance had to be overcome, but now the methodology is being used more frequently to drive innovation. BT is also aiming to improve internal communication on projects through wider use of social networking through deployment of Microsoft’s SharePoint. A contract bid management system is also being introduced using the Microsoft software. [pp.11-12.]
  10. BT RETAIL efforts to more proactively engage with customers through social networking sites drew criticism in a newspaper report, with claims that practices are “Big Brother ish”, amidst suggestions that they may breach data protection and customer privacy obligations. [p.13.]
  11. There were suggestions that manufacturer OpenPeak is involved in the creation of a new “smartphone for the home” from BT, although the telco indicated that much of the development in the proposed new device is being conducted internally. [p.15.]
  12. BT signed a deal with Arqiva that will see it provide digital terrestrial television capacity for BT to broadcast Sky Sports services. The telco is appealing to the regulator to have the remainder of BSkyB’s sports channels included in mandatory wholesaling arrangements, although currently it would not have the channels to broadcast them. [p.16.]
  13. Project Canvas was cleared by the Office of Fair Trading, which said it had no grounds to consider the activity of the initiative as it was not a merger. Canvas partners’ framing of its services in terms of an open platform showed that the lessons of the previously blocked Project Kangaroo had been learned, according to broadcasting rivals. BT is working with MIT on developments for BT Vision that could see the service become an example of “social television”. [pp.17,19.]
  14. Nuance Communications won a contract to provide natural language call steering solutions to BT Business. [p.21.]
  15. tw telecom, a Time Warner Cable spin-off, was named as a customer for Cisco Telepresence conferencing services using the BT Global Video Exchange platform. [p.21.]
  16. BT GLOBAL SERVICES signed a new deal with Olympic Broadcasting Services London, to deliver broadcast and media network access for the London Games in 2012. The work is said to be in addition to that entailed in BT’s role as the event’s Official Communications Services Partner. [p.23.]
  17. BT Onevoice , BT’s unified communications offering, was in the spotlight with the introduction of a version of the service featuring new voice solutions from the telco’s Ribbit subsidiary. Onevoice Ribbit is expected to help virtually extend the scope of internal communications networks through a private cloud. Cisco also highlighted its role as a platform provider for the international launch of the Onevoice offering. [pp.24,25.]
  18. BT named mobile interaction service provider TynTec as a partner within its BT Global Telecom Markets portfolio, while BigFix, an IT infrastructure management specialist, is to provide Global Services with a service delivery platform for its BT MobileXpress product. [pp.23,28.]
  19. Asia-Pacific was named as a key investment destination for BT Global Services, as it aims to return to growth. A further 300 staff could be added to BT’s regional operations as it chases market share in a growing £8bn market. BT additionally hopes to partner local firms looking to expand outside the region. BT is also expanding the availability of its Radianz hosting services for financial services customers in Singapore, in partnership with one time investment StarHub. [p.29.]
  20. BT WHOLESALE won a contract extension to provide white label telephony and broadband services to Scottish & Southern Energy. [p.31.]
  21. A global version of the IP Exchange offering was launched by BT Wholesale. This enables VoIP and TDM calls to be connected seamlessly and is already in use with 100 service providers in the UK. The potential for offering services to mobile operators delivering IP originated GSM text messages was flagged. [p.32.]

About BTwatch

Issue: 2010.05
Covering: May-June 2010
Published: June 2010
Next issue: July 2010

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Written by AB · Filed Under BTwatch (BT Group) 

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