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BTwatch Report #216 Executive Brief

6 October 2010

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Executive Brief from BTwatch, report #216. Click through for: an Extract from this month’s report; the Report Snapshot; or to contact us for more information about the full 58-page report, this industry standard monthly report service, and ongoing subscription access.

  1. STORIES OF NOTE: BT Group is rumoured to be considering closer ties with China Telecom and possible cross investment. However, the speculation was played down by BT, and said to be based on reporting of a “regular practice” client meeting. Senior BT executives did, however, elaborate on previously announced plans for growing the telco’s presence in the Asia Pacific region. [p.12.]
  2. BT Retail trumpeted free upgrades to fibre for customers on its existing broadband and voice bundles. The offer applies principally to customers already using one of its higher end broadband products, and is dependent on the so far restricted availability of the product, but the telco is clearly continuing its aggressive approach to building as much of a lead in the fibre market as it can before rivals can formulate a viable alternative. TalkTalk expressed optimism regarding the outcome of talks with Openreach on wholesale fibre products that would enable the altnet to compete with BT Retail in the sector. [pp.23,44.]
  3. BT Global Services has been awarded a three year extension to its Defence Fixed Telecommunications Service agreement with the UK Ministry of Defence worth £640m. The extension will see it manage systems until 2015, and integrate 19 separate networks onto a single platform. There are calls for a National Audit Office investigation into aspects of BT’s work on the NHS National Programme for IT. [pp.28,30.]
  4. Vendor Cisco’s Content Delivery System has been selected by BT Wholesale to support its online video delivery network Content Connect . The upcoming BT product is intended to boost capabilities for service providers wishing to deliver digital content to end users by caching content deeper into the broadband network to minimise congestion. [p.40.]
  5. The commercial relationship between Huawei and Openreach is said to have deepened as the Chinese vendor was identified as a strategic partner for the BT fibre rollout, providing fibre access network solutions. [p.48.]
  6. BT GROUP has been named on a list of telcos expected to make an impact in the market for cloud computing services, alongside AT&T, Orange Business Services, and Verizon Business, after they were seen to have been gearing up to compete with IT companies over the past 18 months. The UK telco also hosted a cloud computing conference where executives highlighted the improvements that cloud based solutions have made to the company internally as part of its ongoing transformation. [pp.4-5.]
  7. BT claims to have been inundated with applications for its apprenticeship scheme, and is also re opening its graduate recruitment programme, after freezing graduate hiring in the midst of job cutbacks. [pp.5-6.]
  8. The Group is continuing to trumpet its efforts in corporate social responsibility and in using energy more efficiently, although a study suggests the message is not getting through to the public. [pp.7.]
  9. Would be fibre network rivals to BT expressed dismay at recent updates to ratings charges for network infrastructure, which are said to hamper small operator investment. A decision by the new government to hold off on reviewing the basis of ratings valuations also disappointed rival operators. While BT insists the current system does not offer it an unfair advantage, any disincentive to invest plays into the hands of BT and its larger more established rivals. The European Union is looking at ensuring next generation networks are competitive with more open access, although draft regulations do not appear to go significantly beyond BT’s current commitments. [pp.10-11,13.]
  10. Several of BT Retail’s recent advertisements for its ADSL2+ broadband and new BT Infinity fibre services were criticised by the Advertising Standards Authority, with BT warned about making claims about superior performance and “instant internet”. [p.15.]
  11. BT Retail has welcomed a decision by regulator Ofcom to refer the state of competition in the pay TV movie sector to the Competition Commission in the wake of its earlier intervention in the premium sport content market. However, there was some scepticism as to whether BT has so far significantly benefited from its ability to offer Sky Sports , and its customers are being aggressively targeted by its pay TV rival BSkyB. [pp.16,18.]
  12. Project Canvas announced YouView as the brand for its upcoming internet television services, and claims hardware vendors are close to being on board for a mid 2011 launch. Channel Five completed a swift about turn to rejoin the management of the project, and Kip Meek, a former senior Ofcom figure and non executive director of the controversial targeted web advertising company Phorm, has been named as the venture’s Chairman. [pp.18-20.]
  13. In Ireland, BT trumpeted the advantages of having sold off its retail business, enabling it to take more business from incumbent Eircom as it is no longer competing with many of its largest clients for the same pool of end users. [p.26.]
  14. BT Global Services won a five year contract to upgrade department store group Debenhams’ data networks. The BT division was also linked to a £600m contract for data and voice services with the Lloyds Banking Group, five years after it lost the work to a consortium of IBM and Vtesse. The BT services contract with Liverpool Council, worth an estimated £70m a year, is also said to be subject to negotiations over a seven year contract extension. [pp.28,27,30.]
  15. Internationally, BT Global Services announced the completion of a technology upgrade for the trading floor of the New York Stock Exchange. In Germany, BT is to provide Wi Fi access to Starbucks coffee shops, echoing earlier deals with the chain for its stores in Ireland and the UK, and the Iberian peninsula. BT is also providing telepresence solutions for Indian IT services company Wipro. [pp.27,33,32.]
  16. BT heralded the potential for savings offered to corporations using its BT Onevoice converged communications platform as it launched a Microsoft accredited SIP trunking service, and reported on the success of early iterations of its Onevoice service embedded with telco 2.0 Ribbit IP voice features. [p.35.]
  17. Business communications provider Viatel is participating in BT Wholesale trials of priority class services over Wholesale Broadband Connect solutions, ahead of potential commercial offerings in spring 2011. Wholesaler Entanet announced it is offering Annex M services, which improve upload speeds, on BT Wholesale ADSL2+ lines. [p.38.]
  18. Satellite IP company VT iDirect said its web based network management tools have completed proof of concept testing with BT Wholesale. [p.41.]
  19. Openreach highlighted efforts to “re parent” lines in a Welsh village previously considered a broadband “not spot” . The exercise involved re routing lines to an alternative exchange to enable broadband access to be provided. [p.42.]
  20. There are now more than 15 million copper based broadband access points in the UK, according to BT, with BT Retail taking one third of the total. The number of unbundled lines in the UK also passed a milestone as the total exceeded seven million. Despite the progress, the Office of the Telecommunications Adjudicator indicated there is still room for improvement in Openreach’s performance after recent setbacks. [pp.42,46.]
  21. Openreach is piloting a scheme that would see communication provider customers influence the fibre rollout through nomination of exchanges to be upgraded to deliver its Generic Ethernet Access offering. Commercial commitments will be required. [p.43.]
  22. BT Group’s first quarter results for the period to the end of June 2010 are said to show “acceptable” progress towards the company’s goals. [pp.49-61.]

About BTwatch

Report: #216
Covering: August/September 2010
Published: September 2010
Next report: October 2010

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Written by AB · Filed Under BTwatch (BT Group) 

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