BT 'too slow and too old' for global challenge

NEWS Under heavy pressure from backers to reduce debt and reveal plans for the future, BT today did a U-turn on the float of BT Wireless and faced reports that its Concert alliance with equally beleaguered AT&T was falling apart at the seams. Simon Buckingham, MD of telecom consultants Mobile Lifestreams, said: "It's a question of which BT debacle. From the unraveling of Concert to the indecision over Yell and BT Wireless, you begin to think they couldn't organise themselves out of a paper bag." Concert has failed to hit sales targets in Europe and revenue has fallen from £836m in the three months to September 2000 to £541m in the following quarter. Underlying profits dropped from £58m to £50m. A BT spokesman said: "We are disappointed with the severe margin decline in Concert and are in active discussions with our partner on a number of options." BT has also changed tack from going full steam ahead for an IPO of BT Wireless to what a spokesman said was a search for "the most innovative solution - this could be an IPO, a demerger or a combination". Chairman Sir Iain Vallance and CEO Sir Peter Bonfield now face major pressure from financial institutions over their stifling debt, currently standing at around £30bn. Buckingham said: "What everyone wants to see is new management, decisive management and radical moves. Hostility to BT is high amongst investment and fund managers who are fed up with its underdeployment. "And once they turn against you, it's difficult to turn that around. I feel sorry for them, but how could they so consistently underperform? It's frightening. I wish them good luck." Mat Hanrahan, analyst at Bloor Research, said: "It's not a happy time to be a telco, but it's same old, same old. Blair wants to make the UK a leader in broadband and the net, and the major obstacle to achieving that is BT - it's too old, too slow and has the infrastructure hanging on it." The round-the-world sailing fleet in the BT-sponsored Global Challenge is well into its fourth leg: Wellington to Sydney from 18 to 25 February. On its website is the following description:
'Known as the Executive Leg, some of the crews are joined by senior executives and celebrities. 1,230 miles in seven days, this can be a tough leg and the conditions at sea are expected to be very changeable.'