BT moves back into directory services

NEWS BT has announced a multi-million pound move into the directories market based on its acquisition of Scoot. The telco is planning to combine its existing directory enquiries service with classified listings and information services such as weather and sports results through a single number, 118 500. BT's service will be based on the recently acquired directory company Scoot, which it bought for £5m. It hopes to build into a business generating £100m a year by 2004/5. The move follows Oftel's decision to open the directory enquiries market to competition, and the replacement of the old 192 number with a range of numbers starting 118 xxx. BT Retail CEO Pierre Danon told silicon.com the telco plans to invest considerable sums in marketing the new service in the media and by exploiting cross-promotion opportunities, such as advertising on its customer bills and the BT.com website. However, BT feels it has no need to invest significant sums of extra cash to expand its service delivery capability. This all makes the Scoot deal seem like something of a bargain for BT, even with the £3m of Scoot debt BT took on through the deal. Paul Elliott, the former head of customer operations at First Direct who is general manager at BT Directories, said the cost of building and classifying a directory would have cost the company more than it spent on the Scoot acquisition. The move marks a re-entry to the directory services business BT left when it sold off Yell for £2.1bn to a consortium of venture capitalists. BT's plans still see it building a much smaller business than Yell, which has operations in the US and revenues of £865m for the past financial year. Danon was emphatic BT has no plans to expand overseas. He said: "Our investors are very nervous about any foreign adventures and I think that for the foreseeable future we will be able to maintain our growth targets without venturing abroad."