Business braced for separation fall-out

BT Prospects: News of company break-up adds to users' gloom, writes Antony Adshead

BT Prospects: News of company break-up adds to users' gloom, writes Antony Adshead

BT's recently announced restructuring has been viewed with dismay by some users and analysts who suspect that business will pay for the telecoms giant's reorganisation.

The main concern for business customers is the likelihood of having to deal with separate entities and of difficulties arising from a period of uncertainty while the restructuring takes place.

BT is restructuring in order to help cut debts of £30bn. It will dispose of its wireless division, directory business Yell and substantial amounts of property and equipment.

The company plans to sell to its partner AT&T its share of Concert - a joint venture which created an international carrier supplying telecoms services to the corporate market.

David Harrington, director general of the Communications Management Association, was concerned at the uncertain fate of Concert.

"At a practical level the imminent collapse of Concert will be a cause of great concern - and not a little work - to communications managers who have contracts with it.

"I use 'collapse' because the company's future is uncertain and in such circumstances staff morale and hence customer service usually goes to the wall. And it's only a couple of years since some customers were pretty well faced with a fait-accompli by being transferred to Concert," said Harrington.

John Moroney, an analyst with Ovum, said, "It depends on how deep the break-up goes - structural reorganisation could affect account separation, such as with the sell-off by BT of its wireless division, for example. It raises the question of how you draw up proposals and how service level agreements are administered. Having said that, the break-up could help to bring a better focus on the customer."

A BT spokesman said, "Concert has just won an award for customer service and it will still be as focused in future. Most people deal separately with one part or another of BT at the moment and that will not change."


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Antony Adshead
antony.adshead@rbi.co.uk

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