BT demerger hit by debt worries
All the papers report on the latest troubles to hit British Telecom's demerger of its mobile telecommunications arm, now called MMO 2. The Financial Times reports that the company's share price fell by 6% yesterday, following the news of a possible £500m write-down on its September half-year figures. Most reports attribute this to the "unexpected liabilities" arising from the restructuring of Concert, the company's loss-making joint venture with AT&T.
The Guardian reports that three senior executives at MMO 2 are in line for a cash and shares bonanza worth several million pounds when the company demerges in November.
Terrorist attacks hit AOL Time Warner figures
Only the Financial Times carries the news of AOL Time Warner's warning that its revenue and cash flow would be seriously affected by the terrorist attacks of 11 September. According to the Financial Times' report, the attacks "exacerbated an already poor advertising market". The company announced new expected growth figures of 5% to 7%, compared with the earlier target of 12%.
Napster close to settlement
The Financial Times, the Independent and The Daily Telegraph report that Napster, the online music service, has reached a preliminary settlement with American songwriters and music publishers. The company will pay songwriters $26m (£17.78m) in damages for past infringements, and about $10m (£6.8m) in advance royalty payments. This brings Napster a step closer to launching a legal online music service.
The Daily Telegraph notes media analysts' comments that the company may have problems repairing its brand image and regaining customers.
Boots to close Internet photo service
The Times and the Independent report that Boots is to close its internet photographic service, bootsphoto.com, exactly a year after its launch. The venture attracted 250,000 subscribers but "failed to live up to revenue expectations", according to the Times. The Independent reports that the company will be relaunched early next year, offering digital services such as editing and printing.
Best of the rest
The Financial Times reports
- India's booming software sector is likely to suffer a setback as the prospect of outsourced work from US companies - its biggest market - recedes in the wake of the terrorist attacks of 11 September.
- Online advertising revenue has fallen by nearly 8% in the first half of 2001, according to a report from the Interactive Advertising Bureau.