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Thursday, 30 November, 2000, 17:40 GMT
BT shares hit 31 month low
Graph showing BT's share performance over the past two years
British Telecom shares have fallen below 600p for the first time in more than two and a half years.

The company, whose shares started the year at 1513p, slid 28p to 591p on Thursday morning.

The shares later recovered to close down 10p at 609p.

The last time shares in the former state monopoly closed below 600p was on 10 March, 1998.

Telecoms weak

The latest decline was in line with falls in other telecoms stocks in London, as Colt Telecom was down 46p, or 3.7%, at 1,210p, and market leader Vodafone fell 4.75p, or 2%, at 241.25p , weakened by the continuing global concerns over prospects for profits.

The fall defied the unveiling of plans to sell the portal and internet service provider LineOne as part of a company "refocusing".

Analysts have voiced concerns that BT has retained too much of the dislocated public service structure inherited on its privatisation in 1984.

LineOne, a 50:50 joint venture with United News & Media, claims to be one of the top five UK ISPs, and is worth an estimated 340m.

Investigation ditched

BT also heard on Thursday that it was to escape an investigation by telecoms regulator Oftel into unfair trading practices.

Oftel had been concerned that the firm's mobile phone arm, BT Cellnet, was using its financial muscle to keep middlemen afloat.

BT Cellnet has been offering service providers, which sell telephone call time on to customers, rates which competitors could not match, Oftel feared.

But the regulator said that new data had eased its concerns.

Rollercoaster relationship

The ditching of the investigation follows an increasing focus on BT by Oftel, which has come under fire from rival telecoms firms and the European Commission for not taking a harder line.

Firms have complained that BT has been allowed to abuse its market dominance, which stems from its days as the UK's only major telecoms operator before privatisation.

On Monday, Oftel announced its first formal competition inquiry into BT, over rates offered in a new flat-rate internet access and voice calls package.

Oftel said it was concerned that BT may be "abusing its dominant market position" in using cash from the firm's traditional voice telephone market to support the unmetered package.

The move prompted a rare retort from BT, which said it was "bemused" by the inquiry.

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See also:

23 Nov 00 | Business
Fresh blow to BT
09 Nov 00 | Business
The rise and fall of BT
19 Oct 00 | Business
BT confirms unmetered tariff
13 Nov 00 | Business
UK web access breakthrough
21 Nov 00 | Business
BT mulls Nordic exit
21 Nov 00 | Wales
Internet auction fails in Wales
08 Aug 00 | Business
Telewest cuts web access costs
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