BBC News | BUSINESS | BT announces global mobile service

BBC News Online: Business

Thursday, 9 March, 2000, 14:02 GMT

BT announces global mobile service

British Telecom has announced plans for a global mobile phone internet service in the latest round of worldwide web wars.

The UK telecoms giant is staking a claim to a share of the predicted huge market for mobile internet access, and says it will restructure its prices to make the services available to all.

As part of the plan, BT's mobile phone division, Cellnet, is launching the UK's first pre-pay WAP-based mobile internet phone.

WAP stands for wireless application protocol and describes the new technology connecting mobile devices to the net.

Customers will be charged an upfront fee of Ł99.99, plus Ł10 a month for the WAP phones.

BT says it is investing Ł160m in the new services, which will be launched in the summer after trials commencing next month.

Shares surge

The stock market received the plans warmly, with BT's share price closing up 144p - or 12% - to Ł13.15.

Telecoms analyst James Ross said: "This is a positive indicator. It shows a level of aggression in a new technology area that is not usual for BT. People are used to BT being a follower.

"But it now looks set to capture a market which will make it money - people with a particular set of needs who will pay for their needs to be gratified."

BT Cellnet forecasts sales of up to 500,000 WAP phones between April and June, and says that in 18 months nearly all new mobiles will be internet-enabled.

Kent Thexton, former marketing director of BT Cellnet, will be managing director of BT's new global mobile internet unit.

He says the global number of mobile subscribers is expected to leap 200% in the next five years to more than a billion, while BT's internet-related turnover is growing at more than 80% a year.

The global service will be based on BT's Genie Internet UK service. Genie has more than 600,000 subscribers, a number which is growing at a rate of 4,000 per day.

BT forecasts that the worldwide mobile e-commerce market will be worth $200bn in four years' time.

Joint venture

Content and e-commerce will be provided by a raft of media groups, including BSkyB, the Financial Times, The Street, 365 Corp., Uprush and the Guardian.

Shopping and financial services will be available from Lastminute and First Direct.

Logica will be the global WAP provider for Genie, Microsoft will provide mobile internet applications, and Freeserve the e-mail services.

Other partners include Sharp, Panasonic, Motorola, Ericsson, Siemens, NEC, Mobile Telecommunications International, Phone.com and Looksmart.

BT also announced the first commercial universal mobile telephony standard (UMTS) network to be launched in the Isle of Man by its Manx Telecom unit.

The network will deliver multimedia information to new mobile handsets and devices at speeds at least ten times faster than existing networks.

Red tape

The industry regulator, Oftel, has announced a reduction in regulation for BT in competitive international markets.

Oftel said the decision was in line with its strategy of reducing regulation as markets became more competitive.

BT has seen its market share fall to below 37% for international calls made by business users and in the residential market, its share has dropped by 12% over the last five years.

In light of this, Oftel has amended several regulatory requirements for BT.

It has reduced, from 28 days to one day, the amount of notice BT must give of price changes; removed BT's obligation to provide Oftel with a prior breakdown of costs for price changes; and removed its obligation to seek consent for prices which are below cost.

Related to this story:
BT fuels internet price war (08 Mar 00 | Business)
BT angry at Brown's internet call (16 Feb 00 | Business)
Price warning for BT (06 Mar 00 | Business)

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