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BT Talks Up Plans to Charge Video Providers

15 06 2009 – BT, the largest broadband provider in the UK, has said it plans to charge video content providers for the amount of bandwidth they consume on BT’s network, according to a story in Thursday’s Financial Times.

The paper quotes John Petter, managing director of BT Retail’s consumer business, saying, “We can’t give the content providers a completely free ride and continue to give customers the [service] they want at the price they expect.”

BT last week was caught throttling connections to the BBC iPlayer to less than 1 megabyte per second between the hours of 5:00 p.m. and midnight for subscribers of its 8 Mbps service. That’s permitted under its terms of service, but it looks like BT wants more — from content providers like YouTube or Hulu. I don’t blame it. In any competitive market, subscribers would flee such prohibitive limits once they realized what was happening, leaving BT with lowered revenue. It would need to make that up somehow.

So now Petter is pulling out the usual ISP trope about content providers  “developing very profitable business models” using BT networks, and they should help subsidize the cost of the bandwidth the video content consumes. I’ve heard this from just about every ISP I’ve spoken with.

However, the content providers do pay for their bandwidth, as do the customers of the ISP who consume it. In many cases, video providers also contract with content delivery networks, which can help ISPs reduce the burden of the video files on the last-mile network connecting the consumer’s home to the ISP’s cable plant or central office. If video costs the ISP “many millions” as Petter tells the FT, then it should raise prices somewhere along the line rather than go into dangerous territory that sounds like  trading money for access:

He [Petter] said that the quid pro quo of payment from content owners might be guarantees of picture quality.

Maybe BT is all talk, but many ISPs would love to see a company get away with this, so they can try the same thing.

Source: gigaom

BT doubles job cuts to 30,000 as it slumps to annual loss

14 05 2009 – BT has slumped to an annual loss for the first time in almost a decade and doubled jobs cuts to 30,000, as the former state-owned telecoms company struggles with a disastrous performance of a key division.

Source: Telegraph.co.uk

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BT, the telecoms giant, said today it will cut another 15,000 jobs over the next 12 months after making a full-year loss of £134 million due to continuing problems within its Global Services division.

The company revealed that it had already shed 15,000 jobs over the past year, about 5,000 more than previously announced, and said today: "We expect further reductions of a similar level next year."

The group said the performance of Global Services – once the engine room of the company’s growth – was unacceptable and that it would have to take charges of £1.3 billion following the completion of contract and financial reviews at the unit. The division, which provides networked IT services to companies and is now in the process of being restructured, has been hit hard by the downturn and as it become more cautious about how profitable its contracts will prove to be. The group will also take a £280 million restructuring charge on the unit, with further restructuring charges of £420 million over the next two years. Francois Barrault resigned as chief executive of the unit in October last year amid troubles for division and was replaced by Hanif Lalani, the group’s finance director.

BT will also be forced to make pension deficit contributions of £525 million for the next three years after the shortfall of the huge fund ballooned to £2.9 billion, compared with a surplus of £2 billion in the previous year. The group’s previous contribution was £280 million over ten years.

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For the 12 months to March 31, the group reported a pre-tax loss of £134 million, compared with a profit of almost £2 billion the year before, largely wiped out by the £1.3 billion writedown on Global Services in the fourth quarter. Revenue for the period rose 3 per cent to £21.4 billion, up from £20.7 billion.

Looking ahead, BT said it expected revenue to decline by 4 per cent to 5 per cent in 2009-10, reflecting a continuation of the trends seen in the fourth quarter, the impact of lower mobile termination rates and the impact of refocusing BT Global Services.

However, the group will still pay a final dividend of 1.1p, giving a total for the year of 6.5p, albeit a 59 per cent reduction on the previous year’s payout of 15.8p. Shares in the company fell by 3.6 per cent in early trading.

Ian Livingston, chief executive of BT, said that three out of the group’s business had performed well despite the downturn but that their achievement had been overshadowed by the “unacceptable performance” of BT Global Services.

He added that management at the unit had been changed and that the group had started to turn the division around, and that he believed BT would emerge from the recession a stronger company.

Andy Kerr, CWU deputy general secretary, said fresh job losses would be “very challenging” and that, although many job cuts would fall on contractors and agency staff, this was a serious day for staff at the company.

Mr Kerr blamed “damaging mis-management” of Global Services for the poor results but said the union was hopeful this difficult time was now behind the company.

He added that the CWU would continue to work closely with BT to ensure any losses are voluntary and that they were looking at new ways of finding work and retaining permanent employees, including secondment agreements.

Source: Times on line

British Telecom Chairman Says Open Access Key to Broadband Growth

01 05 2009 – Five years ago, Britain’s largest telecommunication’s service provider was forced to do what at the time seemed like a losing proposition. Regulators required BT, formerly called British Telecom, to open its networks to competitors to lease, and for use by any device and software application.

By doing so, BT and many analysts at the time predicted the company’s demise, saying it would lose its monopoly power over the industry and its revenue streams from proprietary hardware contracts. The company would become a network of dumb pipes, some feared.

Today, BT generates annual revenues of about 20 billion British pounds, the same as five years ago. What’s different is that many more competitors have entered into the wireless, phone, and broadband Internet markets in the U.K. The average speed for broadband access has nearly doubled to 2 megabits a second and the price for service has been reduced by an average of 50 percent from five years ago.

And BT ? It was forced to reinvent itself and be more aggressive with new technologies like its current buildout of fiber optic networks across the U.K., said Sir Michael Rake, chairman of BT, in an interview today.

"It was painful at the time but has been better for the country and consumers in the long run," Rake said.

He believes the lessons learned by BT could be useful for the U.S., which has more telecommunications service providers but is largely dominated by AT&T, Verizon Communications and cable operator Comcast.

The best way to get more people to adopt high-speed Internet is to create competition through a regulatory framework that forces the biggest players to open their networks, Rake said.

"There needs to be a level playing field and the simple thing to do to achieve that is to open access," Rake said. "It’s the only way to create competition and thereby create investment and jobs."

Some carriers have said they are already moving in that direction. Verizon Wireless launched a developers group that is open to any device or application. Its next generation wireless network, or 4G network, will also be open to any device or application.

But there are still examples of exclusive deals like Apple’s iPhone on AT&T’s wireless network. Last year Skype filed a petition to the Federal Communications Commission that would require wireless operators to open their network to applications like theirs. Then chairman Kevin J. Martin moved to dismiss the petition, which is still pending at the agency.

Source: The Washington Post

BT Blocking Pirate Bay To UK Dongle Users Due To ‘Adult’ Content

21 04 2009 – BT is getting itself on the right side of content owners by blocking access to The Pirate Bay for under-18 mobile broadband customers – but it’s nothing to do with the Bay operators’ conviction last week

PC Pro reports customers who attempt to access the Bit Torrent site are greeted with a “content blocked” alert – a page says the move is “in compliance with a new UK voluntary code of practice” and points to the self-regulatory code and blocklist ISPs operate with the Internet Watch Foundation, but that’s misleading. The IWF told paidContent:UK: “(The Pirate Bay) is a P2P site and we don’t have a remit over P2P, so it wouldn’t ever be something that came from us; they are making a connection that doesn’t exist. Some of the mobile operators appear to have been blocking Pirate Bay under their own code of conduct.”

BT spokesperson (via TechRadar): “The reason this content needs regulating is that somebody under the age of 18 can sign up for a mobile broadband dongle. This is different to broadband in the home, where consumers need to be 18 to sign up to this sort of contract. When it comes to The Pirate Bay, the reason we have blocked the site is because users can access adult material on it.” That means over-18s are just as free to access the Bay as under-18s who use a home, family broadband connection. So-called “adult” sites via mobile can be accessed after users prove their age with a credit card check, but the definitions can be bizarre – I had to prove my age just to access Flickr via Vodafone’s service. BT’s mobile broadband runs on Vodafone’s network.

Despite reports this afternoon suggesting all the major UK mobile broadband providers have joined BT in blocking the site, that’s actually unclear. Orange, O2, T-Mobile, Virgin Mobile (NYSE: VM), Vodafone (NYSE: VOD) and 3 have signed IWF’s mobile content code, but this doesn’t cover P2P. Most of the networks could not be reached for comment Tuesday afternoon, but Vodafone was confused and O2 told us it isn’t blocking Pirate Bay: “If it was on (IWF’s) list, it would be blocked, but it’s not.”

Wednesday update: Vodafone told paidContent:UK Pirate Bay is also on its bar list for adult content, along with “the majority of social networks”: “In case of any social network on mobile broadband, we are putting that content behind access control bar. It’s a standard procedure, and it’s easy to lift the bar.”

Source: paidContent:uk

BT CEO On FTTH: ‘Most People Are Happy With A Ford’

17 04 2009 – In 2007, UK telco British Telecom called running fiber to the home “premature,” instead opting to milk copper for a little longer. In 2008, they announced a widely lauded plan to invest in “fiber” (to the node), though the specifics weren’t particularly impressive when you looked a little closer, and the “fiber to the press release” announcement was more about getting what they wanted from lawmakers. Now the carrier, after getting a regulatory back rub from the British Government, is back to saying that nobody really wants fiber to the home:

“Of course a Ferrari is faster than a Ford,” says BT CEO Ian Livingstone. “But most people are happy with a Ford.”

You’d at least wish that executives would make their car analogies consistent. Back in 2003, Qwest’s Utah President Jerry Fenn, when defending his company’s opposition to municipal fiber and reliance on DSL asked: “Why provide a Rolls-Royce when a Chevrolet will do?” Comcast CEO Brian Roberts of course has had his own thoughts on that, likening cable broadband technology to a BMW, while insisting that DSL is a “Hyundai.” Personally, we’d like an Aston Martin, please.

Source: BroadBand DSL Report.com

Video: Steve Osborne, VP Global Integration, BT

TelecomTV - BT26 03 2009 – Steve Osborne, Vice President of Global Integration at BT, was at SOFNET hosting a plenary panel with representatives from BT’s key partners involved in the development of its 21st century network. Here, Steve explains to TelecomTV’s Martyn Warwick how the new network creates opportunities for software developers, who, in turn create opportunities for BT’s network to further develop, all resulting in an increase in the level of innovation over time.

View Video:

Source: TelecomTV

Video: Steve Osborne, VP Global Integration, BT

TelecomTV - BT26 03 2009 – Steve Osborne, Vice President of Global Integration at BT, was at SOFNET hosting a plenary panel with representatives from BT’s key partners involved in the development of its 21st century network. Here, Steve explains to TelecomTV’s Martyn Warwick how the new network creates opportunities for software developers, who, in turn create opportunities for BT’s network to further develop, all resulting in an increase in the level of innovation over time.

View Video:

Source: TelecomTV