BT Group plc
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BT Group plc (which trades as just BT, and is commonly known as, "British Telecom" or "British Telecommunications") is the privatised former British state telecommunications operator. It is still the dominant fixed line telecommunications provider in the United Kingdom.
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Businesses
BT owns and runs the telephone exchanges, trunk network and local loop connections for the vast majority of British fixed-line telephones. Currently BT is responsible for approximately 25 million telephone lines in the UK. BT is still the only UK telecoms operator to have a Universal Service Obligation (USO) which means it must provide a fixed telephone line to any address in the UK. It is also obligated to provide public call boxes.
It is officially designated the dominant operator in British telecommunications market. BT's businesses are operated under special government regulation by the British telecoms regulator Ofcom (formerly Oftel).
BT Group has been organised into five business divisions:
- BT Global Services: Business services and solutions (formerly BT Ignite)
- BT Openworld: BT Internet provider
- BT Retail: Retail telecoms
- BT Wholesale: Wholesale telecoms network
- BT Exact: Research and Development, and consultancy
History of BT
A number of privately owned telegraph companies operated in Britain from 1846 onwards. Among them were
- The Electric Telegraph Company,
- British and Irish Magnetic Telegraph Company,
- British Telegraph Company,
- London District Telegraph Company,
- and the United Kingdom Telegraph Company
The Telegraph Act of 1868 passed the control of all these to the newly formed GPO (General Post Office)'s "Postal Telegraphs Department"
With the invention of the telephone by Alexander Graham Bell in 1876 the GPO began to provide telephone services from some of its telegraph exchanges. However in 1882 the Postmaster-General, Henry Fawcett started to issue licences to operate a telephone service to private businesses and the telephone system grew under the GPO in some areas and private ownership in others. The GPO's main competitor the National Telephone Company emerged in this market by absorbing other private telephone companies, prior to its absorption into the GPO in 1912.
The trunk network was unified under GPO control in 1896 and the local distribution network in 1912. A few municipally owned services remained outside of GPO control. These were Kingston upon Hull, Portsmouth and Guernsey. Hull still retains an independent operator, Kingston Communications, though it is no longer municipally controlled.
In 1969 the GPO, a government department, became The Post Office, a nationalised industry separate from government. Post Office Telecommunications was one of the divisions.
Formation of British Telecom
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On 1st July, 1981 Post Office Telecommunications was renamed British Telecom and became a state-owned corporation independent of the Post Office. In 1982 BT's monopoly on telecommunications was broken, with the grant of a licence to Mercury Communications.
Privatisation
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The privatisation took place in 1984, with the sale of 51% of the shares in the company (incorporated in 1984 as British Telecommunications plc) to the public in November.
The company changed its trading name to 'BT' in March 31, 1991. The remaining state holdings in the company were sold in 1991 and 1993.
In the 1990s, BT entered the Irish telecommunications market through a joint venture with the Electricity Supply Board, the Irish state owned power provider. This venture, entitled Ocean, found its main success through the launch of Ireland's first subscription-free dial-up ISP, oceanfree.net. As a telecoms company it found much less success, mainly targeting corporate customers. BT acquired 100% of this venture in 1999.
In 2000, BT acquired Esat Telecom Group plc, and all its subsidiary companies, and Ireland On Line. It also purchased Telenor's minority shareholding in Esat Digifone. The Esat Telecom Group was split in two: the landline and internet operations were combined with Ocean and became part of BT Ignite. Esat Group was renamed Esat BT in July 2002, and eventually BT Ireland in April 2005. Esat Digifone became part of BT Wireless. EsatBT installed the first DSL lines in Ireland, and operate one exchange, in Limerick. It has been suggested that BT's Northern Ireland operations may be merged into BT Ireland at some point in the future.
Yell Group and O2 demergers
In June 2001 BT's directory business was demerged as Yell Group. A larger demerger followed in November of the same year, when the former mobile telecommunications business of BT, BT Cellnet, was hived off as a separate business named "mmO2". This included BT owned or operated networks in other countries, including BT Cellnet (UK), Esat Digifone (Ireland), and Viag Interkom (Germany). All networks now owned or operated by mmO2 (except Manx Telecom) were renamed as O2.
This was a move designed to remove the burden of debt with which the company had encumbered itself, much of which was acquired during the bidding round for the 3rd generation mobile telephony (commonly known as 3G) licenses. The de-merger was accomplished via a share-swop, all British Telecommunications plc shareholders received 1 mmO2 plc and 1 BT Group plc (of which British Telecommunications is now a wholly owned subsidiary) share for each share they owned. British Telecommunications plc was de-listed on 16 November 2001 and the two new companies started trading on 19 November. mmO2 plc was replaced by O2 plc in a further share-swop in 2005.
BT as it is today
In April 2003, BT launched its new corporate identity. The "BT" logotype from 1991 was retained, but the piper was replaced by a "connected world". Esat BT retained the piper for nearly two years after it was dropped by its parent.
Oftel's strategy for telecoms deregulation in the UK through the 1990s was to drive down BT's market share. It aimed to achieve this by restrictions on the size of its price increases and by forcing it to allow other telcos to gain access to the connection between the exchange and the customers premises.
This has been successful in the area of telephony resale through Independent Service Providers (ISPs) but has left BT as the dominant operator in ADSL connections and local loop provision.
In 2003 BT resumed its participation in the UK mobile market with the launch of BT Mobile. The company denies the move is a U-turn, describing the sell-off of mmO2 as the best move for shareholders and investors. BT wishes to reach younger consumers who use BT's fixed line services less than previous generations. BT Mobile is a reseller of mobile services supplied by the UK's mobile operators and no longer owns a mobile network.
BT Broadband
BT Broadband/Yahoo is an ADSL ISP in the United Kingdom, operating under the BT Retail division of BT Group PLC. There are currently four different packages available.
Both BT Yahoo and BT Broadband use the BT CentralPlus scheme, and so are unable to offer static IP addresses.
Financial performance
| Year ended | Turnover (£m) | Profit/(loss) before tax (£m) | Net profit/(loss) (£m) | Basic eps (p) |
|---|---|---|---|---|
| 31 Mar 2005 | 18,623 | 2,343 | 1,821 | 21.4 |
| 31 Mar 2004 | 18,519 | 1,945 | 1,414 | 16.4 |
| 31 Mar 2003 | 18,727 | 3,157 | 2,686 | 31.2 |
| 31 Mar 2002 | 20,559 | 1,461 | 995 | 12.0 |
| 31 Mar 2001 | 20,427 | (1,031) | (1,810) | (27.7) |
| 31 Mar 2000 | 18,715 | 2,942 | 2,055 | 31.7 |
| 31 Mar 1999 | 16,953 | 4,295 | 2,983 | 46.3 |
| 31 Mar 1998 | 15,640 | 3,219 | 1,706 | 26.7 |
| 31 Mar 1997 | 14,935 | 3,203 | 2,077 | 32.8 |
| 31 Mar 1996 | 14,446 | 3,019 | 1,986 | 31.6 |
| 31 Mar 1995 | 13,893 | 2,662 | 1,731 | 27.8 |
| 31 Mar 1994 | 13,675 | 2,756 | 1,767 | 28.5 |
| 31 Mar 1993 | 13,242 | 1,972 | 1,220 | 19.8 |
| 31 Mar 1992 | 13,337 | 3,073 | 2,044 | 33.2 |
Future
BT's 21st Century Network (21CN) is a network transformation project which will see the UK's telephone network move from the present AXE/System X Public Switched Telephone Network (PSTN) to an Internet Protocol (IP) system.
BT envisages annual savings of £1 billion when the transition to the new network is complete (the majority of customers should be transferred by 2008). Capital expenditure is put at £10 billion over the next five years.
See also:
BT's "Web patent"
BT owns a controversial patent, (US patent number 4873662), which it claimed gives it a patent rights on the technology of the hyperlink on the World Wide Web. Whilst the UK patent has long since expired, the US patent is not due to expire until 2006. Opponents of BT's claims hold that the patent is not valid, due to prior art by both Douglas Englebart and Ted Nelson's Project Xanadu. On February 11, 2002, a court case relating to BT's claims started in a US federal court against Prodigy Communications Corporation. A U.S. court ruled on August 22, 2002 that the BT patent is not applicable to Web technology, and granted Prodigy's request for summary judgement.
- BT’s “Hyperlinking” Patent Litigation Fails (http://www.nswscl.org.au/journal/51/Glen_Sauer.html)
See also
External links
- The BT Group Home page (http://www.groupbt.com/)
- The BT Home page (http://www.bt.com/)
Data
- Yahoo! - BT Group plc Company Profile (http://biz.yahoo.com/ic/41/41763.html)
Other
- BT's 'Events in Telecommunications History' webpage [1] (http://www.btplc.com/Thegroup/BTsHistory/Eventsintelecommunicationshistory/Eventsintelecommunicationshistory.htm)
- National Telephone Company history (http://www.connected-earth.com/Journeys/Prideofownership/TheForceofPublicOpinion/Thetelephonedilemma/NationalTelephoneCompany/NTC-NationalTelephoneCompany-1881.htm)
- BBC news story on BT's claimed 'web patent' (http://news.bbc.co.uk/hi/english/sci/tech/newsid_798000/798475.stm)
- link to BT's patent text at USPTO (http://patft.uspto.gov/netacgi/nph-Parser?Sect1=PTO1&Sect2=HITOFF&d=PALL&p=1&u=/netahtml/srchnum.htm&r=1&f=G&l=50&s1=%274873662%27.WKU.&OS=PN/4873662&RS=PN/4873662)
- Patent case court judgement against BT (http://www.nysd.uscourts.gov/courtweb/pdf/D02NYSC/02-07733.PDF)fr:BT (opérateur télécom)