- guardian.co.uk, Monday May 28 2001 01.29 BST
The continuing shake-up at BT under new chairman Sir Christopher Bland could see the telephone company mount a broad assault on cable companies by offering its 19m customers television services.
Sir Christopher believes BT's huge retail customer base is an untapped gold mine that could also sell gas, electricity and other services.
If executed correctly, the move could generate billions of pounds of extra revenues for the ailing former national champion which earlier this month announced plans to split into two.
The plans by BT mirror the actions taken by another privatised monopoly, British Gas, which successfully broke itself up and then saw its consumer division, Centrica, diversify into credit cards and motoring services, through its purchase of the AA, as well as selling electricity.
A move into television would pose a serious competitive threat to Britain's leading cable TV operators NTL and Telewest.
"We're keeping our eyes open for opportunities in non-traditional areas," a BT insider said yesterday.
"Other companies are operating in our market, so why shouldn't we do the same?" Sir Christopher was quoted as saying.
The expertise Sir Christopher has acquired in his role as the chairman of the BBC is likely to accelerate BT's expansion into broadcasting now that regulations restricting the move, put in place when the former monopoly was privatised in 1984, have expired.
To realise Sir Christopher's ambition, the first task would be to upgrade BT's old copper wiring so that television signals, the internet and telephone services could be car ried on the same digital subscriber line (DSL). Broadcasters BSkyB and ONdigital, a joint venture between Granada Media and Carlton, could provide the TV content.
Sir Christopher has already noted that smaller, nimbler companies such as Kingston Communications already offer flat-rate telephony, flat-rate internet access and multi-channel television through DSL.
BT, under its previous management, had been slow to exploit new technology for fear of eating away at its revenue stream. BT has 55,000 such customers compared with Germany's Deutsche Telekom which has 450,000 broadband accounts.
In Britain rivals, notably Energis and Thus, have ac cused BT of stifling the roll out of DSL and the regulator is conducting a review of BT's pricing structure to ensure that it is not edging out competitors.
To fulfil any ambitions to be a force in broadcasting, Sir Christopher will have to turn the tide of negative sentiment and he is certain to exert pressure on BT's Openworld division - widely viewed as having failed to deliver on DSL.
The new chairman has already made his mark. He promised to decide the fate of directory service division Yell by the end of May and he delivered. Yell was sold to a consortium backed by venture capitalists Apax Partners and Hicks, Muse, Tate & Furst for £2.1bn on Saturday.
