Energis may link with cable firms to reach new customers

Energis, the telecommunications business owned by National Grid, is considering radical plans to form alliances with UK cable companies to give the network better access to local business customers.

The move, which could cost up to pounds 50m in additional investment, is thought to be a clue to Energis's long-term strategy following last year's persistent speculation that the Grid, under chief executive David Jones, was looking to sell a substantial stake in the business, which runs fibre-optic phone wires along electricity cables.

Energis has so far invested pounds 550m in building a 4,500km national fibre- optic trunk network, which includes running phone wires along London tube tunnels. However Mike Grabiner, Energis's chief executive poached last year from British Telecom, has become increasingly frustrated at access charges it has to pay to use BT's local phone network. Out of likely revenues this year of pounds 100m, more than 40 per cent goes directly to British Telecom, which still controls more than 90 per cent of phone lines.

Energis has already complained about the organisation of the UK's local phone network to regulators in the US and the European Commission, which are investigating BT's planned pounds 13bn merger with US long-distance giant MCI.

The US watchdog, the Federal Communications Commission, has said it will only give the BT-MCI deal the go-ahead if the two companies can prove the UK market is as open as in the US.

Mr Grabiner declined to specify which cable operators would take part in partnerships, but said discussions were going on with most companies. "We haven't ruled anything out or walked away from anything."

He said that the deals would be "deeper" than conventional partnerships and would overcome regulatory rules which prevent cable companies selling capacity on their local networks to long distance operators. The Grid apparently remains committed to sell a stake in Energis to an outside investor by the end of this year.

Talks with AT&T, the US's biggest phone company, had started in 1995 but were abandoned many months ago. One reason the Grid has been more laid back about finding a partner is that Energis has been outperforming forecasts under Mr Grabiner after a shaky start.

Observers suggested a series of piecemeal cable deals pointed to Energis allying itself with the gradually consolidating cable industry in a "third force" to compete with BT and the pounds 5bn merged company currently being formed by Cable & Wireless, Bell Cablemedia and Nynex CableComms.

Telewest has so far stayed out of the C&W deal, preferring to invest in a long-distance partnership with Racal.

Start your day with The Independent, sign up for daily news emails
News
election 2015The 10 best quotes of the campaign
News
A caravan being used as a polling station in Ford near Salisbury, during the 2010 election
election 2015The Independent's guide to get you through polling day
News
people
Voices
David Blunkett joins the Labour candidate for Redcar Anna Turley on a campaigning visit last month
voicesWhat I learnt from my years in government, by the former Home Secretary David Blunkett
ebooks
ebooksA celebration of British elections
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Ashdown Group: Editor-in-chief - Financial Services - City, London

£60000 - £70000 per annum + benefits : Ashdown Group: A highly successful, glo...

Ashdown Group: Junior Application Support Analyst - Fluent German Speaker

£25000 - £30000 per annum + benefits: Ashdown Group: A global leader operating...

Guru Careers: Management Accountant

£27 - 35k + Bonus + Benefits: Guru Careers: A Management Accountant is needed ...

Guru Careers: Project Manager / Business Analyst

£40-50k + Benefits.: Guru Careers: A Project Manager / Business Analyst is nee...

Day In a Page

General Election 2015: ‘We will not sit down with Nicola Sturgeon’, says Ed Balls

'We will not sit down with Nicola Sturgeon'

In an exclusive interview, Ed Balls says he won't negotiate his first Budget with SNP MPs - even if Labour need their votes to secure its passage
VE Day 70th anniversary: How ordinary Britons celebrated the end of war in Europe

How ordinary Britons celebrated VE Day

Our perception of VE Day usually involves crowds of giddy Britons casting off the shackles of war with gay abandon. The truth was more nuanced
They came in with William Caxton's printing press, but typefaces still matter in the digital age

Typefaces still matter in the digital age

A new typeface once took years to create, now thousands are available at the click of a drop-down menu. So why do most of us still rely on the old classics, asks Meg Carter?
Discovery of 'missing link' between the two main life-forms on Earth could explain evolution of animals, say scientists

'Missing link' between Earth's two life-forms found

New microbial species tells us something about our dark past, say scientists
The Pan Am Experience is a 'flight' back to the 1970s that never takes off - at least, not literally

Pan Am Experience: A 'flight' back to the 70s

Tim Walker checks in and checks out a four-hour journey with a difference
Humans aren't alone in indulging in politics - it's everywhere in the animal world

Humans aren't alone in indulging in politics

Voting, mutual back-scratching, coups and charismatic leaders - it's everywhere in the animal world
Crisp sales are in decline - but this tasty trivia might tempt back the turncoats

Crisp sales are in decline

As a nation we're filling up on popcorn and pitta chips and forsaking their potato-based predecessors
Ronald McDonald the muse? Why Banksy, Ron English and Keith Coventry are lovin' Maccy D's

Ronald McDonald the muse

A new wave of artists is taking inspiration from the fast food chain
13 best picnic blankets

13 best picnic blankets

Dine al fresco without the grass stains and damp bottoms with something from our pick of picnic rugs
Barcelona 3 Bayern Munich 0 player ratings: Lionel Messi scores twice - but does he score highest in our ratings?

Barcelona vs Bayern Munich player ratings

Lionel Messi scores twice - but does he score highest in our ratings?
Martin Guptill: Explosive New Zealand batsman who sets the range for Kiwis' big guns

Explosive batsman who sets the range for Kiwis' big guns

Martin Guptill has smashed early runs for Derbyshire and tells Richard Edwards to expect more from the 'freakish' Brendon McCullum and his buoyant team during their tour of England
General Election 2015: Ed Miliband's unlikely journey from hapless geek to heart-throb

Miliband's unlikely journey from hapless geek to heart-throb

He was meant to be Labour's biggest handicap - but has become almost an asset
General Election 2015: A guide to the smaller parties, from the the National Health Action Party to the Church of the Militant Elvis Party

On the margins

From Militant Elvis to Women's Equality: a guide to the underdogs standing in the election
Amr Darrag: Ex-Muslim Brotherhood minister in exile still believes Egypt's military regime can be replaced with 'moderate' Islamic rule

'This is the battle of young Egypt for the future of our country'

Ex-Muslim Brotherhood minister Amr Darrag still believes the opposition can rid Egypt of its military regime and replace it with 'moderate' Islamic rule, he tells Robert Fisk
Why patients must rely less on doctors: Improving our own health is the 'blockbuster drug of the century'

Why patients must rely less on doctors

Improving our own health is the 'blockbuster drug of the century'