Genesis calls up a threat to BT

Genesis Communications, the mobile phone supplier, is planning to take on BT in one of its most vulnerable areas - small and medium-sized businesses - by moving into the fixed line phone business.

Genesis Communications, the mobile phone supplier, is planning to take on BT in one of its most vulnerable areas - small and medium-sized businesses - by moving into the fixed line phone business.

The group, founded by the double-glazing tycoon, Brian Kennedy, is to take advantage of next year's deregulation of what is called the local loop, the direct connections with phone customers. It will mean competing with BT head-to-head.

The move will involve massive investment in phone systems, and Genesis is in talks with a number of investors about ploughing up to £100m into the expansion.

Genesis, founded five years ago, is already one of the UK's fastest-growing mobile phone groups, selling only to businesses, and it has struck a deal with One2One to be a "virtual supplier" of mobile phones. This means, like Virgin mobile, it will sell under its own name, not One2One, and set its own tariffs. However, it will also sell BT Cellnet, Vodafone and Orange phones if those are what customers want.

Now Genesis wants to offer fixed lines, too, and has hired a team from BT to lead the move. "We want to offer customers a total service, be it mobile, internet, data or fixed line," said Ian Blackhurst, who founded the group with Mr Kennedy.

The business as a whole will turn over £50m this year, and be rapidly expanded. This weekend, Genesis announced plans to create 260 jobs in a drive aimed at doubling the size of the company this year.

Mr Kennedy's double-glazing firm Latium bought Weatherseal in 1989 and then its main rival Everest in the late 1990s. Latium now has a turnover of £250m. A big rugby fan, Mr Kennedy has bought Manchester Sale Rugby Club.