As BT shares powered through pounds 10 yesterday, it was easy to rubbish that analysis. However, it was broadly correct in all but one key respect - far from being dull, BT's local network has turned out to be a goldmine.
Consumers have caught internet fever and every time they log on BT reaps the benefit. What's more, people tend to spend a lot longer on the line when they're surfing than when they're chatting to a friend down the road. BT reckons 15 per cent of the traffic on its network is internet-related and thinks this will rise to at least 20 per cent next year. New technologies offering high-speed internet access over the standard copper line will further boost demand.
The cash being thrown off is helping to fund a series of expensive overseas investments and a pounds 10bn joint venture with AT&T. These may yet prove to be worthwhile, although it is still too early to tell. But if BT does establish itself as a global telecom operator, remember that it was its boring old residential business that paid for it all.