Shake-up to streamline BT into single unit

BRITISH TELECOM unveiled a major shake-up of its UK businesses yesterday as part of an attempt to streamline its operations and fight off growing competition.

The reorganisation is the brainchild of Bill Cockburn, the former WH Smith chief executive who joined BT as UK managing director last October.

It is likely to accelerate the rate at which BT sheds parts of its workforce, although Mr Cockburn yesterday declined to give any figures for job losses.

Under Mr Cockburn's plans, BT will merge its consumer and business divisions into a single unit - called BT UK Markets - which will offer a complete range of BT's products. It will be supported by other units concentrating on customer services, products and solutions and networks.

However Cellnet, the mobile phone operator in which BT holds a 60 per cent stake, will continue to be run as a separate unit.

Mr Cockburn said the total UK telecom market was expected to double in value in the next five years, spurred by the growth of electronic commerce and Internet communications.

"We have got to reshape ourselves to pay more attention to the growth areas," he said.

Mr Cockburn added that although BT might continue to lose market share to its competitors, the market was growing fast enough for it to continue to increase its revenues.

From next year, BT will begin to tailor packages of products for different types of customers. The packages will combine products such as email, pagers, voicemail and mobile phones, possibly on a single bill.

The packages - which are subject to approval by Oftel, the telecoms watchdog - will allow BT to target customers by how much they spend on telecom services rather than whether they are a business or an individual.

In the past, the company has struggled to service the market for small and medium-sized enterprises and the fast-growing proportion of the population which now works from home.