BT joins US company in mobile joint venture

British Telecom and Crown Castle, the US broadcast transmission company that bought the BBC's national transmitter system last year, yesterday launched a joint venture to develop infrastructure for third-generation mobile networks.

British Telecom and Crown Castle, the US broadcast transmission company that bought the BBC's national transmitter system last year, yesterday launched a joint venture to develop infrastructure for third-generation mobile networks.

The companies will develop the roof space of 4,000 BT local exchanges to offer transmission services to the five mobile telephone groups which won licences to offer universal mobile telecoms services (UMTS) from 2003. The pact is for 10 years with an option for a further 50.

Crown Castle will pay development fees to BT's wholesale arm worth £150m over two years, while investing a further £75m to build the structures at an initial 1,500 exchanges. BT said the venture would boost pre-tax profit by more than £50m annually.

Bob Giles, chief operating officer of Crown Castle, said: "What makes this attractive is that all of these exchanges are directly hooked into BT's fibre-optic system. It's that large bandwidth that will allow third-generation operators to transmit large amounts of data in a short period of time."

The four existing mobile operators each have 5,000 to 7,000 cell sites. The smaller coverage radius of UMTS cells means a national network may require more than 10,000 sites, when local councils are attempting to restrict mast construction. "There is no way there will be 50,000 or 60,000 sites in this country," Mr Giles said. "You couldn't get planning permission. Operators will have some sites they own and some they share, and sharing will be favoured by council planners."