Recession may force BT to put next-generation network on hold

[Noreen]

The economic recession has called into question BT's plans to spend £1.5bn bringing the next generation of super-fast broadband services to 10m British households within the next four years.

Chief executive Ian Livingston admitted yesterday that he had been contacted by company shareholders who believed BT would be better off holding onto its cash, instead of spending it installing fibre-optic networks across the country............

http://www.guardian.co.uk/business/2008/nov/14/btgroup-telecoms1

[Rik]

I can see the point, but it's a very short-term view and I can't help but feel the Govt should be providing the assurances needed for the work to go ahead, which would fit with their current philosophy and stand us in good stead, or at least better, for the future.

[Lance]

I personally would have thought now was a good time to do it! If they start now, then when the economy recovers they'll be ready to get the benefit. Otherwise, they'll wait for the recovery, then spend four years doing it, and then find we are in another recession and no-one wants to splash out on super fast broadband services!

[Rik]

Good point, Lance.

[Lance]

In addition, no doubt they will need to tender some of the work, and in the current climate companies will put in a lower tender to ensure they get some business come their way.

[Rik]

That thought had crossed my mind. I can't help wondering whether it's a bit of politics to force Ofcom's hand?

[Tacitus]

On ElReg:  Link

Why aren't I surprised.....

Sorry - Just noticed Noreen's post further down refers to the same thing albeit from a different source.

Bit early yet isn't it :-)

The  mods can delete this if they wish rather than start another topic.

[Rik]

NP, it doesn't any more, so to speak, Tac.

I actually feel that it's a bit of posturing to gain concessions from Ofocm, but time will tell.

[Sebby]

Surely the current level of repair costs must be a killer for them. A next-generation network would no doubt reduce this cost. Of course, the cost of a new network is a far larger outlay! Whilst I appreciate that the current economic climate is difficult for everyone, it sometimes feels unfair that we are at the mercy of BT and have to suffer as a result.

[Rik]

We should either have a State-owned network or real competition, Seb. The current situation helps no-one.

[Tacitus]

We should either have a State-owned network or real competition, Seb. The current situation helps no-one.

I agree Rik.  As is usual with this country we end up with the worst of all worlds.  We don't emulate the US properly with real competition, neither do we adopt the European or Scandinavian systems of State owned/managed enterprises which are run for the general good. 

I think we try to emulate the US without having US style resources.  It comes back to what Peston was saying about GBrown and US/UK borrowing.  The US can get away with it because it's still the big dog - though for how much longer remains to be seen.  We think we're still the Country of Empire, lead the World and are able to do the same.  Unfortunately the politicians and a good proportion of the country haven't woken up to the fact that we're not, and can't. 

'Fantasy Island' doesn't begin to describe it.

[Inactive]

Hear .. Hear Tac.

[Rik]

We think we're still the Country of Empire, lead the World and are able to do the same.  Unfortunately the politicians and a good proportion of the country haven't woken up to the fact that we're not, and can't. 

'Fantasy Island' doesn't begin to describe it.

I third that statement! 

[g7pkf]

Surely now they are axing a load of job's they can afford to do this.

I think the 2 may be linked as i am sure they may be worried OFCOM will insist they get the new network in.

I feel sorry for all contractors and temps that may lose there jobs just now...not a good time.

[Rik]

Yet their dates are slipping for 21CN/WBC and exchange congestion is an increasing problem. It seems to me that BT need the staff they have.

[Simon]

Perhaps they've not got the right staff? 

[Rik]

That too, Simon.