UK Telecommunications Research Articles

Strategic breakout in UK telecommunications: the case of Kingston Communications

Abstract The progressive liberalization of the UK telecommunications sector has necessitated a strategic repositioning by its incumbent operators, British Telecommunications (BT) and Kingston Communications (KC), as they face up to increased competition within their traditional market places. This repositioning has stimulated a process of strategic breakout, a framework derived from the author's on‐going examination of changes in the European telecommunications sector. Amendments in the regulatory framework governing the industry has enabled firms to move into geographic and product markets from which they were previously excluded. However, they still face a residual regulatory framework that sustains a commitment by them to their base market principally through universal service obligations. Such a scenario has the potential to create conflict and undermine strategic focus. This paper seeks to explore this conflict through the strategic repositioning of KC since its licence was last reviewed in July 1998. After exploring the process of strategic breakout, the framework is then applied to KC highlighting how the process, when interacting with the residual regulatory framework, creates the potential for strategic conflict. Copyright © 2002 John Wiley & Sons, Ltd.

Classifying relationship structures: relationship strength in industrial markets

Although many authors examine relationships, few attempt to classify alternative structures. In this research a relationship strength construct is developed to distinguish among alternative relationship structures based on a key mediating variable set derived from an assessment of the dominant behavior process and economic content variables underlying important buyer‐seller relationships. Results using a cluster analysis procedure based on a sample of 200 industrial company respondents from the UK engineering, electronic and telecommunications sectors support the classification. This allows us to discriminate between four relationship structures in main buyer‐supplier relationships, which are labeled: bilateral, recurrent, dominant partner, and discrete. Such a classification can provide managers with a mechanism for analyzing and planning for the development of their inter‐firm relationships.

New Products for Old — Making a Profit

We all know how much it costs to make a telephone call — or do we? There are over 150 companies in the UK telecommunications market-place, all with their own unique blend of people, processes and systems, and operating costs. There are even more packages of services and prices, aimed at different segments of the market, and it is vital to each operator, including BT, that these packages actually make money. In order to understand how to set prices, BT needs to understand the basis of its costs, how these are allocated to the different services, and which services contribute revenue over and above these costs. This applies to both retail trading, and also wholesale trading, within BT and between BT and other operators for interconnect services. This paper looks at the process of engineering networks to meet the demand for BT's services, and applies whole-life financial techniques to identify how much it really costs the business to offer these services. It looks at BT's wholesale pricing, and at how trading units within the company can build relationships that lead to both the profitable operation of existing services, and the successful introduction of new services. It looks at the evolution of network platforms, new product development, and the effects of pricing options, from the present day until well into the next century.

Market-Led Culture and Competitive Advantage: A Case of Siemens BCS UK Telecommunications

ABSTRACT The purpose of this paper is to formulate hypotheses on which to carry out empirical research into market-led service strategies that can provide organisations with competitive advantage. The primary objectives are summarised as follows: 1. How service strategies affect the competitiveness of service organisations. 2. How changes in culture within service organisations influence customer satisfaction. 3. How market-led strategies lead to competitive advantage and the achievement of business goals. It is necessary to compare opinions of customers, employees, and managers with the theoretical research to improve customer service and enhance the market position of Siemens BCS. The theoretical method focuses on the following three specific areas: the involvement of the customer in the provision of exceptional service; the culture of the organisation in delivering customer satisfaction; how market-led service strategies help to beat the competition. This is particularly important to Siemens BCS becaus...

The practice of access pricing: telecommunications in the United Kingdom

This paper discusses in detail the determination of access charges by the UK telecommunications regulators. It draws on a unique 15-year experience to draw practical guidelines for regulators. The details cover a discussion of the processes followed to achieve competition in the sector, including the rebalancing of call charges and the key accounting rulings that generated the information required by regulators to take many of the key decisions in particular with respect to cost allocation.

Total quality management and business process re-engineering: A study of incremental and radical approaches to change management at BTNI

The paper reports a case study (an element of a wider project) undertaken at a Northern Ireland subsidiary of a UK telecommunications company, which is one of the few organizations in Ulster to have implemented total quality management (TQM) and large-scale business process reengineering (BPR). The company's latest re-engineering project is discussed in the context of certain theoretical issues. These include: the nature of BPR; the circumstances in which the implementation of BPR is most likely to be eff ective-in particular, whether or not a crisis is a necessary trigger; the most eff ective mode of implementation; the role of information technology and what, if anything, BPR is likely to achieve. Of major interest is the interaction between TQM and BPR, and how the company has made eff ective complementary use of these two approaches to change management in the pursuit of business excellence. In part, this has proved possible because both are underpinned by a long-term vision and change strategy, comprising many integrated elements.

Market-led culture and competitive advantage: A case of siemens BCS UK Telecommunications

Market-led culture and competitive advantage: A case of siemens BCS UK Telecommunications

Cable & Wireless – past, present and future: The telecom giant awakens

Presents a current overview of the UK telecommunications group Cable & Wireless. Describes its existing global business, with subsidiaries in over 50 countries and links with many major companies and overseas governments. Discusses the development of communications, from copper cables transmitting Morse code to modern fibre optic strands using laser light, reviewing the introduction of satellite and digital technology, computers and the Internet. Debates the convergence and possible future combination of these technologies in a multimedia communications revolution. Examines the precedents set in the early 20th century with mergers of cable and radio companies, and considers the possibility of similar mergers in the future between cable, satellite, computer and media businesses. Describes C&W’s involvement with Microsoft and BSkyB in areas such as: Web TV; set-top boxes; video-on-demand and digitization.

CellStream — pilot customer experience

The announcement in October 1996 of BT's pilot CellStream asynchronous transfer mode (ATM) service marked a significant milestone in the provision of broadband services within the UK telecommunications market. Building on the success of BT's initial broadband Switched Multi-megabit Data Service (SMDS), CellStream provides BT's customers with high-speed and operationally flexible communications within the UK and internationally. This paper outlines BT's CellStream ATM services, and, by taking a particular example, illustrates how customers have been supported in their introduction to them.

The Effect of Regulatory Announcements on the Cost of Equity Capital of British Telecom

This paper examines the impact of regulatory announcements which affect competition, pricing policy and the supply of services in the telecommunications industry on British Telecom's (BT) systematic risk, as measured by the beta coefficient of a market model. Changes in investors' perception of a company's systematic risk will of course also change its cost of equity capital. Since BT's beta coefficient is found to be unstable over the estimation period, the market model is estimated using a time‐varying parameter model. The results suggest that announcements which allow the price of BT's services to increase and announcements affecting its supply of services are likely to have an impact on BT's cost of equity capital, since they affect the investor's perception of BT's systematic risk. However, our analysis does not detect any effect from the other types of announcements tested. Further examination of the individual announcements included in the groups reveals that, within the non‐significant groups, many individual announcements are significant, but they affect beta in opposite directions and thus no prediction can be made on the sign of their aggregated impact. These findings suggest that when one company dominates the industry, such as in the case of the UK telecommunications industry, the actions of the regulator do not always have the expected effect and problems of regulatory capture are likely to be present.

Entry, competition, and regulation in UK telecommunications

In a formerly monopolized industry now subject to competition, there is likely to be considerable interaction between business strategy and regulation. The paper illustrates the development of this process in UK telecommunications. It sets out a framework in which competition between incumbent and entrants takes the form of a race on the part of the former to bridge the innovation gap and on the part of the latter to accumulate the necessary strategic assets, including regulatory assets. The strategies of major UK fixed-link telecommunications firms are analyzed in this light, and regulatory policy towards vertical separation in mobile telephony is also described. The article draws attention to the crucial role which the regulator plays in assisting entrants to gain access to strategic assets, including information. Copyright 1996 by Oxford University Press.

The apparatus business in BT – a team story

Recounts a team approach to turning round British Telecommunications plc′s (BT′s) £1 billion turnover business in the highly competitive UK telecommunications apparatus market. Under BT′s license the apparatus business had to have separate accounts and, by 1991/92, losses had reached levels which led the UK′s then telecommunications regulator, Sir Bryan Carsberg of Oftel, to intervene. Between 1992 and 1994, author Adam Scott led the team which managed the business into profitability. The team operated within BT′s management matrix, with a clear set of values, using product teams, team objectives, program and project management and driving for clarity about the benefits and milestones to be achieved in each element of the planned recovery. The program addressed indirect and functional costs and, latterly, worked up a “balanced score card” – a technique on which the article provides references – to provide a framework for future management.

Mobile phones

The Orange service makes use of the latest digital technology and currently, the service covers over 75% of the UK population. Orange was the first UK telecommunications service to offer CLI (Calling Line Identity) to its customers. The Nokia Orange phone displays the telephone number of the person ringing you, although this is currently restricted to calls from other Orange users.

UK power utilities' experience with optical telecommunications cabling systems

The liberalisation of the UK telecommunications market has encouraged the development of alternative carrier networks, one result of which has been a greatly increased rate of optical cable installation on power lines. A description of UK experience to date with the three main cabling options, optical conductor, wrapped cable and self-supporting all-dielectric cable, is the main focus of this article.

Interconnection issues in UK telecommunications

The growth of competitive entry in UK telecommunications markets has imposed increasing strains on the interconnection regime. At present, OFTEL determines interconnection charges between BT and other operators on a fully allocated cost basis if they are unable to agree them. In addition, other operators are liable to make contributions to BT's deficit in providing access, unless such contributions are waived by OFTEL. The paper discusses and evaluates changes that OFTEL is proposing to introduce into the interconnection regime, and argues that the efficiency and transparency of the market would be enhanced by replacing access deficit contributions with an explicit arrangement for sharing the net costs of BT's universal service obligations.

The flagship is dropping behind the fleet

Following privatisation in 1984, BT was mainly preoccupied with customer service, operating costs and business exploitation. BT, its competitors and the industry regulators now have to address major new network issues. Their success in meeting the challenges of the new technologies will have a major impact on the future of UK telecommunications equipment manufacturers. The author takes a hard look at the facts. He argues that duplicating local telecommunications plant is a mistake and should stop; price cap regulation produces the wrong result; and an authoritative engineering agency is needed to co-ordinate technology nationally.

The flagship is dropping behind the fleet

It is ten years this year since BT was privatised, and ten years on the author takes a hard look at the facts of the UK telecommunications industry. He covers subjects which include: key issues; minority-led progress; financial realities; the US scene; broadband technologies; local distribution links; price regulation; nontechnical policy makers; and authoritative agency.

A methodology for expert systems development

Abstract There are virtually no methods or techniques available for developing expert systems in law. Further, with the exception of the UK government's Central Computer and Telecommunications Agency project, GEMINI, [1] there has been no attempt to lay the foundations for an expert systems development methodology in general. This paper discusses a number of conventional software engineering methodologies and explains why the spiral model is most suited to the development of legal expert systems. This also happens to be the same model which was advocated by the results of the GEMINI project.[2]

Competition in UK Telecommunications: Restructure BT?

In November 1990 the UK Government published its long-awaited review of the telecommunications duopoly, aimed at the introduction and stimulation of competitive pressures. This was followed by a White Paper in March 1991 which encapsulated much of the review proposals (Department of Trade and Industry, 1991). Following the decision to privatise British Telecom (BT) and license a single network competitor, Mercury, until this date, the issue of the appropriate structure of the industry had remained controversial. This was explained, in part, by two factors.

Telecommunications policy in the UK: Myths and realities

The UK government's Duopoly Policy Review is exciting much speculation about the future shape of the country's telecommunications sector. In reality there already exists not a duopoly but an oligopoly, and the licensing of other niche competitors should not come as a surprise. Widespread competition in the local loop is unlikely; however, government and industry should turn their attention to more pressing issues such as the need to develop and regulate network interconnection arrangements and to review the position of Oftel. The implications of the inevitable trend towards convergence must be faced, and the UK telecommunications industry must improve its orientation to the global marketplace.