BT Warns of New Technology

date: September 13, 2001

British Telecommunications is expected to make a stark warning over the financial risks of 3G mobile phone technology when it demerges its mobile division later this year, the Financial Times reported on Thursday.

A draft copy of the listing particulars for "mmO2," the new name for the mobile division, reveals that BT can't guarantee the technology will improve existing services, the FT reported.

The document also warns that the existing 2G network of radio masts is unlikely to be sufficient for 3G technology, while the construction of new masts could be hampered by tougher planning restrictions.

The BT document warns that UMTS, the 3G standard used across Europe, may not prove superior to existing technologies. It points out that much essential development work remains to be completed. "The technology for the new UMTS services is not yet fully developed by the suppliers of the handsets and software," the document says.

This risk could be compounded by a shortage of available equipment. "We expect to roll out our UMTS network at the same time as many of our competitors," adds the draft. "This, combined with the limited number of suppliers of UMTS network equipment, may extend the delivery times of such equipment, which may mean we can't provide sufficient network capacity."

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