BT says Yahoo! to Euro broadband

14 Feb 2003

It’s been announced that US portal Yahoo! is to join forces with BT to enter the highly competitive European broadband market.

It’s expected that the service will be launched later this year at which time the fee will be announced.

The new service, which will be called Yahoo! UK Plus, will give BT broadband customers multiple email accounts, digital photo storage, firewall and virus software security.

At the moment BT is charging approximately £28 sterling per month for its basic broadband service and it’s likely that the Yahoo! service would be priced at a premium.

Both companies said that the joint operation will be extended further down the line to include additional broadband access services and price plans.

Spokesperson for Esat BT, Una McGirr, told that this latest development would have no immediate impact on the Irish division but said that the company would be looking to exploit the opportunity in the Irish market.

McGirr added that Esat BT was hoping to leverage the deal locally as part of the company’s overall strategy to use its partnership with its parent. However, she said it would not be at the top of its priority list at the moment.

Esat BT currently has its own DSL capability and has built 40 exchanges around the country.

The company also rents infrastructure from Eircom. However, its current dissatisfaction at the wholesale price being offered by the national carrier would, according to McGirr, make utilisation of its relationship with its parent in the area of broadband provision more cost-effective for it down the line.

BT yesterday released its third-quarter results which showed that profit for the quarter before taxation, goodwill amortisation and exceptional items was £521m sterling, up 37pc on the same three months a year earlier.

The company’s turnover was £4.70bn sterling – up 1pc for the same period.

Esat BT did not release any official figures for its own third quarter. A spokesperson for the company said it was no longer obliged to but told that the quarterly results were broadly in line with official first and second quarter results. First quarter figures showed a turnover of €65.3m and a growth margin of €28.1m while the second quarter showed a turnover of €59.4m and a growth margin of €24m.

The announcement of the partnership came as the European Commission issued a statement urging all member states to do more to promote the take-up of broadband and 3G telecommunications.

Enterprise Commissioner Erkki Liikanen said that by 2005 all public administrations should be connected to broadband. And by 2005, its ultimate aim should be that half of all internet connections in Europe are broadband connections.

By Suzanne Byrne