Pair upbeat at Concert end

By PETER GRIFFIN

The long-awaited demise of Concert - the global joint-venture between British Telecom and AT&T - is not expected to affect Concert's New Zealand partners Telecom and Clear, the telecommunication companies said yesterday.

British Telecom confirmed this week that it was winding up Concert, a telecoms network catering to multinational companies and spanning 55 countries - at a cost of up to 2300 jobs and billions of dollars in restructuring costs.

Concert will now be split between BT and AT&T, with the two companies taking back roughly what they brought to the venture when it was launched in 1998 expecting annual revenues of $US10 billion ($22.8 billion).

BT will take control of managed network infrastructure in Europe, the Middle East, Africa and the Americas with AT&T taking responsibility for the Asia Pacific region, acquiring frame relay assets contributed by BT.

As a local distributor of Concert's frame relay and network services to a "small number" of locally based companies, BT-owned Clear said the change would have "zero impact on Clear's customers, revenues or costs".

The same message of "business as usual" came from Telecom, which last year struck a deal to distribute Concert's data and internet services to business customers in New Zealand - and in Australia through its wholly owned subsidiary AAPT.

Telecom spokesman Andrew Bristol said the company was talking to Concert about the transition to AT&T but Telecom customers would not be affected.

Citing a radically different telecoms environment to when Concert began, BT's chief executive, Sir Peter Bonfield, said ending the cash-hungry venture would give BT "a better way forward than the status quo".

But extracting themselves from the ill-fated Concert venture will be expensive. BT will write down the value of Concert by £1.2 billion ($4 billion) - including a £300 million write-off of BT's share of Concert's goodwill, and an £825 million write-down of fixed assets.

The elimination of BT's 9 per cent stake in AT&T Canada will account for £350 million and BT will take an additional charge of £200 million to cover redundancies.

AT&T, meanwhile, will take a charge against third-quarter earnings of $US3.5 billion related to Concert and taking over BT's interest in AT&T Canada.

In addition, the company will take a charge in the same quarter of $US1.8 billion related to its existing commitments to AT&T Canada.