BT 2005 Annual Report Download - page 11

UK operations. The value of these services, including
existing business, is expected to be in excess of £500
million over the seven-year term.
&A number of contract wins during the 2005 financial
year helped to confirm BT’s European credentials and
capability. For example, we signed an outsourcing
contract with French company THALES Group, an
international electronics and systems group serving the
defence, aeronautics, security and services markets.
The five-year contract covers the management of
fixed-voice and data network services for THALES and
its subsidiaries in up to 42 countries.
&We signed a multi-year managed services agreement
with Bristol-Myers Squibb to manage its LAN and WAN
infrastructure globally. As part of the agreement, BT
will migrate these services to a state-of-the-art, high-
speed, IP-based global MPLS (multi-protocol label
switching) infrastructure.
&We were awarded a global network outsourcing
contract with South Korea-based CyberLogitec, the IT
subsidiary of Hanjin Shipping. With a sales order value
of £18 million, this is one of the largest contracts won
by BT in the Asia Pacific region.
&National Air Traffic Service awarded us a £32 million
contract to provide a system to carry all
communications between its radar, communication
and air traffic control centre sites and its IT network.
&In addition to the range of large deals, we secured
more than 300 networked IT services contracts each
worth between £1 million and £5 million during the
2005 financial year.
&In April 2005, we won an extension to 2012 of a
contract to deliver essential telecommunications
services to the Ministry of Defence (MoD) and the UK’s
armed forces. Between April 2005 and July 2012, the
Defence Fixed Telecommunications Systems public/
private partnership contract between the MoD and BT
will be worth up to £1.5 billion, bringing the total value
of the contract to more than £2.7 billion.
&We underlined our position as a global networked IT
services company with the launch of a major
business-to-business advertising and marketing
campaign in September 2004. The campaign ran in
multiple languages in international and local media
across Europe, the Americas and the Asia Pacific
region.
Networked IT services for wholesale customers
We believe that the convergence of IT and
communications technologies creates commercial
opportunities for communications providers, and our
strategy is to enable these providers to take full
advantage of such opportunities.
We have a long and successful tradition of delivering
network-based connectivity to the carrier and
intermediate telecommunications markets throughout the
UK, and have developed value-enhancing services and
solutions. We have a number of agreements with service
providers and mobile operators to upgrade their IP
capability. In addition, we have used our expertise and
geographic reach to provide ubiquitous, bespoke data
housing solutions.
Our plans for our twenty-first century network (21CN)
will enable the delivery of further integrated network and
communications solutions to our customers and their
end-user customers.
Deliver on broadband
In the 2005 financial year, we continued our drive to
enhance the awareness, availability and attractiveness of
broadband and we are on target to bring broadband to
exchanges serving 99.6% of UK homes and businesses by
the summer of 2005. The UK now has the most extensive
broadband network of all the countries in the G7 Group,
according to telecommunications analyst Ovum.
We believe that the key issues in today’s broadband
markets are speed and price, but that, going forward,
applications will increasingly prove to be a competitive
differentiator.
Broadband for wholesale customers
In early April 2005, we reached our target of five million
broadband lines, one year ahead of schedule. Since we
first announced the target, take-up has continued to
accelerate – whereas it took a year to reach our first
million, the fifth million took just four months. Since
September 2004, we have been connecting someone to
broadband every ten seconds of every day. In total, 4,419
exchanges had been upgraded by the end of the 2005
financial year, reaching almost 97% of the UK’s homes
and businesses. Broadband is now one of the fastest
growing consumer products of all time.
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
2003 2004 2005
277
391
555
800
1,058
1,339
1,753
2,215
2,687
3,294
4,107
4,932
BT Wholesale DSL broadband connections (thousands)
&In February 2005, Northern Ireland became the first
UK region outside London to have all its exchanges
enabled for broadband. As at 1 March 2005 – as a
result of a £10 million partnership between BT and
One Northeast, the regional development agency for
northeast England – all 181 exchanges in the region
had been upgraded. In April 2005, we won the £16.5
million public tender with the Scottish Executive to
bring broadband to the most remote communities in
the UK. We will enable 378 exchanges to deliver
broadband to 51,000 households and 5,400
businesses.
&During the 2005 financial year, we removed the
distance-related limits on our most popular broadband
services, bringing around one million more UK homes
and businesses within reach of broadband.
&As the broadband market has matured, new
applications, including video and music downloads and
videoconferencing, have driven a demand for
increasing speed. Since April 2005, we have been
testing speeds of between 2Mbit/s and 8Mbit/s with a
10 BT Group plc Annual Report and Form 20-F 2005 Operating and financial review