British Telecommunication Plc’s partnership with Telefonica d’Espana SA, formed when Telefonica joined Concert Communications last April, may rupture on February 18th, when the Spanish operator holds a board meeting to hammer out the future shape of its international alliances. Since MCI Communications Corp left Concert to merge with Worldcom, Telefonica has been negotiating with a number of potential partners, including AT&T Corp, GTE Corp and BT. One obstacle to an ongoing relationship with BT, however, is the UK company’s direct competition with Telefonica on the Spanish market, where BT has a subsidiary, BT Telecomunicaciones, offering corporate voice and data services and a 16% stake in mobile operator Airtel. When Telefonica joined Concert, BT agreed to dilute its existing operations in Spain. Not only has BT failed to cut back its activities in Spain, there is now speculation that it will apply for a full operating license there. Any parting of ways will be eased by the fact that BT and Telefonica have not gone ahead with the 2% share swap, agreed upon when Telefonica joined Concert. The Spanish operator, which ditched the Unisource NV alliance to join Concert, will probably now seek to forge a US partnership to strengthen its Latin American network.
