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May 4, 1988

SOUTHWESTERN BELL CHOOSES UK TO LAUNCH ASSAULT ON THE EUROPEAN PHONE MARKET

By CBR Staff Writer

The UK arm of Southwestern Bell Corp, Southwestern Bell Telecom UK, is preparing an assault on the European telephone equipment market, with 14 products is lined up for launch this year. Activity will be restricted to the UK for the first year, says John King, sales and marketing director at the UK subsidiary, but he confirms that his brief is to develop a European operation over time. He refuses to disclose specific business targets but says that the operation will be a multi-million dollar business in Year One: As a subsidiary of the US Fortune 24 company, there is no point in being a minority player he says. He launched a private premises pay-phone last week in anticipation of an Oftel announcement on deregulation, and this follows last month’s launch of the FC7 basic telephone (CI No 903). A further 12 products addressing the basic, feature and cordless telephone markets are in the pipeline for summer launch. But Southwestern faces no mean task in wresting market share from the likes of British Telecom and GEC or competing with the new, aggressive arrivals to the liberalised market like Norton. But King reckons that most of the players in this market would find it impossible to launch 14 products in one year and also says that this frenzy of activity is a sign of the company’s faith in the UK market. I think that the market has gone through the first phase of maturing and will now benefit from the injection of brand offerings. Most of Southwestern’s products will be anglicised versions of equipment sold in the US by the parent, though a few, such as the pay-phone, were designed specifically for the UK. More innovative Its efforts in the cordless phone arena will concentrate on catering to the domestic customer’s requirements for the time being. Despite the headway being made in the CT2 standard for mobile cordless technology, King suspects that The mass market will confine its spending to around the UKP100 mark and doubts whether anyone is ready to launch a CT2 service. Meanwhile the new domestic cordless standard TG47 became available last year and King hopes that his company will be among the first to offer a product that conforms. Year Two of business for the fledgling company will see the release of further products, this time of a more innovative nature. For example, the parent company has just launched a voice-activated telephone, an item sufficently novel to merit a few seconds’ airspace on the Good Morning America TV show. King describes future application scenarios such as asking the phone to make a call to the bank, possibly playing a pre recorded message. More important for the UK arm is the pool of resources and technical innovation at its disposal, he says. The full potential of the company’s telephone range will only be realised when British Telecom has completed the digitalisation of its exchanges, King concedes. Sets are equipped with pulse tone switching which can take advantage of Centrex-type features when they arrive. Telecom does offer the Star Services option, which enables the customer to redirect or block calls on the local exchange, but this is limited to a few London exchanges at present, and Telecom has not given any dates for wider availability. But he promises users of the Southwestern product that it will not be obsoleted when Star Services expands.

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