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November 26, 1987

TELECOM REPORTS ON SLOW CONNECTION, STORM DAMAGE, DIRECTORIES, PAY PHONES

By CBR Staff Writer

British Telecommunications Plc has denied that it is being deliberately slow in connecting the Mercury Communications network to its own. Group managing director Graeme Odgers said yesterday that the delays were caused by a tremendous demand for new lines from all customers, not just Mercury. Odgers made his remarks at Telecom’s interim results briefing yesterday in response to a question about Mercury boss Gordon Owen’s allegations of poor service. Owen claimed on Tuesday that delays of six months were common and that in one case Telecom had said it would take two years to arrange a connection (CI No 819). Several cases are now before the Pomeroy Commission, a body set up by the Office of Telecommunications to arbitrate in disputes between Telecom and Mercury. According to Odgers, the demand for new lines is particularly strong in the South of England. The City of London alone is waiting for 25,000 lines to be connected. This, though, is an improvement on the 35,000 figure immediately after the engineers’ strike earlier this year. By next March, Odgers hopes the waiting time for lines can be reduced to four weeks. The delays were exacerbated by the October 16 storms. 200,000 customers cut off At one point, over 200,000 customers were cut off as a result of the bad weather. The total is now 9,000, although fewer than 1,000 of these are people cut off on Day One of the storms. The cost of the damage has been estimated at between UKP30m and UKP40m with Telecom having to find UKP10m. The rest is covered by insurance. The UKP10m will fall into the second half. In the period to September 30, the company produced pre tax profits up 11% at UKP1,120m on turnover up 7.4% at UKP4,954m. Rental income was up 8.9% to UKP1,643m while phone call income was ahead by 8.5% at UKP2,630m. The number of business and residential lines increased by 6.7% and 2.8% respectively. Staff are being rewarded for the improved performance by the restoration of the discretionary profit sharing scheme. UKP15m has been set aside in the first half with a further amount likely to be allocated next June to cover the second half. There was no such allocation last year – management was not in the mood to pay bonuses to striking members of the Union of Communications Workers. The growth in demand for Telecom services extends to directory enquiries. The service is receiving over 1.6m calls daily – a rise of 150,000 on this time last year. Odgers says this is almost entirely due to certain firms hiring unemployed ex-actors to make tens of thousands of enquiries each month. He added that Telecom is seriously considering introducing call charges to cover the annual UKP150m cost of the service. Any money raised in this way will almost certainly result in a decrease in standing charges. Odgers statement is certain to lead to another lively public debate on the company’s service. Another area of controversy, payphones, seems to be getting better. Telecom says nearly 90% are in working order at any one time, a substantial improvement on earlier this year when Oftel found only 77% were in service. The ‘999 only’ display is being replaced by a ‘no cash calls’ message. Users finding the new message will not have to pay connection fees to make reverse charge calls. The cost of such local calls will be 20 pence for each three minutes.

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