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BT Lines Up VOD Launch

BT Group plc (NYSE: BT; London: BTA) is trialing video on demand (VOD) services over existing DSL lines with a view to launching commercial services late this year or early in 2006, according to the new CEO of its Retail business, Ian Livingston (see BT Names New Retail CEO).

Talking at today's quarterly results presentation, Livingston said the carrier is currently testing various systems and working on a video services proposition, "and I am trialing the service in my home [over a 2-Mbit/s connection] so I know it works." (See BT Reports Q3 Results and BT Puts IPTV to the Test.)

The former BT CFO, just four days into his new job as Retail's CEO, stressed that broadcast TV services would not be part of BT's offering. "The U.K. is different from other European markets such as France and Italy because of the strength of existing TV service providers," he said, responding to questions about whether BT would offer services similar to those offered by triple-play carriers on the continent (see Neuf: Time Is Right for IPTV, Italians & Triple Play: It's Amore, and Iliad Ramps Up Broadband to the Homer).

He said he couldn't see a demand from the public for another way to get the same channels already available over the air, via cable, and via satellite. "We are starting with what the customer might want, not with what the technology we have can deliver. I know that's not the traditional telco approach," he added sardonically.

BT Group CEO Ben Verwaayen added that to offer broadcast TV over DSL "would be duplication, not innovation. There is all sorts of exciting stuff we can do, and we need to differentiate, not provide what is already widely available."

Livingston also said that there was a lot that could be done with 2 Mbit/s, announced today as the new standard bandwidth connection rate following an upgrade to BT's incumbent DSLAMs (see BT Ups Retail Broadband Speeds). But he noted that later in the year BT will be testing more bandwidth-hungry services, such as "multi-computer entertainment," over 8-Mbit/s connections and higher, made possible by ADSL2+ technology currently being installed and tested (see BT Plans Faster xDSL).

Two of BT's main rivals in the retail voice, broadband, and entertainment markets, the U.K. cable firms NTL Group Ltd. (Nasdaq Europe: NTLI) and Telewest Communications Networks plc (Nasdaq: TWSTY), recently launched their first commercial VOD services (see Brits Do VOD With SeaChange and Telewest Sources PVR Gear).

— Ray Le Maistre, International News Editor, Light Reading

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