Rivals Fancy C&W's Castoffs

Cable and Wireless plc (NYSE: CWP)'s decision to dump 27,000 business customers might have left investors and analysts a bit cold, but it raised eyebrows and excitement levels at some of the U.K.'s other service providers. (See C&W Stuns With Job & Customer Cuts.)

Take Phil Male, chief operating officer at THUS plc (London: THUS), who didn't miss his chance to have a dig at a rival. "At THUS we value all our customers," says Male in an email to Light Reading, adding: "We welcome the new market opportunities that yesterday's announcement by C&W present as it provides us with an ideal opportunity to expand our customer base even further...

"Our focus on business customer growth remains integral to our strategy as we believe this is the best way to deliver value for our company. The acquisitions we have recently embarked upon support this strategy and will enable us to secure more business with more customers." (See THUS Gets Your Communications.)

Other players, such as Colt Technology Services Group Ltd , Global Crossing (Nasdaq: GLBC), and Verizon Enterprise Solutions (formerly MCI), declined to comment on C&W's disconnection strategy, but one industry veteran, who requested anonymity, said there would be a mass scramble among those with small and medium-sized business (SMB) strategies to identify and cherry-pick the most lucrative of C&W's leftovers. (See Viatel Lures SMBs to VOIP .)

And Camille Mendler, head of the European telecom analyst team at Yankee Group Research Inc. , reckons they'll pick up some decent business.

"When you look at the demographics of the U.K. business telecom service market, I can understand why C&W has made this decision," she says, "but in my view, it's the mid-sized business customers, the ones that C&W is letting go, that will deliver value to service providers in the long term." Mendler adds that it's the diversity that thousands of mid-sized business bring to a carrier's business customer base that provides the liquidity needed to develop and sustain the business, "and I'm not sure the rump C&W will be left with will be able to provide that liquidity."

— Ray Le Maistre, International News Editor, Light Reading