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BT to drop charges for local calls

LONDON: British Telecommunications Plc plans to offer unlimited free local phone calls within the next year for a small monthly flat fee, the Sunday Express reported.

The newspaper said BT hoped to recover lost revenue from the initiative by attracting more Internet users.

The move -- which would have to be authorised by the industry regulator, Oftel -- follows calls from British Chancellor of the Exchequer Gordon Brown for Internet access costs to be slashed.

Brown said last week he wanted to see the cost of Internet access in Britain slashed to U.S. levels within three years in a bid to ensure British leadership in the "knowledge economy".

Brown also said Oftel was considering shortening its deadline for BT to open up its so-called "local loop" -- cables linking local exchanges to houses and offices -- to competition.

The remarks sent BT shares into free fall and BT said there would be no change to the July 1, 2001 deadline already agreed.

BT is set to face ferocious competition, kicking off next month when it starts offering competitors high-speed connections to its exchanges under technology known as Asymmetric Digital Subscriber Line (ADSL).

In a separate report, the Sunday Times said a shake-up of BT's management to reshape the group to fend off greater competition could see its UK managing director Bill Cockburn moving to a new job or leaving the company.

The newspaper said the reorganisation would create a flatter management structure and pave the way for parts of the company to be spun off.-Reuters