BCE transformation moving in right direction, Yankee Group study finds

BCE Inc's proposed takeover of CTV Inc is the final piece of a puzzle that should see the telecom giant retain its place at the head of the pack, according to a new study by the Yankee Group in Canada. The last few months have seen BCE acquire Aliant Inc, purchase an equity stake in Manitoba Telecom Services, and sign an operating agreement with SaskTel. On the national front, Bell Nexxia provides the national backbone infrastructure and its Intrigna division is rolling out CLEC services in Alberta and British Columbia. "These transactions secured BCE as a communications service provider, reaching coast-to-coast in Canada—a significant accomplishment considering only a year earlier, the company was restricted to operations in Ontario and Quebec," states the report, The Changing Face of BCE. "BCE's ownership in Aliant wrapped up the East, and, with the partnership with SaskTel, the presence of Bell Nexxia, the ownership in MTS, and the subsequent creation of Intrigna, the West was won." The rash of activity at the conglomerate permits it to address four essential components: connectivity, coverage, commerce and content. The Yankee Group notes BCE is the only Canadian company that offers service in each of telephony, wireless, Internet, broadcast distribution, content and commerce. Its challenge, however, will be finding the time to effectively integrate each service sector. With so many competitors vying for the same market, the report advises BCE to act quickly. The company is also poised to move onto the international stage through its ownership of Teleglobe. Teleglobe's network connects 150 nations, it owns licences to operate in 27 countries, and it has offices in more than 50 nations. BCE is proceeding with the building of GlobeSystem, an Internet infrastructure program that will deliver an integrated voice, Internet, data and video network. The system, which will cost $6.5 billion over five years, will eventually link 160 communities through Teleglobe's facilities. This is a necessary step for a firm that is a small fish in a big pond. "Relative to the international telecom landscape, BCE is a small competitor," the report notes. "Given the pace of global telecom merger and acquisition activity, BCE could potentially be at risk for a takeover. Certainly the company has a great deal to offer, and perhaps once the ownership rules are relaxed, as companies such as AT&T Corp are hoping for, this will actually become a possibility."

BCE transformation moving in right direction, Yankee Group study finds

News | June 5, 2000

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