C&W to neuter Bulldog; transform business to wholesale broadband provider

8 Jun 2006

Cable & Wireless has announced plans to transform its UK broadband business Bulldog Communications into a wholesale service provider, and says it will stop acquiring new residential and small business retail customers from 1 July. The company says it will continue to provide services to existing retail customers. As a result of the move, Bulldog will reduce its headcount by approximately 150, mainly from the sales and marketing departments. C&W says the company’s local loop unbundling (LLU) plan will remain unchanged and it is on target to fully unbundle 800 exchanges by the end of September; it had unbundled 411 exchanges by the end of March.

C&W acquired Bulldog in May 2004 and embarked on an aggressive broadband marketing plan using LLU to connect consumers to the internet. C&W had hoped Bulldog would challenge UK incumbent BT with triple-play services and targeted revenues of more than GBP250 million by 2008. However, Bulldog endured a rotten 2005 during which subscriber growth failed to reach projections and the company was hauled up in front of regulator Ofcom after receiving a record number of complaints for its quality of service, as well as for its marketing and customer service. In November 2005 Ofcom closed its investigation after the ISP made assurances on its future conduct and agreed to provide the regulator with regular updates on its business. The following month Bulldog set up a new business division to target SME and SoHo users for the first time, but it has failed to make inroads in an increasingly competitive market and it had just 118,000 retail subscribers at the end of March, giving it an estimated market share of less than 2%. It has long been rumoured that C&W would look to sell the business or shut it down altogether.

United Kingdom, Cable & Wireless (UK)