Initial launch
Concert Communications Services was a $1 billion joint venture, originally launched in June 1994 by BT Group and MCI Communications. Portugal Telecom became a partner in 1997.[1]
Concert was the first multiservice global end-to-end telecommunications provider,[2][3] which broke the global national telecom monopoly on both international and in-country services. Its aim was to provide single deliverer end-to-end connectivity to multinational corporations. Its speed of global service coverage and availability was gained by leasing bandwidth from national telecoms companies, unlike competitors like FLAG or Global Crossing who physically laid cables in oceans, roads and pavements.
After the breakdown of the BT/MCI relationship, it became a joint venture between BT and AT&T in 1999. After BT and AT&T's relationship broke down in 2001, Concert's assets were split between the two parties and merged into their regional operations in 2002.
Business need for Concert
In 1992, Sir Iain Vallance's SCOOP project in BT (later called Project Sovereign [4]), objective was to rid the organisation of its Civil Service culture, and create a strategy to develop to create a global-level competitive group.[5] This needed two deliverables in the business plan:
Concert was developed to address the second deliverable — the conductor of global business. It was recognised in the strategy for Concert, that the organisation (i.e. - BT and Concert combined) could not own the world - nor would it want to, as some markets may be key to certain customers, but not to the overall strategy. Secondly, the regulation of global communications was broken down into national, regional, and global based regulators — to address them all would be highly complex, but most importantly slow rollout speed of the service. Resultantly, Concert had to be seen to be an independent organisation of its founder BT.
It was decided to locate Concert's global HQ in North America, the largest global telecommunications market. Reston, Virginia was chosen as it was both easily accessible from Europe, and sat in the then developing telecommunications and technology corridor of Northern Virginia. Concert started building its Global network in 1993;[6] unlike its competitors FLAG and COLT, who physically built their network using their own assets, Concert grew rapidly by purchasing capacity from other TelCo's.
Concert with MCI
In June 1994 BT and MCI (who had been talking to European rivals France Telecom and Deutsche Telekom about the same idea[7]), launched Concert Communications Services, a $1 billion joint venture between the two companies.[2] MCI had been in trouble for a while and needed cash - while BT needed a partner for Concert and access to the North American market: BT resultantly bought 20% of MCI to secure the deal, and inject the needed cash.[8]
Concert's aim was to build a network which would provide easy global connectivity to multinational corporations.[9] A series of Concert products were announced, which were based on Concert's global delivery platform, to fulfill its stated mission to develop a portfolio of enhanced telecommunication services targeted at multinational corporations. These services were available to purchase from both the owners, plus a series of partners who signed in to the Concert global platform around the world.[10]
Concert with AT&T
As BT now owned Concert, and still wanted access to the North American market, it needed a new partner.[5]
An AT&T/BT option had been mooted in the past, but stopped on regulatory grounds due to their individual virtual monopolies in their home markets. By 1996, this had receded to the point where a deal was possible. However, the former monopolies clashed in management and culture [22] - and the alliance never really worked from the start. Also, during the proposed MCI merger position, BT/MCI had placed a series of nominated customers inside Concert to overcome regulatory issues, leaving Concert with a sales force. On merger with AT&T, it was reversion to delivery of a series of Global products,[23] and two competing owners - which robbed Concert of revenues and left its management disillusioned.[24]
At its height, the Concert managed network directly reached more than 800 cities in 52 countries, and interlinked to about 240 other networks to extend access to 1,300 cities in 130 countries.[25]
External links
- WebbConsult.com - Telecoms history in the 1990s
- Le Monde - Towards a worldwide communications oligopoly?
- Biz Journal article on break-up of Concert
- BT Global Services BT's solutions and products were moved to BT Global Services division