EC comes to the aid of crisis-hit BT

Debt-laden BT has found an unlikely friend in the European Commission.

A new White Paper from Brussels sets out a range of options for relieving the heavy debt burden on Europe's struggling telecomms companies, who have already spent over £88bn on 3G mobile phone licences.

The move comes on the heels of BT's mysterious cancellation of an emergency meeting with large shareholders last week. Topics slated for discussion were BT's plans to raise extra investment from shareholders and efforts to cut the company's £30bn debt mountain.

The ritual sacrifice of chairman Sir Iain Vallance and chief executive Sir Peter Bonfield had not been ruled out.

The company's failure to stem the crisis has led to fears that it is paralysed by indecision.

BT's shares rose slightly at the news that the Commission wants EU governments to consider deferring the collection of payments for the licences, and of allowing operators to share infrastructure.

Finnish prime minister Paavo Lipponen recently suggested that the cost of UMTS licences could affect the EU's competitiveness with the US. He said Finland, the world leader in mobile phone use, wanted a study to see if "there could be reasons to try to co-ordinate policy and harmonise licensing methods at a European level".

But other countries could be reluctant to let Brussels intervene in a national issue.

Also published in Network News