Things are beginning to look up for dear old BT. The company recently announced good end-of-year figures and a tie-up with Vodafone to converge fixed and mobile services. The convergence project requires a considerable investment and these latest financial results show that BT can afford it.

So what does BT mean by converged services? The basic idea is that a user should have one phone, one phone number and one bill, whether at home or on the road.

This is achieved by using a handset that can act as both a mobile and a standard cordless phone. Users will also want a single voicemail service and a single method of diverting calls.

Implementation of these features will require a much more intimate relationship between the fixed and mobile networks and considerable extra intelligence to be distributed between the two networks.

True convergence would allow seamless roaming between fixed and mobile networks, so that a phone call started at your desk could transfer to the mobile network. This would be harder to implement.

BT has set up a collaborative venture, codenamed Bluephone, with a seven-member consortium led by Alcatel and including Motorola and Ericsson. They will develop a complete system, including network infrastructure, management systems and mobile terminals. Initially, the cordless technology will be based on Bluetooth.

One member of the consortium is Norwood Systems, a UK firm that specialises in Bluetooth mobility. BT has been testing Norwood's mechanisms since July last year and results have been promising .

The Bluetooth aspect of Project Bluephone should make it possible to do neat things such as using your PDA to manage calls, update phone books and control voicemail.

About one in five households have no fixed line and rely on mobile phones even though the tariffs are much higher. This suggests that users want the convenience and simplicity of just one phone and one number. Most homes have only a single fixed-line number, so converged systems will have to take account of this.

Corporates can achieve some of the benefits of convergence through diversion mechanisms, but many other features, including the use of a single roaming phone, require the collaboration of the mobile operator. The full benefits of convergence must therefore wait for services such as Bluephone and will require the corporate PBX to be more intelligent and to have a closer association with the public networks.

Converged services should benefit both home and business customers. We will look back and think that it was quaint to have separate fixed and mobile numbers.