British Telecom (BT) Group Plc, one of the world's largest telecoms operators, expects its annual revenues from China to hit US$250 million within three years, a company executive said yesterday.

Ben Verwaayen, chief executive officer of the BT behemoth, said that BT will "generate a quarter of a billion US dollars from China" within three years. BT now generates annual direct revenue in tens of millions of US dollars from China.

The group is optimistic about the Chinese market as demand for telecoms and IT (information technology) services are surging in the country.

BT's business in China mainly focuses on serving business users, especially multinationals' Chinese operations which need globally networked services such as VPN (virtual private network).

For instance, "if Shanghai wants to become a truly global financial center, such as New York, London or Frankfurt, they (banks and financial institutions) need a flexible and reliable network," said Verwaayen.

And an increasing number of multinationals are expanding their offices in China, which could boost demand for the telecoms services BT can provide.

BT has partnered with China Netcom, one of the top four Chinese telecoms operators, to provide MPLS, an important technology for fixed and mobile services on a converged network.

Verwaayen revealed BT is planning to double its investment in China in the future, but declined to give details. In 2005, BT invested more than US$48 million in rebuilding its networks in Asia-Pacific as part of its global next generation network which could cost US$20 billion.

BT entered the Chinese market in 1995 and has established three offices in Beijing and Shanghai, employing about 40 people.

China's telecom market has long been a tough nut for overseas operators to crack. In 2000, US operator AT&T launched Shanghai Symphony Telecom, a joint venture with Shanghai Telecom and Shanghai Information Investment.

The performance of Symphony, now called Unisiti, has been largely disappointing. Company executives have blamed it on regulatory limitations in its business scope.

Verwaayen said he is seeing "very positive development" in China's telecoms market after the country's accession to the World Trade Organization.

In the past few years, leading overseas operators Vodafone and Telefonica have bought stakes in Hong Kong-listed China Mobile and China Netcom respectively. In June, South Korea's SK Telecom (SKT) signed a deal with China Unicom under which Unicom will issue US$1 billion in convertible bonds to SKT.

China Telecom is now the only telecoms operator which has yet to partner with a foreign operator. Chairman Wang Xiaochu late last month said the firm was in talks with five potential foreign investors. Verwaayen would not confirm whether BT is one of the potential investors.

(China Daily September 7, 2006)