NTL considers renting network to rivals

LONDON - In a radical plan that would see NTL abandon its strategy of trying to become a one-stop shop for TV, phone and internet access, the debt-ridden company is considering renting its network to rival companies.

The plan, believed to be under consideration, would see it rent chunks of its network to ISPs. The company is already thought to have held talks with Freeserve and AOL UK.



The move into the wholesale market is likely to come well before the end of the year and is expected to coincide with a heavy cut in NTL's advertising and marketing budget.



The change in strategy reflects the spending constraints the company is now under, as marketing and capital investment are all cut. Without these key investments, NTL can not afford to drive the market and promote its service to win new customers.



By renting its network to rivals, it could gain new customers without the heavy marketing costs associated with winning those new customers.



NTL managing director Stephen Carter told the Financial Times that it was definitely something that the company was looking at. "Last year, we had a short-term retail advantage that we wanted to exploit. I would not rule out our participating in the wholesale market in 2002," he said.



However, there is thought to be some resistance from the ISPs to paying upfront towards the cost of rolling out broadband access. NTL is thought to want the ISPs to pay for contributions to expanding the network, as well as wholesale charges for the use of its network.



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