BT, MCI tightlipped over concert global comms marketing

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LONDON -- British Telecommunication's $22bn acquisition of U.S. long distance carrier MCI Communications will have no immediate effect on the marketing structures or agency rosters of the telecoms marketers within their home markets. Although both brand names will be continued within their respective markets, BT and MCI will present a new face internationally called Concert Global Communications PLC.

Company officials say it's too early to say how marketing for the global brand will be handled. Although a 15-man management team made up of BT and MCI executives has been announced, a person in charge of marketing has not been named, according to a BT spokesperson. BT is the bigger partner in the merger, but MCI has a reputation for agile, innovative marketing and could be the source of an executive to lead the combined group's marketing efforts. Concert will be headquartered in London and Washington, D.C., but the main office will be in London.

BT says its main roster agencies in London are Abbott Mead Vickers BBDO and Butterfield Day Devito Hockney. The main ad agency for MCI, the second largest telecoms company in the U.S. and the world's third largest international carrier, is New York-based Messner Vetere Berger McNamee Schmetterer/Euro RSCG.

BT first acquired a 20% stake in MCI in 1993 for $4.3bn. A year later they launched the joint venture Concert Communications Services, which provides seamless voice, data and network communications to multinational companies. It already has $15bn worth of contracts with 3,000 multinational customers.

Currently Concert Communications Services handles product development and leaves marketing to its parents. "But that could change down the road,'' says Kerry Morgan, senior manager for corporate communications at Concert Communications Services in the U.S.. MCI oversees Concert Communications Services in the Americas, while BT is in charge of the rest of the world. AMV/BBDO handles Concert Communications Services for BT, according to Morgan.

With annual revenues of $42bn, Concert Global Communications will be the world's fourth largest telecoms company by sales, behind Japan's NTT, AT&T and Deutsche Telekom. It's three larger competitors, however, derive the majority of their revenues from their home markets. Concert Global Communications is a leader of international business with 43 million customers in 30 countries.

Concert is competing with two other major international alliances called Global One and Uniworld in a bid to create the world's first global communications company. One of their main battlegrounds is an emerging technology called asynchronous transfer mode, or ATM, which allows a single network to carry voice, video and data signals across the globe. While some corporate customers already use ATM domestically, the new global telecom alliances hope to link the voice, video and data services globally for corporate customers. There are predictions that ATM signals could account for a third of the telecom industry's revenues within 15 years.

Global One is an alliance of U.S. carrier Sprint and Europe's two largest state-owned carriers: France Telecom and Deutsche Telekom. In October Global One broke a $10m global ad campaign to promote itself to multinational businesses. The TV and print campaign, created by Grey Advertising New York, is running 14 countries, with a focus on Europe and Asia.

AT&T is partner with the European Unisource in the joint venture Uniworld. In 1994 AT&T formed with Unisource (a joint venture between Dutch, Swedish, Spanish and Swiss telephone companies) an alliance to provide voice and data services to multinational corporations. In 1995 they adopted the brand Uniworld, and handed the pan-European advertising account to McCann-Erickson, which also handles AT&T's advertising across Europe.

Despite Uniworld's early lead in this market, it has been hit by a number of setbacks, including the departure of the chairmen of AT&T and Unisource who set up the deal in 1994. In fact, Viesters Vucins left Unisource to head Global One.

Copyright November 1996, Crain Communications Inc.

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