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RealTime IT News

Forget J.R. Hartley, 'Yellow Pages' Is Now Fishing for Online Success

British Telecom's (BT) online 'Yellow Pages' business directory is to be floated later this year under the name of 'Yell,' paving the way for the unit to be developed as an e-commerce marketplace for small and medium sized enterprises.

The announcement follows Thursday's revelation by BT that it is embarking on its biggest restructuring since privatisation, with the former phone monopoly splitting itself into separate divisions and focusing on four key growth areas.

In addition to Yell, the new divisions consist of 'Ignite,' a corporate data business; a mass-market Internet business, 'Btopenworld;' and 'BT Wireless' - which will include mobile network Cellnet.

Traditional voice services in the U.K. will also see a shake-up as BT creates a single division to manage its retail relationships with customers, and another to handle the network and wholesale contracts with other telcos and ISPs.

BT's so-called 'New Wave' restructuring follows recent criticism by both the government and Oftel that it is reacting too slowly to change, particularly with regard to the Internet. The criticisms have also helped wipe billions off BT's share price.

But now Yell will be in the vanguard of change, transforming the old Yellow Pages business into an international online directory and e-commerce portal.

The division is expected to make an operating profit of about £160 million ($244.8 million) this year and, once floated, could be valued as much as £6 billion ($9.1 billion).

The move comes as web-based directories are forging an increasingly valuable niche in the online marketplace, adding to their services such things as local maps, weather reports and cinema listings.

As the Internet grows, so will the demand for online directories experts believe. But Yellow Pages cannot rest on its laurels. Rival service Scoot.com - rebranded from the old 'Freepages' directory in 1997 - has impressed the City greatly in recent months, with its shares soaring more than 660 per cent.

Others, such as 'Ask Jeeves,' have also stolen a march over BT.

Meanwhile it has just been announced that Scoot has struck an alliance with IBM under which the U.S. computer giant will provide technology and services to help the service expand more swiftly in Europe.

Just three months ago French media and utilities group Vivendi similarly pledged support to Scoot, investing £100 million ($153 million) in the online directory company.



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