Sunday, May 01, 2005

Buy British, It's Your Obligation

I'm simply stunned by the press this weekend on the Marconi/BT [no]deal. Understandably, the Marconi team are pretty upset that they didn't win a share of the £10 billion BT buying bonanza. It seems to me, though, that they've broken rule 1 of the book on "what to do when you don't get your own way". It says "Deep breath, engage brain, don't say a word." Instead, they've gone for the "It's disgusting .... how can BT not buy from a British company ... These other companies are getting subsidies." All otherwise known as "It's not fair." A senior Marconi source, according to the Independent, said:
"We would hope they would have a word with BT and assist us to get back in there," the source said. "In other European countries, this wouldn't happen. They always favour the local vendor."
I heard similar stuff on TV last month about Rover. Someone on the box, a Rover employee I seem to remember, claimed that it was all the fault of the British public who, unlike the French and the Germans, weren't willing to buy domestic. Another employee's wife professed disgust at the way they were being treated noting, to my astonishment, that the British public "were perfectly willing to send money to the tsunami disaster folks" but unwilling to buy British cars with the money they have left, presumably. I can see the conversation in BT a few days ago. It would have been between a few senior execs and it would have gone along the lines of "Bugger ... we didn't select Marconi? Are you sure? It could put them out of business! Think of the flak we'll get. Go and make sure we did the sums right. See if there's anything we can do. Was it close? Could we give them something? Make sure we've got a good audit trail; a lot of people will want to look at this one." Someone - Paul Reynolds I guess - then drew the short straw over who had to call Marconi. And, in return, he's got a torrent of vitriol, most of it in the press. I suspect the conversation on the phone was more subdued - more like "Oh shit. Are you sure? Ok. That's pretty bad. Is there anything we can do to recover this? No? Ok? Thanks for taking the time to tell me". BT say
"We picked suppliers on the basis of technological, operational and commercial considerations. On this occasion, Marconi did not meet the commercial specifications. At other times it has."
It's a tough market and there are a lot of players who want in to the IP network business. The big companies - Cisco, Alcatel etc - have deep pockets and, naturally, can price more keenly at this stage. Maybe they bid low, looking for a reference, maybe they just have better kit and enough offshore manufacturing to make it much cheaper. BT don't have to publish their full criteria for evaluation, but it might serve them well if they did - so that Marconi know exactly what happened and the rest of us too. But Marconi will get a debrief and then they'll know. Want to bet that it all goes quiet then? I'm sorry for the Marconi folks who may lose their jobs; I can't imagine what it must be like to be in that position. The bigwigs should be hunkering down now, thinking through the options, analysing what went wrong and trying to figure out how to move forward. Slugging it out with BT in the press won't make BT suddenly roll over and say, "oh sorry, we meant to give you the deal in the first place, we were just seeing if you'd lower your price if we said no deal." Buy British. It's your obligation. Even if the cars / comms equipment / televisions / snowglobes are more expensive, not as good and not as reliable. Right now I'm just buying British strawberries. They seem fine.

3 comments:

  1. RichardB11:46 am

    My concern with this is where is the technology actually being made? Given that the 21st Century Network is replacing much of the core infrastructure of the UK and given the scale of hostile network attacks occuring, who is watching out for the National critical Infrastructure? The UK needs this kind of capability ( more than we need Trident ) and if the decision of BT does 'can' Marconi who is left?

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  2. I can see a benefit for a technical infrastructure that is EU skewed to keep an IP independence from the US for defence reasons.

    During the Falklands War France ultimately yielded information to enable a UK defence against their Entendard. Yet Boeing seem unable to sell us Chinooks that can fly at all when the sun don't shine in peacetime.

    Should we be equally relaxed about the geographic supply of GPS, IFF, crypto-keys, 21CN... infrastructure or yield them off the EU shore?

    Military interests are exercised parochially and of course politically. I don't imagine the US are so liberal about offshore purchases for their core systems.

    BT who?

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  3. Anonymous12:26 am

    It's shameful that whilst other G8 countries have protected a major company in each major sector of business and industry, successive UK governments have allowed the wholesale collapse and sell-offs of once dominant industry leaders.
    We will soon be an economy dominated by a few massive companies in a few limited sectors; go to the shelves of your supermarket and find out how many of those products you thought might be British are actually owned by US companies. You can barely by a car from a British owned company. Huge swathes of industry are being sold off - why didn't RMC, Aggregate Industries, Blue Circle, Hanson consolidate into one company like the French would have 'encouraged' them to do (one example out of *many*)? Instead, 3 have been bought out and Hanson (like BPB plc) is now a target - for a huge French company!
    Why does it matter? Because over-dependence on a few industry segments means that if anything goes wrong with global economics as it is, the UK economy gets a severe hammering, with no chance of getting a foothold back into the traditional industries which actually make things to sell.
    We're always being told how marvellously UK plc is doing - well, it's only doing marvellously for UK plc's shareholders (many of whom are of course foreign investors), and the industries themselves, along with the people on the street, are in peril.
    MG Rover should have been supported by the British public, and it wasn't because the British public is only able to express its patriotism by screaming childishly at its football teams. You wouldn't find the people of most other nations doing the same ...

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