LONDON — British Telecom will launch an e-shopping channel in September as part of its BTopenworld global Internet business. It has appointed Budd Margolis, an American, to head the operation.
Margolis will oversee interactive retail business on BTopenworld's Internet and interactive platforms, which are part of a massive corporate restructuring undertaken earlier this year.
It divided BTopenworld into four operating groups that include conventional telephony and the yellow pages, a business worth some 600 million pounds a year (about $900 million USD) and slated for an IPO this fall.
BTopenworld brings together BT's varied global Internet interests which comprise Internet service providers; portals, including a 50 percent stake in Excite; Genie, a portal for phones; a stake in Open TV; and Talk21, a free e-mail service.
The system uses Asymmetric Digital Subscriber Line technology that transforms existing copper phone wires into a high-speed digital line. It will offer e-commerce services across broadband, wireless and narrowband platforms.
According to BT, Margolis “will drive the creation of the best interactive shopping experience and establish relationships with leading retailers and suppliers.”
He has been in the United Kingdom for the better part of a decade, first helping to establish US shopping channel QVC and ending up as executive producer. He also has been a consultant in launching home-shopping channels worldwide.
His last job was director of global marketing at BestofChina.com, a leading business-to-business portal for the Chinese market. He also helped establish the first m-commerce-enabled wireless portal for China with IBM and Motorola.
He sees the narrowband shopping site as a first step to a much wider array of goods and services BT will be able to offer once broadband has been established and is up and running, perhaps within a year.
“On broadband we can deliver two megabytes a second and that means full-frame active video streaming and presentations on demand,” he said. “If you wanted information on buying a camera we'll give you a 10-minute overview.
“We'll offer videoconferencing and have a personal sales assistant who can talk a customer through the whole order.” Nor will that order be limited to conventional consumer goods the site plans to offer initially.
“BT has a lot of things in its own grasp,” Margolis said. “It has the largest fleet of cars and commercial vehicles in Europe, so we could start selling cars on broadband almost at once.”
BT, he said, is the third most trusted brand in the UK, right after drug chain Boots, and Tesco, a supermarket chain.
For the September launch Margolis is signing merchants who sell everything from white goods to music, computers and books. But he promised to be very selective about those he picks.
“We want to get fewer of them but pick those who have better products and allow better choices,” he said. “The problem with the Internet is too many choices.”
Interest in the broadband version of the site is keen, Margolis said, with 100,000 preregistered customers for the service. He expects several hundred thousand customers in “a couple of years.”
Subscribers, he said, should save a hefty amount of money from paying a 40 pound ($60 USD) charge compared to what they are now paying in telephone fees, even if they have free access.
Also, Margolis argued that free access doesn't provide high-quality service. “Most people who use free services have four or five accounts,” he said. “If one doesn't work they flip over to another.”
But Margolis conceded that broadband installation will take time to manufacture enough modems and time to put them into place.
Meanwhile, BT is launching a $30 million to $40 million public relations and advertising blitz to promote openworld services overall. Shopping will be a part but not the focus. That will come in the “second wave,” he said.
“We have to burn the name into people's minds and make them aware that openworld exists.”