Atlantic Telecom drops expansion plans

Atlantic already resells BT's ADSL service nationwide, but had previously planned to offer its own product to businesses more widely.

It now plans to offer a business-focused broadband product, using SDSL (symmetric digital subscriber line) technology and its own equipment, from 20 BT exchanges in the Manchester area, although it has yet to reveal a launch date.

A spokeswoman said: "We already have a strong presence in the Manchester area, and we think it's a good niche market because there are a lot of small and medium enterprises in the area. Any other rollout will depend on how things go in the area."

Unlike many companies which have pulled out of offering broadband services, blaming BT's intransigence, Atlantic blamed the difficulty of raising funding on the current market climate.

A spokeswoman said that it is "cautiously optimistic" about the relationship with BT, but declined to comment further.

However, in a statement, Graham J Duncan, executive chairman of Atlantic, said: "At a time when markets are focusing increasingly on issues of funding and debt levels, we are in a position to provide a conservative business plan which can be executed from our existing resources."

The group's share price has taken a beating recently, falling from over 1000p per share to today's price of around 34p. In January the company announced it would cut its 1,200-strong workforce by one third.

Atlantic also announced a halt to its German DSL rollout, despite progress in Germany being further ahead than in the UK. It expects to have 550 exchanges connected by the end of the month, with the potential to connect up to one million small businesses.

The company also hopes to double its deployment in Holland, from 55 to nearly 105 exchanges, by the end of May. The firm's interests in France - a non-core market for Atlantic - will be sold.