Marconi's failure to be included on the eight-strong supplier roster for BT's £10bn 21st Century Network (21CN) project (click here) has sent the company's share price into nose dive - down around 40% at one point and still looking decidedly squishy. It has also sparked a wave of media speculation that the company is either about to shut up shop or be taken over. "This is a disappointing outcome from a very competitive tender process", said Marconi ceo Mike Parton. "Our products performed extremely well technically, but we have been unable to meet BT's commercial requirements".

Marconi is estimated to take around a quarter of its business from the UK incumbent and non-participation in the 21CN, together with the winding down of existing supply contracts, looks likely to mean major job losses. The company said it would continue to supply equipment and services to BT under the various, multi-year frame contracts it has in place.

Interestingly one of the successful 21CN participants is Marconi's new best friend, China's Huawei Technologies Co. Ltd. At the end of January the two announced a partnership that would see each company sell certain products from the other's product portfolio into their respective customers. The two companies also discussed how Marconi could use its extensive services structure to support Huawei's pursuit of equipment business in the European market.
John Williamson