UK phones giant British Telecom (BT) is aiming to become a major power in Britain's television sector and seems on course to be a broadcaster within two years.

Newly installed chairman Sir Christopher Bland says that by distributing television content over its own landlines, satellites and microwave networks it could go head to head with cable operators NTL and Telewest and with digital satellite broadcaster BSkyB.

In an interview with the Sunday Times, Bland said: "at one extreme we can be a distributor of other people's programmes just as the existing cable companies do. On the other extreme we can build a fully-integrated model which makes and distributes its own programmes over its own and others networks and also distributes others' content over its own system."

For many years BT has hinted that it wanted a piece of the broadcast market, but in the last couple of years it has been stung by the success of the ability of the cable companies to offer a combined package of phones and television. The new BT mantra is for BT to compete on a triple play of telephone, television and high-speed internet.

Late last year BT was awarded a broadcast licence (Screendaily, Nov 5, 2001), but the company then described the move as exploratory and said that it had no active plans to move in to television. But the arrival of Bland and new chief executive Ben Verwaayen are expected to sharpen that focus. Bland is if anything more a broadcaster than a phones executive. He was chairman of commercial channel London Weekend Television for ten years until 1994 and from 1996 to 2001 was the top dog among the governors of the BBC.

The move is mixed news for the firms such as Video Networks struggling to provide pay-per-view (PPV) and video-on-demand (VoD) over ASDL connections leased from BT. They have frequently complained that BT has not let them have enough high-speed lines and have only done so at prices that make their service unattractive to consumers. If BT decides to become a broadcaster it will be forced to offer more connections and on the same terms to third parties. But the emerging the PPV and VoD companies will simultaneously find themselves facing a much bigger and richer competitor.

In the interview, Bland also said that he does not rule out buying or investing in content production companies (Screendaily, June 22, 2000).