The future of BT's system integration division, Syntegra, was thrown into doubt last week as PC Week discovered it has been excluded from the company's new joint venture with AT&T.
Syntegra's big opportunity to achieve spectacular growth at a stroke through the joint venture has been ruled out as both partners have agreed that Syntegra is not up to the job.
This must feel like history repeating itself for Syntegra after the possibility of a deal with SystemHouse, the computing service arm of MCI, evaporated following the failure of that attempted merger late last year.
A spokesman for AT&T's sytems integration business, AT&T Solutions, said that both partners are working out which parts of each business will be included in the global joint venture. "Including Syntegra would confuse things - anything that isn't a straight communications service won't be in the package," he said. "It is more likely to be AT&T Solutions who will provide the integration."
Syntegra was formed in 1993 from 40 disparate computing service businesses within BT. It employs 3,500 people worldwide, over half of whom are based outside the UK. BT claims that Syntegra has 20% of the trading systems integration business.
A spokesman for Syntegra said: "It is still unknown how all the different parts of both companies will plug in to the new joint venture, which doesn't even have a name yet, but we do know that Syntegra will not be a part of it."
John Matthews, principle consultant at Ovum, said: "It is clear that Syntegra is not core to the transmission of voice and data messages around the world. High level discussions have taken place at BT on whether it should be in this market at all - it wouldn't surprise me if (BT) divested Syntegra in the near future."
Simon Weedon, telecoms analyst at Deutsche Bank said: "BT has been pretty bullish on the future of Syntegra following the hard year it has had almost integrating and then disintegrating with MCI SystemHouse. (But) despite BT's best efforts to support the division, Syntegra lacks the size to fulfil its global ambitions."
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