E-payphones rollout

BT Group PLC
12 December 2001


                                   December 12, 2001

BT AND MARCONI JOIN FORCES IN E-PAYPHONES ROLLOUT

BT announced today a multi-million pound partnership with Marconi to launch
the world's largest public network of multimedia terminals in payphones.

     BT Payphones, part of the Consumer Division of BT Retail, will install
28,000 new terminals to be built by Marconi and which will offer full Internet
access, e-mail and text messaging. Rollout will begin in April 2002 with 3,000
terminals expected to be in place within a year.

     Pierre Danon, chief executive officer of BT Retail said: 'BT working in
partnership with Marconi is ensuring that everyone has the opportunity to
access the Internet.

     'We are continually striving to meet our customers changing
communications needs and although more than 20 million adults have logged on
to the Internet many people are still excluded from using the web because they
don't have access to a PC.'

     The new phones will offer a range of services including e-mail, text
messaging, maps, directions, location-based services and retail opportunities
- as well as classic voice services.

     Liam Brown, managing director, Marconi Interactive Systems said: 'This
will make the UK the leader in public multimedia web phones and will provide
BT's customers with easy access to the latest interactive communications.'

     The new design of terminal is robust enough to be installed in high
street phone boxes as well as shopping centres, rail, tube and bus stations,
airports and motorway service areas. Featuring its own built-in keyboard and
trackerball, the terminal will offer video images as well as still pictures.
It is expected that the new network of terminals, which will be installed by
BT engineers, could realise 56 million hits a week.

     Under the terms of the agreement Marconi is investing in the terminals
while BT will be managing the network, providing content and offering sales
and marketing support. Revenue from the new units will be shared by BT and
Marconi with BT's revenues expected to be £50 million by 2004/05.



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