Broadband provider Bulldog is to stop selling to small business and residential customers, parent company Cable & Wireless announced this morning, at a cost of around 150 jobs.

As it revealed a "revised strategy," the telecoms company said it would "cease any further proactive sales, marketing or advertising activities to acquire new residential and small business customers."

Instead, Bulldog will concentrate on providing wholesale services to other internet service providers and retail services to large corporate customers.

This follows the rest of C&W, which said in February it would focus on its more profitable big business and government customers.

It revealed then that 89 per cent of its customers delivered just 4 per cent of its revenue.

Existing customers

All existing Bulldog customers will continue to be served and receive new services, C&W said. The division's plan to add its broadband equipment to 800 telephone exchanges (a process called local loop unbundling) by September remains in place.

John Pluthero, group managing director for C&W in the UK, said: "As the market leader in full local loop unbundling, we have been looking at the best way to maximise the return on our investment. We believe that a wholesaling approach to the consumer and SME market is the best way to optimise our return from our unique local loop network capability."

He said the company expected limited benefits from Bulldog's move to wholesale provision in the 2006/07 financial year as the internet service provider completed the local loop roll out and invested in wholesaling capability.

Bulldog came under fire from a BBC television Watchdog programme in September last year for poor customer service. The consumer-driven show said that a major advertising push had overwhelmed the company with new customers.

Overwhelming demand

Watchdog received 500 complaints about unanswered customer calls and unfixed connection problems in the first year that Bulldog was owned by C&W.

Competitor Carphone Warehouse grabbed the headlines in April by launching a "free" broadband service, bundled with a telephone offering. In fact, the service costs customers £21 a month. Read the full story.

As it unveiled a strong increase in profits earlier this week, earned before the broadband move, Carphone said it had also been overwhelmed with demand from customers. It has connected just 100,000 out of 340,000 applications.

C&W gains income from the service as it provides broadband network services to Carphone Warehouse.

Shares in Cable & Wireless gained 2.75p to 108.75p in heavy trading after today's announcement..

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