British Telecommunications, trading as British Telecom, severed its links with the Post Office under the British Telecommunications Act, 1981 and became a totally separate public corporation on 1 October. They were now two separate organisations with their own chairmen and boards of directors.
It was also at this time that the first steps were taken to introduce competition into the United Kingdom telecommunications industry. In particular, British Telecom lost its monopoly of the supply of customer premises equipment (CPE) except, as an interim measure, providing the first telephone at an address. In practice, it had become increasingly difficult in the years leading up to the Act to exercise this monopoly as more and more unauthorised equipment was added to the network.
The Act introduced an independent approval regime for CPE. Before 1981, the Post Office and then British Telecom had alone decided what could and could not be connected to its network. The 1981 Act established an independent procedure to set standards and approve equipment for connection to the network. Standards were now set by the British Standards Institution (BSI), while the British Approvals Board for Telecommunications (BABT) issued approvals based on independent evaluations. This was the first step in separating regulatory and operational activities which was essential if private suppliers were to be able to compete with BT on equal terms.
The 1981 Act permitted further liberalisation by allowing network competition. The Secretary of State for Trade and Industry was empowered to grant licences to operators other than BT to provide network and value added services. This was a recommendation of the Beesley Report, published in April this year, which suggested full freedom for private suppliers to use the national network to provide Value Added Network Services (VANS) at a flat rate.
British Telecom offered telephones for sale for the first time as an alternative to rental. Eleven phoneshops were opened in major department stores.
New style telephone plugs and sockets were introduced on 19 November, enabling convenient movement and replacement of telephones and customer equipment.
The first 'System X' digital exchange to which subscribers were directly connected was opened at Woodbridge in Suffolk.
The development of 'System X' exchanges was the linchpin of the policy to modernise the existing network by replacing analogue plant with digital switching centres interconnected with digital transmission links. It enabled an increased variety of facilities and services to be made available to the telecommunications user, resulting in ISDN (Integrated Services Digital Network) and ISDN 2 .
Thereafter, the network was rapidly modernised and more and more exchanges converted to digital systems. In 1970, 8.5 million exchange lines were Strowger, representing 98 per cent of the total. As late as 1980, when the number of Strowger lines reached a peak of 13 million, 75 per cent of the network was Strowger. Throughout the 1980s and 1990s modernisation of the network was rapid, so that in July 1990 the long distance or trunk network became totally digital. The last Strowger exchanges (Crawford, Crawfordjohn and Elvanfoot, all in Scotland) were withdrawn on 23 June 1995.
During the same period the TXE and TXK families of electronic and electromechanical exchanges were gradually withdrawn. The last TXE2 exchanges (Ballycastle, Northern Ireland, Llandovery, Wales and Ramsbury, England) were also closed on 23 June 1995. The last TXK crossbar exchange, at Droitwich, was withdrawn in 1994.
The UK network became totally digital on 11 March 1998 with the closure of the last electronic TXE4 exchanges at Leigh-on-Sea and Selby and their conversion to System Y (AXE 10) and System X respectively.
The first cashless, card-operated payphone - the Cardphone - was introduced as a new service and to combat damage caused by vandals attempting to break into payphone coinboxes. The 10, 20, 40, 100 or 200 unit Phonecard was inserted in the payphone and the call made in the usual way, with the charge for the call erased from the phonecard until the units were exhausted.
Radiopaging was extended to give a virtually nationwide service.
Britain's first automatic carphone service, System 4, was launched in London on 14 July, whereby customers were able to make direct calls without having to go through an operator
A microfiche system was introduced in inland directory enquiry centres to speed up the response time to subscribers' enquiries.
Prestel was extended to Holland, Italy, Sweden, Switzerland and West Germany.
Prestel launched an electronic "mailbox" service in London. It was extended nationwide in 1984.
BT launched the "It's for You" campaign, featuring such characters as Neptune and the Hunchback of Notre Dame, followed by a series of animal themed advertisements. The campaign ran until 1985.
British Telecom introduced the Answering and Recording Machine No 101, following field trials of the Answering and Recording machine No 1 by the Post Office from 1979. This was the first British Telecom supplied answerphone, although models had been available from other suppliers for some years. By law these had to be approved at that time by the Post Office / British Telecom as meeting their standards. Some were approved, though in the years leading up to the Telecommunications Act 1981 (which led to greater choice for customers in obtaining equipment) many answerphones and other items of equipment on the market were not approved.
Cable & Wireless Ltd. was privatised in November, the Government selling 50 per cent of its shares in the company