LONDON --

British Telecom

(BTY)

is fighting back.

On Thursday, the U.K. telco announced a series of initiatives to take its mobile Internet services global, something it hopes will silence its many critics, who say the former monopoly is not being aggressive enough in its mobile and Internet strategy. The announcement follows Wednesday's decision to cut proposed unmetered Internet charges following this week's offers from cable companies

NTL

(NTLI)

and

AltaVista

to provide such access.

The market certainly thinks this is more like it. In London, BT shares closed Thursday 12.3% higher, at 13.50 pounds. That's up 38.3% from Feb. 2, when the shares fell 18% in a single day after the company announced that pretax profits in the third quarter were 24% lower and fourth-quarter figures would be little better. Shares traded in New York rose 17 11/16, or 9.2%, Thursday to 211.

Today's initiatives include a new division that will launch a global mobile portal in the U.K., Germany, the Netherlands, Singapore and Hong Kong. The portal will be based on

BT Cellnet's

mobile Internet service,

Genie

, which already has 600,000 customers and is growing by 4,000 per day.

BT will work with 30 partners to roll out this global portal, including BT Cellnet in the U.K.,

Viag Interkom

in Germany,

Telfort

in the Netherlands,

SmarTone

in Hong Kong and

StarHub

in Singapore. Content providers include

BSkyB

,

Financial Times Information

,

EMI

,

Travelocity

,

Lastminute.com

and, indeed,

TheStreet.com

.

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and

Mobile Telecommunications International

will provide mobile Internet applications,

Phone.com

(PHCM)

will provide the portal software, and

Logica

and

Syncordia

will take care of the systems integration.

BT will invest 160 million pounds ($256 million) in the global mobile applications and services venture, which will be launched in the summer, with trials starting in April.

And as if all that weren't enough, BT is showing a little initiative to boot.

A Generation Ahead

BT says it's planning to launch the U.K.'s first prepaid wireless application protocol, or WAP, mobile Internet phone. The company also announced Europe's first commercial deployment of a universal mobile telecommunications service (UMTS) network through its Isle of Man unit

Manx Telecom

, a service that will be introduced to the British isle early next year. Manx Telecom will effectively be a test run of the service for the mainland U.K. should it win one of the UMTS licenses the British government is in the midst of awarding.

Before the announcement, BT was trading at a level of estimated 2001 EBITDA that was significantly lower than that of competitors. However, with today's rise in its share price, BT appears to have clawed its way back into investors' good books. So all is well again at BT? Well, perhaps not.

BT has

hinted that it is ready, like many of its peers, to spin off parts of its business, such as the Internet and cellular operations. However, it has yet to give any firm commitment to do so, and as such the details of any spinoffs are unavailable. But simply hiving off parts of the business doesn't guarantee success: Execution is key.

Furthermore, there are doubts about the value of these businesses. Although BT Cellnet is the U.K.'s second-largest cellular operator behind

Vodafone AirTouch

(VOD) - Get Report

, third-place

Orange

(ORNGY)

is growing fastest and Vodafone is increasing its international subscriber base at a faster rate than the others.

There is also the little matter of what will be left of BT once the cellular and Internet operations are, as is expected, spun off.

"Good question," says Amit Khandwala, senior vice president of international investments at

Wright Investors' Service

. "It's all very well spinning off these parts, but you're left with the fixed business and that's getting killed."

Indeed, it was the savaging that competitors were giving BT's fixed-line business that it blamed for the nosedive in profits in the third quarter.

Khandwala, who is long BT, likens a stripped-down version of BT to

Cable & Wireless

(CWP)

now that it has disposed of its Hong Kong subsidiary. "Cable & Wireless has become an obvious acquisition target since it got rid of HKT because of its huge cash flow," he says.

Cable & Wireless has irked its investors by appearing to lack direction, and BT's management is likely to come under similar criticism until a strategic plan and reorganization for the rump part of the business is articulated.

Yet for all that, investors are unlikely to desert BT in droves given the current positive momentum in the stock. And when it comes to fighting, BT can't be accused of being short of practice.