THE recent announcement by CableTel, the new Northern cable television and telecommunications operator, may give some clue as to how the company hopes to recoup its huge investment.

One of CableTel's earliest public pronouncements had nothing to do with its new television service but rather extolled the benefits of its new phone network. Its calls to the Republic would be up to 23 per cent cheaper than those of British Telecom, CableTel said.

CableTel, which is investing about £600 million sterling in the 15 year licence, is laying high tech cable in the North which has the capacity to carry both a telephone and cable television signal.

CableTel has to pay the British government £216 million in fees over the life of the franchise, and "dig the holes" required to bring its network to 80 per cent of the North's homes by the year 2003.

When the licence was awarded last year, many observers wondered how CableTel could justify such a high fee. The answer seems to be that, in part, it plans to give BT a real run for its money.