A bus passes a BT logo outside of offices in the City of London, Britain. -Reuters
Britain's biggest telecoms company BT aims to reinvigorate its unloved brand by combining the strengths of its fixed-line and mobile networks, it said on Wednesday, to jump-start a stalled turnaround under its embattled CEO.
Gavin Patterson's efforts to transform BT into a modern communications provider have been undermined by regulatory issues, pensions and accounting fraud, which have led to investor disquiet as its share price tumbled to five-year lows.
On Wednesday it set out a new strategy from consumer boss Marc Allera to offer seamless services such as supercharged broadband to provide customers with faster speeds and a hub offering the best TV content to counter BT's image of a former telecoms monopoly dogged by bad customer service.
"The way our customers feel about BT needs to evolve, needs to change," Allera told reporters. BT, which runs the country's biggest broadband network, bought market-leading mobile operator EE in 2015 as part of its drive to modernize the group, acquiring a brand synonymous with superfast connectivity and popular with young Britons.
While it has already stripped out costs by integrating back-office functions, BT will now provide customers with a more joined-up offering, backed by a marketing campaign and a move to improve its customer service reputation by bringing its call centers back to Britain and Ireland by 2020.
The first example of its so-called converged offering will be hybrid broadband technology, which combines 4G mobile and fixed-line broadband to boost Wi-Fi signals in customers' houses and maintains connections if the fixed-line fails, Allera said.
To boost its TV offering, BT will make Amazon Prime content available on its platform, in addition to Netflix, and from 2019 Sky's content on Now TV, providing a wide range of programing in one place. "Convergence isn't just about bundling products," Allera said. "We are going to create a new, smart, converged network for our customers. "We are going to be the only place to get all of this content on one box with an integrated search experience."
The consumer relaunch designed by Allera has become all the more important since the group announced plans to cut 13,000 staff and close its London headquarters, highlighting the pressures faced by the company and CEO Patterson.
EE was the one strong performer last year and the new strategy is designed to maintain that lead over rivals in a retail broadband market in which it competes with Sky, TalkTalk and Virgin Media VMED.O.
BT Consumer, which includes BT, EE and value brand Plusnet, accounts for about 40 percent of group revenue. Analyst Paolo Pescatore at CCS Insight said the update provides a much-needed boost to BT, given the widespread negative publicity it has endured in recent months.
"More importantly, the new structure and strategy provides better clarity on the future direction of the consumer segment, which has been in limbo for some time," he said. The Amazon partnership, he said, could turn around BT's fortunes given that BT TV has recorded losses for the past two quarters and subscriber growth has been lacklustre in recent years.
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