On October 9th, BT held a media and analyst briefing by BT Group CEO Philip Jansen, BT Consumer CEO Marc Allera and BT Business CEO Gerry McQuade.
The main announcements made during the briefing were:
- “Reinventing customer service to make it more local and personal”. BT is bringing forward its completion date for call centre repatriation from Christmas 2020 to Christmas 2019. It is also “bringing BT back to the High Street for the first time in nearly 20 years”, adding BT branding and products to EE shops. A new Home Tech Experts service will offer customer support in customers’ own homes and business premises.
- Upgrading “hundreds of thousands” of customers from copper to “superfast” at no extra charge. In places where superfast is available, BT will no longer sell copper broadband.
- Launching a new convergent service plan, BT Halo, which adds 5G, unlimited mobile data and simplified calling plans to the BT Plus convergent plan launched in 2018.
- Becoming the shirt sponsor of the national football teams of all four home UK nations, both men and women, and promoting the participation of women and para-athletes in football at the national level.
- Promoting national development of digital skills to help people and businesses avoid being left behind. Examples include the Barefoot Computing initiative for primary school teachers and a new Apprentice Nation programme.
New Generation Infrastructure
There were several references from all three CEOs to the rollout of “next-generation infrastructure”, both mobile and fixed line, but no new announcements in that area. Allera reiterated that 5G is available in 20 UK cities, with 25 more planned by the end of 2019.
Jansen talked about BT’s intention “to bring fibre to 15 million homes and businesses by the mid-2020s”, but he avoided any direct reference to Prime Minister Johnson’s “pledge” to connect all UK homes and businesses with fibre by 2025.
BT needs to sound positive about that, but also acknowledges that it is unachievable without radical changes in regulation and funding — and that even then, it would be a huge logistical challenge.
Rather than infrastructure, today’s announcements were centred on marketing. They built on the platform of BT’s recently launched new corporate brand, with the slogan “Beyond Limits”. We detected two notable themes that were prominent in the announcements and the discussion:
- Repeated references to BT’s national role: enabling and improving the UK’s use of digital technology, to enhance citizens’ lives and improve businesses’ productivity.
- These announcements were all about BT providing access to digital services. There was nothing about the digital services themselves (although Allera did mention a teaser for some new TV services, details to be announced soon).
Regarding the second of these themes: we applaud BT’s focus on the basics. Amid all the talk about telcos needing to “transform” themselves into “digital service providers”, there is a danger of forgetting that what customers predominantly pay telcos for, both now and for the foreseeable future, is connectivity.
As people’s use of connectivity expands, what they need most from their telco is a reliable connection whose performance improves as the scope of what it is used for grows.
Allera referred to the need to support a growing number of connected devices in the home, from typically half a dozen today to “potentially a hundred or more in a few years”. He did not, however, make any mention of BT as a provider of the services that those new connected devices will use, i.e., smart home services — wisely so, in our view, given the current immaturity of smart home service offerings, and the bad experiences of competitors that have entered that market in recent years, such as O2.
Gerry McQuade focused on national productivity as an area where improvement is sorely needed, and stressed BT’s role in helping “UK PLC” to achieve that. As well as meeting businesses’ current and future connectivity needs, BT also aims to help small businesses develop their understanding of what technology can do for them, and their skills in applying and using technology.
In answer to a question, McQuade said that although there will be charges for some “concierge services”, BT’s initiatives in the area of improving digital skills will be free of charge. As well as being a way of contributing to the national good, McQuade acknowledged that this is also something that can benefit BT’s revenue line in the long term: “The more comfortable customers feel with technology, the more likely they are to buy it from us,” he said.
We think BT’s role in the development of UK society and business is a strong theme to build on, given BT’s history and its predominance as a builder of fixed-line infrastructure. It also ties in well with the noises that the UK government is currently making about broadband infrastructure development.