Mobile déjà-vu for BT

Written by on February 10, 2015 in Guest Blog with 0 Comments

BT Centre in Newgate Street, London.Last week BT confirmed its acquisition of EE would proceed, subject to regulatory clearance. From a proposition perspective, this looks good news for BT, as its forays into the mobile space since selling O2 have been less than inspiring. As a customer of either organisation, I could only hope that somehow, on some level, they manage to create a new customer service operation that is better than the norm for telcos (experience tells me not to get excited here). As an aside, one reason I like being a giffgaff customer is that I know I will never have to talk to someone in a mobile operator call centre!

Much of the comment about the BT EE acquisition has focussed on how it will create a dominant player in the market across both fixed and mobile. However I’m not convinced this will matter so much in the future. For many of us, landlines are history and we only have them to deliver broadband. In the future, data services will increasingly be delivered wirelessly, especially via whatever next generation wireless broadband can deliver. The role of fixed line networks will increasingly be focussed on backhaul for wireless providers; I can see a case for carving this part of the BT network out into a separate, transparent business.

Although yet to be finalised, it looks like Hutchison will attempt to acquire O2 and merge it with Three. This is a more contentious deal because it reduces the number of mobile networks in the UK from four to three. I’m not convinced this is necessarily a bad thing because of the costs of running networks and the hardware duplication involved (some infrastructure is already shared).

What could Ofcom do to deal with competition concerns? Create a regulatory framework that compels mobile operators to support virtual operators (MVNOs) on fair terms; force the sale of some LTE spectrum which might be attractive to broadband providers looking to use wireless for fixed broadband (as suggested by @sammachin); impose more stringent data coverage requirements; would all be options.

Whatever the outcome the next couple of years will be interesting …

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About the Author

About the Author: Jonathan has been working in payments for 18 years covering digital money, identity verification, telco billing, finance systems and consumer payment services; in both startup and corporate environments. Most recently, his experience is in developing alternative consumer payment models. "I'm passionate about removing the friction and frustration from payments. The convergence of payments and mobile technology and its impact on consumers fascinates me." You can follow Jonathan on Twitter at @sevendotzero .


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