Subscribe / Unsubscribe Enewsletters | Login | Register

Pencil Banner

Analysis: BT must ramp up enterprise services to make EE deal work for business

Matthew Finnegan | Feb. 9, 2015
Everything Everywhere acquisition will make it easier for corporate customers to procure mobile services, and could open the doors to IoT and M2M applications

BT's £12.5 billion acquisition of mobile network provider Everything Everywhere may be mainly targeted at boosting its consumer business, but the mega-deal should also benefit corporate customers of the telecoms giant too — provided it can ramp up its enterprise services fast.

While BT has partnered with mobile virtual network operators (MVNOs) in the past, the agreement with Deutsche Telekon and Orange means that former state-owned firm will have its own mobile division for the first time in 15 years.

According to TechMarketView analyst Peter Roe the deal will allow BT will become more responsive in the way it sells mobile services to businesses, while owning a mobile network outright will provide it with advantages such as "joint marketing and product development" as well as better "credibility in the marketplace". It will also be good news for enterprise customers looking to source all of its telecoms requirements from one vendor.

"BT has got the opportunity to be a lot more coherent in its mobile policy, and in selling mobile services to businesses. It had an MVNO arrangement in the past with EE recently, and previously with o2, but it had not worked particularly well," he said.

"It is positive news for BT, but might also make life easier for business customers to keep costs down and to have an efficient sourcing policy."

The main challenge for BT in attracting business customers, however, is the need to build out its enterprise mobile division. EE had a solid presence in the consumer and SMB markets, but few large international businesses on its books.

This is likely to mean that business customers will not be inclined to jump ship from current providers such as Vodafone in the short term, said Dan Bieler, Forrester Research principal analyst for CIOs, who anticipates a "transitional period" as BT ramps up its enterprise offerings.

"It needs to now develop a full blown mobile business division," he said. "If you look at what EE has to offer in the enterprise space, this is not really the full range of services that you can get from an Orange or Verizon, where you have a wide spectrum of collaboration solutions, all sorts of cloud based solutions, enterprise app stores, a wide range of security services — you name it. This is something that BT has to develop.

"There is a big task ahead for BT to make this new mobile arm enterprise-ready and this is not something that can happen overnight."

In the longer term, the deal has the potential to open the doors for BT and EE into the M2M markets and internet of things. As Jeremy Green, principal analyst at Machina Research points out here, EE may have been held back in its M2M ambitions to some extent due to the separate plans of its owners DeutscheTelekom and Orange.

 

1  2  Next Page 

Sign up for CIO Asia eNewsletters.