Telecoms: BT wants to become the reference operator for European companies
This is an interesting case to follow, especially for Orange which is in the process…
This is an interesting case to follow, especially for Orange which is in the process of redesigning Orange Business, its B2B subsidiary in difficulty, to return to profitable growth in 2025. And not only because its first shareholder is now called Patrick Drahi. In the United Kingdom, the incumbent operator BT (ex-British Telecom) has already completed its own reorganization. It is now reaping the rewards, which enables it to better position itself with European companies.
Since the Covid, all telecom operators in Europe have faced a decline in their traditional B2B activities, in particular voice calls. In business, the good old black handset has been replaced by Teams or Zoom. IT is no longer hosted on site but in one or even several remote “clouds”, creating new needs in terms of cybersecurity. However, these new professions are less profitable for the operators. All therefore seek to pivot to look more like integrators, “packaging” and installing IT services such as cloud or cybersecurity (including those of partners) at customers, like Atos or Capgemini.
For this, the group is in the process of merging its Business and International activities into a single division. Called BT Business, this entity will weigh 8.5 billion pounds in turnover and 2 billion in Ebitda. With the key 100 million savings. “Even if we are not in Patrick Drahi’s shoes, our transformation is widely supported,” smiles Joris van Oers, BT’s World and Europe sales manager. Since the end of 2022, the stock market price in any case has increased significantly (+31%).
The network, cloud and cyber triptych
If BT is accelerating today, the operator did not wait for the Covid to transform. While Orange has just presented its plan for 2025, BT reorganized itself… from 2018. The group then sold less strategic activities to refocus – like Orange today – on a triptych: networks, the cloud and cybersecurity. In this last business, BT now has 13 centers around the world (including one at La Défense in Paris) where 450 analysts thwart 6,500 cyberattacks per day.
At the same time, in continental Europe, BT chooses to target multinationals exclusively, unlike the United Kingdom and Ireland where the operator serves 1.2 million customers, including many SMEs. Among its references today: Alstom, Michelin, ABB, DHL, Nestlé, Unilever… “Today, when you call your airline, there is a good chance that the call will be handled by BT” summarizes Joris van Oers, in the Paris offices of the Ariane Tower.
The new professions now in the majority
This transformation has not been neutral for employment. On the business side, the workforce went from 17,000 employees to 14,000. But for Joris van Oers, this refocusing has been beneficial. New businesses thus represent 53% of BT’s B2B sales, compared to 44% at Orange. On cybersecurity, BT also says it is growing faster than the market.
Admittedly, B2B turnover is still down (-5% over the first nine months of the year, at £3.7 billion) as is EBITDA (-19% at £1 billion). books). But this is a cyclical decline linked to the difficult macroeconomic context. In the long run, BT thinks its bet will pay off.