BT hunts new mobile partner in wake of £200m 4G splurge

Former subsidiary O2 could even be in the frame

BT‘s surprise entrance in Britain’s recent 4G auction may have had a hidden agenda, it has emerged, with news that it wants to team up with a mobile partner in a renewed drive into the sector. What’s more it may even join forces with O2, the operator it sold to Spain’s Telefónica 12 years ago. When Ofcom put the super-fast spectrum up for sale earlier this year [2013], BT paid almost £200 million for its chunk of the airwaves, bidding aggressively and ending up with more than it needed to boost just its Wi-fi coverage.

At the time the company kept its plans for the new spectrum close to its chest.

But sources close to BT suggest it may soon be traded or used as part of a deal with a new mobile phone partner.

It’s emerged that BT has already begun advertising for an operator to provide mobile services to its customers, both consumer and business, as well as supplying its own employees.

Perhaps significantly, O2 itself did not acquire any of the higher frequency spectrum at the auction?

Although consumer mobile has not been a priority for the once state-owned operator in recent years, it’s thought its future strategy will focus more on connecting all types of customers.

Those in or out of the home through its voice and data networks, building on its existing triple or ‘quad play’ service bundles offering combined phone, broadband and TV.

BT has run a small mobile business using Vodafone’s networks for years, though this agreement could be negated by Vodafone’s acquisition of Cable & Wireless Worldwide, BT’s UK-based network rival, last July.

Analysts, meanwhile, suggest BT could in future could use its ties with its operating partner to allow mobile customers to access a wider range of hotspots, at the same time using its new 4G spectrum for streaming its relaunched internet TV services.

Whether that will be done in tandem with O2 – Britain’s second biggest mobile carrier – remains to be seen, though only last month the Telefonica offshoot reported an 8.5 per cent drop in revenues in Q4 2012, despite signing up 282,000 new customers over the period.

In January this year Telefonica ruled out the possibility of floating its UK subsidiary O2 on the London market, despite struggling to make a profit and taking its O2 Germany unit public as part of a move to reduce its €56 billion (£46.5 billion) debt.

About Dave Evans

Dave Evans was a long established commentator on both the IT and cellular industries. His last focus was on share price trends within the sector. He passed away in September [2014].
This article was published in 4G, Financial, Vodafone, mobile news, o2, telefonica and tagged , , , . Bookmark the permalink.

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