BT rearranges deck chairs, launches good ship Enterprise

Onwards and upwards...until the next reorg

BT tower against backdrop of london terraced houses

Brit mega-comms firm BT has given its flagging b2b divisions a corporate facelift, merging the wholesale, public sector and business units into BT Enterprise.

Under the latest rejig, Gerry McQuade, head of BT Wholesale and Ventures, was named chief exec of BT Enterprise, while former boss of BT Business, Graham Sutherland, is to leave the operator after 12 years of service.

It follows the merger of the firm's more profitable divisions into BT Consumer and EE, which have combined annual revenues of £10.5bn, and means the former state monopoly will have fewer reporting segments.

The other three will include BT Enterprise, which will have annual revenues of £6.5bn according to analyst firm Megabuyte; Openreach (£5.1bn); and the beleaguered Global Services unit (£5.1bn).

Last year BT said it would cut 4,000 jobs worldwide – with many of those expected to come from Global Services.

The division has consistently shrunk, and once again dragged sales down in BT's last quarter, with Global Services dropping 3 per cent to £5.97bn.

The UK telco fingered its troubled outsourcing division as the "main contributor" to revenue decline in the three months to December 31, 2017, with its sales in the quarter falling 9 per cent to £1.26bn.

Of the latest seemingly cosmetic changes, Gavin Patterson, BT chief executive, said: "Having brought together our Consumer and EE businesses, this is the next step in the simplification of BT's operating model.

"Combining our enterprise businesses will allow us to strengthen the services and products we offer to businesses and sharpen our focus on customer service, through clear accountabilities and by introducing efficiencies."

Philip Carse, analyst at Megabuyte said: "It remains to be seen whether the combination of the two segments will help improve services, but from a reporting point of view Wholesale always looked a slight anomaly with about £2bn of annual revenues versus £4.5-5.4bn for each of Global Services, Consumer, EE, Openreach and Business."

But he noted that compared to its consumer divisions, the b2b businesses are behind, with "fundamental market share pressures on BT in its core B2B space" remaining. ®

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