At the time it had little choice. And BT looked almost dead in the water. Given that situation, and despite all its flaws, faults, and foul-ups, the fact that BT has managed to retain its status as one of Europe's telecom services giants, and remain relevant as an international service provider, without a mobile operation, is actually quite impressive.
Instead, the British carrier, which today announced its fiscal first-quarter earnings, focused on some other areas, such as the development of IT services, where it was something of a trailblazer. But it's had a few problems recently as a result. (See BT's Numbers Hit by Rogue Unit.)
How much longer can BT carry on without its own mobile operation? It's missing out on the kinds of revenues, economies of scale, cashflow, and market penetration that the likes of Telefónica SA (NYSE: TEF), which also announced its latest financials today, can boast.
The Spanish carrier, of course, is now the owner of BT's former mobile assets. When BT Cellnet was spun off, it was renamed mmO2, and eventually just O2. Now, following an audacious acquisition in 2005, it's part of Telefónica Europe (the carrier's non-Spanish European operations), which has 54.5 million customers, including 45.2 million mobile subscribers.
Globally, Telefónica has 278 million customers, including 211 million mobile subscribers, and quarterly revenues of €15.1 billion (US$19.8 billion) and rising. (See Telefónica Reports H1.)
BT has 27 million operational lines in the UK, plus its international business customers, and quarterly revenues of £5 billion ($7.8 billion) -- and declining. (See BT Reports Fiscal Q1.)
A crass comparison? Maybe. But mobile is where the big growth is, especially as next-generation wireless data technologies like Long Term Evolution (LTE) are deployed.
So can BT continue to be a viable communications service provider in the long term when it only has fixed-line capabilities? Is it too late for BT to be a converged fixed/mobile player? Maybe not. Maybe it could bag itself some spectrum…
The already gaff-prone new UK coalition government, it seems, is ready to rush through some spectrum auctions (it needs some cash, apparently). (See UK Plots 4G Spectrum Auction .)
The spectrum is suited to LTE, an all-IP network technology. BT has an IP network and already has backhaul networks that support wholesale mobile traffic.
Might it bid for some spectrum? It seems unlikely that BT would have the business case or the bottle to outbid the UK's existing mobile operators, including Telefónica's O2 UK, to land some of that spectrum. And it doesn't fit with the company's stated plans. (See BT Outlines 3-Year Plan.)
But, boy oh boy, wouldn't it be interesting if it did?
Come on BT. Don't be shy. Show us what you're made of, and stick your name in the bidding list when that spectrum is up for grabs. You know it make sense!
— Ray Le Maistre, International Managing Editor, Light Reading