BT buys into mobile – acquires EE for £12.5bn

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BTBT have announced that they are buying mobile phone operator EE for £12.5 billion. With EE’s 24.5 million direct mobile customers that values a mobile phone users at just over five hundred quid.

BT have had an interesting mobile history. Buying up a slew of small operators (e.g. Martin Dawes) they formed BT CellNet which they sold and eventually became O2. O2 is now potentially to be purchased by Hutchison Whampoa, owner of Three.

EE was formed by a merger of the Orange and T-Mobile brands and was the first operator in the UK to offer 4G services. EE’s current owners Deutsche Telekom and Orange will hold stakes of 12% and 4% in BT.

BT’s CEO Gavin Patterson said: “This is a major milestone for BT as it will allow us to accelerate our mobility plans and increase our investment in them“.

BT had been planning to offer mobileservices through a wholesale tie-up with EE but said the takeover offered “far more control of our own destiny“. If Three purchase O2, BT say it will present a threat to EE’s position as market leader adding “that by combining EE’s 4G network with its extensive superfast broadband network it would have greater scope for future investment and product innovation“.

BT are planning to sell a full range of services to the combined customer base, including BT offering broadband, fixed line and pay-TV services to those EE customers who do not currently take a service from it.

This is where things become interesting, Sky and Virgin have made inroads into telephony and broadband, marketplaces such as Amazon and Rakuten are making inroads into entertainment with services such as Amazon Instant Video and Wauki TV. Mobile, Landline, Broadband and Entertainment bundles are becoming the norm.

Once again, for the first time in a decade since they sold BT Cellnet/O2, BT will be at the forefront of UK mobile. What next for BT, perhaps once eBay divests payments and ecommerce websites, BT could acquire a marketplace?

6 Responses

  1. If, as a BT customer already, they could offer me a tasty deal on a mobile, I would seriously consider taking it.

    That said, I just wish that BT (and others) would let me have broadband without a landline.

  2. Interesting that they opted for EE rather than their old O2 Business.
    Fibre without line rental is available via Virgin Media, although add their basic call package its £1 more with the line rental


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