BT Ireland and Vodafone today confirmed that BT Ireland is moving their consumer division to Vodafone while they will remain working on what is their core businesses these days, which is infrastructure and managing network builds and networks for other companies.
Details from the press release:
BT will transfer its consumer and small business broadband and voice customer base to Vodafone and will also provide wholesale network services to underpin Vodafone’s business over a seven-year period.
Agreement positions Vodafone as the clear no 2 in the fixed market with over 170,000 fixed customers and a 15% market share of the fixed broadband market
Over 84,000 consumers and 3,000 small businesses currently with BT will transfer to Vodafone over the next several months. (Small businesses are those with 6 telephone lines or less)
BT plans to unbundle another 58 exchanges in Ireland
A small number of BT employees are expected to transition to Vodafone under the terms of the agreement.
The Irish Times had this story last Saturday and some details from it include:
The transfer would involve BT’s residential fixed-line customers and broadband subscribers. The company has a 13 per cent share of the fixed-line market and a 9 per cent share of broadband, according to the latest statistics from ComReg.
BT’s consumer business accounts for just 6 per cent of revenues but delivered a “strong set of results”, according to the British company at the publication of its full-year results in May.
Analysis:
It’s long been rumoured that BT Ireland would pull out of consumer and this deal is comfortable for them, their customers and for Vodafone.
BT Ireland are very good at building and running networks. Infrastructure and services is what makes them nearly all the money in Ireland. Despite trying the consumer area and merging Esat Clear, Oceanfree and IOL into a consumer division, they never made huge inroads. It didn’t help that the margins for these services are absolutely tiny, almost zero, and there have been years of constant battles with eircom and the regulator to get better prices and probably more importantly, better switching provisions for potential customers. I’m sure there’s huge relief now in BT Ireland.
It’ll be interesting to see how Vodafone runs with this now as Perlico under the Vodafone ownership still appeared to be very independent. Will BT Ireland broadband packages remain unchanged, will Vodafone and Perlico packages change to be the same as BT Ireland ones?
Update:
Some questions and answers too:
Will any jobs be lost with the moving and merging of the BT consumer operations with Vodafone?
No – all Rep of Ireland employees working in the transferring businesses will transfer across to Vodafone under the TUPE process.
Will BT Ireland still unbundle exchanges and if yes and manage them or will Voda do this in future, if BT then will Vodafone be the one reselling the services exclusively or will BT offer them to others?
BT will be unbundling and managing up to 58 new exchanges (to add to the current 22), offering a competitive wholesale platform for the first time in the Irish marketplace, which covers up to two thirds of the available broadband lines.
How long will the BT packages customers are on, be honoured for?
Nothing will change for BT’s customer base in the short to medium term – BT and Vodafone will be managing a smooth transition of the base over the coming months, enabling an improved portfolio of converged products and services to these customers.
