BT Explores Launch of Budget Mobile Brand to Compete

blockchain In a strategic move to bolster its presence in the competitive telecommunications landscape, BT is reportedly contemplating the introduction of a low-cost mobile brand. This initiative comes as the company seeks to counter the growing influence of fintech disruptors like Revolut and Monzo, who are rapidly making their mark in the UK mobile market.

According to a report by the Financial Times, BT is evaluating various strategies to penetrate the budget mobile sector. This could involve either establishing a new brand internally or acquiring an existing virtual network operator (VNO). Such a shift represents a significant change for BT, which has traditionally offered mobile services exclusively through its premium EE brand.

While BT does own Plusnet, the company opted last year to limit this budget brand to broadband services only. However, the increasing competition from new entrants, particularly those emerging from the fintech realm, has prompted BT to reconsider its approach to remain relevant in the evolving market.

BT Explores Launch of Budget Mobile Brand to Compete Virtual network operators are becoming a substantial force within the UK mobile landscape, accounting for 16.5% of the market share last year. This figure is projected to grow in the foreseeable future as more players enter the market. Both Revolut and Monzo have announced intentions to launch their own mobile services, aiming to diversify their revenue streams while exerting pressure on established operators like Vodafone and Three.

Additionally, companies such as Klarna, known for its buy now, pay later services, are also venturing into mobile services, further intensifying the competition. Fern Trading, backed by the multibillion-pound Octopus Group, is another example of a new entrant aiming to capitalize on this lucrative market.

In light of these developments, BT is reportedly contemplating an expansion of its BT brand for broadband services. This strategy aims to attract older customers who may not be as familiar with its newer offerings, such as EE and Plusnet. The initiative is being spearheaded by Allison Kirkby, the chief executive of BT Group, and has gained the endorsement of Indian billionaire Sunil Bharti Mittal.

Business Last year, Bharti Enterprises became the largest shareholder in BT Group after acquiring shares from Patrick Drahi, the founder of the Amsterdam-listed telecom firm Altice. This change in ownership has likely influenced BT's current strategic considerations.

In response to inquiries about the potential launch of a budget mobile operator, a BT spokesperson commented, “We regularly review our offerings across all our brands to ensure our customers have access to the best products and services on the best network. At present, we have no plans to change our mobile offering.” This statement reflects BT's cautious yet proactive approach in a rapidly changing industry.

As BT navigates the challenges posed by new market entrants, its consideration of a low-cost mobile brand underscores the company's commitment to adaptability in the telecommunications industry. With the rise of fintech companies like Revolut and Monzo, BT's strategic decisions will be crucial in determining its future success and competitiveness in a landscape that is increasingly influenced by diverse players.