BT has launched a new B2B unit, “BT Business” that combines and streamlines its previous enterprise and global segments. Hema Jalil, previously global CIO of BT Digital has been appointed as CIO for the new unit.
BT Business was first announced in December 2022 and will serve corporate and government customers. It is led by former BT Global CEO Bas Burger. BT Enterprise CEO Rob Shuter is leaving BT after the consolidation.
Burger said in a LinkedIn post on April 3 that “today marks the official start” of the unit which BT says will provide “unified communications, multi-cloud networking, and advanced security solutions.”
BT Business unit will help drive £100m in savings
BT said in December that the new unit would help it save “at least” £100 million by the end of 2025 through “consolidation and rationalisation of management teams, support functions, product portfolios and systems.”
The telco is targeting cost savings of £3 billion by the end of 2025 and is undergoing a major digital transformation, with Harmeen Mehta, chief digital and innovation officer (CDIO) at BT Digital earlier admitting that the company’s IT to revenue ratio was 40% worse than other competitors in the telecoms sector.
Among its IT modernisation efforts are plans to “move off mainframes given the prohibitive increase in legacy infrastructure cost – without rewriting decades-old applications” as Mehta put it in January.
As part of that project, some applications are being ‘retired’ (contributing to the Group’s target to get to fewer than 500 strategic systems by 2027, simplifying its technology estate), ‘refactored’ or rehosted on cloud. BT and Kyndryl estimate that the project will cut mainframe operating costs and energy consumption by 70%, generating annual savings of £17 million by the time the project is due to complete in 2026.
BT is building and connecting full fibre networks “like fury” CEO Philip Jansen said as the company announced its fiscal Q3 earnings in February, saying it had reached 9.6 million premises, with its 5G mobile network now reaching 60% of the UK population. BT reported revenues for the quarter of £5.2 billion, down 3% year-on-year.
While BT has reiterated its FY2023 commitment to deliver £7.9 billion of EBITDA, growth in the telco sector has slowed post-pandemic and with global inflation Jansen has stated that cost-saving measures, such as unit consolidation, remain crucial. BT is also hiking prices 14%, in line with the consumer price index (CPI) plus 3.9%.