Summary Bullets:

• BT is selling Irish wholesale and enterprise operations, including about 3,400 km of managed fiber, 400 customers, and revenues of EUR57.6 million to challenger Speed Fibre Group.
• BT’s move typifies many telcos as they scale back and restructure their global ambitions to refocus on fewer markets, presenting opportunities for challenger service providers.

BT has entered an agreement with Speed Fibre Group for the sale of its wholesale and enterprise business unit in Ireland. BT states it will “retain a strong presence to deliver connectivity, cloud, and security services to MNCs and large organizations.” The transaction is expected to be completed in 2025.

BTCIL (BT Communications Ireland Ltd.) includes the company’s domestic infrastructure (circa 3,400 km of managed fiber), revenues of EUR57.6 million, over 400 customers, and associated teams supporting wholesale and business enterprises. However, it excludes multinational customers, large Irish organizations, and the Emergency Call Answering Service. It also doesn’t involve the recently announced BT Irish data center business acquisition by Equinix. As part of the transaction, BT and Speed Fibre Group have signed an agreement to source connectivity from each other for their respective customers.

Speed Fibre Group includes Enet and Magnet+ and is owned by Cordiant Digital Infrastructure Ltd. with a turnover of just EUR86 million (EUR144.8 million post-acquisition), and about 190 employees and 11,000 customers, Speed Fibre Group is a classic challenger growing both organically and through acquisitions. This acquisition is a smart move to further boost Irish operations.

BT’s disposal of its Irish network is the latest step in its journey toward a focus on the UK, with the future of its international operations still under strategic consideration – underlined recently by the combination of BT’s small- and medium-sized business (SMB) and corporate and public sector (CPS) units, and appointment of a new BT Business CEO (Jon James), with former BT Business boss Bas Burger now focused on the future strategic direction of BT’s international operations.

BT is not alone in rationalizing non-UK operations. Vodafone, for example, has effectively exited direct operations in Italy and Spain. Three will exit the UK over the long term with the now approved merger of Vodafone UK and Three UK.

This European telco refocusing and withdrawal process is driven by a shift by many service providers from focusing on physical networks (underlay) toward software-defined networks (overlay), which many – but not all – operators no longer see as a differentiator. It also reflects the financial positions of European telcos as they need to invest in rolling out fiber and 5G mobile infrastructure, resulting in high demand for CapEx when working with thin margins and undergoing organizational rationalization. Much focus has shifted to financial engineering from technology engineering.

With this move, BT has largely finalized its exits from multiple joint ventures that formed the basis of its global strategy in the 1990s. At the time, BT struck fear into competitors across the world, but with changes in technology and a poorly managed strategy that failed to keep control and focus across disparate investments, the assets lost value and BT lost its way. Bas Burger has a challenging job defining how BT continues to be a key player globally, but the refocusing and disposals are important steps along the road for BT as it rebalances its enterprise market strategy.