In our view, Livingston has five challenges to address:
BTs recovery from the abyss peaked in quarter three (Q3) two years ago with growth year-on-year of eight percent. The corresponding figure was five percent twelve months ago, and one percent in the results announced in February this year. Any growth for what is a fixed-only business is highly credit worthy, and yet the feeling is BT should have done better. Ian's challenge is to repeat the success he has had in turning around BT Retail across the Group.
Customers and services
BT needs to evolve its portfolio to suit its customers, not technology. For example, the younger generation of students are compulsive communicators, which is good news for the industry. This generation use a mix of direct - voice, email, Instant Messaging and texts - indirect - such as social networking sites, on-line message boards, Second Life - means to communicate.
BT needs to provide these new workers with the direct and indirect communications services they need as they enter the workplace.
Central to achieving a greater understanding of customer needs is marketing. BT needs to ensure that its brand is spontaneously linked to the communications services it provides to the market segments (both decision makers and users) that matter most to it. Livingston needs to bring customers and marketing more to the fore in BT.
Networks and technology
BT needs to refresh its 21st Century Network (21CN) story and address the issue of fibre in the access network.
Livingston was reported in The Sunday Times as laying down a challenge to regulator Ofcom on FTTP (fibre to the premises) and the USO (Universal Service Obligation).
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