BT Group PLC (LSE:BT.A) striking a deal to sidefoot the BT Sport broadcast arm into a joint venture has wrapped up a major target for boss Philip Jansen, but after almost three and a half years in the job he still has plenty on his to-do list.
The company’s entered the sports broadcast battle back in 2012 under previous gaffer Gavin Patterson as a way to attract new fans, or ‘customers’ as some football clubs insist on calling them.
Securing Champions League rights among other deals saw BT park its tanks on the lawn of rival Sky, but the cost of acquiring top-level sports rights is high and with competition from the likes of Amazon Prime and DAXN it appears to be an unwanted extra weight on the company’s balance sheet in coming years.
Picturing Jansen, who got his feet under the chief executive’s desk at the former telecoms monopoly in early 2019, as a football manager, it would be plausible to picture him with a big grin at the post-match press conference after the deal with Warner Bros Discovery and a solid set of final results.
Looking more like Chelsea’s Thomas Tuchel than old-school Ron Atkinson, Jansen might not be quite “over the moon” but pretty pleased nonetheless – though new-ish chairman Adam Crozier might be standing off-camera, glowering with unfulfilled ambition
Other goals were also chalked up in the results, including the return of the final dividend and well as progress on the rollout of superfast fibre broadband and 5G mobile masts in the past year by Openreach, the club’s giant goal-machine/infrastructure unit.
Shifting BT Sport into a sort of loan deal with Warner Bros Discovery, which has an option to buy, Jansen said would “improve our content offering to customers, aligning our business with a new global content powerhouse”.
Jansen also pointed to hard work on the training ground, with cost-cutting targets upped, but acknowledged the outlook “remains challenging” with targets for the season ahead.
Transfer target?
Some big items still loom over the organisation, not least the sizeable stake held by France’s Altice.
While Altice boss, French telecoms tycoon Patrick Drahi, has said a takeover any time soon is not on the cards, speculation remains rife.
As one of the ‘big four’ in the UK scene, the competition remains intense, with rivals such as Sky, Vodafone and Cityfibre competing hard to win broadband services.
In the mobile market, Vodafone was also reported today to be in talks with Three UK about a possible merger.
The cost-of-living crisis could also force some customers to cut back on non-essential purchases and subscriptions, with even the BT-Discovery offering up for the chop if the likes of Netflix also reporting slowing subscriber growth.
Jansen and Crozier BT still have many issues to deal with, not least a big pension deficit, the cost and complexity of further investment in the network and trade unions threatening industrial action unless wages are increased 10%.
Some investors have been less than gruntled with shareholder returns, given heavy investment in the infrastructure expansion and it will be a major achievement for management team if they juggle the other balls and still get the group anywhere near back to mid-table on this score.