ALEX BRUMMER: BT dials up the changes but will it fix Britain’s lagging broadband network?
The notion that it makes commercial sense for telecoms providers to control proprietary information and entertainment content has been around for two decades.
Many transactions and deals in the sector have proved a step too far.
The apotheosis was the celebrated £255billion mega-merger between internet pioneer AOL and Time Warner two decades ago.
Net outlay: New BT boss Philip Jansen wants to end pedestrian thinking at the Openreach broadband arm by bringing in outside investment
It proved a ghastly failure, with the companies burning up huge amounts of goodwill before spinning off in all directions.
In Britain, BT has decided that the £5billion or so it has spent on football rights is not the best of investments, and chief executive Philip Jansen wants more focus on delivering fibre for UK broadband users.
New York telecoms behemoth Verizon Communications is on a similar journey – it is disposing of its media brands Yahoo! and AOL to private equity. It also has disposed of blogging platforms Tumblr and Huff Post.
Verizon found it hard to compete in the digital advertising space with online giants Facebook and Google. It is doubling down on efforts to roll out 5G super-fast mobile networks across the US.
Having extricated itself from sports rights, the big question for BT is how best to speed the upgrade of the UK’s creaking copper broadband network, which at times was overwhelmed in the pandemic.
Much will depend on the choice of new chairman after the sudden departure of Jan du Plessis in March. Former Kingfisher chief executive Ian Cheshire is favourite and has support from Jansen. Not all independent directors are so enamoured.
Jansen, who arrived at BT via Worldpay and private equity, wants to end pedestrian thinking at the Openreach broadband arm by bringing in outside investment.
Whether regulators and the public would have any sympathy for a private equity full or partial buyout is up for debate.
Advent and Bain Capital are among those interested. Britain is strewn with the remains of private equity profiteering, ranging from Debenhams to the AA and Cobham. It is not a good look even if there are deep pockets and the possibility of effecting change out of public view.
A better solution would be for BT to spin out Openreach as a separate quoted firm able to raise new capital on the public markets.
It is critical that the logjam is unblocked so that the Government-backed broadband initiative is rapidly powered up for the digital age.
Fears that over-ambition for Deliveroo has fouled the nest of the London Stock Exchange are misplaced.
Canadian-founded deep tech firm Alphawave, which embeds communications and switching technology in chips, is set for a float this month. It has chosen London for its £3.3billion IPO because it likes the geographical reach west to the US and east to Asia.
It also thinks that Cambridge is a terrific place to recruit advanced engineers.
The worry must be that with a standard one-vote, one-share structure, it might suffer the same fate as Arm Holdings and Imagination, both of which fell into unsafe overseas hands.
Alphawave founders Tony Pialis and Jonathan Rogers are convinced they can withstand the assault when it comes.
Confidence is inspired by the arrival of cornerstone investors Blackrock and London-based Janus Henderson.
Hard on the heels of Alphawave, as soon as this summer, is Oxford Nanopore. Its devices and intellectual property are playing a critical role in the pandemic and enabled the UK to be at the cutting edge of discovering Covid variants. It does this by speeding up the sequencing.
It is good to see M&G’s new Catalyst team, working on behalf of Pru Fund, backing the latest fundraising with a £195million investment.
I don’t pretend to understand the science but the internal R&D has generated some 1,400 patents.
Intellectual property is the key to the tech start-ups with the most potential. Oxford Nanopore looks to be on the right track with a valuation of £2.48billion. Encouraging.
Succession planning is a key element of good governance and is even more important when the bloke in charge is 90.
The outing of Berkshire Hathaway vice-chairman Greg Abel as the person to take charge when Warren Buffett downs his final Cherry Coke is being greeted with great excitement. At 58, Abel is just a stripling.