BT CEO Philip Jansen (pictured) predicted the operator would take a hit of £500 million over the next five years due to the UK’s decision to restrict Huawei’s involvement in networks, with the bulk of the charge incurred from ripping out 4G kit.
Earlier this week, the UK cleared operators to use Huawei equipment in their 5G networks, but limited its role to RAN with a 35 per cent cap on the amount of equipment used.
On BT’s fiscal Q3 earnings call (covering the three months to end-December) Jansen said the majority of the costs would be “front loaded”, likely spread over the next three years. He added clarity on Huawei’s role was “extremely helpful”, adding although there are a few outstanding questions on the government’s policy, the decision allowed BT to press on with expanding EE’s 5G network as soon as possible.
The company is still assessing the full impact of the government’s decision, but the executive noted the immediate action for BT would be to “accelerate some of the [network] rebalancing we were already in the process of”.
BT uses Huawei equipment within EE’s mobile infrastructure and, to a lesser extent, in BT’s fibre network.
During the quarter, revenue was £5.8 billion, down 3 per cent year-on-year when adjusted to reflect a change in accounting standards. The company attributed the decline to headwinds from regulation, declines in its consumer fixed base and results from its Enterprise and Global divisions.
It noted performance of its Consumer unit, which includes EE, was “solid” with momentum in its convergence service Halo.
Net profit is reported for the first nine months of its fiscal year rather than on a quarterly basis: over this period the figure was £1.5 billion, less than the £1.7 million booked in the prior-year period though BT noted direct comparisons were not meaningful due to the accounting standard change.Subscribe to our daily newsletter Back