Investment: 02, led by Mark Evans, has spent £500million on the 5G auction
Mark Evans sounds like a man up for a fight. The boss of O2, one of the most powerful men in the UK mobile industry, is getting worked up about BT, the old enemy which still controls Britain’s phone lines.
Another row appears to be brewing in the sector, which has seen more ding-dongs over the past few years than an episode of EastEnders.
Ironically, O2 was originally part of BT but the telecoms giant had to offload its mobile phone arm back in 2001 as part of a plan to reduce its then gargantuan debt pile.
The company it spun off, O2, was subsequently bought by Telefónica of Spain and has more than once found itself at loggerheads with its one-time parent.
The latest spat comes after BT was forced last year to open up its tunnels and telegraph poles to rivals such as Sky and Virgin Media so they could install superfast broadband in homes across the country.
Now, Evans wants the same access for mobile phone operators like O2, Three and Vodafone. They say they also need to tap into BT’s infrastructure, which is run by its Openreach division, in order to launch 5G, or fifth generation, superfast mobile internet.
‘Why should one sector be treated differently to another sector? I’d like to see Openreach give mobile players the same access to their infrastructure,’ he says.
‘That’s a message we’ll be putting forward to BT and the regulator. If the UK wants brilliant 5G coverage and services, then that’s going to be critical.’
BT’s boss Gavin Patterson will be leaving his post soon after a fractious relationship with the regulator Ofcom which last year forced it to ring-fence Openreach. This looming row could mark the last chapter in Patterson’s tumultuous BT career.
But surely BT, which has its own mobile network, EE, won’t want to help its competitors?
While the future is certainly 5G, the destiny of O2 is rather less certain. Its Spanish parent Telefónica has been looking to sell the UK division for the past few years
‘If they’re minded to help the UK accelerate innovation and drive 5G then they will. If they’re looking to avoid competition and slow down investment, then maybe they’ll kick it into touch and fight the battle with the regulator or maybe in the courts. I hope not.’
With his towering frame and athletic build – he’s up at 5.30 every morning to hit the gym – rugby-mad Evans, 49, doesn’t look like a man you’d want to get into an arm-wrestle with. Born in Wales but brought up in Southampton where he trained as an accountant, he is a proud fan of the Welsh team and has a friendly rivalry with the England team, which O2 sponsors.
‘England triumphed this year over Wales [in the Six Nations] but I live in hope. The World Cup’s next year and that’s even bigger so you never know,’ he jokes.
THE EARLY-RISING PHONE CHIEF WITH A HIGH-TECH CALLING
Name: Mark Evans
Family: Wife Julie, children Tom, Sam and Jessica.
Day in the life: Wake up at 5.30 every morning to go to the gym at work. Either go into the Slough headquarters or the London office. Go to lunch with large customers, or with O2-owned GiffGaff and Tesco Mobile, which both run on O2’s network.
Leave work in time to sit down for dinner with the family – where it’s a strictly no-phones zone.
Favourite book: The Girl With The Dragon Tattoo.
Favourite film: The Bourne Identity.
Best advice you have received: Be proud of who you are – but always remember you’re a work in progress.
Tip for the top: Do what you have a real passion for, as that’s where you’ll be most energised and constantly look to learn and develop.
Thrillers: High drama in Evans’ favourite book
We’re in O2’s futuristic London office, surrounded by funky start-up businesses. These independent high-tech small firms are funded by Telefónica, which takes stakes in companies it believes could invent the money-making technologies of tomorrow.
It’s an apt setting for Evans to spell out his vision of a Britain transformed by 5G, the most powerful generation of mobile internet. It may sound like an Orwellian nightmare to some as it powers everything from robots to driverless cars, but Evans argues it will improve life for everyone.
He says devices connected through 5G could mean the council knows when to pick up your rubbish – which in turn could mean they can lower your council tax bill. Or that your fridge could suggest what you have for supper, based on the ingredients inside, reducing food waste and saving you money and trips to the shops. And there’s good news for commuters as 5G could help vehicle flow by, for instance, making traffic lights more efficient.
‘What would a 10 per cent reduction in commuting time mean for the economy as a whole? That’s eminently feasible if we can ignite and drive a smart city,’ Evans says.
Later this year, O2 is launching the first public testing site at the O2 Arena, which is now the busiest music venue in the world, so people can see the benefits of 5G for themselves. The company has bet big on it, splashing out £500 million on the recent spectrum auction.
This is the process where the regulator determines the share each firm will receive of the airwaves, through an auction process. It is somewhat fraught, since the 3G auction almost two decades ago resulted in players, including BT, bidding huge sums – much of which turned out to be wasted.
Still, O2 is spending more than any of the other three main competitors, EE, Vodafone, and Three. I wonder whether older people might get left behind once our toasters start talking to us.
‘Absolutely not. If you take tablet use, my parents use theirs more than I do. I don’t think it’s as stereotypical as sometimes we believe.’
Nor does he think people in the countryside will be forgotten about. He says it could help – one example he suggests is smartwatches tracking health and sending data to GPs, which would be great for people in remote places.
He’s two years into his job as O2 chief executive, overseeing 6,500 staff, having been chief financial officer before that. He spent 11 years at Vodafone. Evans is certainly not afraid to ruffle a few feathers for the benefit of O2, but also for his customers.
5G could make traffic lights more efficient and reduce commuting time by 10 per cent
He recently introduced flexible contracts, meaning his subscribers can choose to pay less some months when money is tight. It was partly in response to Brexit. Uncertainty surrounding the UK’s exit from the EU has caused Evans to warn that Britain could miss out on hundreds of millions of pounds worth of investment in improving mobile speeds.
While the future is certainly 5G, the destiny of O2 is rather less certain. Its Spanish parent Telefónica has been looking to sell the UK division for the past few years. A £10.3 billion sale to Three owner CK Hutchison fell through in 2016 amid competition concerns, while a stock market float has been on the cards since then.
That would propel Evans into the ranks of FTSE 100 bosses. Liberty Global’s deal in Europe with Vodafone has even ignited speculation the US cable giant, which owns Virgin Media, could swoop for O2 to enter the UK mobile market before the listing.
‘My focus is on doing the right thing by customers by continuing to grow the O2 business. If you run a successful, healthy business, then understandably others may show at interest in it,’ he says, sticking to the script.
With a new battle with BT and a possible float on the cards, Evans could have a busy summer ahead of him.
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