The world's first commercial telecommunications venture, The Electric Telegraph Company (ETC), was incorporated by Sir William Fothergill Cooke and Joseph Lewis Ricardo in 1846. Alarmed by this threat to its monopoly, the General Post Office lobbied for the right to buy up both the ETC and other rival firms and by 1912 had created an even more lucrative monopoly. With the 1969 Post Office Act, the GPO ceased to be a government department and became a nationalised corporation.
BT as we know it today sprang into life with its flotation on the LSE in 1984. It prospered as the poster child for Margaret Thatcher's privatisation policy, a champion of mass share ownership and free-market economics - even if the competition was largely notional. But, by the early noughties, things looked grim - shares that had topped £10 in the dotcom boom were worth just £2, and a series of big flops like the Concert JV with AT&T of the US left BT with debts of over £30bn. Shareholders forced the demerger of mobile division BT Cellnet as a result.
Who's the boss?
Ian Livingston, a Scottish accountant who became Dixon's finance director at 32, then the youngest in the FTSE 100. He joined BT as FD in 2005 and succeeded Ben Verwaayen in 2008. He has wrestled with plenty of gremlins, notably the write-down by the Global Services consulting division of £1.3bn in 2008; the decline of fixed-line phone services; and a vast pension fund deficit. Yet Livingston must be doing something right: BT posted pre-tax profits up 71% to £1.7bn for the year to March 2011, and the pension deficit is down £6.1bn to £1.8bn.
The secret formula?
To go hell-for-leather after the broadband infrastructure market. BT has been replacing its copper phone cables with superfast fibre-optic lines - an investment that is showing results. As well as profitably punting bandwidth on the wholesale market, BT is the UK's largest provider of domestic broadband services.
Staying on its feet after privatisation - unlike British Leyland, British Steel and others. And who could forget the TV ads, from Busby and Beattie in the 1970s and 1980s, through Jeremy (can't win 'em all) Clarkson to Adam and Jane?
Don't mention ...
... the Cellnet demerger. That business, which became O2 when sold to Spain's Telefonica for £18bn in 2005, now generates some £830m more in annual revenues than its former parent.
Annual sales: £20bn
Pretax profit: £1.7bn
- Figures for year to March 2011