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“Silly” remark by Everything Everywhere chief lets slip truth about T-Mobile brand

October 26, 2011

Dear Mr Swantee

How do these female Telegraph journalists do it? Trap you into saying things you didn’t really mean to say, that is? Not many months ago, Mr Cable was silly enough to tell two such hackettes that Mr Murdoch’s empire was thoroughly evil and that he was going to put a stop to it, just when he was supposed to be impartially adjudicating the self-same Mr Murdoch’s bid for BSkyB.

Now you, too, have been very silly. Or, to be more precise, you have been caught rubbishing Everything Everywhere, the brand name of the company where you are chief executive.

Here are the very words you used, as reported by the delightful Katherine Rushton:

“Everything Everywhere is not a brand, it’s a silly name with a stopping effect”, he said, although he maintained it was useful for stores which house the two mobile brands.”

Now I know what you’re going to say; in fact what you have said: just like poor old Vince, you were quoted out of context. His context was entrapment; yours we’re going to work on a bit – just in case there’s any misunderstanding.

The first thing I’d like to make clear is that we are all right behind you. Not only do we admire the candour of someone in so senior and responsible a position voicing what we have all long since judged to be a self-evident truth (just, as it happens, we did with Mr Cable). We are also quite prepared to accept that journalists, with their obsession for compression, tend to miss the bigger picture.

I expect, when you were describing your corporate brand as “silly”, what you were really doing was employing a bit of time-honoured rhetorical licence: using the part as shorthand for the whole. It’s not Everything Everywhere the brand that is “silly” with “a stopping effect”, but the brand strategy behind it. That, surely, is the bigger picture that got left out of the context.

Right from the beginning, that brand strategy has been misconceived, hasn’t it?

I mean, the initial idea was all right as far as it went: putting together 2 failing UK mobile telecoms brands in one brand-new holding company and, overnight, transforming yourself into UK leader by customers, ahead of those snake-oil people at O2. What a clever sleight of hand, and one that avoided Orange and T-Mobile experiencing serious difficulty with the competition authorities into the bargain.

The trouble is, your predecessor Tom Alexander wasn’t empowered by his twin masters, France Télécom and Deutsche Telekom, to take the idea any further – and you were left to clear up the mess that resulted. 50:50 ventures never work, do they? Still, you’ve done what you can, within the agreed terms. You’ve swept away all those unnecessary backroom boys and girls, stripped out excess infrastructure, rationalised the shops, brushed up the margins, cleansed the boardroom of useless, nay-saying, former T-Mobile executives and ploughed on with a leaner, meaner Orange team. Yes, Sirree, having worked at HP before you joined France Télécom, you know just about everything there is to know about consolidating tired, low-growth companies.

But one thing they haven’t let you do is to slay the elephant in the room. Yes, I know what you said when you took over earlier this year:

“The T-Mobile customers want a flexible payment and usage system. The Orange customers want a predictable amount paid every month. There is a clear difference.”

But the justification for that difference is becoming less and less apparent, isn’t it? Look at your latest, Q3, figures: pre-paid, plummeting; contracts up. T-Mobile’s days as a UK brand are surely numbered.

Truth to tell, Orange is and always has been much the stronger brand; better serviced too. Maybe, if there hadn’t been all that fudging at the beginning by your corporate masters, then the figures would have been a lot more convincing than they are today. And your brand hierarchy a lot more coherent. Without T-Mobile to worry about, poor old Tom would never have had a nervous breakdown trying to justify the vacuous sticking-plaster of Everything Everywhere – as the best of all branding in the best of possible worlds, when it patently wasn’t.

No wonder you let slip your frustration with a “silly”, unguarded remark.

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Vince hands BSkyB to Murdoch on a platter

December 21, 2010

It would appear the Scourge of Capitalism (aka business secretary Vince Cable) was bent on doing exactly what I earlier predicted. That is, committing a gross act of hypocrisy – in the clandestine manner of the bankers he so despises – by rigging the market to get the result he wanted.

This is the only reasonable interpretation of his unguarded remarks to two Telegraph undercover reporters about “declaring war on Mr Murdoch”. He is of course referring to his supposedly impartial role in adjudicating the acceptability of NewsCorp’s bid for the 61% of BSkyB it does not already own. For the avoidance of doubt the guileless minister of the crown went on to explain to the two reporters – posing as constituents: “I have blocked it [the bid] using the powers that I have got and they are legal powers that I have got…”.

Actually, that last bit is a tad premature. Ofcom is not supposed to report back on whether there is a prima facie case for referral to the Competition Commission until December 31st. But Vince was clearly confident that he had Ofcom in his pocket and could press ahead with a referral on the public interest grounds of an infringement of “media plurality”. The beauty of such grounds is that they reside entirely in the realm of political value judgement rather than the rigorously factual analysis of any threat to competition. And given that Cable would have had the final word, Murdoch & Co were clearly going to be thwarted.

No longer. Vince is off the case (indeed, he is off any adjudication of media competition cases from now on), although he has narrowly managed to retain his job. And culture media and sport secretary Jeremy Hunt will take his place. As a Tory, Hunt does not carry Cable’s Lib Dem ideological baggage; and if he does harbour any personal animosity towards the Murdoch clan it has so far remained scrupulously off the record.

Which is just as well. In the circumstances he will find it politically excruciating to deliver the thumbs down. The European Commission has just waved through the bid on competition grounds. That leaves the public interest argument. But this, too, is looking increasingly shaky when assessed on any fair-minded basis – as it will have to be in the wake of Cablegate. The legal precedent was set when the last government forcibly caused BSkyB to divest most of its 18% stakeholding in ITV. Ironically, the stated grounds were that NewsCorp’s then 39% holding in BSkyB posed a threat to UK media plurality. If you’re already a threat to media plurality when you hold a controlling 39% interest in a company, how is owning the rest of the shares going to make a material difference?

As political fiascos go, this is a corker. The Scourge of Capitalism has ended up performing a humiliating act of public self-flagellation. In the process, he has damaged Ofcom’s independence and almost certainly brought about the result he most feared: the strengthening of Rupert Murdoch’s commercial interests.

En passant, he has also damaged The Telegraph – one of his allies in the Murdoch matter, if no other; although Cable can hardly be blamed for that. The Telegraph deliberately suppressed Cable’s anti-Murdoch comments, presumably on the grounds that they harmed its commercial interests. Only because some nameless Assangeite felt that editorial integrity had been inexcusably compromised did the scoop come into the capable hands of BBC business editor Robert Peston.

I bet they’re laughing up their sleeves at Osterley Park and Wapping. I can’t say I blame them.


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