Former CIO as CEO will not calm business users of Openreach
The appointment of Clive Selley as CEO of Openreach, having been Group CIO of BT, has the potential to fuel discontent with Openreach by the telecoms industry and business community.
Openreach is intended to be a completely separate organisation from BT and is tasked with operating and maintaining the national core communications infrastructure, though owned by BT it is expected to be vendor neutral.
Openreach was created in 2005 following a review by telecommunications regulator Ofcom. Under its terms with Ofcom, Openreach is expected to operate and maintain the BT broadband and phone networks and provide operation and maintenance support for the same price to all other telecoms providers in the UK, a business that is reported to have earned Openreach £1.25 billion in its first year of business.
In March 2015 rival communications service providers called on Ofcom to break up Openreach as part of a review the regulator was launching into the UK’s digital business sector. Sky and the recently hacked TalkTalk were amongst the most vocal in the demand for a break up. Talk Talk CEO Dido Harding said Ofcom should use its review to end the conflict of interest that she said deterred Openreach from “meeting its obligations” to BT rivals. With BT now re-entering the mobile market with the acquisition of EE, having sold what is now o2, calls for greater independence are rising.
Talk Talk and Sky are unlikely to have found much succour in the news yesterday that former BT CIO Clive Selley has been appointed CEO of Openreach to replace the Nationwide building society bound former CEO Joe Garner.
Selley is a BT lifer, he joined the organisation on its graduate entry scheme and has worked his way through the behemoth former state owned telecoms provider. Selley cannot fail to have a loyalty to BT.
Selley’s appointment as CEO was welcomed by peers, including fellow telecoms CIO, Phil Jordan, Global CIO of Telefonica who tweeted the importance of a CIO becoming a CEO. However, Selley’s appointment is more akin to the appointment of Philip Clarke as CEO of supermarket retailer Tesco. Clarke was announced as CEO of the now struggling supermarket chain in July 2010 and many saw it as a great leap forward for the CIO community. Clarke had been CIO of Tesco prior to his promotion. But as former ICI CIO Richard Sykes wrote, that was to miss the point, Clarke was a Tesco lifer and had been given the CIO role as part of his development towards becoming a CEO at Tesco. As history shows, Clarke’s tenure was not a happy one and was always going to be a challenge as he was the first CEO of Tesco to follow in the wake of Sir Terry Leahy, who had become a darling of British industry for his rampant growth strategy that saw the Tesco brand expand as far as Malaysia and Korea and make acquisitions in the USA.
Selley, like Clarke is an experienced BT operator and leader. He has CEO credentials, having been CEO of BT Innovate & Design from April 2010 to December 2012 and CEO of BT Technology, Services & Operations from January 2013 until he leaves for Openreach. Both of these CEO roles he held alongside the Group CIO role.
Not only will rival telecommunications providers calling for a change at Openreach, so too are the CIO community. Many CIOs have expressed frustration with the standard of service they receive from BT and Openreach, while consumers, particularly in rural areas are bored by constant claims by BT of improved connectivity, whilst staring at a flashing red light on their broadband routers.
Selley and Openreach face an enormous challenge to convince the business community that they can deliver a reliable and neutral service and not just be the installation and maintenance arm of BT.