BT Group is reportedly considering plans to launch a new low-cost mobile brand as part of a possible strategy to compete with a wave of new entrants – including fintech heavyweights Revolut and Monzo, both of which are preparing to launch mobile services.
According to the Financial Times, the UK’s largest telecoms company is considering whether to develop an in-house budget brand or acquire an existing virtual network operator (MVNO) as it explores options for re-entering the mobile market value chain.
Such a move would mark a strategic shift for BT, which currently offers mobile services exclusively through its premium EE brand and has focused its Plusnet subsidiary on broadband since a restructure last year.
The push comes as virtual network operators – companies that lease capacity from established networks such as EE, Vodafone and Three – are expanding rapidly, accounting for 16.5% of the UK mobile market in 2024, according to Ofcom. Analysts expect that share to rise as competition between low-cost and digital-first providers intensifies.
Fintech companies are among the new entrants. Revolut and Monzo, which together have a user base of more than 13 million UK customers, are preparing to launch mobile plans as part of wider efforts to diversify revenue streams and strengthen customer loyalty through bundled financial and telecommunications services.
Buy now, pay later provider Klarna is also moving into the mobile space, as is Fern Trading, part of investment empire Octopus Group, which is building telecoms assets across the UK.
“Fintechs are blurring the lines between banking, payments and connectivity,” said James Barford, head of telecoms research at Enders Analysis. “They already control the digital interface to consumers – the transition to mobile services is a natural extension of that ecosystem.”
BT’s exploration of the low-cost segment is being driven by chief executive Allison Kirkby, who took the helm at the start of the year. Kirkby is understood to be looking at ways to boost customer acquisition in a saturated market and broaden BT’s appeal beyond its high-end EE brand.
Industry sources told the FT that the plan is backed by Sunil Bharti Mittal, the Indian billionaire and founder of Bharti Enterprises, who became BT’s largest shareholder in 2024 after taking over the shares of French-Israeli telecoms tycoon Patrick Drahi.
The potential move is in line with Mittal’s strategic focus on affordability and market size – principles that underlie its success at Airtel, one of India’s largest mobile networks.
The telecommunications group is also reviewing the positioning of its consumer brand BT, which remains well known among older customers. Executives are said to be considering a revival of BT-branded broadband and mobile packages, aimed at more traditional users less familiar with the company’s newer brands, EE and Plusnet.
BT’s own research reportedly found that brand awareness remains a key factor in attracting and retaining older customers, particularly as rivals emphasize simplicity and value.
“EE has become a powerful brand for premium users,” said Sarah Hall, telecommunications consultant at Pegasus Strategy. “But the volume growth is in the mass market – and that’s where the fintech challengers attack first.”
Responding to the reports, BT issued a short statement: “We regularly review our offerings across all our brands to ensure our customers have access to the best products and services on the best network. We currently have no plans to change our mobile offering.”
But analysts say BT’s silence was due to early-stage deliberations rather than a rejection of the idea. The group is under increasing pressure to defend its share of the consumer market as value-focused new entrants such as Giffgaff, Smarty and Voxi continue to attract younger users with flexible, app-based contracts and transparent pricing.
The UK mobile market is currently experiencing one of the biggest disruptions in years, driven by digital disruption, consolidation and rising costs of network investment.
BT was already under competitive pressure following the Vodafone Three merger, while also struggling with the challenge of monetizing its multi-billion dollar investment in 5G infrastructure.
Meanwhile, fintech companies are seeing telecom as a lucrative gateway to everyday digital services – allowing them to bundle banking, payments and connectivity into one app and leveraging rich data insights to drive growth.
“If Revolut and Monzo can transform mobile services into lifestyle ecosystems, it could redefine customer engagement in both finance and telecoms,” said Dr. Anna Pickering, lecturer in digital economics at King’s College London. “BT and the legacy networks cannot afford to ignore this.”
While BT insists no formal decision has been made, the discussions underline how the rapid convergence between telecoms and fintech is forcing incumbents to innovate or risk losing relevance with younger, mobile-focused consumers.
If BT goes ahead, a low-cost mobile brand could not only protect its domestic market share, but also serve as a strategic counterweight to digital challengers seeking to undermine the dominance of Britain’s established networks.
Whatever the case, the battle for Britain’s mobile future is no longer just about connectivity – it’s about who controls the customer relationship in an increasingly digital world.
