Everything Everywhere CEO Tom Alexander announced his departure this week at an interesting juncture in the newly formed company’s life. A year on from the official merger of Orange and T-Mobile in the UK, Everything Everywhere is at something of a crossroads.
Alexander is widely seen as an entrepreneur and dealmaker, so perhaps it is no surprise that he is bowing out now. The hard grind of consolidation lies ahead, which is not his forte. His successor, Olaf Swantee, will have to make that consolidation happen. He also has to grapple with the increasingly problematic question of whether to keep the two brands in existence, as well as in competition, or merge them properly under the Everything Everywhere banner.
Merging two large organisations with very different cultures is no mean feat, but that task has not been made any easier by the decision to keep both the Orange and T-Mobile brands going. It’s a tricky business at the best of times to pull off a successful merger, but surely it is even more difficult when the two sub-brands have to remain in competition with each other.
The argument at the time of the merger announcement was that plenty of businesses have rival products selling under an umbrella brand. True, but mobile operators are not exactly toothpaste, biscuits or even cars. Competition in the UK mobile market is among the toughest in the world, so wouldn’t it be better to merge the two brands and allow a unified business to concentrate on fighting O2, Vodafone and Three?
The view from the market is that the merger process has got bogged down and that there are too many management layers. Analysts suggest the consolidation process must be speeded up and that a leaner organisation is required. The departure of a number of senior staff over the last few months either indicates they have seen the writing on the wall, or they are frustrated with the current state of affairs.
We may find out more in September, when Everything Everywhere is due to conclude a review of the brand situation. The recent decision to roll out 30 more Everything Everywhere branded retail stores might be a hint that this is the direction the business wants to go. There are plenty of good things happening inside Everything Everywhere, but the UK’s largest operator needs to make up its mind what kind of business it wants to be, and fast.