EE boss Olaf Swantee: Hacking activity has increased since TalkTalk attack came to light
It's not just ironing out the details of the coming takeover from British telecom giant BT, scheduled for March next year, that’s keeping EE chief executive Olaf Swantee busy.
The mobile operator EE, – created in a 50:50 joint venture between Deutsche Telekom and Orange SA in 2010 – has had to fend off an increased number of cyber attacks since TalkTalk revealed it had 15,000 customers’ financial details stolen last month.
Olaf Swantee, the Dutch businessman who’s captained EE since 2011, tells City PM: “Since the TalkTalk breach, we have seen heightened activity from criminals and people who want to access our system.
“We have successfully prevented these attacks, but we are reviewing what we can do better to protect customers’ data,” Swantee adds.
Digital security at companies that store customers’ financial information have been under increased scrutiny since the attack on TalkTalk last month.
TalkTalk has said the loss of 157,000 of its customers’ personal details, including 15,000 people’s financial details, could cost the company up to £35m.
Meanwhile, this is a trend that has been clearly growing for some time.
The cost of hacks and data breaches was found to have doubled this year, according to a recent government report.
The initial costs of a major security breach at a large organisation rose to an average £1.46m, jumping from £600,000 in 2014, due to disruption, lost sales, recovery of assets, fines and compensation.
The costs to smaller firms also rocketed to £310,000 from £115,000 last year.
Swantee says: “We come under attack every day, and these attacks are not going to stop. On the contrary, I think we will see more of this kind of attack in the future.”
Better off with BT?
Having now been cleared by the Competition and Markets Authority, the acquisition of EE by BT Group for £12.5bn in March is set to add to the ongoing consolidation in the market.
Despite concerns that costs to the customer could be set to rise, Swantee says it is something from which customers will benefit.
“It was the right decision for BT to buy EE. The dependency BT has on fixed line is well complimented by EE,” Swantee says.
As 4G continues to be rolled out across the country, Swantee expects so-called 4G dongles – wireless routers that multiple devices can connect to the internet through using the 4G network – to vastly increase in use.
“I think there is a place for both fixed-line broadband and 4G broadband, says Swantee.
“Sometimes, when it is not possible to get a fixed line in place and the connection is required for a business, for example, we can get 4G routers in place very quickly to get them online.”
It’s this combination that Swantee thinks makes BT and EE such a good fit for each other.
“Where [fixed-line] broadband is bad,” he explains, “4G will replace it. Where it is good, 4G will be available as a secondary option.”
Rural areas around the country that are still lacking reliable, fast broadband – due to the costs of laying cables to reach them – may be brought online through wireless broadband instead.
“In parts of the country, we have tested 4G broadband where there is no fixed line available. There is though always an interdependency between the two,” Swantee says.
The branding of the combined companies has yet to be nailed down, but Swantee reiterates what BT boss Gavin Patterson has previously said, that keeping separate brands is an option.
On what his own role at the combined company will be, Swantee says that is not currently his concern.
“I’m focused squarely on getting the deal through. I am committed to finalising the legal details and the integration, and then we’ll see.”