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What drives the sudden last minute push for this share, I see it time and time again, either reviving late in the day, or alternatively forced lower after a day of steady increase ?
Seems strange when compared to other shares ?
Larry - mostly good, but there is a potential 30% profit to be made on investment.
I’m not saying BT will do this but ....
It is possible in BTs case to reduce investment to 30% less than their current corporation tax payment, this would then allow them to benefit from the 30% profit margin available under these plans.
This would have the opposite, desired effect of reduced investment in BT’s case, this to me indicates for broadband roll out this is a bad policy, because BT can only make profit by reducing investment or..... there’s more policy down the line.
I repeat not saying BT would do this, but by my understanding they could & ac30% margin on investment seems attractive if there’s nothing else in it for them.
Okay, so it’s all looking clearer after BT’s press release. It sounds like this is only 2 years relief, based on what they are saying, they do not see this as an opportunity to spend massive over two years, then claim tax relief over many years, so this doesn’t look anything other than saving from their corporation tax bill over 2 years (not brilliant in my opinion for a 10 year build or to replace £5bln promise)
This also pre-supposes this investment will qualify.
Larry - yes. It won’t take long some fool will soon be accusing you of being negative.
There’s not much in it, but I was thinking the government isn’t going to give away money, they are only letting companies pay less tax,
Therefore BT can only save the amount they pay in corporation tax, circa £440mln, I was thinking what ever that figure is that’s the max, unless they can carry on claiming the 2 years investment in years 3,4,5,6 etc, which I think someone thought they could?
It’s good news, but as always it’s the detail which matters & will determine how good.
Fleccy - I don’t think there is a case to spend as much as they can, unless they can carry on claiming tax relief over next 10 - 15 years
If BT only pay £300mln in tax, they can only ever claim £300mln back or £210mln if they want to maximise profit.... if they spend more tan £210mln (for this example) they reduce profit opportunity
This is good news, but it’s only 130% of their investment costs from tax over / years.
I don’t think BT can invest a huge proportion of their planned £12bln over the next 2 years & if they did, I don’t think they pay enough tax, in order to save.
I’d like to see this roll over to subsequent tax years, could leave Bt not paying tax for next 10. To 15 years
That’s my understanding, 2 years, up to 130% of investment from their tax Bill.
Fleccy - the problem with living in the past is you lose perspective
In the 90s the cable industry were nothing more than startups, SKY too wasn’t far short of a startup TV only company.
Mobile hadn’t undermined fixed line voice
It’s almost like you don’t understand the difference in revenue between BT owning a retail customer & BT only owning the wholesale relationship
& I’ve never said “destroy BT “ only compete with
Fleccy you know my logic too well.
My opinion is
Sky, Liberty & Comcast are disrupters, anti incumbent by nature. It is in Comcast’s DNA to fight incumbents, BT will likely be viewed the same way, not as a partner.
American cable kings are wedded to cable technology by nature. Cable is a religion to these people, not a preference.
John Malone is a deal maker, he wants back into the us cable industry, for reasons above, part of why he sold up in Europe. John Malone & BT’s methods couldn’t be more different. Sky’s latest CEO is the ex COO of Virgin Media, a protege of John Malone from previous cable ventures
Sky needs to get away from satellites, they need to become a cable company (in comes Comcast). Comcast will look for Cable options by nature, they will over pay, wait or do what ever is necessary to promote a cable options, over and above any consideration, even without logic, this is a company who makes $100bln from cable, it’s a religion
It doesn’t matter how many times you say it, Virgin don’t need to use BT network options for the majority of U.K. homes & is increasing by the week. Customer Numbers increasing, O2 is coming on board, O2 already have SKY mobile.
Because BT has been so dominant for so many years, these companies, along with Vodafone naturally seem themselves as BT’s competition, for the first time, they are not far off being able to seriously compete / impact / eat into BT’s market share / dominance.
All my own opinion.
Hi Larry - yes, sky Comcast, Liberty media are not necessarily fully linked up yet, but all three independently or together are on the opposite side to BT. You can add Vodafone into that mix too, all have far more in common than they do with BT in my opinion