BT snaps up

The telecoms giant has added the UK's leading IT Web-based retailer to its portfolio, which could help it develop as a supplier of technology products and services

BT announced on Friday that it has bought the Internet retailer for an undisclosed amount.

One of the largest Web-based retailers of electrical and electronic goods, Dabs processes more than 75,000 customer orders through its Web site every month.

The acquisition looks like a surprising move for BT, which is best known as an IT and telecoms services company rather than a retailer. BT, though, insists it will help it to develop in the IT services and products space.

"Dabs is an excellent fit for us," a spokesman for BT told ZDNet UK. "It is a very well-respected name in retail."

One of the first companies to enter the online retail electronics market, Bolton-based Dabs has a good reputation for customer service and has won many awards.

"We have a very broad range of computer and IT services and products," the BT spokesman said. "This is all about cross-fertilising the different markets, and it brings great benefits to BT, to our customers and our partners. We are not a phone company any more — we are an IT products and services company."

BT sells products and services through a wide range of channels, including resellers. Many of these already have to compete with BT Retail, and now face competition from a BT-owned Dabs, but the company claims the acquisition doesn't risk angering resellers. "We will continue to have a wide variety of channels," the spokesman said.

BT is retaining the Dabs name, but it is unclear to what extent the BT and Dabs brands will be integrated. "We are looking at that," the spokesman said.

The acquisition may help BT reach new customers. "We deal with large companies down to SMEs," the BT spokesman said. "But this announcement is about more than SMEs, it is about consumers as well. We have a large presence there though our broadband services."

Dabs claims to have around a million consumer and business customers in the UK, as well as a few more through a small operation in France. In the year ended in March, the company's revenues were £180m with gross assets valued at £42m.