Gray all charged up byiPhone

THE FRIDAY INTERVIEW: DANUTA GRAY is running late but from the reaction of other executives in O2 you are left with the impression…

THE FRIDAY INTERVIEW:DANUTA GRAY is running late but from the reaction of other executives in O2 you are left with the impression this is not an unusual occurrence. Given she is a director of 16 Irish-registered companies, including Aer Lingus and Irish Life and Permanent, juggling her commitments is a full-time job.

The chief executive of Ireland's second-largest mobile phone operator admits there is no such thing as a typical day. Earlier this week the Irish rugby team paid a visit to the offices of their shirt sponsor. Gray is in the midst of a series of briefings with staff on company strategy for 2008. Then there's the small matter of squeezing in board meetings with the other companies where she sits as a director.

With her desk in the corner of the fourth floor of O2's open-plan Liffey-side offices, she is the living embodiment of the mythical chief executive whose "door is always open". Such openness may also have contributed to O2 being voted best place to work in the Republic in 2006.

Gray sits down for the interview with an Apple iPhone in hand - the device O2 Ireland will start selling exclusively on March 14th and which she believes will "change the way people use their mobile".

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While other senior executives in the telecoms industry may be more polished, Gray could never be accused of not being enthusiastic about the job and the iPhone has her fired up.

"This as a device I believe is 18 months, maybe two years, ahead of its time," says Gray. "I am excited that we are the partner because it will enable us not just to sell handsets but I think to learn a huge amount about how customers change their pattern of behaviour when they get this kind of device in their hands."

She admits that O2 UK securing the iPhone was one of the main reasons the sister organisation in the Republic was able to do the deal so quickly. The iPhone has been the fastest-selling new product in the history of O2 UK or its predecessor BT Cellnet, according to Gray, so she is clearly excited about the prospects in the Republic when it goes on sale.

"What's interesting in the UK is that it increased the number of customers going through the door into the shops and they saw a flow through into the sales of what you might call standard handsets," she says.

In the highly competitive Irish market, she's also hoping it will enable O2 to woo customers from Vodafone, Meteor and 3.

It certainly seems to have done the trick across the Irish Sea with about 60 per cent of iPhone customers reportedly coming from other networks. Gray is hoping it will have a "halo effect" for O2 just as the company got a general brand boost from being the first to have the Blackberry e-mail messenger a few years back.

"Something like the iPhone is good for the industry because we were getting to a bit of a cycle of sameness," says Gray. "Some of the products that were coming out didn't have the excitement factor that you would have had two, three years ago. It needs it to reignite that interest."

Apple has broken the mould in the telecoms business by demanding a slice of the revenues that are generated by the iPhone. It's not something that Gray baulked at. She points out that O2 already shared revenues with content providers to its iMode service.

"If you have a business model that is about going into partnership with someone, then you both gain from it," she says.

At its end, O2 is keeping a close rein on the iPhone, which will only be available online, through O2's own retail outlets and from Carphone Warehouse.

There will be a significant marketing spend to support its introduction that will include TV, outdoor and online advertising as well as a "huge amount" of activity in-store.

"I love the advertising, I love the marketing," she laughs. "Ask any of my team which bit I love best. There's a pecking order in families, there's even a pecking order in business."

That's a far cry from Gray's roots in England. She studied physics in college but realised her talents lay in business rather than research. She joined British Telecom in 1984 and made the transition to its mobile unit 10 years later. From a role as senior vice president of BT Wireless's businesses in Europe, she took up the top job at O2 Ireland in 2001.

She stayed on in her role even when BT sold the business to Spanish mobile giant Telefonica in 2006. "Being part of a larger group expands your view of the world," she says.

In the last seven years, the mobile phone business in Ireland has matured and even reached saturation - there are 117 mobiles in the country for every 100 inhabitants.

In the midst of the iPhone hype it is easy to overlook the fact that O2 posted strong fourth-quarter figures and now has 1.646 million Irish subscribers - second to Vodafone. The growth, however, is going to come from new services rather than just voice and text.

One sweet spot that Gray highlights is mobile broadband - O2 has 41,000 subscribers from a base of zero last year.

"There's still pent-up demand out there," she says referencing the ongoing debate about broadband availability.

Gray has had to oversee some pretty tough decisions. Last year the company announced it was going to outsource its technology function and has awarded the contract to IBM.

"We took the decision because I fundamentally believe whether it's hard or easy, it's the right decision for us to make," she says. "We'll save significant amounts of money and, secondly, we'll get seriously increased amounts of flexibility."

The mobile operator will now be able to tap into the 30,000- plus IBM staff specialising in telecoms around the world versus the 450 it had working in-house. While she acknowledges that some of the contract will be fulfilled offshore, she does not anticipate IBM letting go any of the O2 staff in the current tight market for technical skills.

"Just because activities move to a different geography doesn't mean that jobs get lost," she says.

The European mobile industry recently attracted the ire of the European Commission for the high cost of using data services when subscribers travel to another EU country.

Gray is unequivocal that the issue will be addressed by the industry and doesn't require regulation. "As an industry we have to get this right across Europe. It will get fixed."

AT THIS MONTH'S Mobile World Congress in Barcelona, Viviane Reding, European commissioner with responsibility for the information society and media, said she would introduce regulation if prices weren't reduced by July 1st next.

When asked if that deadline would be met, Gray says it will be for roaming on other Telefonica-owned networks but points out that negotiating with the other European networks will take time.

Although no figures have been released on O2's joint venture with Tesco on the Tesco Mobile brand, industry sources suggest it has performed beyond expectation. Gray rules out the prospect of a deal that simply involves another brand selling voice minutes and texts on the O2 network.

"I think in that whole data space, if someone comes with some ideas that are around how you can meet the niche needs of certain segments of the marketplace, I am completely open to that," she says.

Gray, in common with her no-nonsense personal style, has a very simple philosophy on how to be successful in business.

"Most business challenges boil down to a couple of things. They are about people and they are about strategy, and then really great execution of the strategy."

What she brings to her non-executive director roles in Aer Lingus and Irish Life and Permanent, she says, is the ability to question what they are doing. "The industry knowledge comes later."

She's also chairman of The Barretstown Gang Camp Fund which runs a camp in the Wicklow foothills for seven-17 year olds from Ireland and Europe who are suffering from serious illnesses.

She admits that her working week is a "write-off" in terms of family time. However, she always endeavours to get home before her nine- and 11-year-old sons are going to bed, "but that's not always possible".

"The weekends I try to keep for family and kids and more often than not I manage it," she says.

While there has been a history of overseas telecoms executives being parachuted into Ireland for a couple of years to run the local subsidiaries, Gray doesn't appear to be eyeing a move within the group.

Her non-executive and charity roles provide plenty of variety, and she says her family is very happy in Ireland.

"I'm a great believer that if the job itself is still a challenge, you are still enjoying it, still getting a buzz and there's still things to do, then there is a need for you to be here," she says.

"There will come a time when I come in one morning and say that maybe my style and my approach is not right for the time we are in. That will happen.

"My job is to make sure that I have a brilliant team so that if I get run over by a bus or decide I want to go and do something else, someone else is going to be ready to step in."

ON THE RECORD

Name:Danuta Gray

Age:49

Job:Chief executive, O2 Ireland

Why she is in the news:In tandem with releasing its fourth-quarter results yesterday, O2 revealed it had got the exclusive contract to sell Apple's iPhone in the Republic.

Lives:Enniskerry, Co Wicklow

Family:Married to Andrew, with two sons.

Something you might expect:She listens to the Today programme on BBC Radio 4 as she drives her Mini to O2's city centre office.

Something you might not expect:She practices Reiki, the Japanese technique for stress reduction and healing, and claims to be a "sucker" for alternative therapies.