BT CEO Ben Verwaayen will step down on 31 May after six years as BT's CEO.
Ian Livingston, who is currently chief executive of BT Retail, will take over as BT Group CEO from 1 June.
BT did not give a reason for Verwaayen's departure, but analyst firm Ovum said rumours of his exit had been circulating for some time.
Verwaayen joined BT in January 2002 from Lucent Technologies, where he was vice-chairman of the management board. He will step down as CEO on 31 May 2008 and leave the board on 30 June.
Ovum said in a research note that Verwaayen's achievements had been impressive.
He had fixed 'the mess he inherited when he joined', repaired relations with Ofcom and championed the climate change agenda across UK industry.
'His legacy is a company that is in good financial health, well managed, and one that embraces change.'
Ian Livingston was the obvious internal candidate to replace him, Ovum said. As CFO, he was part of the group of people that brought the firm back from the financial abyss in the early part of the decade, and for the past three years had headed the important retail division.
Not everyone was so complimentary. As the Financial Times pointed out, the move follows a period when BT's business and share price have performed poorly and comes just over six months after Sir Michael Rake took over from Sir Christopher Bland as chairman. The piece added, 'The company has come under pressure from rivals such as Carphone Warehouse and BSkyB, which have exploited deregulation of the so-called local loop to offer landline services. That has impacted revenues at BT's wholesale division, which sells products to other telecoms companies and which contributed 27% of group turnover in BT's last financial year.' BT has yet to figure out a way of making up the shortfall and has failed to keep its existing retail customer base happy - see story below.