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Vodafone purchase foreshades future Broadband war 
Back in May, Vodafone secured the purchase of Spanish ISP Ya.com, which means that the UK-based mobile network operator could very well push quad play services on the continent by the end of the year.
Whilst this doesn’t directly affect the average UK Broadband consumer, it could conceivably change the current shape of the converged communications market. The parent companies of Orange and O2, both market leaders in the mobile/Broadband stakes over here compete with Vodafone in Europe; the acquisition of Ya.com also puts Vodafone at loggerheads with Tiscali, who have a strong presence in Italy.
In an article that was posted on influential IT website The Register by one Faultline, it was suggested that this move could put Vodafone in strong position for the future:
“If Vodafone decides it cannot bring a full quadruple play to market on lines which are merely leased from British Telecom […] it has the obvious next step of trying to acquire the remaining business of Tiscali, based mostly in Italy and the UK. Tiscali has recently sold off its German and Netherlands operations to focus on the UK and Italy…”
Faultline also states that: “if anyone came in to bid for it, its value would likely rise well above $2bn, making it expensive even for Vodafone,” so whilst it does not explicitly state that a Tiscali takeover is on the cards in the near future, the article reflects how market movements elsewhere can affect things at home.
A Vodafone takeover of, or merger with Tiscali would see another quad play provider entering the UK market, threatening the current top 2 – Vodafone has strong brand power and is the largest mobile operator in the world, something which Virgin Media should be very afraid of.
We put together a quick ‘who owns who’ of our listed providers, to see how purchases and acquisitions overseas could potentially shake things up in the rapidly narrowing broadband market.
BT – owns the majority of the phone lines in the UK, and sells local loops to other services providers as per the terms of the Openreach plan. Also funds, but does not operate PlusNet.
Carphone Warehouse – the largest independent mobile retailer in Europe, which owns and runs a mobile repair service, the newly launched Geek Squad mobile tech support service, and TalkTalk as well as the AOL internet services for the UK, which Sky were also interested in snapping up.
Telefónica O2 – part of the BT Group back in the BT Cellnet days, O2 was bought by Spanish telco Telefónica, which competes with France Télécom/Orange and Vodafone on the continent. More recently, O2 purchased Be Broadband in the UK.
Tiscali – Italian-based ISP which took over the Homechoice IPTV service in 2006, making it a triple play provider of digital TV, Broadband and home phone services. It is highly likely that Tiscali will acquire Pipex by the end of the year.
France Télécom / Orange – the main telco in France owns and runs the Orange mobile phone and broadband services, originally known as Wanadoo. Bundled Mobile/Broadband/Home Phone services were launched following the Wanadoo rebrand.
Kingston Communications – a telco formed from the Hull Corporation which set up its own telephone infrastructure independent of BT around Kingston upon Hull – the phone network is the only municipally owned network in the UK. Kingston Communications owns and runs Eclipse Internet.
British Sky Broadcasting – runs the most popular pay-TV platform in the UK, and launched a converged TV/Phone/Broadband package after the purchase of ISP Easynet in 2005. Sky also owns, but does not operate UK Online, which was part of Easynet during the acquisition.
Virgin Media – compromised of the combined services of the merged NTL: Telewest (cable TV and landline phone service) Virgin.net (broadband), and Virgin Mobile (mobile phones).
Pipex – absorbed the ISPs Host Europe and Nildram in 2004 and both Toucan and Bulldog Broadband in 2006, cancelling out millions of pounds worth of debt in the process in 2006 before launching the infamous David “King of the Internet” Hassellhoff ad campaign. Began looking for a buyer early this year; Tiscali are hotly tipped to take over.
NamesCo – web hosting company which took over Simply.com in 2004; NamesCo supplies domain names, hosting as well as broadband services, and own gold mining facilities in Vietnam, which makes them sound like a front for a James Bond supervillain corporation.
2 Comments »Posted by Tom on June 26th 2007 in AOL, BT Broadband, Be Broadband, Broadband, Eclipse Internet, NamesCo, O2 Broadband, Orange Broadband, Pipex, Sky Broadband, TalkTalk, Tiscali, Virgin Media
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2 Responses to “Vodafone purchase foreshades future Broadband war”
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Dave said on 28 Jun 2007 at 2:32 pm #
Great post Tom_Newton. Good to have a little in-depth knowledge on whos who in the broadband market place.
Theodosios said on 15 Nov 2007 at 2:40 am #
Cool!