Carphone to buy out beleaguered Tiscali?

After reports of Tiscali falling into some serious financial difficulty, it has emerged that TalkTalk and AOL owners Carphone Warehouse are rumoured to be plotting a last minute takeover bid.

Carphone was once the frontrunner for a Tiscali takeover bid launched last year, which fell through at the last minute. Sky then stepped into the bidding war, stumping up £450 million for the Tiscali’s UK services, but again, negotiations deteriorated before a deal could be worked out.

Last September, a Carphone buyout of Tiscali would have seen its joint subscriber base swell to a massive 4.6 million, overtaking BT at the head of the British Broadband league table. A Sky purchase would have seen the satellite broadcaster become the third biggest ISP, with its customer base rising to 3.6 million.

Tiscali are some €500 million in the hole, and as the credit crunch continues to bite, the lenders of Europe are calling for their pound of flesh. After Tiscali revealed that its shares have been suspended on the Italian stock market following a 50 per cent tumble, it asked lenders to freeze debts in order to “allow a period of suspension for interest repayments and financial covenants,” according to a piece in the Telegraph.

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Tiscali buyout looks uncertain after shares suspended

Tiscali appear to be the first victims of the recession in the British Broadband Big 6, after its shares have been suspended on the Italian stock market after taking a 50 per cent tumble this morning after it was revealed that the group, which collectively owes banks €500 million, failed to meet a debt repayment.

Tiscali is currently the fifth largest broadband provider in the UK, with a subscriber base of around 1.7 million. Tiscali, who listed looking for a buyer for their UK consumer services as a top priority in 2008, were looking for at least £600 million. Among those interested in a buyout included TalkTalk/AOL owners Carphone Warehouse and Sky – the latter stumped up £450 million for Tiscali’s UK arm, but talks broke down, becoming “impossible to proceed,” according to Tiscali.

This means that Tiscali will be coming to the banks of Europe cap in hand, at a time when fiscal security is shaky to say the least.

BT’s next-gen broadband given regulatory go-ahead

BT plans to surge ahead with its massive £1.5 billion upgrade to its broadband network, after Ofcom promised not to hinder progress, and allow the broadband market leader to make recoup losses made on its investment.

Telecoms regulator Ofcom yesterday promised to allow BT to set prices rival ISPs such as Carphone Warehouse and Tiscali would have to pay to gain access to the improved network, although BT Openreach will be required to charge every customer “on equal terms and without favour”.

The network, once complete will see some 10 million homes able to sign up for next-gen broadband services promising maximum speeds of up to 100Mbps – rollout will encompass 40% per cent of the UK population by 2012.

Many have said that regulation has prohibited deployment of a cable network by BT in the past, allowing Virgin Media – whose cable network currently reaches roughly 50 per cent of the population – to surge ahead with next-gen broadband services.

Virgin Media are already selling 50Mbps broadband to a handful of their customers, and, once upgrades are in place, are expecting to be able to service their entire network with the Size: XXL 50Mb product by the end of the year. Virgin have repeatedly stated that their current network is already capable of handling 100Mbps speeds, (pending the requisite upgrades) meaning that they are already ably placed to match BT’s offer, and won’t have to spend nearly as much money in doing so.

[Link: Guardian]

Virgin Media and O2 lead the pack in 2009 with fastest average speeds

Broadband comparison site Broadband.co.uk have released the results of their anecdotal speed tests for January 2009, which sees Virgin Media sitting pretty atop the pile with an average download speed of 6.018Mbps – a speed and position no doubt bolstered by the recent launch of the premium Size: XXL 50Mbps service.

Sitting just behind Virgin in second place is O2, owners of Be Broadband’s ADSL2+ infrastructure, with a top average download speed of 5.319Mbps. Third place is Sky Broadband, with a top downstream average of 3.521Mbps.

The three ISPs offer theoretical maximum download speeds of 50Mbps, 20Mbps (or 24, if you’re with Be) and 16Mbps respectively.

Market leaders BT were nowhere to be seen in the upper echelons of the speed test, lurking second to last with a top average download speed of 2.331Mbps, just about AOL’s 2.011Mbps.

In the upload speed stakes, O2 performed considerably better than Virgin, with a top average of 0.734, well above the cable group’s 0.466Mbps.

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12 months of Free TalkTalk Broadband and Calls with Carphone

The Carphone Warehouse are helping customers beat the credit crunch blues with their amazing new offer which sees customers who sign up for the TalkTalk Essentials plan for 18 months before February the 28th get the first 12 months of broadband with evening and weekend landline calls included for free.

Customers will only pay for the line rental at £10.50 per month, a one-off connection charge of £29.99, and will only be charged an extra £6.49 a month from the 13th month onwards.

Not including the cost of line rental, this brings the cost of the TalkTalk Essentials down to £68.93 over an 18 month period (three months at £6.49 plus the connection fee).

The TalkTalk Essentials package gives you top download speeds of 8Mbps, a 40GB download limit, free wireless router as well as unlimited evening and weekend calls to local and national UK landlines, as well as a selection of popular international numbers.

This TalkTalk Essentials offer is available up until the end of February, and is currently only available in either Carphone Warehouse stores, or by calling this number: 0800 049 7890

TalkTalk Broadband launches customisable broadband and phone package

TalkTalk from the Carphone Warehouse has launched a new customisable home phone and broadband package called MyTalkTalk – a value package which allows cutomers to pay for additional services and features.

The new package was created in response to a consumer survey which suggested that, in light of the current credit crunch, 94% of broadband users don’t want to pay for features that they don’t use, and 65% would like to pick and choose the particular services they require in their broadband package.

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Sky hook in over £400m for Tiscali

Sky are all set to raise £450 million in a bond issue to institutional investors in order to stump up some massive coin which is allegedly earmarked for the acquisition of the UK tentacle of Tiscali.

Tiscali have recently confirmed that they have been in talks with Sky over a potential deal – the Italy-based ISP and telecoms outfit announced late last year that the long term goal for 2008 was to find themselves the right buyer.

It is uncertain whether or not the deal includes Sky taking over the Tiscali TV IPTV platform, on which there are already a number of Sky channels. If the deal goes ahead, Tiscali TV, which began life as Homechoice, could potentially be rebranded under the Sky Picnic name, in the event that a deal with Ofcom is worked out.

The move would not only see Sky leapfrog into third place behind broadband and digital TV rivals BT and Virgin Media and ahead of Carphone Warehouse, whose main broadband concern TalkTalk is also reportedly up for sale.

There are rumours that Sky are also interested in buying up TalkTalk along with Tiscali, but if this were true, then the satellite giant would probably need to dig a little deeper – the TalkTalk arm of Carphone’s business is valued at a cool £1bn.

TalkTalk to split (from Carphone Warehouse)?

The Grande Fromage of TalkTalk and AOL owners Carphone Warehouse, Charles Dunstone has launched a “formal review of the group’s corporate structure” which could lead to the breakup of its telecoms division, which could potentially see TalkTalk becoming a fully independent ISP.

However, it is more than likely that usual suspects Sky, Vodafone, Orange, BT and the gang will be offered the chance to bid for the customer bases of both TalkTalk and AOL beforehand – TalkTalk is believed to account for some £1bn of Carphone Warehouse’s current £1.3bn valuation.

The BestBuy deal is said to be taking its toll on the group, and Dunstone is reportedly considering splitting the group in half, allowing for easier management of the retail arm of Carphone Warehouse.

“We recognise, however, that the structure of the Group may now no longer be appropriate for the optimal development of the two businesses,” said Dunstone. “The Board has therefore initiated a formal review of the Group’s corporate structure and capital requirements, which may lead to a separation of the two businesses. In this instance I would remain closely involved with both companies.”

This is a bit of an about turn for the company which, earlier this year, was thought to be the favourite to buy up the UK arm of Tiscali’s home broadband customers, a move which would have seen Carphone become the biggest ISP in the country. Now Sky are thought to be in negotiations to buy up Tiscali’s UK operations instead.

Sky enters talks over Tiscali deal

Sky have entered negotiations to aquire currently fourth largest ISP Tiscali, after rival bidder Carphone Warehouse – which runs its own Talk Talk and owns the UK arm of AOL – reportedly pulled out of the auction.

The triple-play provider is thought to have put forward an indicative offer of £450 million for the Italian company’s UK operations, with the potential for a further price drop. The potential purchase is seen as a strategic departure for the company, which currently offers free broadband to customers who also sign up for to its television package. 20% of Sky TV subscribers have taken up the offer so far.

If Sky carries the deal forward, it will become the third largest UK broadband provider with 3.6 million, overtaking Carphone Warehouse and creeping up behind its main rival Virgin Media, which hopes to improve on its current 3.8 million customer base in its third quarter report, to be announced this Thursday. BT is currently in pole position as Britian’s biggest broadband provider. The telecoms giant is thought to have walked away from the long-running auction, along with Vodafone.

Earlier on in the bidding, Vodafone had been considered a strong player as the only company willing to buy up both Tiscali’s UK and Italian broadband operations, but has pulled out since the business’s valuation has fallen.

Tiscali has been trying to find a buyer since May. The provider has around 1.2 million broadband users in the UK, although it is believed to have lost market share recently, perhaps due to news that the company is planning to up sticks and sell to the highest bidder. Last Friday Sky revealed that its broadband take-up had risen to 1.8 million customers.

Customers flock to free laptop deals – but are they worth it?

Mobile broadband packages which come with a ‘free’ laptop are set to become a must-have gift this Christmas, overtaking standalone dongles.

Consumers looking to save money or defer the cost of buying new technology are driving sales of mobile broadband pay monthly deals which include a laptop in the price. Networks and electronics retailers such as 3, Vodafone, Carphone Warehouse and PC World are offering free laptops or netbooks on certain mobile phone contracts usually lasting 18 to 24 months, and retailers have experienced a sharp increase in sales of free laptop deals in recent months, by as much as 23% of overall sales since July.

Mobile retailer Phones4U has reported considerable growth since it launched a ‘free’ laptop deal, predicting that such bundles will prove a popular choice this Christmas.

“Since launching laptop-broadband deals on Phones4u.co.uk, we have seen significant sales growth month-on-month and predict that laptop-broadband deals will be top-sellers this Christmas,” stated a Phones 4U spokesman.

A piece in The Guardian this week suggested that 3 and Vodafone currently offer the best deals on mobile broadband-laptop bundles.

However, though deals including a free laptop may seem like an inexpensive option in the run-up to a credit crunch Christmas, they are likely to cost you far more in the long run than if you bought a standalone dongle and laptop separately. The cost of laptops advertised as being ‘free’ is in fact spread over the length of the contract.

For example, a 24 month deal on Vodafone which comes with a ‘free’ Dell Inspiron Mini 9 ultraportable will set you back £25 a month, costing a total of £600 over the two years. Bought on its own, the Mini 9 will cost you around £300. Of course, you get the data contract as well, but with mobile broadband prices set to come down further in the coming months, you may well regret being tied down to a 2 year contract.

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