BSkyB is fighting back against US cableco Liberty Global with a deal to acquire Telefonica’s O2 and BE consumer broadband and fixed line telephony business in the UK.
The £180 million ($270.6 million) deal will make Sky the second largest broadband provider in the country and help it battle Liberty Global, which agreed a takeover of UK cableco Virgin Media earlier this month.
Telefonica’s 500,000 UK subscribers will be migrated to Sky, taking the firm’s total broadband customer base to 4.7 million. The telco’s UK chief, Ronan Dunne, explains the firm will now focus solely on its mobile services “including next generation (4G).”
Jeremy Darroch, chief executive of Sky, says the deal will accelerate the firm’s growth and pledged to maintain high standards of customer service for the subscribers migrated over.
Ovum telco strategy analyst Emeka Obiodu notes the acquisition “strengthens the hand of BSkyB in the market, as the company would now be able to boast of having a bigger TV customer base, and more broadband customers than its main rival – Virgin Media.”