Virgin Media may be sold to global cable firm
By Stewart Mitchell
Posted on 5 Feb 2013 at 12:20
Cable company Liberty Global is considering a bid for Virgin Media, meaning the UK's second biggest broadband provider could change hands.
According to a report in the Financial Times citing sources close to the deal, a bid could be made within days, and Virgin told PC Pro that talks are ongoing.
"Virgin Media confirms that it is in discussions with Liberty Global, a leading international cable company, concerning a possible transaction. Any such transaction would be subject to regulatory and other conditions," the company said in its statement. "A further announcement will be made in due course."
In the market, you can't really separate broadband from TV, because as fast as Virgin's speeds are, people don't always understand faster speeds
The FT story focuses on the impact the deal could have on the television market in the UK, with Liberty linked with several major studios, but as the UK's second largest ISP any changes in the company's direction could also have an impact on fibre deployment and home equipment.
According to analysts, after similar takeovers in other countries, Liberty Global has maintained the local branding, so the Virgin name would likely remain in place if any deal were to go ahead.
In fact, the biggest difference could be the addition of Liberty's Horizon set-top box to the Virgin line-up, bringing more internet TV features to the living room.
"In the market, you can't really separate broadband from TV, because as fast as Virgin's speeds are, people don't always understand faster speeds – most people want more 'bells and whistles' like more TV selection," said Francesco Radicati, a research analyst with Informa Telecoms and Media.
"The Horizon box is more of a gateway to the web, with photos and YouTube - it has a few companies running scared."
Liberty could also dip into its cash reserves to fund network upgrades to improve capacity, according to analysts, although wholesale cable broadband footprint improvements are unlikely.
"As Virgin upgrades its network to avoid congestion by adding new cabinets and extra fibre feeds, there are bits and pieces of work that could benefit, but at one point it will have to decide whether to spend more on upgrading the existing network or go the way that Openreach is going and start going to people's homes rather than cabinets," said Andrew Ferguson, network expert at Thinkbroadband.com.
"It's not going to speed that up, but any extra capital might help with pre-improving the network with extra fibre capacity and other improvements before congestion becomes an issue."
So how does the liberty box compare to Tivo? Tivo already has youtube and other bits and bobs.
Now if it had a built in DLNA client that would be handy to pull everything through the box and pump it to the TV.
By jamesyld on 5 Feb 2013
Living in Germany, I have to say, that I'd never heard of the Horizon TV.
Looking at the Unitymedia (Liberty's German cable provider) website, they don't even offer it as an option as far as I can see...
By big_D on 5 Feb 2013
and I thought I could trust the hairy one!
Virgin Media is not really much to do with Branson anymore so should we trust any of this branding anymore? - from the Grauniad:
In 2005-06, Branson was busy assembling the Virgin Media group that today competes with BT and Sky for entertainment, phone and broadband customers. The formation of Virgin Media is a classic Branson business venture: he owns a tiny stake in the business that is listed on the Nasdaq exchange in New York, but derives tens of millions by licensing the brand name. He is not on the Virgin Media board and the company is run by chief executive Neil Berkett.
By jonathandk2 on 6 Feb 2013
You're right. The Horizon box is not yet released in Germany. It has been making waves in trials there and is due out either later this year or next. Story updated as such.
By SMitchell on 6 Feb 2013
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