European Commission Give OK to Liberty Global Purchase of Virgin Media


It is beginning to appear that 2013 may go down as one of the biggest years for industry restructuring. On the same day U.S. satellite television services provider Dish Networks offered to buy all of Sprint for $25 billion, the European Commission (EC) gave the green light to US-based international cable TV  giant Liberty Global to purchase UK operator Virgin Media for €17.2 billion ($22.5 billion).

Both deals exemplify the continuing convergence of broadcasting and all things Internet, and the perceived desirability of going after the missing pieces for being able to offer one-stop shopping quadruple play services —Internet, phone, entertainment (broadcast, cable and IPTV) and mobile and Wi-Fi wireless services. The Dish deal to purchase all of Sprint is U.S. specific and comes on the heels of its failed attempt to buy Clearwire from Sprint. The Liberty Global deal, first revealed in February of this year, combines the second largest Pay TV operator in the UK and the largest cable operator in Europe.

In signaling the Liberty acquisition could proceed, the EC said its investigation “confirmed that the transaction would not raise competition concerns, in particular because the parties operate cable networks in different Member States and because of the merged entity's limited market position in the wholesale of TV channels in the UK and Ireland.”

Liberty Global’s CEO John Malone throughout his long history in the cable business first in the U.S. and now in other parts of the world has been aggressive in terms of looking ahead of industry trends and leveraging his position via either merger (his cable goliath TCI with AT&T) or acquisition (growing Liberty Global). For those of you unfamiliar with Liberty Global here are some particulars:

  • Revenue: $10.3 billion
  • Employees: over 21,000
  • Active cable operator in 13 countries, including 11 in Europe under such household names as Telenet, Unitymedia and UPC
  • 34.2 million homes passed
  • 19.8 million customers
  • 34.8 million RGUs (video, Internet, and voice subscribers)
  • Owns content production business Chellomedia

This is shaping up as an Internet era version of the “Battle of Britain.” Only this time the fighting is going to be not just in the skies over the UK.

In fact, to just that point, Telefonica UK recently announced it was selling its O2 and BE consumer broadband and fixed-line telephony business to British Sky Broadcasting Group owned by media titan Rupert Murdoch. It is clear by Virgin’s decision to step aside and let even bigger boys fight it out that his is going to be quite the spectacle. 

This is an instance where Mr. Malone probably deserves a tip of the hat. In picking Virgin Media he is picking up a very nice company that fits well with Liberty’s ambitions in the UK and all of Europe. Virgin Media is actually one of the few service providers that is already in the quadruple play business by virtue of offering UK customers broadband Internet access, TV, mobile (they basically invented the virtual wireless business years ago) and fixed-line telephony services to customers in the UK. Just last month UK regulator Ofcom said Virgin provided the fastest fixed-line residential broadband speeds, and the company has been leading edge with such services as its cloud-based multi-screen entertainment service and a rather innovative capability that allows customers to make use of free calls on their home phone talk plan using their smartphones and tablets and a Wi-Fi connection.

Some in the UK would say about Virgin, “It is a bit Cheeky!” But being cheeky has been a Malone and Murdoch characteristic along with that of Virgin Group founder Sir Richard Branson. Given that the target customers for quadruple play, particularly given the amount of video traffic now going over wireless networks, in order to stay ahead at the moment, being cheeky is a good thing and it appears bulking up is becoming paramount.  

For those who live in the U.S. you probably remember the soap opera As The World Turns which after first airing in 1956 showed it final episode only two years ago. It appears the 2013 is going to be one in the service provider industry that not only takes on the characteristics of a soap opera but really is going to be about what happens as the converged world not just turns but turns faster.  

Edited by Rich Steeves
Related Articles

How to outsource photo editing for e-commerce

By: Contributing Writer    11/17/2021

Find out how to find a reliable service to outsource photo editing for ecommerce. Learn what factors you should consider and what questions to ask you…

Read More

New Bill Requires Automakers to Development Drunk Driving Prevention Tech

By: Luke Bellos    11/12/2021

Congress recently passed a bipartisan infrastructure bill, which includes a mandate requiring auto companies to develop drunk-driving prevention techn…

Read More

Facebook Whistleblower Shares Metaverse Concerns

By: Luke Bellos    11/11/2021

Whistleblower Francs Haugen recently interviewed with AP News and shared her concerns regarding Facebook's recent shift in attention toward the metave…

Read More

High-Energy High-Power Density Thermal Batteries: High Impact Climate Change Solutions to Expand in China

By: Matthew Vulpis    11/10/2021

For nearly three decades, the United Nations has been bringing together almost every country on earth for global climate summits - called COPs - which…

Read More

New Zealand Cybersecurity Company Helps Squelch BlackMatter Ransomware Scheme

By: Laura Stotler    11/1/2021

A New Zealand cybersecurity firm is stamping out the BlackMatter ransomware scheme through a critical vulnerability. The firm is helping ransomware vi…

Read More