UK INTERNET SERVICE PROVIDER (ISP) Sky revealed its plans to acquire Telefonica's broadband and fixed line businesses provided by O2 and Be on Friday, in a move that will see it become the UK's second largest broadbrand provider.
It will hand over £200m for the business, paying an initial £180m with a further £20m to be paid once Telefonica's customers are switched to Sky. The firm says that the move will see it gaining an additional half million subscribers, which will move it past Virgin Media as the UK's second largest broadband internet service provider behind BT.
Sky CEO Jeremy Darroch said, "Sky has been the UK's fastest-growing broadband and telephony provider since we entered the market six years ago. From a standing start in 2006, we have added more than 4.2 million broadband customers. The acquisition of Telefónica UK's consumer broadband and fixed-line telephony business will help us accelerate this growth.
"We believe that the O2 and Be consumer broadband and telephony business is a great fit, with customers used to high-quality products and strong levels of customer service. We look forward to welcoming these new customers to Sky and giving them access to our wide range of high-quality products, great value and industry-leading customer service."
Ovum analyst Emeka Obiodu says today's move by Sky further strengthens the firm's dominance in the UK.
"This 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," Obiodu said.
Sky's acquisition of Telefonica's broadband business is expected to be completed by April. µ