BSKYB AND VODAFONE reportedly are in "high-level discussions" about a possible merger, with the two firms plotting to tackle BT's dominance in the broadband market.
That's according to The Sunday Times, which citing "senior sources" revealed that Sky and Vodafone discussed striking deals on Sky's sports and movie channels, as well as collaborating on a high-speed broadband service. Presently Vodafone offers its contract customers free access to Sky Sports Mobile, or a free Spotify Premium account.
However, the Times' sources said it was unlikely that the two companies will build a nationwide fibre network because it would cost "several billion pounds".
Although both Sky and Vodafone declined to comment on the speculation, such a move would make sense.
Bskyb saw £1.5bn wiped off its share value in November after BT won the rights auction to show Champions League football. In addition, BT plans to spend more than £3bn on a high-speed fiber-optic network that should reach 90 per cent of homes in the UK by next year, and a further £2 billion on sports broadcasting.
BT reportedly is also planning to make a comeback in the mobile market this year, which likely is why Vodafone reportedly is keen on partnering with Sky.
Although BT has not explicitly announced a return to the mobile market, in October it announced that it was dumping Vodafone as its mobile virtual network operator (MVNO) partner in favour of EE.
The deal between BT and EE covers 3G and 4G services, which means that BT will be able to make use of EE's LTE speeds. BT also picked up 2.6GHz spectrum of its own in the 4G auction last year. µ