Sky to become second-largest UK ISP as it snaps up O2 and BE

by Mark Tyson on 1 March 2013, 09:37

Tags: Sky, O2/Telefonica (NYSE:TEF)

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Sky is set to become Britain’s second largest broadband provider following a deal announced today. The company said it has reached an agreement to buy the O2 and BE broadband and fixed line businesses. There are currently about half a million customers using Telefónica UK’s consumer broadband and fixed-line telephony services.

Commenting on the deal Sky’s Chief Executive, 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.” He went on to say that existing O2 and BE customers “used to high-quality products and strong levels of customer service” are a great fit for Sky’s services.

The Chief Executive of Telefónica UK, Ronan Dunne, made a statement saying that “Sky offers great value, totally unlimited broadband which includes unlimited fibre services,” and that he believes “this agreement is the best way of helping our customers get the highest quality home broadband experience from a leading organisation in the market.” The deal means that Telefonica UK can focus upon delivering great mobile connectivity including 4G services, added Dunne.

To seal the deal Sky will pay £180 million to Telefonica. A further amount, up to, but not more than £20 million, will be paid upon successful delivery and migration of the services to Sky. Furthermore “Post completion, O2 and BE customers will be migrated onto Sky’s fully unbundled network, supported by a nationwide all-fibre core, which reaches 84% of all UK homes.”

The deal is due to complete in April. Following the deal BT will still be the number one provider of broadband and fixed lines but Sky will leapfrog both arch-rival Virgin Media and TalkTalk.

Does a company like Telefonica really have to put aside its broadband and fixed line business to concentrate on 4G service provision? Perhaps its planners and analysts see such services becoming less and less relevant as we approach the dawn of the 4G and White Space wireless eras and that now is the best time to sell up.



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He went on to say that existing O2 and BE customers “used to high-quality products and strong levels of customer service” are a great fit for Sky’s services.
Folks I've spoke to in the past were of the opinion that Sky's customer service was just as “good” as Virgin's, in which case I feel sorry for O2/BE folks. :(

That said, I didn't know that O2 had a fixed line product. Live and learn.
They're all as bad as each other to be honest, though the worst customer service I've experienced recently has been the DWP! Took them 4 months to get my change of address sorted, even though they had sent over 50! letter to the correct address…
To be fair, I have found Sky's customer service to be fine, I was annoyed they made me take half a day off work to set up my broadband (engineers visit) only to remotely activate it the day before but cant be helped. The english call centers were pleasant to deal with thogh

Virgin media on the other hand was beyond useless. Utterly dire…lieing, miss leading, patronizing…you name it they were useless at it!

However… Virgin had a far far faaar better product with TIVO & the fibre optic then Sky. I find the Sky box confusing, unintuitive (sp) and far too many menus to click through compared to Virgins. it is also lacking the third tuner TiVo had which was great. Thumbs up & down feature was brilliant and their menus whilst a bit slow at times (split second lag) were nicely laid out.


edit; My views above are based off 3 years with Virgin Media, before moving house and having to take Sky. 2 months with Sky so far, and my parents/grandparents both having sky for years.
Sad news. Love my O2 broadband (still on an old unlimited package). Hate giving money to the Murdock's but trying to sell house so new contracts are no go so guess I'm stuck until I move…
Andehh
To be fair, I have found Sky's customer service to be fine, I was annoyed they made me take half a day off work to set up my broadband (engineers visit) only to remotely activate it the day before but cant be helped. The english call centers were pleasant to deal with thogh

Virgin media on the other hand was beyond useless. Utterly dire…lieing, miss leading, patronizing…you name it they were useless at it!

However… Virgin had a far far faaar better product with TIVO & the fibre optic then Sky. I find the Sky box confusing, unintuitive (sp) and far too many menus to click through compared to Virgins. it is also lacking the third tuner TiVo had which was great. Thumbs up & down feature was brilliant and their menus whilst a bit slow at times (split second lag) were nicely laid out.


edit; My views above are based off 3 years with Virgin Media, before moving house and having to take Sky. 2 months with Sky so far, and my parents/grandparents both having sky for years.


I concur. Virgin customer service has been about as useless as any I've ever had. While on the cable, I could forgive them because the product itself was very good and pretty reliable (customer service was mostly re: minor issues and billing). However, I made the mistake of taking their national service when I moved. You seem to get exactly the same dire customer service, only with aoverpriced, mediocre product (with none of the bells and whistles that allowed you to overlook the CS before) that leaves you NEEDING that missing customer service. To rub salt in, I keep getting flyers through the door trying to sell me their cable + tv package… which you can't get in this area.


EDIT- If I can't get ‘proper’ cable internet here, does anyone have any strong opinions (either way) re: BT/BT Infinity re: the product AND the customer service? If it does half of what it says on the tin, it'd be a major improvement on what I have now, and I'd be tempted…