Vodafone, BSKyB mulls tag team to take on behemoth BT

Vamien McKalin, Tech Times 22 January 2014, 07:01 pm

Vodafone and BSkyB are reportedly in talks to team up for a new high-speed broadband service. This move, according to reports, is aimed at countering BT's dominance in the UK. If everything goes according to plan, the new service could offer customers packages of TV, Internet, mobile and home phone service.

Both companies are concerned about BT's growing power, now that the company has an upcoming mobile venture with EE, and football TV rights. The football rights cost BT £900 million, but the company will get exclusive broadcast rights of the Champions League and the Europa League.

The 'quad-play' plan where customers gain access to TV, Internet, landline and a mobile contract, is popular in the UK and with the combined forces of both Vodafone and BSkyB, BT might be in for some serious competition and might also lose its dominance in the UK market. However, this would be left up to Vodafone and BSkyB's execution abilities.

However, according to sources who spoke with the Sunday Times, such a business strategy to compete with BT, could fall short of building out a UK-wide, multi-billion pound fiber optic broadband network.

Failing to build a UK-wide fiber optic broadband service could pose problems for the joint venture against BT. Still, it might very well slow BT's growth to the point where Vodafone and BSkyB can compete more effectively.

This isn't the first time Vodafone and BSkyB have chosen to work closely with each other. Both companies are already partners, striking a deal to show Sky Sports content on smartphones back in 2013. If this new partnership takes shape, then it would be the most important venture the two companies have ever come together to create.

Vodafone and BSkyB's possible assault against BT could mean a lot of benefits for UK consumers. TV, Internet, and Mobile packages could get cheaper as each company seeks to be dominant, or defend its dominance in the UK market. Then again, to make this possible, a lot of money would have to be spent, something none of the companies might not be interested in doing.