If BT gets EE, it will trigger EU treasure hunt for fixed lines

bealtine

"Examining the motives of EU telco 'old boys' networks"

interesting piece about "capex migration" in mobile/fixed across the EU

http://www.theregister.co.uk/2014/12/31/if_bt_gets_ee_it_will_trigger_eu_treasure_hunt_for_fixed_lines/

bk

You can already see this clearly playing out in the Irish Market.

- Meteor is already owned by Eircom and it's fixed line monopoly.

- Vodafone is now very involved in fixed line services and is about to get much deeper into it with it's FTTH partnership with ESB. The ESB fibre network will be very useful for backhauling Vodafone mobile services. And we might even end up with Vodafone microcells hanging off ESB poles and substations.

- Three has already gobbled up o2, thus eliminating one player from the market. However Three still probably needs a fixed line and backhaul presence.

UPC internationally is too big for them to buy and I doubt Liberty Global would be interested in selling off UPC Ireland on it's own. Perhaps Three UK & Ireland will look to buy UPC Ireland + Virgin Media in the UK.

Of course rumour has it that Vodafone is looking to buy UPC across Europe. I'm not crazy about the idea of Three, with their bad record, owning UPC, but it would be better then Vodafone, from a competition diversity perspective.

If a purchase doesn't happen, then UPC and Three at least partnering makes sense. UPC operates as a MVNO on Three and Three gets access to UPC's backhaul and street cabs for microcells. Probably this scenario would be best for competition.

Three could also look at buying BT Ireland. But I'm not sure really if they have enough resources for them.

I've no idea what Sky will do. They really aren't at the races at all here in Ireland!

clohamon

Not convinced by the capex migration theory. It shouldn't matter if the Mobile buys the Fixed-Line or vice-versa; the net value of the merged entity ought to be the same. I'd like to know how the accountants on either side are coming up with different numbers.

Anyway it (the BT/EE merger) seems to be going ahead.

watty

Currently Three has no broadband product. Perhaps they will partner with UPC in UK and Ireland?

bk

watty wrote: »

Currently Three has no broadband product. Perhaps they will partner with UPC in UK and Ireland?

Well UPC are already due to launch as a MVNO on the Three network very soon:

http://www.irishexaminer.com/business/upc-deal-with-three-will-provide-mobile-offering-in-about-a-year-270598.html

In the UK, Virgin Media (UPC's UK operation) is already the largest MVNO with it's Virgin Mobile brand, which is currently operated as a MVNO on the EE network.

Interestingly Sky has just done a deal with O2 UK (now owned by Three *) to start as a MVNO in the UK. I assume they will try and do the same here in Ireland.

* EDIT: Three is in talks to buy o2 UK, but the deal hasn't gone through yet.

Vodafone UK is about to launch their own broadband and TV service in the UK on BT's VDSL network, much as they do here in Ireland. The interesting point about this is they are launching TV to, assuming IPTV, so I assume they will do the same here.

There have been persistent rumours of Vodafone looking to buy UPC's parent, Liberty Global or at least their UK operation Virgin Media. Important to note that UPC Ireland is now directly part of Virgin Media UK, so would likely be included in any such deal.

However recently this rumour has dissipated slightly and instead a rumour of them buying Talk Talk in the UK has emerged.

If that happens, then I wouldn't be surprised if we see Three possibly try and buy Liberty Gobal (UPC), shudder!

Basically there is a big game of musical chairs going on at the moment, Sky actually looks to be in the weakest position, having little but it's expensive sports rights. Interesting times!

mass_debater

watty wrote: »

Currently Three has no broadband product. Perhaps they will partner with UPC in UK and Ireland?

Not true. Three own O2 who resell Eircom ADSL and FTTC

bk

mass_debater wrote: »

Not true. Three own O2 who resell Eircom ADSL and FTTC

Yes, but only to business customers, right?

I don't think they have a significant presence in the market at all, certainly nothing like Vodafone or Sky.

mass_debater

bk wrote: »

Yes, but only to business customers, right?

I don't think they have a significant presence in the market at all, certainly nothing like Vodafone or Sky.

Yes, business only

watty

mass_debater wrote: »

Not true. Three own O2 who resell Eircom ADSL and FTTC

RESELLING

O2 has near zero Broadband.

Sky resell too. They have no Broadband.

Resellers neither provide nor drive investment in Broadband. Customers of the real broadband providers are the driving factor.

Mobile dishonestly sold, line rental and voice + SMS + MMS cross subsidising data is inhibiting broadband investment.

Eircom admitted that Meteor promotion to match Three's data pricing (Three have never made a profit) and Line rental was cannibalising fixed line. Mobile vs line rental is why fixed line has fallen from about 82% to 66%