Busy times for the cable guys

Recently, Google Alerts seem to be flagging mainly cable stories involving Virgin Media rather than anything else.

Yesterday's Telegraph (and any number of other online sources subsequently) reported that Virgin Media are looking to purchase Pipex, who were recently put up for sale.

The move would make sense as the cableco looks to expand their non cable business, as they have recently announced that they will be doing in their financial results. In addition to the Virgin.Net ADSL ISP they already run, Pipex would add 570,000 broadband customers and a huge web hosting business to their stable as the broadband ISPs in this country consolidate.

ISP Review reports that the asking price is £335m.

BT, who recently purchased Plus Net, are said to be the main competitors and one suspects that both of these two will also be in the running for Tiscali UK should it actually be sold - along with Carphone Warehouse.

Virgin Media came second in last night's BBC Watchdog poll of broadband providers (second to BT), while Carphone Warehouse's TalkTalk and Orange's broadband services were slated and came at the bottom of the pile.

The cable guys are going to be sponsoring the next series of Big Brother, BB8, replacing Carphone Warehouse who pulled out after the race row that engulfed this year's series. While this correspondent is no great fan of the programme, the demographic that are can very much be considered to be Virgin people - will Virgin Media or Virgin Mobile be the headline sponsors though?

Virgin Media's marketing Managing Director James Kydd said:

"We're a pioneering and innovative company so it made sense to create an alliance with a show that has genuinely changed the face of TV. We want to take the show to the next level by engaging viewers and pushing the boundaries of interaction across platforms in a way never seen before."

Ofcom are going to be probing Sky's strangehold on the pay TV market in the UK after complaints by a number of other providers such as Virgin Media, BT & Setanta.

Chris Wynn, analyst at Informa Telecoms & Media, emphasised the strangelhold that Sky does have on the market in this country:

"Sky's virtuous circle is everyone else's vicious circle. If you want to break into this market you've got to have deep pockets for decent sport and movies.

As Sky has most of those deals tied up its rivals are at its mercy. Sky would argue that it has spent a lot of money buying these rights and it would be crazy to give that content to its competitors."

Should the decision go in the way of the competition (and the consumers accordingly), Sky could be forced to reduce their prices and make their programming available across multiple platforms, something that they've recently being going away from by withdrawing a number of channels from the Cable and Freeview platforms.

Sky seem to be getting the expensive lawyers in - Ofcom's announcement can be found here.

Private Eye last week had a rather amusing cartoon about the aggravation that the withdrawal of those channels by Sky has caused the customer services people at Virgin Media:

The spat has led to the inevitable consequence of some of Sky's key advertisers asking for refunds due to the sudden drop in eyeballs viewing their promotions. The Sunday Telegraph reported that Honda and Cadbury's were among the big names looking for some cash back.

Plenty to talk about then!

Virgin Media have also confirmed the news from their financial results that they will be doubling their fastest broadband speed - their 'XL' package - from the current 10Mb speed to 20Mb, albeit with a £2 monthly price increase.

Chief Commercial Officer Ernie Cormier said:

"For internet savvy customers who want the best broadband money can buy, our XL service is perfect for speedy downloading and uploading - whether it's music, videos, podcasts or blogs."

Sky is claiming that it's a ruse to put their prices up, mentioning their 'up to 16Mb' speed in passing. One thing that was reminded to me when I was in the USA was just how much consumers only go for ADSL if they can't get cable.

Comcast, the daddy of all the cable companies, are using their brilliant tortoise family - the Slowsky's - to great effect to emphasise the difference in speeds between ADSL and Cable. Watch their great commercials at TheSlowskys.com.