Does BT need to watch out with Virgin Media and TalkTalk discussions underway?

dialling up the pressure on BT.

Is sharing really caring when it comes to broadband? Well rumour has it Virgin Media and Talk Talk are working on a deal to share the cost of ultrafast broadband networks; dialling up the pressure on BT.

Tentatively exploring its options and turning up the heat big time on BT, Virgin Media and TalkTalk are said to be discussing a deal which will explore the possibility of passive infrastructure sharing. As well as reducing cost, this deal could enable the budget provider to lay fibre optic lines in Virgin’s cable ducts – and vice versa.

TalkTalk is currently reliant on Openreach’s national copper and fibre optic network, piggybacking its services. But things could soon be shaken up as TalkTalk pushes to establish itself as a network owner in its own right, not just a reseller. Most recently TalkTalk announced a joint deal with M&G which, the company says, will provide ultrafast broadband via FTTP to more than 3m premises in the mid-size UK towns and cities.

By making a deal with Virgin Media, it is safe to say that the sharing of passive infrastructure will lend itself to be quite an economical solution. If such a deal were to go ahead, TalkTalk would be sure to benefit from a sizeable cut in engineering costs and well as improving timescales.

Suffice to say, discussions are at a rather early stage and no deal has actually be finalised. Though neither company has commented, we are sceptical at NCN whether we should hold out much hope of a deal being passed. Notably Virgin Media and parent company Liberty global have, generally speaking, preferred to retain a closed network; so why would they make such a major shift now?

There has been reports that Virgin Media could accelerate its ongoing Project Lightening expansion by following TalkTalk into new territory, but we shall just have to wait and see.

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