BSkyB buys Wi-Fi provider The Cloud

28/01/2011

BSkyB has bought Wi-Fi hotspot operator The Cloud, giving the broadcaster access to more than 5,000 UK hotspots. BSkyB said that it reached an agreement to acquire The Cloud on 11 January, but completion of the transaction will be subject to regulatory clearance.

BSkyB said The Cloud’s Wi-Fi hotspots would complement its existing domestic broadband services by providing customers with internet connectivity while on the move. The company also said that The Cloud's network would support its plans to launch a new service to make Sky content available on mobile devices.

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"Later in the year, we will launch a new service, Sky Anywhere, to make it easier for customers to enjoy our programmes wherever they are," said BSkyB chief executive Jeremy Darroch.
BSkyB's announcement comes just a day after mobile operator O2 disclosed plans to build a Wi-Fi hotspot network of its own, which will be free to access.

Commenting on the deal, Steven Hartley Ovum principal analyst, said the deal spelt trouble for Sky rival BT : “The primary impact of all this activity will be to place further pressure on BT. The UK incumbent has tried to use its superior WiFi network to differentiate itself over the competition and has therefore been heavily marketing its WiFi capabilities. No doubt the battle will turn to who has the most hotspots as the protagonists build-out their footprints.

“In absolute terms BT has the advantage, although the vast majority of its hotspots come from its Fon network on which top download speeds are just 512 kbps. Faster speeds are possible on cellular networks and promise true mobility rather than WiFi’s nomadism. Furthermore, O2 plans to have double the number of hotspots than the Cloud and BT’s non-Fon footprint combined by 2013. O2 can also offer users mobility via its cellular network.“

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