Sky and TalkTalk Join The Scramble to Acquire O2

Tim Maytom

O2Sky and TalkTalk have joined the bidding to acquire UK mobile network operator O2 from Spanish owners Telefonica. The bids come less than a week after Three owner Hutchison Whampoa revealed its acquisition attempts.

Acquiring O2 would be a considerable gain for Sky, moving them into the 'quad play' market by adding mobile to its current television, phone and broadband offerings, and allowing it to market heavily based on synergistic savings.

It's likely the bid was spurred on by BT's recent talks with EE, which if successful would make BT a 'quad play' business. Before it decided on a bid for EE, BT was previously considering acquiring O2, the business it sold to Telefonica 10 years ago.

TalkTalk recently partnered with O2, who agreed to host its virtual mobile network after the company left Vodafone. TalkTalk also recently acquired Tesco's Blinkbox streaming service and the supermarket's broadband and fixed line businesses, strengthening its own quad play offerings.

As more and more services head towards quad play integration, O2's standalone mobile business becomes less and less attractive for current owners Telefonica, which has likely triggered the acquisition talks.