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All Change as Comcast Win UK Bidding War with FOX for Sky UPDATE

Saturday, September 22nd, 2018 (7:48 pm) - Score 2,723

After a long battle Comcast has today beaten off Rupert Murdoch’s 21st Century Fox and emerged as the victor in their bidding war for control of Sky (Sky Broadband). The US cable giant raised their final bid to £30bn for the pan-European TV and broadband company (£17.28 per share), while Fox offered £15.67 per share.

Hopefully by now everybody already knows the turbulent history of Murdoch’s repeated attempts to gain full control of Sky, which over the years has faced more than a few regulatory hurdles (here and here). By comparison Comcast, which specialises in cable (DOCSIS) and fibre optic (FTTP) broadband delivery in the USA, doesn’t have the same conflicting media or news interests to worry about.

Arguably Comcast’s win may have actually been secured a few months ago after the company retreated from its strategic counter-pursuit of Fox (here), which at the time was in the process of being purchased by Disney. The market predicted that Comcast’s decision could be taken as a signal that Fox would stop trying to outbid the cable operator and thus enable them to secure Sky, while Disney would in-turn secure Fox.

The development comes at an interesting time for Sky, which until recently appeared to be stuck in a state of limbo over their future plans within the United Kingdom’s broadband market. All this changed a couple of weeks ago when the company finally confirmed that they’d work alongside Openreach (BT) to launch a new set of G.fast and FTTP based ultrafast broadband packages for residential consumers (here).

Comcast are traditionally more broadband focused and as such it will be interesting to see how today’s news evolves Sky’s position in the UK market, as well as across their other territories within Europe (Ireland, Germany, Austria, Italy, Spain and Switzerland). Many of Sky’s rivals are now building their own “full fibre” (FTTP/H) networks and, despite the new Openreach agreement, there’s still plenty of room for Comcast to adopt a similar strategy.

Lest we forget that Sky Broadband is the second largest consumer ISP in the UK after BT, which is a position that Comcast won’t wish to sacrifice. Admittedly there’s still the usual regulatory hurdles and shareholder approvals to get out of the way before Comcast can formally seal the deal, although for now Comcast appears almost certain to take the reins.

UPDATE 24th September 2018 – 7am:

The news came in a little late on Saturday for us get a response from either side, although Comcast’s Chairman has now issued the following statement.

CEO Brian L. Roberts, Comcast’s Chairman, said:

“This is a great day for Comcast. Sky is a wonderful company with a great platform, tremendous brand, and accomplished management team. This acquisition will allow us to quickly, efficiently and meaningfully increase our customer base and expand internationally.

We couldn’t be more excited by the opportunities in front of us. We now encourage Sky shareholders to accept our offer, which we look forward to completing before the end of October 2018.”

Martin Gilbert, Chairman of the Independent Committee of Sky, said:

“We consider the Comcast Offer to be an excellent outcome for Sky shareholders, and we are recommending it as it represents materially superior value. We are focused on drawing this process to a successful and swift close and therefore urge shareholders to accept the recommended Comcast Offer.

On behalf of the Independent Committee of Sky, I wish to thank Jeremy and Andrew for their outstanding leadership of the business throughout the twenty-one month bid process and congratulate everyone at Sky on creating such a successful company that has attracted strategic interest from one of the world’s greatest media companies.”

At this point it might also be worth highlighting Comcast’s formal offer document (PDF), which details their view of the Sky acquisition. Meanwhile Sky has also published a formal response document for the final bid (here).

Leave a Comment
22 Responses
  1. Sky says:

    Who care about comcast

    1. GT says:

      You probably should if you are a customer of Sky.

      Long term, who knows what Comcast will want to do with Sky and its services.

      Comcast have an fairly poor reputation as an ISP in the US, so I hope they won’t interfere too much.

    2. CarlT says:

      Please stop trolling these comments under various names. It is getting somewhat depressing knowing that the first comment on a variety of topics is going to be you taking a pop at the company in question.

    3. GT says:

      @CarlT I assume your comment is aimed at “Sky”, yes?

    4. CarlT says:

      Yes GT. I apologise for the confusion. Unless I specify someone else I’m responding to the OP, and I should make this clearer. I will do so in the future 🙂

    5. un4h731x0rp3r0m says:

      I could put up with Max’s nonsense if when he posted he could at least do so with any resemblance of a full sentence. Everyone can have an opinion even if like him it is negative all the time. I would even go as far as saying i could tolerate complete and utter spamming with his comments. What i can not stand though is reading (or should that be trying to read) broken comments that read more like some poor flat pack assembly instructions, which make no bloody sense at all. Come to think of it what comes with those is often a few screws short of a full assembly 😉 Only difference is you can return the flat pack stuff as not fit for purpose… Idiots you are just stuck with.

    6. Timeless says:

      to be honest, not a fan of Comcast, l only care because from what lve read they are part of the the reason Net Neutrality rules were repealed over in the States.

    7. CarlT says:

      Timeless: They are certainly guilty of behaviour that’s less than stellar.

      However while Max doesn’t care this is a huge deal. Comcast run the largest single country cable network in the world. They know infrastructure. They have capital behind them. The chances of Sky building an access network increased substantially here.

      I wonder how government would react to the idea of Comcast acquiring Virgin Media from Liberty Global? I would be delighted to see this happen, Comcast have a history of being at the forefront of cable technology and, unlike VM, they actually deploy it to production networks in a timely fashion, they don’t just trial then sit on technology for a few years for commercial reasons.

    8. Mike says:

      As long as Sky is on the OR network everything should stay relatively the same, the potential issue is if Comcast decides to either take over VM (merge with Sky) or roll out their own network and they decide to bring over some of their bad habits from the US such as:

      *Terminating “excessive” bandwidth users.
      *Data cap and fee for unlimited service.
      *Traffic management.
      *Supposedly extorting internet services like Netflix in order to pay for better speeds for their content.

    9. Timeless says:

      Mike hit the nail on the head with my worries.

  2. Vytautas says:

    I do not like when British companies are sold to Americans. I hope they won`t mess the service of sky.

    1. occasionally factual says:

      You do realise that the current major shareholder of Sky is an American company?
      And that most of the other shareholders are non UK companies?
      Murdoch’s 21st Century Fox has 40% of Sky and is US company. And that the chairman is American (Rupert Murdoch’s son)
      And Rupert Murdoch is an Australian born but US Citizen (he had to become American to own newspaper companies in the USA).
      It isn’t a British owned company by any stretch of the imagination.

    2. un4h731x0rp3r0m says:

      Trying to use logic or facts will just confuse him more 😉

    3. Vytautas says:

      It is confusing, but thanks for detailed answer. So all major ISP`s are sold as I understand?

  3. James Vincent says:

    From what I’ve heard watching tech reviews, Comcast is the most hated TV and internet provider in America. It concerns me that they have entered the British market & have control of a company that provides an excellent TV service. But is also hated by many.

    1. alusufferer says:

      this is mainly due to the ISPs having monopolies on areas. people get stuck with poor services and support combined with high prices and they have no options to move or alternative upgrade paths.

      It’s not the same environment as the UK but i still wouldnt be keen on moving to them

  4. Mark says:

    Well hey can’t do any worst for Sky, I wouldn’t touch their broadband and telephone but we have Sky Q, and it was great to see Sky ditch ALL sports from its services apart from Football, F1, cricket and golf.. so if your a tennis fan tough! Hence why Amazon now has it, and give them some time I think they could make it work very well.
    Then what’s next on the Amazon sports list….

    Will be interesting to see what’s Comcast does for the company..

    1. Random Precision says:

      Amazon Prime have one of the Premier League packages which commences 2019/2020 when the old deal runs out. Dipping their toe in the water I guess. I believe that Prime members won’t have to pay any additional subs.

    2. un4h731x0rp3r0m says:

      “so if your a tennis fan tough! ”

      Not sure what you mean though in terms of traditional heavy weights in Pay TV land Sky from memory has/had all 9 of the ATP tour events this year. BT from memory only had the WTA. From next year Amazon Prime has jumped in and will have many of the tournaments.

      The major 4 tournaments this year and into the 2020’s are shown as follows…
      Australian Open is/was on Eurosport
      French Open is/was on ITV and Eurosport
      Wimbledon is/was on BBC and Eurosport
      US Open is/was on Amazon Prime

      Eurosport is available on Sky, BT and Virgin and if you do not wish to pay for any of those is also available as an app/service from Eurosport thereself called Eurospot player.

      So in regards to no Tennis on Sky errr I do not really see how they fair better or worse than the competition.

  5. Jazzy says:

    I was with AOL on dial up then BT for ADSL then Sky for ADSL and Fibre and I can honestly say that Sky Broadband has been brilliant since the day I moved across in 2009. BT wouldn’t upgrade my old one ethernet port router or upgrade me from 2MB to 8MB max so I moved to Sky where I was immediately on ADSL2 and downloading at 19MB for cheaper than BT which was £24.99 plus line rental at the time. I migrated to Fibre the minute that Wideopen (Newcastle upon Tyne) was upgraded to Fibre and we were one of the first cabinets live.

    In the 6 or 7 years I have had fibre max (used to be fibre pro) they have been brilliant. I even for the pro for the normal fibre price as I was one of the first to trial it on my exchange and now in 2018 I am paying 9.99 line rental and 17.50 for fibre max because I re-negotiated my contract. I hope that Sky continue to offer what I consider to be an unbeatable service. I am FTTC but I always hit 65MB on the desktop which is ethernet wired in my study and about 40-50 anywhere in the house on my iPhone 7.

    Sky may have a sort of monopoly on their customers (their best deals are when you take all of your services with them excluding mobile) but their customer service and service has never faulted. In the 9 years since I moved to them, my internet has gone off ONCE for 4 hours when someone sliced a cable near the exchange. Let’s hope this takeover improves the service.

    Since BT took over EE I have seen a decline in their deals and customer service which is why when my contract ends on 31st December (yes new years eve lol) I will be starting 2019 with a new provider unless they give me a spectacular deal.

  6. Ray Woodward says:

    Apparently Comcast have already puchased 29% of Sky Shares …


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