Mobile operator O2, which many may remember as having split from the fixed-line operations of BT some years back, has confirmed that it may re-enter the market and launch a broadband product:

O2 chief executive Peter Erskine said the company wants to pipe television pictures over broadband to customers' home, following the example of its new parent, Telefonica, the Spanish fixed-line and mobile giant.

''Put bluntly,'' he said. ''I'm now on the board of Telefonica, and you hear how fixed and mobile convergence can actually work.'' Telefonica is Spain's largest provider of TV over the internet, with a quarter of a million users.

Mr Erskine said that it would be ''months'' rather than ''years'' before O2 UK launched broadband, which it will bundle with its existing mobile offerings on a single bill.

The mobile operator is currently mulling over whether to lease network capacity from an existing provider, build its own or buy an existing one. The statement of “months” would seem to rule out the building of its own operation.

The Telegraph newspaper reminds us that early rumours had placed O2 in the same boat as Vodafone, with both reportedly eyeing up Bulldog, Pipex and Tiscali as potential targets.