The report in the Sunday Telegraph said that the Newbury, UK-based mobile goliath had identified Tiscali’s UK operation as a possible acquisition target. Another possible target is thought to be Cable & Wireless Plc’s ISP, Bulldog.
The article said an ISP acquisition would be Vodafone’s response to a move by rival mobile operator Orange SA to offer its mobile customer free broadband services via its sister company Wanadoo SA (soon to be rebranded Orange).
There has been speculation for a while now that Vodafone would acquire some form of fixed-line network so it could offer a bundle of services comparable to those offered by NTL Corp and BT Group Plc (fixed-line, broadband, and pay TV).
Earlier in April, Vodafone reorganized into three units covering Europe, emerging markets, and new technology. The focus of this last unit is on converged and IP services to deliver new revenue streams.
In March Vodafone chief executive Arun Sarin seemed to rule out an acquisition when he said there was no need to purchase a fixed-line asset, as it was just as easy to resell wholesale services.
Speaking to Computer Business Review, a Tiscali spokesperson refused to comment on market rumors. Vodafone has also distanced itself from the report.
Tiscali is a standalone ISP with no backing from a former incumbent and is listed on the Milan Stock Exchange. It has a total of 4.7 million customers in Europe, 1.7 million of whom are broadband customers. It operates in Italy, the Netherlands, Germany, and the Czech Republic, but the UK is its largest market where it has a customer base of 1.85 million, one million of whom are broadband clients.
The ISP is spending roughly 60m pounds ($106m) on Local Loop Unbundling in the UK, and hopes to have unbundled 600 exchanges by the end of the year.
