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Summary:

A few weeks ago, Rupert Murdoch’s satellite TV operator BSkyB shocked everyone when the company acquired Easynet for $373 million. No one was expecting the media giant to make a move into the high speed Internet access market, even though his acquisitions of MySpace and IGN […]

A few weeks ago, Rupert Murdoch’s satellite TV operator BSkyB shocked everyone when the company acquired Easynet for $373 million. No one was expecting the media giant to make a move into the high speed Internet access market, even though his acquisitions of MySpace and IGN for an estimated $1.2 billion did indicate his seriousness about the Internet. Now Reuters’ is reporting that he is considering a similar move in the US.

“Here (in the United States), we don’t know,” Murdoch told the newspaper. “We may be forming a company with partners to build something out here that would give you broadband.”

Whatever that move might be, it is going to be seriously expensive. Unlike Europe and UK, where the regulators have forced the broadband market to become more competitive, US is a a duopoly. The cable and phone companies are all essentially going to be competing with Murdoch in the television business, and it would make it harder for him to partner with them.

That leaves dregs of the broadband business – the independents. I suspect companies like Covad Communications and TowerStream could be the way to go, but that’s not like getting a real national footprint. Earthlink? There are quite a few large independent phone companies and small cable operators, so perhaps that is an option.

Robert Young had previously indicated that Murdoch could simply become the big player in the WiMAX space, if he did all the right things. By putting up WiMAX towers in cities/rural areas and with the DirecTV dish already in place, interesting things could happen. Daily Wireless has some thoughts.

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  1. Hi Om

    This is all about TV over IP. In the UK we have a company called HomeChoice who are delivering TV over IP in London. They have all of our national stations, freeview (UK free digital stations) and some of Sky’s premium channels. They are also a triple play provider. BT is about to announce its IPTV partnership with Microsoft and so Sky need to find a cheaper more effective alternative to satellite. It will also allow Murdoch to finally get a reliable return path from his set-top boxes and open up the interactive/ecommerce markets. Finally it is about advertising. His Sky+ boxes are proving to successful in enabling consumers to fast forward adverts. He needs to create a new advertising platform and this is it. Own the EPG, control the content, personalise the expericence enabling personalised adverts to an IP address.

    So buying a network is cheaper in the UK than building out his own network and co-locating in BT exchanges.

    Just a thought …

  2. Jesse Kopelman Monday, November 7, 2005

    What would McCaw say about Murdoch becoming the big player in WiMax? He has kind of already set himself down that path with Clearwire.

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