11.45am: BSkyB is said to be planning a£1bn move into the broadband telephony market with one of its possible acquisition targets being IPTV service Homechoice.
BSkyB is said to be planning a£1bn move into the broadband telephony market with one of its possible acquisition targets being IPTV service Homechoice.

According to The Guardian the move would allow the satellite giant to offer a triple play package of phone service, broadband internet access and pay TV.

Broadband services Easynet and Pipex are also potential targets.

This week the satellite giant said it is thinking of raising up to£1bn through the sale of its first bonds for more than five years, triggering speculation that it may be in acquisitive form.

It is thought that an estimated 50% of this could go on acquisitions while up to£200m may be invested into local loop un-bundling, giving Sky a direct line to customers, without having to pay BT to use its local exchange equipment.

Sky's new HDTV set top box which comes out next year will have an Ethernet port, enabling a broadband connection, although the group have not said whether it will be active from launch.

By buying Homechoice it would give the broadcaster an immediate footprint of around£2.4 million homes throughout London and Stevenage. The service is only partially unbundled at present but aims to be totally unbundled in due course.

Meanwhile some City analysts suspect that if Sky were to raise£1bn through bonds it would be to fund subsiding Sky plus boxes. Media analyst Paul Richards from Numis Securities believes this to be the lightly option.

A Sky spokesman refused to comment on a potential move into broadband but said "we continue to set the pace in media content and distribution."

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