What is gonna happen if the giant mobile operator Vodafone acquires Tiscali, one of the biggest service providers in Europe? Vodafone is already working hard to push to the market an advanced FMC offering for the consumer and business market, hence this would surely be a strategic acquisition for them.
Moreover, Vodafone bought Tele2 Italy and Spain some time ago, too. The main advantages Vodafone would get from this further acquisition are, to me, the following:
1) Immediate access to the wide DSL customer base of Tiscali as well as their customers for telephony
2) The opposite, that is Tiscali could easily leverage the HUGE Vodafone customer base, over 170M customers
3) Integration: tight integration between VoIP, DSL access and Mobile offering.
4) While Vodafone is strong in the business market, Tiscali isn’t. A benefit for Tiscali.
5) In countries like Italy, where Tiscali’s headquarters are, a great advantage in terms of competition towards Telecom Italia and Tim.
Let’s stay tuned. People close to Vodafone told me that the first formal signs of interest have been submitted to the mobile operator already.
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Your rationalisation for Vodafone buying Tiscali is good but you’ll find the other candidates all have valid reasons too.
BSkyB – Need the DSL and TV Subs to grow their base and They have LLU and can migrate all the Tiscali customers onto it which reduces the cost of the give away mentality of Tiscali to acquire customers.
Carphone – Inorganic growth to be the largest DSL supplier in the UK bigger than BT, Require IPTV and content. LLU player same as BSkyB
BT – Stay market leader, keep the revenue on the BT network rather than have them migrated to an LLU provider and Content.
Downside Tiscali has many systems which they haven’t integrated since they purchased other companies and Italy run the core Tiscali OSS stack so if you split the two business’ apart Italy and UK it would need a special clause for the time Italy would carry on supporting the UK.
Question is even if any of these companies buy Tiscali will they be any good at integrating their systems and customers without issues?
Carphone have no real proven ability One.Tel still hasn’t been fully migrated yet purchased in 2005. AOL is being run separately and not touched purchased 2006.
BSkyB No real proven capability of integration of customers as they’ve really purchased companies for systesms and technology and grown their bases organically.
Vodafone – Again no real evidence of integration capability and would probably have to partner with a larger Telecoms company to do so.
BT – They have the correct formula for integration outsourced BSS/OSS to india and the company that run it do integrations for their living.
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