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Liberty Global’s Virgin Media Could Cut Up To 600 Jobs In UK

By | Thursday September 19, 2013 @ 9:07am PDT

John Malone’s Liberty Global acquired the UK’s Virgin Media in a $23B deal in June. In the past year, Britain’s No. 2 pay-TV operator has added 1,000 extra customer service roles while its rival, 21st Century Fox-controlled BSkyB, said in May that it plans to add 550 jobs to meet demand and serve a growing customer base. Now, Virgin is looking at streamlining its senior and middle management ranks with the possible axing of 600 positions. The cuts would amount to about 4% of the company’s workforce and are intended to “find the best shape” for Virgin and help build an “agile and efficient” organization, I’m told. After the acquisition by Liberty, Virgin CEO Neil Berkett exited the company and Tom Mockridge, coincidentally the former CEO of News Corp’s News International, came aboard to replace him. Regarding the job cuts, Mockridge said today, “Like organizations across the public and private sector, Virgin Media is making sure it has the structure it needs to meet the needs of its customers. These proposals are designed to take advantage of the opportunities that come with being part of the world’s largest cable operator and create an organization that’s fit for growth.”

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Netflix Shares Hit New High Following Deal To Appear On Virgin Media Cable Systems

By | Tuesday September 10, 2013 @ 8:18am PDT

The new arrangement with the UK cable company is a breakthrough for Netflix: It’s the first time the service, built on the Web, will appear alongside traditional cable channels on a pay TV service. Customers still need to pay extra for a Netflix subscription, but it will be accessed via an app for Virgin Media customers who use its set-top boxes from TiVo. It will first be offered to 40,000 Virgin Media TiVo households and will be available to all 1.7M by year end, according to the company that is owned by John Malone’s Liberty Global. Although the deal probably won’t result  in a financial windfall for Netflix, its inclusion in a pay TV package “is an important shift in mindset, signifying that [Netflix] is viewed increasingly as another network and less as competition” for distributors, Janney Capital Markets analyst Tony Wible says. Since users can search Netflix offerings alongside traditional TV shows, he adds, “we expect to see higher utilization of the [Netflix] service, which we believe will come at the expense (at least in part) of traditional TV networks, particularly for lesser watched programming.” Investors apparently agree: Netflix shares are up nearly 4% in early trading to $306. Read More »

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BT & Virgin In Sports Channels Deal Just Ahead Of Premier League Soccer Kick Off

By | Thursday August 15, 2013 @ 9:52am PDT

Britain’s BT has pacted with Liberty Global-owned Virgin Media to offer its nascent BT Sport package on Virgin’s UK pay-TV service. The move comes just in time for the British Premier League soccer season which kicks off this weekend. The wholesale deal more than triples the number of BT Sport viewers, bringing the total to about 3M for the three channels (Virgin’s XL subscribers will get the channels for free and lower tier subscribers will be able to purchase them for £15.) Both BT and Virgin compete with Sky, the UK’s dominant pay player. However, Virgin also offers Sky’s channels meaning that following today’s BT pact, it becomes “the only place sports fans can enjoy every goal, try, penalty and heart-stopping sporting moment,” Virgin said in a statement. Sky, meanwhile, is giving Britain a “free day of football” on Saturday when it makes Sky Sports available to every UK household. As a rule, BT offers BT Sport 1, 2 and ESPN HD for free to its broadband customers.

BT has steadily increased its position in the sports rights arena, outbidding ESPN for 38 live Premier League matches for each of the next three seasons in a £738M deal in 2012. (It has since acquired ESPN’s UK & Ireland TV businesses.) At the same time, Sky is paying £2.3B over three years for 116 live matches. Other players have tried and failed to take on Sky in the sports game, but some media watchers say BT isn’t necessarily eyeing a challenge to its supremacy in that domain. Read More »

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Global Showbiz Briefs: Vision, Archeos, XII Tribes Partner; Liberty Global Closer To $23.3B Virgin Media Acquisition

By | Monday June 3, 2013 @ 11:46pm PDT

Vision Film, Archeos Ent. Team On XII Tribes Pics

Indie distributor Vision Films and Archeos Entertainment are teaming on a slate of movies to be produced in Canada by XII Tribes Entertainment. The Cannes-sealed deal uses Montreal-based Archeos’ financial backing for pics budgeted at $3M-$15M to be made in Alberta and distributed worldwide.

Liberty Global Investors Approve Virgin Media Buyout

Liberty Global shareholders Monday OKd the $23.3B purchase of Virgin Media, and now it’s up to the UK cableco’s investors. They will vote on the deal Tuesday, and it is expected to close by week’s end. Liberty Global it expects broadband and Virgin Media’s mobile offerings to be key amid the rapid growth of online and mobile video usage.

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Former News Corp. Exec Tom Mockridge To Become CEO Of Virgin Media

By | Wednesday May 8, 2013 @ 2:20am PDT

Tom Mockridge, the former CEO of Rupert Murdoch’s News International, has been named successor to Virgin Media‘s outgoing CEO Neil Berkett. The UK’s Virgin Media is in the process of being acquired by John Malone’s Liberty Global in a $23.3B deal, setting the stage for a battle of the billionaires in the UK pay-TV sector where Murdoch’s Sky is the number one operator and Virgin is number two. Mockridge resigned as the News International head in December 2012 after assuming the reins in July 2011 amid the phone hacking scandal. He spent more than two decades at News International owner News Corp. where he also held the posts of chief executive of European television operations and chief executive of Sky Italia. Liberty’s takeover of Virgin will be voted on by shareholders in June with the acquisition to close shortly thereafter. Berkett will leave Virgin when the deal is finalized.

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European Commission Approves Liberty Global’s Takeover Of UK’s Virgin Media

Liberty Global chairman John Malone is a step closer to facing off in the British cable biz with long-time frenemy Rupert Murdoch. European authorities today cleared Liberty’s $23.3B takeover of UK cable operator Virgin Media. The European Commission said its investigation “confirmed that the transaction would not raise competition concerns, in particular because the parties operate cable networks in different Member States and because of the merged entity’s limited market position in the wholesale of TV channels in the UK and Ireland.” Liberty already operates in 10 European Union states, including Ireland, but not the UK. Virgin is the second largest pay-TV operator in the UK where it competes, notably, with the News Corp.-controlled Sky. The Commission said the combined group “would still face sufficient competitive constraint from other players.” The deal was originally announced in February. In March, we reported that Virgin Media CEO Neil Berkett will exit with $86.8M in severance, options and rewards once the transaction is completed.

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Virgin Media CEO To Depart With $86.8M After Liberty Global Merger

By | Friday March 8, 2013 @ 3:02am PST

Once John Malone’s Liberty Global finalizes its $23.3B acquisition of the UK’s Virgin Media, Virgin CEO Neil Berkett will leave with $19.6M in severance and $67.2M in other options and rewards, a company spokesman confirms. Berkett joined Virgin as COO in 2005 and was named CEO in March of 2008. The native New Zealander said he would exit after the merger closes, which Liberty Global expects will be in the second quarter of this year. Under Berkett’s stewardship, Virgin Media’s share price has tripled as it competes in the pay-TV, telephone and broadband space that is also inhabited by the News Corp.-controlled BSkyB and by BT, among others. The UK’s second largest pay-TV operator, Virgin Media has 4.9M subscribers. A search is currently underway for Berkett’s replacement and the exec is unsure of his future plans. “I haven’t thought much ahead about what I’d like to do,” he said at last week’s Cable Congress in London.

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Sky To Acquire Telefonica’s UK Broadband Business

By | Friday March 1, 2013 @ 2:13am PST

Upping the stakes in its rivalry with Virgin Media, News Corp.-controlled BSkyB will acquire the broadband and fixed-line telephone business of Telefonica UK making Sky the second-largest broadband provider in the market. The company is adding more than half a million subscribers via the deal for about 4.7M total, which puts it about 200,000 ahead of Virgin – itself the subject of a takeover by John Malone’s Liberty Global. Sky is paying £180M for Telefonica’s consumer broadband, home phone and line rental customers and up to £20M in contingency fees. The acquisition, expected to complete in April, is subject to regulatory clearance.

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ITV Shares Surge Amid Takeover Talk In London Media Sector: Reports

By | Monday February 18, 2013 @ 10:01am PST

ITV, the UK’s leading commercial web (and home to Downton Abbey) has been the subject of takeover chatter in the past year, but renewed talk set the market abuzz on Friday and today. The stock rose as much as 3.3% in London trading today, after already jumping 3% at the end of last week. Shares closed at 120.3 pence this afternoon. The hikes come as Citigroup put the company on a list of European firms that could become takeover targets or begin share buybacks. Nomura also reiterated its buy recommendation, according to Bloomberg. Liberty Global’s move to acquire Virgin Media in a $23.3B merger earlier this month has fueled takeover talk in the sector and private equity groups are thought to be the most likely suitors in the event of a move on ITV. But, other media groups have been mentioned as potential bidders including RTL, NBC, Mediaset and Time Warner, The Guardian reports. According to The Evening Standard, traders have also suggested ITV could attract interest from TV and music mogul Simon Cowell and retail billionaire Sir Philip Green. Read More »

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UPDATE: Liberty Global To Acquire Virgin Media

By | Tuesday February 5, 2013 @ 5:21pm PST

UPDATE 5:21 PM: Liberty Global and Virgin Media confirmed late today that Liberty will acquire Virgin Media. Here’s the release:

ENGLEWOOD, Colo.–Liberty Global, Inc. (“Liberty Global”) (NASDAQ: LBTYA, LBTYB and LBTYK) and Virgin Media Inc. (“Virgin Media”) (NASDAQ: VMED; LSE: VMED) today announced that they have entered into an agreement, subject to shareholder approvals, pursuant to which Liberty Global will acquire Virgin Media in a stock and cash merger valued at approximately $23.3 billion.

Under the terms of the agreement, Virgin Media shareholders will receive $17.50 in cash, 0.2582 Liberty Global Series A shares and 0.1928 Liberty Global Series C shares for each Virgin Media share that they hold. Based on Liberty Global’s Series A share price of $69.46 and Series C share price of $64.50 as of February 4, 2013, this implies a price of $47.87 per Virgin Media share, reflecting a 24% premium to Virgin Media’s closing price on February 4, 2013.1

PREVIOUS: Setting the stage for a battle of billionaires John Malone and Rupert Murdoch, Virgin Media has just released a statement regarding yesterday’s news that Malone‘s Liberty Global is prepping a $20B+ bid for the group. The UK’s second largest pay-TV operator confirmed it is “in discussions” with Liberty Global “concerning a possible transaction.” A move by Malone on Virgin and its 4.9M subscribers would pit him against long-time frenemy Murdoch whose … Read More »

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Liberty Global Preparing $20B+ Bid For Virgin Media: FT

By | Monday February 4, 2013 @ 5:20pm PST

This would be John Malone’s most ambitious effort to become a media power in the UK, the Financial Times says — noting that “several people familiar with the situation” believe a bid “could be announced in the coming days.” The paper also says that a move on the cable company, which had nearly 4.9M video subscribers at the end of September, could pit Malone against his long-time frenemy Rupert Murdoch. News Corp owns 39.1% of satellite broadcaster BSkyB. Malone has long been interested in Virgin. In 2007 he said that his company was “doing our homework” to compete in an auction if it took place. The previous year he and Murdoch ended a two year battle that began when Liberty quietly bought a 16.3% stake in News Corp. Murdoch won back the shares by giving Malone a 38.5% stake in DirecTV, as well as $550M and three regional sports networks. Malone’s Liberty Global now has 19.6M cable customers in 13 countries, including 11 in Europe.

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Ofcom Enlists ISPs And Copyright Owners In New Draft Code On Illegal Downloading

By | Tuesday June 26, 2012 @ 3:54am PDT

The UK government and regulator, Ofcom, are taking the next steps to bring the Digital Economy Act’s mass notification system on copyright infringement into effect. After a court case slowed down the legislation, Ofcom’s new draft code is now expected to head to Parliament later this year. The code calls on ISPs to alert subscribers when their connection is suspected of being used to illegally share films or music. For now, the code covers ISPs with more than 400K broadband customers including BT, Everything Everywhere, O2, Sky, TalkTalk and Virgin. BT and Talk Talk had previously argued that it was not for them to police their customers, but they lost on appeal. ISPs will also be required to explain to subscribers how they can protect their networks and where they can find licensed content. Copyright owners in turn are expected to invest in awareness campaigns and develop “attractive online services to offer their content.” The government, for its part, has put secondary legislation before Parliament that would see the notification system paid for by rights holders with ISPs paying a smaller element. Read More »

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PBS UK Launches On BSkyB, Virgin Media

By | Monday October 31, 2011 @ 10:34pm PDT

The U.S. Public Broadcasting Service, long an importer of British fare, will attempt to return the favor starting Tuesday with the launch of PBS UK, the Wall Street Journal reports. The lineup includes U.S. flagship shows PBS News Hour and Frontline; the science series Nova; the U.S. version of Antiques Roadshow (format imported from Britain); and documentaries from director Ken Burns, whose Prohibition (pictured) will air on Day 1. It’s PBS’ first major foreign foray since the service was founded more than 40 years ago. PBS UK will air on Britain’s two biggest pay-TV platforms, British Sky Broadcasting and Virgin Media. It will be available to about 14 million viewers, roughly half the country’s TV audience. PBS is late to the party because it doesn’t have a lot of money. U.S. commercial networks such as MTV, Nickelodeon, Discovery and CBS have been in the UK for years. “The top priority is to get our content to an audience that I know is interested in the work we produce,” said PBS chief executive Paula Kerger. Read More »

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Entertainment One Inks Development Deal With Richard Branson’s Virgin Produced

By | Monday September 12, 2011 @ 11:09am PDT

Indie studio Entertainment One and Virgin Produced — the production unit of Richard Branson’s Virgin Group — have signed a two-year, first-look development deal in which eOne will have exclusive rights to all scripted TV development at Virgin Produced, which has been ramping up with deals since forming 11 months ago as a joint venture with Relativity Media under the leadership of CEO Jason Felts and chief creative officer Justin Berfield; the development, packaging and producing division already has a first-look deal with E! Entertainment for nonscripted TV development. The deal adds to EOne’s stable of content creators, which this year has netted NBC’s upcoming The Firm, ABC’s Rookie Blue, Syfy’s Haven, HBO’s Hung and AMC’s upoming Hell on Wheels.

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UK Pay TV Report: Sky’s Stranglehold On Hollywood Movie Rights Hurts Consumers

By | Friday August 19, 2011 @ 5:45pm PDT

BSkyB has for years held exclusive rights to the movies of the major Hollywood studios in the first subscription pay-TV window, the UK’s Competition Commission pointed out in a provisional report issued today, saying Sky’s large subscriber base is preventing rivals BT and Virgin Media from bidding successfully against Sky for these rights. BSkyB responded by saying it will cooperate with the the ongoing regulatory review but believes that no regulatory intervention is required.

“At the heart of the problem is Sky’s strong position in the pay-TV market, with twice as many subscribers to pay TV as all other traditional pay-TV retailers put together,” said Laura Carstensen, who headed the commission probe. Sky supplies some other pay-TV companies with its movie channels, but the industry watchdog said that prices charged for the service are too high. Consumers are paying up to $98M a year too much to see films on television as result of Sky’s dominance, the commission said. Subscribers to Sky’s 12 movie channels pay roughly $60 a month. Read More »

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Scripps Acquires Virgin’s Stake In UKTV

By | Monday August 15, 2011 @ 6:18pm PDT

Scripps Networks Interactive and Virgin Media announced the agreement today. UKTV is one of Britain’s leading multichannel TV programming companies. Scripps Networks will pay about $390M to purchase Virgin Media’s 50% common equity interest in the UKTV partnership and also will pay about $163M to buy the outstanding preferred stock and debt owed by UKTV to Virgin Media. BBC Worldwide is the other 50% stakeholder in UKTV. Completion of the transaction is contingent on regulatory approvals in the Republic of Ireland and Jersey. UKTV is a significant opportunity for Scripps  to participate in a thriving multichannel dual-revenue stream media biz in one of the world’s largest television markets, according to Kenneth Lowe, Chairman/President/CEO of Scripps Networks Interactive. “Making a solid investment in UKTV and entering into a strong partnership with BBC Worldwide reinforces our core international strategy which we believe will create significant long-term value for our shareholders.” Related to the transaction, Scripps Networks Interactive and BBC Worldwide are negotiating an agreement whereby, after completion, BBC Worldwide would have the option, via a combination of cash and a package of digital rights for UKTV, to increase its shareholding from 50% to a maximum of 60%. Scripps’ existing voting rights and board representation would be unaffected by this proposed arrangement, which would be subject to BBC Executive and BBC Trust approvals.

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Lovefilm Signs MGM Distribution Deal

By | Thursday August 26, 2010 @ 2:57am PDT

The British equivalent of Netflix will add 100s of MGM titles to its online streaming service. Lovefilm has 1.4 million subscribers – all of whom have access to streamed movies as part of their membership — making it the third-largest UK subscription movie service after Sky and Virgin Media. There are 5,000 titles available to watch over the internet, compared to over 67,000 on DVD. Lovefilm hopes to double the number of streamed titles to 10,000 available by Christmas – half the number currently available stateside on Netflix. It originally thought that download-to-own (DTO) was the way to go, launching its DTO service in April 2006 with King Kong. Instead, the BBC’s on-demand catch-up service the iPlayer attuned customers to streaming.

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Sky Faces Splitting Up Movie Business

By | Wednesday August 4, 2010 @ 3:58am PDT

UPDATE: The pay-TV giant could be forced to separate its consumer movie channels and the way it sells those channels to rivals. Ofcom, the communications regulator, has referred Sky’s dominance of the movie pay-TV business to Brussels. The Competition Commission will spend up to 2 years investigating Sky. Separating its consumer movie channels from its wholesale business would be worst case scenario though. What’s at stake are fears that Sky could dominate the coming subscription video-demand movie business the same way it has dominated movie channels for the past decade. Ofcom is concerned that the way Sky sells and distributes movies distorts the market in its favour. “The end result for consumers is less choice, less innovation and higher prices,” says Ofcom.

Virgin Media says: “We’ve long argued that current arrangements for the supply and acquisition of premium movies do not serve consumers well. We’re pleased that these issues are now going to be the subject of further detailed examination by the Competition Commission.”

But Sky slammed Ofcom for yet again seeking to intervene in a sector in which customers are well served. “Further prolonging this unnecessary investigation will only create uncertainty and serve to undermine incentives to invest and innovate, which is bad news for consumers,” BSkyB tells me.

Jonathan Davis, strategy adviser to a number of European public bodies, reminds me that Brussels told incumbent telco BT to separate … Read More »

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