FRANKFURT (Reuters) - U.S. Cable company Liberty Global (LBTYA.O) has appointed a European mobile chief as it pushes into wireless services to meet growing demand for television, broadband, mobile and fixed-line services - so-called “quad play” - from one provider.
The quad move could be a threat to operators in the crowded German sector as they scramble for a share of Europe’s largest telecoms market.
Liberty said on Friday it had appointed Graeme Oxby as managing director of its European Mobile operations.
Oxby was director of Mobile & Home Phone at Virgin Media, which Liberty earlier this year bought in a stock-and-cash deal worth about $15.8 billion.
Liberty has been testing the waters as a so-called mobile virtual network operator (MVNO) in Europe, including in Britain, Belgium and Germany - where it owns the No. 2 cable company Unitymedia KabelBW - but has not made a serious push so far.
MVNOs are operators who rent access on bigger rivals’ networks and tend to sell cheaper mobile plans, often without a long-term contract and targeted at youth or ethnic niches.
In Britain, Virgin Media offers superfast wireless broadband services to businesses, which are increasingly looking to buy fixed, mobile and other telecom services from a single provider to save costs and simplify billing.
“In this new role Graeme will further develop Liberty Global’s core mobile network to become a full MVNO operator in most of its European operations,” the company said on Friday.
A rise in demand for “quad play” services was the main reason that British telecoms group Vodafone (VOD.L) splashed out 7.7 billion euros ($10.4 billion) to buy Kabel Deutschland, Germany’s biggest cable operator, this year.
Unitymedia KabelBW’s chief executive Lutz Schueler has said that while the German Liberty unit had not made a serious push into mobile, such a move was an option.
Unitymedia had just under 200,000 mobile subscribers at the end of the second quarter in a market of around 114 million subscribers. It will release third-quarter results next week.
Analysts at Citigroup last week said in a note opportunities could emerge for MVNOs from Telefonica Deutschland’s (O2Dn.DE) acquisition of KPN’s (KPN.AS) E-Plus, which was announced this summer and is now being evaluated by the European Commission.
“We expect Telefonica Deutschland/E-Plus will be mandated to offer some form of a wholesale reference offer to be available to MVNOs/service providers and on a national roaming basis (in case a new entrant emerges),” they wrote in a client note.
Deutsche Telekom (DTEGn.DE) and Vodafone are the biggest mobile operators in Germany, with a market share of around 35 percent each, while Telefonica Deutschland and KPN’s E-Plus share around 30 percent.
Deutsche Telekom is in fierce competition with cable companies that have upgraded their lines designed originally to only deliver TV to homes so that they can also carry Internet and voice calls. They offer Internet at speeds that are often five times faster than the competing services from telecom operators and have snatched clients from Deutsche Telekom, which still has more than 40 percent of the German fixed-line market. ($1 = 0.7414 euros)
Reporting by Harro ten Wolde; editing by David Evans