Vodafone in talks to buy Blinkbox from Tesco

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Acquisition of video-streaming service could accelerate Vodafone’s move in to quad-play

Vodafone is in talks with Tesco to purchase its video-streaming service Blinkbox as it looks to expand its quad-play offering in the wake of BT’s takeover talks with EE, O2 and Three.

Reports suggest that the operator is in advanced talks with Tesco to buy the pay-TV service after other parties dropped out of negotiations.

Vodafone is not expected to pay a high figure for Blinkbox, which reported a loss of £18.5 million in its 2013 annual accounts published in May. Tesco’s new CEO Dave Lewis has already said he will close the digital media “distraction” if a new owner can’t be found.

Blinkbox currently has existing relationships with rights holders and employs more than 350 people in its office in Farringdon. A Vodafone spokesperson said: “Vodafone does not comment on rumour or speculation.”

On November 12 Vodafone announced plans to re-enter the consumer broadband market early next year following its £1 billion acquisition of Cable and Wireless in 2012.

It is also in talks with Sky about offering its Now TV services alongside its broadband packages. In recent months, the operator has formed an increasingly close relationship with the TV provider, including offering Sky’s sports channels through its Vodafone Red 4G contracts.

The potential purchase means it joins EE, BT and Virgin Media as major providers fighting for a slice of the potentially lucrative ‘quad-play’ market, offering consumers mobile, fixed-line, broadband and TV. EE launched its TV offering, EE TV, in stores last month.

Vodafone’s UK income for the half year fell by £133 million from £3.2 billion to £3.09 billion between April and September while organic group revenue fell by three per cent.

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