Regulators approve telecoms takeovers

Two corporate takeovers that have the potential to radically change the UK's telecoms sector have received approval from government regulators.

The Office of Fair Trading (OFT) announced last week that it would not oppose BSkyB's acquisition of Easynet, or NTL's takeover of Telewest.

BSkyB has offered £211m for Easynet, which offers wholesale broadband services in metropolitan areas of the UK. The satellite operator is expected to use the purchase of Easynet to help it to offer television, telephony and high-speed Internet access services.

"Sky's acquisition of Easynet will enable it to offer triple-play services, in which it currently has no offering, in competition with other providers. Consumers may be expected to benefit from this," said the OFT.

The OFT also revealed that "third-parties" had contacted it to complain that BSkyB could refuse to supply rival broadband firms with pay-TV content. The regulators did not consider this was a good reason to block the deal, as BSkyB is already in a position to do this.

The merger of NTL and Telewest will mean that UK has a single cable operator, which should be in a better position to battle BT.

The OFT ruled that this will not result in a significant loss of competition, as there is very little overlap between NTL and Telewest's networks today.

NTL is also attempting to acquire Virgin Mobile, although the approach was initially rejected by shareholders.