Sunday Times broke the news last week that Murdochs media conglomerate (through B-Sky-B is bidding for “no-brand” WiFi infrastructure supplier TheCloud. The Cloud prouds itself to be an independent WiFi hot-spot provider, with a strong backbone network and providing 22.000 access point all over Europe at strategic places like airports, railway stations, major hotels etc. These services are mainly accessible to the user through other brands.
The key question is what this means to the business. In the short term, B-Sky-B is running a satellite based home-broadband access service, and adding TheClouds hotspots, would provide mobility to their customers. However, since TheCloud is a neutral provider, you would hardly need to own them to provide their services.
What is more worrying is that Big Broadcasters, like Mr Murdoch, have always been keen on establishing a vertical distribution chain with ownership of everything from content through CA-systems and physical distribution. Now in the latter department TV-towers and Satellites are now to be replaced by WiFi hotspots. So far legislators have resisted vertical integration in the traditional TV-Business, preventing large media companies owning the whole chain. Will they also react this time ?
The broadcast industry has lost both markets and spectrum to the telecom industry dusring the last 15 years so it is no supprise that they at last are trying to get back!
No doubt – the question is if the regulators will let them take controlling vertical positions. Since more than 10 years European competition regulation has prevented them from controlling the whole chain (or at least to be more subtle about it ;-)