Following ongoing speculation, TalkTalk has confirmed its acquisition of blinkbox, in a deal which also included the Tesco broadband and fixed line voice base. Although the purchase price has not been officially disclosed, it is thought to be around £5 million; a bargain for TalkTalk and a reflection of the extent of the business’s failure for the UK grocer. The debt accrued by blinkbox whilst at Tesco is not being transferred to TalkTalk.
With the purchase, TalkTalk has expanded its multi-platform offering to customers, as it now owns fixed line, mobile, broadband, TV (YouView) and movie streaming services. TalkTalk hopes that ‘the benefits of restructuring the combined platform and revenue synergies [are] expected to flow from the end of calendar 2015.’ Adrian Letts, Blinkbox CEO and co-founder will join TalkTalk as managing director for TV.
“We are excited about the opportunity that blinkbox’s platform and technology expertise bring, and which will significantly accelerate the development of our TV platform,” commented Dido Harding, chief executive of TalkTalk. Harding’s excitement does not stop there: “We are excited about the future of quad-play – fixed phone and broadband, TV and mobile – and this acquisition will help to further drive home our value for money advantage.”
Both companies stress the gains from the deal, with TalkTalk’s buy adding 75,000 internet and 20,000 voice households to its customer base, and Tesco claiming the sale will reduce its £1 billion capital expenditure budget for 2015. TalkTalk also now hopes to be able to deliver a number of key initiatives significantly faster, such as offering a TV app to customers for in and out of home access to paid-for content.
The sale was announced in a Christmas trading statement this morning, which also included news that Tesco will close 43 stores and close its staff pension scheme.
blinkbox offers a pay as you go digital movie and TV service, with a library of 20,000 movies and TV episodes to buy or rent without subscription.
Image: Blinkbox Entertainment Limited