British ISPs eyeing Tiscali Broadband Arm

Consolidation in the Internet sector could see Tiscali, Italian telecommunications company Tiscali SpA, exit the market amidst increased costs and competition.

BT Group, British Sky Broadcasting Group and Carphone Warehouse are said to be interested in acquiring Tiscali.

The battered ISP has acquired a string of smaller Broadband companies including Bulldog Broadband and Toucan as well as Homechoice.

In September 2007, Tiscali purchased Pipex for £210 million and became the fourth largest broadband provider in the UK overnight.

However, the size of the acquisition as well as the credit crunch seems to have taken the toll on Tiscali.

Carphone Warehouse is said to be particularly interested in Tiscali's business and if the sale is agreed, it could see CPW becoming UK's biggest broadband provider.

The Financial Times says that Tiscali UK broadband could be valued up to £600 million, which would represent around £380 per broadband subscriber; the company has 2.4 million users in the UK.

Tiscali has introduced a number of all inclusive packages which bundled internet connection, TV on demand, landline and inclusive phone minutes.

In related news, Best Buy is said to be looking to acquire Carphone Warehouse which would mark the start of Best Buy's invasion of Europe.