Sky signed a deal worth £49m with Virgin Media Business to upgrade its backhaul broadband network, it has been revealed.
The deal with Sky was announced by Virgin in its quarterly earnings report for the start of 2013, but the firm has now confirmed the value of the deal. Virgin will provide Sky with its 10Gbps High Capacity Services, linked to the firm's unbundled local network exchanges, to connect into Sky’s own backhaul network.
The move is designed to ensure Sky can keep pace with the ever-growing demand for services across its network, as Duncan Higgins, product and marketing director for Virgin Media Business, explained to V3.
“We’re providing a 10Gbps pipe from a third of Sky’s exchanges into their core network to make sure they can support their customers as ever-growing amounts of data, on services like iPlayer, are being sent over the network,” he said. “We’re actively now planning the project with Sky, so it should be in place by the end of the year.”
The deal is similar to one announced by the firm in its Q1 earnings report, with Telefonica and another unnamed operator also signing up for its backhaul services, underlining the growing demand for data being placed on networks.
“Consumers are using more media than ever before, such as video, whether that’s on mobile, WiFi or fixed network connections. It’s not just plain text any more as even news sites, like the BBC, have video on pages as standard.”
The deal is also noteworthy for the fact that BSkyB, owned by Rupert Murdoch, is taking services from a division of Virgin, which is being acquired by Liberty Global – owned by long-time Murdoch rival John Malone.
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