February 23, 2015
by Neil Turner
Recently, Virgin Media announced it was expanding its cable network. Currently just over half of the UK’s 26 million or so households can get cable service from Virgin Media, although of those 13 million eligible, only 5 million actually subscribe. Virgin Media plans to add another 4 millions households to this, although somewhat controversially this will be primarily in urban areas.
A bit of history
Most of the cables for cable TV, internet and phone were laid in the early 1990s in the UK, by various different companies – usually subsidiaries of larger corporations. In York where my parents live, this was ‘Bell Cablemedia’, part of Bell Canada. Some of these companies spent a lot of money digging up streets to lay cables, but then didn’t make enough money to clear their debts, resulting in some gaps in their networks.
By the late 1990s most of the small companies had merged into three larger firms: Cable & Wireless, NTL and Telewest. NTL bought Cable & Wireless’ home cable business, and then in 2005, NTL and Telewest merged. The combined company then took over Virgin Mobile UK in 2006 and gained the rights to use the Virgin brand, re-branding as Virgin Media.
For the first time, there were two major players in multi-channel television: Virgin Media and its cable network, and the dominant Sky, with its satellite TV and ADSL internet service. Its dominance challenged, Sky had a fall-out with Virgin Media in 2007 lead to many of Sky’s channels being taken off Virgin Media, including Sky1 and Sky Sports News. Virgin Media responded by re-branding its lacklustre channel FTN as Virgin One (which seemed to mostly specialise in repeats of Star Trek: The Next Generation and porn), and launched Setanta Sports News with erstwhile Irish sports broadcaster Setanta. It would be 18 months before the Sky channels returned; ironically the following year Virgin sold all of its own channels to Sky.
The situation today
Which brings us to today. Virgin Media is now the only provider of cable TV and internet in the UK, having amalgamated every other company over the years (the last holdout, Smallworld, was bought last year). This means that it’s the only company with its own infrastructure for internet and phone services – Sky, TalkTalk, EE and all of the other providers all have to buy wholesale capacity BT’s Openreach network. Whilst Openreach should be able to reach every household, due to its routes as a public utility company, Virgin Media’s network, even after expansion, will only connect to a small majority of homes.
That doesn’t mean that the expansion isn’t worthwhile. Any expansion will increase competition, which should be better for consumers; more choice should allow people to access cheaper and better deals that suit their circumstances better. However, Virgin will be focussing on ‘filling in’ gaps in its coverage – towns and cities where it already has a presence but with some streets missing. This is unlikely to include rural areas, or towns where Virgin hasn’t been to before, although we don’t yet have a definitive list of places due to be connected. Access to broadband in rural areas is a contentious issue, but actually London has some of the worst broadband speeds in the country.
Register your interest
If you can’t currently get Virgin Media’s services and want to register your interest, you can do so here. Presumably, if enough people sign up in an area, then Virgin will consider connecting that area to its network. There’s no guarantee though – Virgin Media is a business with shareholders and it has no public service remit. Whilst filling out that form doesn’t commit you to signing up, it doesn’t commit Virgin Media to offering you a service either.
I’ve put the postcode of our new house in there, just in case. However, BT will be upgrading its service there by June, as part of the Super Fast West Yorkshire project which allows it to use public money to upgrade exchanges and street cabinets in more isolated areas. Even without it, we should be able to get similar speeds to what we get now – around 17 Mbps, which is fast enough for 99% of what we use the internet for.
I’ve previously been a Virgin Media customer and they were generally okay – and offered a good cheap deal at the time. But we’re currently with BT and get a good service with them, even if it is pricier than their rivals. I’m not sure whether I would go back to Virgin Media – but I would like that option.